How Do We Stop Counterfeit Fashion?
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By Hannah Schmidt-Rees
“When you buy fakes, we all pay.”
Counterfeit fashion are products that virtually look visually identical to other products already on the market. These counterfeit products copy designs, trademarked details, logos/labels; all without the original designers permission. In most cases, counterfeit products are typically copies of various high end/luxury products.
As a fashion marketing student, the threat of counterfeit fashion is legitimate. It’s not just about you being able to buy the latest Louis Vuitton handbag, it’s about you supporting unethical working environments, illegal businesses and threatening the luxury brands that design and create the luxury products that you want so badly. Currently a $600 billion industry, this is a serious subject that’s plaguing the fashion industry, so get ready to read a serious report about its effects.
What is counterfeit fashion?
According to US Law, a product is deemed counterfeit if it fits under the following categories;
It must include another brands registered trademark, or must be ‘substantially indistinguishable’ from other brands design/trademark; including identifiable logos and designs.
These trademarks are used without the original designer’s permission.
The trademark that is being copied must be federally registered with the US Patent and Trademark Office, and is used to generate profit by the original brand.
Specifically for fashion, the trademarks must be registered under class 25 of goods and services; clothing and footwear.
The counterfeiting use of the trademark must be ‘likely to cause confusion, mistake or to deceive’ the average customer, in terms of the product’s source and brand.
Why is it happening?
Customers are aware, but are choosing to ignore it – The fashion industry has transformed from a localised exchange to a global market. The recent influence of fast fashion has transformed customer expectations into an appetite to always be on trend, to have the latest luxury products for low prices, regardless of their source. In addition, the rise of internet banking and online shopping has now made this expectation more accessible than ever.
Customers are unaware – One in six online shoppers are tricked into buying a counterfeit item. The rise of internet banking and online shopping has led to counterfeiters utilising technology to sell their products. Fake luxury websites (‘mirror websites’) fool customers into buying counterfeit products, instead of the real luxury product.
The rise of technology – The advancements in technology allows counterfeit products to be manufactured, distributed and sold quicker than ever before, even weeks after the original product is released. In addition, the use of mirror websites, online shopping platforms and social media allows counterfeiters to access customers in more avenues that are harder to trace by authorities.
Intellectual Property Laws are too loose – According to US law, there are three main trademarking options available for luxury brands to protect their designs and brand image. However, these laws created to protect luxury brands from counterfeiting are hard to obtain and difficult to enforce. In addition, if a trademark, patent or copyright is obtained in US law, it usually cannot be enforced in other countries.
Patent – obtaining a patent for luxury fashion is highly difficult, as patents are usually granted for a new process, machine or manufacturing technique, which fashion is usually not considered. If a product qualifies for a patent, the time taken for it to be approved is too long and is impractical for the fast nature of the fashion industry.
Copyright – copyrights are only available for the pattern, sketch, design or print of a product, not for the product itself. Copyrights are easier to obtain than patents, but the process is still very lengthy and unpractical for the fashion industry.
Trademarks – a trademark can be any word/symbol/design/logo or combination of, that is used by a brand to easily identify their goods from others. If the trademark is being used to generate income for the brand, then acquiring a trademark is very easy. However, since a trademark is so specific, counterfeit products using a slightly different of the trademarked symbol cannot be prosecuted under US law.
“Most shoppers are trying to purchase legitimate goods from brands they’re loyal to. But they’re also looking for the best deals on these goods, which is why a shocking number of consumers end up on sites selling counterfeit goods.”
What are the effects of counterfeit fashion?
The general counterfeit industry is worth $1.2 trillion, with the counterfeit fashion industry worth $600 billion. The money spent on purchasing counterfeit goods are technically stolen from the luxury fashion industry (and the government, through taxes). According to The Global Brand Counterfeiting Report 2018, it’s estimated that luxury brands lost $323 billion in 2017, with $30 billion of that amount coming from online sales. Since counterfeiters generate sales by offering ‘luxury’ products for low prices, the majority of counterfeit manufacturing relies on workers exploitation, unsustainability and child labour, with some counterfeit brands even run by organised crime groups. The profit made from the sales of counterfeit fashion goods also can contribute to support crime groups, sex trafficking and modern-day slavery.
In addition, customers are unknowingly put at risk by purchasing counterfeit fashion goods. Toxic materials can be used to manufacture the products, as an example, counterfeit sunglasses will not have the same UV protection as the luxury version. In terms of online purchases, customer’s personal information may be stolen after an online purchase.
What is currently being done to stop it?
Border Laws – UK Police have created the Police Intellectual Property Crime Unit (PIPCU) in order to tackle the supply-side of counterfeit. The PIPCU can raid counterfeit businesses and seize counterfeit products, jailing offenders for up to ten years. However, the influence on online shopping has made this process more difficult to find. US Border Laws have made it illegal to bring more than one counterfeit item into the US. Any more will be considered trafficking, which makes small-scale counterfeiting a less successful practice.
US Intellectual Property Laws – The US Trademark Counterfeiting Act has made the sale of counterfeit products illegal, punishable with up to $5 million fine and up to 20 years in prison. However, with the difficulty of obtaining trademarks and the advancements in the concealment of the counterfeit industry, this act is rarely enforced.
QR Codes & RFID Schemes – Luxury brands have begun to use Crypto-Tags to prove that their products are real. Using QR codes or RFID tags allow for the customer to use their smartphone to utilise the products blockchain (which stores an items information from factory to store), to safeguard themselves against buying a counterfeit product. However, the advancements in technology have resulted in counterfeit copying genuine information and applying it to counterfeit products, presenting it as real.
Brand-made teams – In 2010, Louis Vuitton created a team dedicated to the ‘management and protection’ of the company’s Intellectual Property Rights. This team has initiated more than 10,000 raids, seizing thousands of counterfeit products and breaking up criminal networks.
Social Media/Digital Involvement – For counterfeiting by established brands, Instagram accounts like diet_prada bring attention to and ‘call out’ brands who actively copy luxury trademarks for their counterfeit products. In addition, global companies are created to combat the use of marketplace websites (such as eBay, Amazon etc.) to sell counterfeit products, as well as taking down mirror websites. These companies also work with search engines to ensure that counterfeit websites do not appear on searches for luxury brands. URL checkers have been developed for customers to check that the luxury websites that they’re using are legitimate.
What needs to be done in the future to further stop counterfeit fashion?
Intellectual Property laws need to be further adapted to the vastly changing of the fashion industry. The process of obtaining a patent/trademark/copyright must become quicker and easier in order to protect luxury brands in the future.
On a global scale, more organisations need to be put in place in order to raid, seize and prevent future imports of counterfeit products.
On the other hand, maybe think twice before buying counterfeit fashion? Putting in place punishments for purchasing counterfeit fashion products will change the reputation of the counterfeit (turning it into a criminal act), and will reduce the effects of the counterfeit fashion industry.
Counterfeit fashion is a serious problem with far reaching effects in the fashion industry. Choosing to purchase a counterfeit product for a lower price is choosing to support unethical manufacturing practices and choosing to ignore the hard work of luxury designers who create luxury products that, frankly, deserve the high price tag.