North African countries collaborate to strengthen anti-counterfeiting measures in an environmentally sustainable manner

Countries in Northern Africa, including Tunisia, Algeria, Morocco and Egypt have been increasing their focus on anti-counterfeiting and protection and enforcement of intellectual property rights.

A seminar, following on from previous events hosted by AfrIPI, was held in September 2023 in partnership with other international organizations to focus on enforcement of intellectual property rights and fight against counterfeiting. The seminar enabled open dialogue between various stakeholders to discuss effective strategies in detecting, monitoring, and investigating IP infringement and to find workable solutions for the destruction of seized goods in an environmentally sustainable manner including recycling seized goods for other uses.

SOURCE: AfrIPI supports North African countries in the fight against counterfeiting and the enforcement of intellectual property rights | AfrIPI

Adams & Adams Anticounterfeiting team roll out seizures of counterfeit roller bearings in 3 Provinces

After extensive investigations into a company importing and selling counterfeit branded roller bearings, the Adams & Adams Anti-Counterfeiting Team assisted the HAWKS (SAPS) with simultaneous search and seizure operations in 3 Provinces. More than 1 300 counterfeit branded bearings were seized by the Police during these operations. 

Criminal prosecutions and civil claims were instituted.

Roller bearings are used as components across various industries, which can include application as automotive parts. Needless to say, the mere nature of these items carry a potential risk of damage or even safety to consumers in the event where substandard and non-compliant counterfeit versions are installed.

The strategic execution of search and seizure operations is crucial to ensure success for brandholders aiming to not only remove counterfeit items from the market but also to identify the suppliers of these illegal goods. 

Adams’ Anti-Counterfeiting Team deals another blow to manufacturers of counterfeit engine lubricant and oil products

After thorough investigations by the firm’s internal private investigators, the Anti-Counterfeiting Team of Adams & Adams recently collaborated with the HAWKS (SAPS) in two provinces to clamp down on syndicates dealing in counterfeit engine lubricant and oil products.

In the first operation in Gauteng, the team managed to identify and take down a manufacturing facility where recycled oil was cooked, decanted into branded drums, sealed and onwards sold. Two suspects were arrested and remain incarcerated while the State opposes their release on bail.

The criminal and civil cases are ongoing. Jan-Harm Swanepoel is the lead attorney from Adams & Adams in these matters representing the Complainants’ interests.

Members of the public are advised to contact our Anti-Counterfeiting team should they suspect any suspicious activities that may involve manufacturing or otherwise dealing in counterfeit products.

Protecting your rights and interests when the authorities fail to act

Jan-Harm Swanepoel recently represented the interests of a client and the firm in securing an order from the High Court for the imprisonment of a Respondent based on a Contempt of Court Order.

The First Respondent embarked on a series of serious intimidating, threatening and defamatory conduct against a client of the firm and even against partners of Adams & Adams. The First Respondent’s actions included blocking access to the client’s business premises, harassing, intimidating and victimising representatives of the client and burning objects at the client’s business premises.

Sadly, officials of the Police Station (SAPS) with jurisdiction (located less than 5 km away from the client’s business premises) failed to respond to the initial calls to take action against the First Respondent or investigate his actions.

Adams & Adams represented the client in approaching the High Court for an interdict against the First Respondent which was granted together with a Court Order on an urgent basis by the Johannesburg High Court. This did not deter the First Applicant who continued with his unlawful conduct in breach of the interim Court order and interdict. In the subsequent Contempt of Court Order and judgment handed down against the First Respondent on 28 January, the High Court referred to the requirements of Contempt of Court as set out by the Constitutional Court in the case Secretary of the Judicial Commission of Inquiry into Allegations of State Capture, Corruption and Fraud in the Public Sector including Organs of State v Zuma and Others (CCT 52/21). Judgment was granted in favour of our client together with a cost order against the First Respondent.
Adams & Adams eventually represented the client successfully in three urgent applications against the First Respondent. During the most recent urgent hearing on 22 February 2022, the Johannesburg High Court handed down judgment and ordered that the First Respondent be committed to imprisonment for a period of 90 days.

