Counterfeiting and consumer harm

By Mariana Benfati and Fernando Casares Teixeira

Because they are of low quality and do not fulfill the technical standards established by the regulatory agencies, counterfeit products can present defects that cause risks to consumers’ health and safety.

It is not new that counterfeiting causes harm to the holders of intellectual property rights and to the public coffers. However, the financial impact becomes of least concern when we think about the health of the consumer who purchases a counterfeit product.

Copyright or trademark violations are commonly viewed as harmless to society and culturally accepted under the pretext people needing to find work. How often do people criticize the police in news covering seizure of counterfeit goods?

The term “counterfeit product”, in the first instance, refers the reader to clothes and bags that bear luxury brands, widely marketed by street vendors and supposedly harmless to the health of those who purchase them. In fact, the illegal counterfeiting market affects many industry sectors. From drugs to automotive parts. From alcoholic beverages to hair products. From cigarettes to agricultural pesticides. There are countless industry sectors that suffer from counterfeiting. The greatest danger, in fact, is the potential detriment of these commodities to the consumer, who is often unaware of the false origin of the product or the risk of choosing the lowest price.

Fake alcoholic beverages, for example, may contain substances such as iodine, ethyl alcohol and methanol, manufactured without any quality standard or hygienic criteria and stored in inappropriate places. A study conducted by CEBRID – the Brazilian Center for Information on Psychotropic Drugs, Unifesp, in 2012 [1], pointed to the presence of high doses of methanol in counterfeit drinks collected from informal vendors. Excess methanol can lead to blindness and, in extreme cases, even death.

The automotive market estimates a loss of about $ 3 billion [2] each year with counterfeit or remanufactured parts in Brazil. The consumer, often attracted by the cheap price, is unable to imagine the potential harm that this type of product can cause. In addition to putting the lives of drivers and passengers at risk, as they do not pass the strict quality control of Inmetro (the Brazilian Institute of Metrology), they can cause irreversible damage to a vehicle.

Regarding sunglasses, according to a survey by the Brazilian Association of the Optical Industry, out of the 24 million glasses produced every year in the country, 7 million are illegal [3]. The health effects on the eyes are enormous, since these products do not normally have lenses that block the ultraviolet rays.

It is quite common to find news stories in the media about good faith consumers who have been deceived and harmed by buying counterfeit goods. Examples include sneakers that deform the feet due to their low quality and lack of technological application and toys that release small parts are lighters that explode.

With the significant increase of online marketplaces and sites, the fight against this practice also faces challenges and requires constant innovation to be effective. New international and national data protection laws have made it even more difficult to gain access to the identity of offenders who register domain names hosted overseas or that use vending platforms to distribute counterfeit goods. In parallel, commercial transactions carried out via e-commerce are fast and efficient, which also facilitates the performance of counterfeiters and helps them to avoid responsibilities.

The Consumer Protection Code (Statute 8,078/90) has the function of protecting the consumer, which is deemed to be underestimated in the contractual relationship. In its art. 6, the statute provides, as consumer rights: protection of life, health and safety against risks caused by practices in the supply of products and services; and education and dissemination on the adequate consumption of products and services, ensuring freedom of choice and equality in hiring.

The statute establishes that suppliers of counterfeit products are jointly and severally liable for defects that render them improper or inadequate to their intended use or that diminish their value.

In fact, manufacturing or marketing counterfeit goods may amount to different crimes under federal law, such as: the Consumer Protection Code, the Brazilian Penal Code, the Industrial Property Law and Law No. 8137. Penalties for these practices may vary from 3 months detention to 15 years’ imprisonment.

In addition to affecting trademark holders who are prejudiced by the loss of the market to counterfeiters and the immeasurable damages as a result of the depreciation of the brand image, the falsification of products harms society itself, as well as the State, as it is no longer raising millions in taxes and due to job losses.

Therefore, because they are of low quality and outside of the technical standards established by the regulatory agencies, counterfeit products can present defects that cause risks to the health and safety of consumers. These consumers should also be aware that, in practice, trade with counterfeiters does not have the guarantees established by the Consumer Code in cases of flaws or defects of the product and possible reimbursement.

