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The importance of intellectual property

Piracy and counterfeiting are taking a heavy toll on the luxury industry; safeguards are a crying need, reports Sushmita Bose.

business Updated: Mar 29, 2008, 01:15 IST
Sushmita Bose
Sushmita Bose
Hindustan Times

A fake Gucci handbag for $1. Does that qualify as a luxury product? While there are those who feel that ‘aspirational’ brands are being made easy-on-the-wallet so that almost anyone can experience the designer feeling, piracy and counterfeiting is hurting the industry — and creativity. Badly. And they have to be tackled on a war footing.

‘Countering fake: Are the laws strong enough?’ was the fifth session at the conference, where lawyers Pravin Anand and Alain Coblence held forth on the challenges faced by the luxury industry on matters of intellectual property (IP) rights. The session was chaired by Vijay Karan, former commissioner of Delhi Police. Karan set the tone by talking about the “passion” with which he and his force had taken on the scourge of fakes and counterfeits. “In India, where 15 to 20 per cent medicines are counterfeit, fake luxury goods almost seem innocuous — because they are bourgeois,” he said.

In other words, it may be tougher to get legal action in place for piracy in a segment that is considered elitist.

According to Coblence, globally, the counterfeit sector is a parallel economy: it is worth $700 billion, of which 47 per cent is in the area of fashion accessories (read: the luxury segment). And although China has the dubious distinction of manufacturing around 80 per cent of fakes, it is, clearly, a worldwide affliction.

It’s easier in the Europe to protect IP, since it is a closely regulated environment and IP protection is a fundamental right. It’s fuzzier in the US, where, Coblence explained, IP is in the public domain. “Ideas,” he said, “are like oxygen in the air — they are for everyone.”

But efforts like “the TRIPS Agreement and the World Economic Forum taking up the issue at a very high level”, said Anand, are steps in the right direction. India has been taking an active interest in pushing for better laws.

Karan pointed out that offenders should be slapped with criminal charges and arrested because “a civil case can keep getting adjourned”. Anand felt “taking the financial incentives out of the counterfeiting business” by close monitoring of assets of suspected parties would instil a fear factor in them and serve as a deterrent.

Finally, everyone agreed that education is the key. “There has to be respect for luxury,” summed up Anand. No judge should feel that luxury marketers can “afford” to be hit by counterfeits. Coblence felt that customers (end-users) should be educated about the counterfeit mafia that sponsors terrorism and uses child labour.

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