Companies, businesses and individuals should obtain legal advice on their options when dealing with individuals who consider themselves to be above the law. Unfortunately, lawlessness of the nature addressed in our client’s cases may become more prevalent, especially where the authorities do not take action.

The two court judgments handed down on 28 January and 22 February can be accessed at:

DGB Order

DGC (PTY) Limited vs Nicholas Vukile Kanyile

DEADLINE FOR MANDATORY RECORDAL OF IP RIGHTS IN KENYA EXTENDED TO 1ST JANUARY 2023

Dear Clients and Colleagues,

On the 26th of April 2022, the Kenyan Anti-Counterfeit Authority (“ACA”) published Public Notice, No. 1/2022, in which it announced a deadline for the recordal on the Anti-Counterfeit Authority Integrated Management System (“AIMS”) of all goods bearing Intellectual Property Rights being imported into Kenya.

That Notice required that all Intellectual Property Rights Holders to record their Intellectual Property Rights through the AIMS system by no later than 1st July 2022.

On the 23rd May 2022 and after extensive stakeholder engagement, the ACA issued Public Notice no.2/2022, depicted below, extending the deadline to submit a mandatory recordal until 1st January 2023 to afford Intellectual Property Rights Holders more time for compliance.

The ACA further advised that it is considering the validity of recordal application approved anytime this year to also run from 1st January 2023. This means that any recordal applications received and processed between now and December 2022 will only begin the 1 year validity countdown from 1st January 2023. Therefore, Intellectual Property Rights Holders are encouraged to submit their recordal applications timeously.

We are continuing to monitor the situation and will provide you with further developments or updates regarding this project. In the meantime, we will be continuing with our engagements with the ACA and other stakeholders to seek clarity on aspects that require clarification.

Should you require any assistance to record your intellectual property rights in Kenya, please do not hesitate to contact us.

A positive step for the Border Management Authority”

It is a well-known fact that counterfeit and illicit goods trade is causing an immeasurable harm to an already struggling South African economy. In 2019, his excellence President Cyril Ramaphosa in particular acknowledged the severe negative impact that this phenomenon has on the local economy and pledged that government would do more in an attempt to address the importation and smuggling of counterfeit and illicit goods into the country.

In this regard, in 2020 and in an attempt to create a more efficient process for overall border control and reduce the corruption element, the Border Management Authority (“BMA”) Act was signed into law. The BMA seeks to eradicate several challenges currently experienced within the border management environment due to the existing fragment model and provide a single authority to oversee all forms of border management control. The BMA model will be implemented at land, air and seaports of entry. The proposed BMA model is expected to create a platform for proper coordination between different Government Departments such as the South African Police Service, the South African Revenue Service, Department of Home Affairs (Immigration), South African Defense Force, to work together in an attempt to clamp down on, inter alia, the importation of counterfeit and illicit goods and facilitate improved movement of people and goods.

The roll out process of the BMA is currently underway and the Minister of Trade, Industry and Competition has now, in terms of Section 15(1) of the Merchandise Marks Act no. 17 of 1941 (“the MMA”), included the below BMA logo as part of “the prohibited marks” under the provisions of MMA:

This in effect prohibits the unauthorised use of the BMA logo as depicted above, or of a similar mark, which may cause confusion in relation to any trade, business, profession, occupation, event, or in connection with any trade mark, mark or trade description applied to goods, unless where such use is authorized by the Department of Home Affairs.

Furthermore, no person or entity may apply for proprietorship of the BMA logo as a trade mark in terms of the Trade Marks Act No. 194 of 1993 (“TMA”), which specifically prohibits such a registration in terms of Section 10(10) of the TMA. However, proprietors of identical or similar trade marks already registered and/or in use prior to the date of this notice will not be affected by this prohibition.

This development is welcomed and indeed a positive step in the direction to a successful implementation of the BMA program, which will hopefully significantly aid in the streamlining of the border control. Once implemented, the proposed BMA model is likely to bring about culture change, improve law enforcement at border environment, minimize cross-border criminality and potentially address many other practical challenges currently experienced.

