Nowadays, people are more aware of the various brands available in the market, from consumable products like food, liquor, or even medicine, to wearable products like clothing and accessories. Many people do not hesitate to spend a large amount of money to get branded products. However, as some products have limited availability at offline stores, people start to look for them online. And with the presence of e-commerce, this has made the shopping experience much easier and faster.

The growth of the online market and the rise in counterfeit risk

Based on the data from the GlobalWebIndex, Indonesia has the highest adoption level for e-commerce in 2019. Around 90 percent of internet users within 16-64 years old conducted transactions through online channels. The number of online buyers significantly grew due to the increase of online buyers outside of Java Island. 

The rise was also caused by numerous available promos provided by online marketplaces. A total of 20 percent of Indonesian consumers even use online marketplaces for price research before deciding to buy a product. Unfortunately, e-commerce does not only bring benefits to buyers and sellers. It also benefits counterfeiters as many of them use online marketplaces to market their products. 

In Indonesia, the selling of infringed products is a violation against the law. This is under the Government Regulation (PP) Number 80 of 2019 concerning Trading through Electronic System, more specifically in article 13, which states that every business actor needs to provide clear, true, and honest information of the product offered. Furthermore, article 80 of the same regulation explained the sanction for business actors that are found to have harmed consumers. The lightest sanctions are the administration sanctions, such as a written warning, having their products labeled as under supervision, being blacklisted, blocked on online marketplaces, and more. While the strongest is the revocation of their business license.

Similar to Government Regulation (PP) Number 80 of 2019, Law No. 8/1999 regarding Consumer Protection states that a business actor must provide real and honest information about a product offered in order to protect the consumer’s rights. A business actor proven to have provided wrong information must take the offered product out from the market and stop its distribution.

The good and bad news

The good news is that online marketplaces are aware of the fact that counterfeit products are being sold using their platforms. Therefore, they implement countermeasures  by taking down suspicious accounts or products. By doing so, a page or even an account that is known to have violated Intellectual Property Rights will be removed from the online marketplace. In addition, most brand owners can open their official store with verification from online marketplaces. This method helps buyers to make sure that what they purchase is genuine. 

The bad news is that not all online marketplaces have the time and resources to conduct an investigation and take down all counterfeit products. Not only that, a lot of people would purchase a product based on its price, without taking much consideration over the genuity and quality of the product, making them a potential buyer of infringed commodities. 

While some people do not care about buying infringed products, its trade can damage the reputation of brand owners in several ways. Based on a white paper fromMarkmonitor, multinational manufacturers lose around 10 percent of their top-line revenue because of counterfeiters. Additionally, the price difference might risk the demand on genuine products. Some pharmaceutical and electronic brands have been certainly damaged as the safety of infringed products are not guaranteed.

Taking down counterfeit products

Knowing this fact, most online marketplaces provide online forms to be filled out by parties who want to report an account or product. After an online form is submitted, the online marketplace will conduct a further investigation. Of course, reporting a counterfeit product is not easily done by everyone. The reporter must have deep knowledge of the related product and trademark to be able to prove that the product is counterfeit. 

The proof can be shown by providing a letter stating that the reporter is a representative of the brand owner or the owner himself/herself. When the report is accepted, checked, and approved, the product will be removed from the site.

In Indonesia, such steps have been taken not just by online marketplaces like Tokopedia, Shopee, Bukalapak, or Lazada but also by social media platforms such as Facebook and Instagram, knowing that many people also use these platforms to offer infringed products. 

According to the regulations, there is no doubt that the takedown is a necessary method that should be implemented to fight counterfeiting. The takedown programs of online marketplaces not only show their readiness to eradicate the circulation of counterfeit products but also raises the awareness of the availability of counterfeit goods within online marketplaces. Furthermore, the program equally encourages people to be actively involved in eradicating counterfeits. Even after a takedown has been conducted, the problem does not end there. People, especially trademark owners, still need to continuously monitor various platforms to ensure that infringed products are not being marketed and offered again. The same thing was also mentioned as one of the reported problems of the takedown in China, where sellers are found to offer the infringed products with different titles or contact names after their products have been removed.

Integrity Asia has been working with Indonesian marketplaces and social media platforms to take down counterfeit products on the internet. We are ready to help brand owners protect their brand identity and reputation by fighting the infringement of their products. Apart from conducting the takedown of counterfeit products on online channels, we are experienced in the continuous monitoring of online channels to detect and identify whether the infringed products are re-offered using a different account or channel. Do not compromise your brand.Contact usfor further information about our brand protection services.

Stevani

Photo by Brooke Lark on Unsplash