 

[1] https://noticias.uol.com.br/saude/ultimas-noticias/redacao/2012/10/30/bebidas-clandestinas-tem-metanol-cobre-e-susbtancia-cancerigena-diz-estudo-da-unifesp.htm?cmpid=copiaecola

[2] https://autopapo.com.br/noticia/autopecas-falsificadas-risco/

[3] https://saude.abril.com.br/bem-estar/fique-alerta-aos-perigos-dos-oculos-escuros-falsificados-para-os-olhos/

 

BIBLIOGRAPHIC REFERENCES

Doctrine:

PIMENTA, Eduardo Salles – Coordenador. Estudos de Combate Pirataria em Homenagem ao Des. Luiz Fernando Gama Pellegrini. 1ª ed. São Paulo: Letras Jurídicas. 2011.

SILVA, Alberto Luiz Camelier da. Concorrência Desleal. Atos de Confusão. 1ª ed. São Paulo: Saraiva. 2013.

Articles:

FERRARI, Eduardo Reale. Reflexos da Pirataria. Revista ABPI edição 134. Jan/Fev. 2015.

“Pirataria no Brasil – Radiografia do Consumo – baseado na pesquisa “O consumo de produtos piratas no Brasil”, Federação do Comércio do Estado do Rio de Janeiro – Fecomércio/RJ, 2007, 2ª Edição atualizada do estudo , 2006;

‘Estudo sobre Contrafação’, realizado por técnicos da ‘COMEÇO – Consultores em Organização e Gestão Empresarial’, que integrou elementos com formação nas áreas de Direito, Gestão e Economia, para a “União de Associação do Comércio e Serviços de Lisboa – UACS, 2001”.

LUCENA, George Mendonça. Diretório Nacional de Combate à Falsificação de Marcas. Disponível em http://www.daniel.adv.br/port/circularLetters/Carta_Circular_n75_port.pdf.

BRITO, Agnaldo. Caça a Pirataria Bate Recorde no Ano. Disponívelem<http://www.economia.estadao.com.br/noticia/geral,caca-a-pirataria-bate-recorde-no-ano,58429>.

Websites:

Jornal O Globo 23/03/2004 & IFPI (www.ifpi.com)

http://jornalnacional.globo.com/Jornalismo/JN/0,,AA1442610-3586-631511,00.html

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http://jus.com.br/artigos/19100/o-direito-e-o-combate-ao-comercio-pirata

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http://www.emerj.rj.gov.br/serieaperfeicoamentodemagistrados/paginas/series/3/Combate_a_Pirataria_e_Agressao_266.pdf

Legislation:

Constitution of the Federative Republic of Brazil. Available at (Portuguese): <http://www.planalto.gov.br/ccivil_03/Constituicao/Constituiçao.htm>. As accessed on: 7 September 2015.

STATUTE 8,078, OF 11 SEPTEMBER 1990. Consumer Protection Code. Available at (Portuguese): <http://www.planalto.gov.br/ccivil_03/LEIS/L8078.htm>. As accessed on: 7 September 2015.

STATUTE 9,279/1996 (ORDINARY LAW) 14/05/1996, REGULATE RIGHTS AND OBLIGATIONS REGARDING INDUSTRIAL PROPERTY. Available at (Portuguese): <https://www.planalto.gov.br/ccivil_03/leis/l9279.htm>. As accessed on: 7 September 2015.

STATUTE 10,406, OF 10 JANUARY 2002. Law Establishing the Civil Code. Available at (Portuguese):  <http://www.planalto.gov.br/ccivil_03/leis/2002/L10406.htm>. As accessed on: 7 September 2015.

DECREE-LAW 2,848, 7 DECEMBER 1940. Lei que Institui o Código Penal. Available at (Portuguese): < https://www.planalto.gov.br/ccivil_03/Decreto-Lei/Del2848.htm>. As accessed on: 7 September 2015.

 

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