Manufacturing of counterfeit products rearing its ugly head again in South Africa

The recent news reports of a manufacturing facility found to be selling counterfeit washing powder, have reignited concerns about the extent of the counterfeiting industry in South Africa.

When you mention the word “counterfeit goods”, most people think about a few counterfeit sneakers or handbags making their way into South Africa in a container or an opportunistic hawker trying to sell a few items at a traffic light. However, when you look at the reports and actual cases where manufacturing facilities were found in South Africa in recent years, it becomes apparent that there is a real threat to brand holders and the public from within our borders. The word “threat” should not only be considered in the context of the financial harm caused to brand holders but also the potential health and safety risks, particularly when looking at the nature of the counterfeit products mentioned below.

In 2016, our firm collaborated with several HAWKS branches of the SAPS across provinces to execute simultaneous operations at several manufacturing plants involved in refilling and selling counterfeit engine oil. In addition to the various counterfeit branded drums and buckets of oil seized, large numbers of counterfeit oil drum seals, branded labels and other manufacturing tools were seized from the Suspects.

During the latter part of 2016, our investigators assisted the Police in clamping down on a factory manufacturing counterfeit bottled water. The video clips of this operation have been widely circulated by various media outlets.

Over the years, manufacturing activities in the counterfeiting industry have evolved into sophisticated syndicates sourcing raw materials from various countries and outsourcing packaging requirements to cheap suppliers. In many instances, we identified important documentary and digital evidence showing that the illegal operations were funded and operated through validly registered companies. Counterfeit Goods manufacturing facilities have mushroomed in recent years in places all over the country, including smaller towns like Hartswater, White River and Brakpan, presumably to avoid detection by the authorities.

Although the Covid-19 lockdown restrictions initially appeared to stifle the counterfeiting trade to a certain extent, the downward curve didn’t last very long. In late December 2021, when the country was battling another Covid-19 wave, SAPS arrested several foreign nationals at a manufacturing facility found in Tshwane, Gauteng. The suspects rented a luxurious house in an upmarket estate and used the large garage and other rooms in the house to manufacture counterfeit instant yeast products. Several luxury cars and bank statements showing large sums of money deposited into company bank accounts were also found at the premises.

In a recent operation in 2022 in the West Rand region, our investigator accompanied the Police during an operation where more than 300 000 counterfeit hair braid packaging sleeves were seized. It appears that this facility even had their own graphic designer employed at the premises to assist in designing the counterfeit packaging to imitate the genuine versions as closely as possible.

The one aspect that has remained consistent over the years when it comes to discovering manufacturing facilities, is that there is no product that they will not copy or imitate. Concerningly, the sophistication of these operations and networks have evolved considerably over the years to constitute profitable business enterprises. That is not only apparent from the luxury cars found at the premises and the trading activities channelled through companies, but also the experienced criminal defence attorneys appointed by them.

Although many brandholders set their hopes on the courts to impose harsh sentences as deterrent mechanisms, brand holders have an obligation to support law enforcement with the required assistance and private investigations. The collection of evidence and timeously submission of subsequent analysis statements are crucial to place the authorities in the best position possible to pursue all the role-players involved. It is important that brandholders are correctly advised on the legal processes and the best options possible to eliminate not only the manufacturing aspect but also to ensure that other parties who have sold and benefitted from the trade in counterfeit goods are apprehended and pursued. In normal run-of-the-mill seizures executed at counterfeit goods traders, you would usually follow the trail of breadcrumbs to the suppliers and manufacturers. But when in the advantageous position of knocking over a manufacturer from the get-go, it is crucial that the legal action should filter down to identify and eliminate the others that derived benefit from the process, whether as traders who purchased counterfeit products from the manufacturers or as the suppliers of raw materials and other tools. When selecting an appropriate civil remedy (whether on its own or to accompany a criminal case) it has been our experience that there are better options to increase the immediate pressure than the usual civil summons-remedy preferred by some anti-counterfeiting practitioners.

With oil and commodity prices skyrocketing due to the Ukraine – invasion, it can be expected that more counterfeit goods dealers will move to take their sourcing activities in-house and start their own manufacturing enterprises.

The Long Awaited Anti-Counterfeiting (Recordation) Regulations Have Finally Been Published

In January 2019, the Statute Law (Miscellaneous Amendments) Act of 2018 was enacted by the Parliament of Kenya to introduce some amendments to various intellectual property legislations including the Anti-Counterfeit Act of 2008 (‘the Act’).

Amongst others, the name of the Anti-Counterfeit Agency was changed to the Anti-Counterfeit Authority and, most importantly, the Act made provisions for the formal recordal applications of intellectual property with the Anti-Counterfeit Authority. The Act provides that an application for recordal shall be made in a prescribed manner and accompanied by a payment of prescribed fees. However, the implementation was put on ice awaiting the publication oof the relevant Regulations.

The Anti-Counterfeit (Recordation) Regulations (the Regulations) were published on 23rd July 2021 in terms of Legal Notice 118 of 2021) link here. The Regulations provides that an application to record an intellectual property right relating to goods to be imported into Kenya shall be made by the owner of the intellectual property in a prescribed form and accompanied by the payment of prescribed fees. The relevant forms and official fees are set out in the First and Second Schedules to these Regulations.

Upon receipt of the recordal application, the Anti-Counterfeit Authority shall notify the applicant of the approval or rejection of the application in writing. If approved, the recordal will be valid for 12 months renewable, in a prescribed form and accompanied by payment of the relevant fee, a month before its expiry date.

The following information and/or documentation is required in support of the recordal application:

  • Name of the owner of the intellectual property right (the Applicant);
  • the Applicant’s contact details and address;
  • Name and contact details of the Applicant’s agent or local distributor, if any;
  • Properly signed Power of  Attorney;
  • Copies of the certificate of registration or renewal of the intellectual property right/s;
  • Samples or digital images of the Applicant’s protected goods ;
  • Name, contact details and address of each foreign person or business entity authorized or licensed to use the Applicant’s intellectual property right;
  • The identity of any parent or subsidiary company or other foreign company under common ownership or control which uses the intellectual property right abroad; and
  • Place of manufacture of genuine goods (i.e. goods bearing the recorded intellectual property right/s).

This is an exciting legislative development in the fight against the rampant importation (and perhaps smuggling) of counterfeit goods into the Republic of Kenya. This development will no doubt boost the Anti-Counterfeit Authority’s moral and enforcement drive and also encourage other East African Nations (and other countries in Africa) to follow suit.

The Anti-Counterfeit Authority is currently engaging various stakeholders regarding implementation of recordal process and it is expected that an online system maybe introduced to facilitate the smooth running of the process.

We are continuing to monitor the situation and will provide further information/details regarding the implementation of the recordal process in due course.

Adjusting Anti-Counterfeiting Strategies: Shifting the Focus to the Sources

 “… the more he got away with it, the more he did it…”

Daniel Golden, investigative reporter and author of The Price of Admission

The seizures of large numbers of counterfeit goods and consignments are regularly communicated in statistics and annual reports on enforcement efforts. Despite this valiant and ongoing work by authorities to combat these criminal activities, little information is disclosed on the individuals behind the syndicates and the sanctions imposed on them, if any.

For brandholders, their main anti-counterfeiting legal strategy often involves opting for the cheapest option in seizing and destroying counterfeit goods. Where the source of these illicit goods can be traced, civil undertakings are often concluded on the basis that the goods may be destroyed. Although some settlements are accompanied by details of the sources of these counterfeit goods, the said details are rarely verified, and further action is not taken. If civil judgements are obtained on an undefended basis, cost orders are seldom pursued and the cases are considered closed upon destruction of the counterfeit items. This creates an opportunity for counterfeiters to move the basis of their operations, replenish stock and repeat their unlawful activities.

Although focusing on the volumes of counterfeit goods remains important in trying to halt this criminal activity, some cases may warrant more aggressive and targeted approaches to shift the focus to the actual sources and individuals behind the manufacturing and supply of the illicit goods. Many counterfeiting syndicates feel brazen enough to register companies that branch out into franchise enterprises, openly dealing in counterfeit goods. Proceeds of these illegal activities are channeled through bank accounts without any fear of forfeiture to the authorities.

Anti-counterfeiting practitioners have an important responsibility to consider the circumstances of each case and to inform their clients (brandholders) of all the available options under South African legislation to enforce their rights to the extent possible.

The Counterfeit Goods Act authorises both criminal and civil action relating to counterfeiting activities. Dealing in counterfeit goods carries a possible imprisonment sentence of up to three years per article upon conviction of a first offence. Repeat offenders or even the presence of a pending case will require a Suspect to be subjected to a formal bail application as required by Schedule 5 of the Criminal Procedure Act. Criminal courts of first appearance are often inundated with new cases, and anti-counterfeiting practitioners are advised to inform prosecutors and investigating officers if they are aware of previous or pending cases against a Suspect.

The Prevention of Organised Crime Act, No. 121 of 1998 (POCA) authorises the preservation and forfeiture of property (including money) if the property concerned is an instrumentality of an offence or where the said property (including money) is the proceeds of unlawful activities. Evidence collected during private investigations on behalf of brandholders or by the Police may warrant and justify POCA enforcement and, similarly to the above, brandholders’ attorneys should communicate with law enforcement and prosecutors to consider whether the above provisions are appropriate.

Selecting the appropriate civil action in combination with a criminal prosecution may just deliver the knock-out blow required to dismantle a counterfeiting operation. Electing the appropriate civil action to be filed may also play a crucial role in curbing this criminal activity, particularly if this is filed in addition to criminal charges preferred by the State. Many anti-counterfeiting practitioners have fallen into a habit of issuing civil summons against counterfeit dealers as the only civil enforcement strategy. In the short term, this may be a cost-effective approach for brandholders to ensure preservation of evidence and prevent the release of the seized counterfeit goods. However, in some cases this approach may lead to more costs and lengthy delays, as vague pleas or bare denials are entered by defendant attorneys and trial dates allocated years into the future.

In certain matters and where appropriate, preferring the Application Procedure opposed to issuing civil summons, may deliver more expedient results, particularly when these proceedings have been filed in addition to a criminal case. Responding to the facts in the founding affidavit (submitted on behalf of the brandholder) will require the respondent (alleged counterfeiter) to deliver an answering affidavit supported by documentary and other evidence to support their version. Binding themselves to a version (defence) under oath will not seem very attractive to the respondent, especially if facing additional criminal charges.

Not only can brandholders file civil proceedings against counterfeit dealers, but recent case law further suggests that third parties (even if not part of a particular counterfeiting operation) can be ordered by court to disclose the information of a counterfeit dealer and face a contempt of court sanction if they fail to comply.

Attorneys representing brandholders should be in a position to identify and inform their clients of the most appropriate options available rather than simply following the norm of a one size fits all approach.   Brandholders who implement and develop multiple anti-counterfeiting strategies may very well be the biggest deterrent to counterfeiting operations in the long run.

Anti-Counterfeiting Law in South Africa

Anti-counterfeiting legal advice is sought out by any person, or entity, whose intellectual property right has been infringed upon. These parties include authorised intellectual property right owners, licensees, importers, exporters, distributors or other authorised agents. The intellectual property rights that are protected by the Counterfeit Goods Act include registered trade marks, copyright, and well-known (yet unregistered) trade marks.

Anti-Counterfeiting Meaning

Anti-counterfeiting prevents individuals from manufacturing or otherwise dealing in unauthorised goods which constitute substantial identical copies of the genuine goods or where the unauthorised goods  bear or incorporate the subject matter of the relevant intellectual property right or a colourable imitation thereof so that the unauthorised goods are calculated to be confused with or taken as being the genuine goods.

Counterfeit goods have been described as constituting “fraudulent imitations” of the genuine goods copied.

Counterfeiting is used to deceive others, whether into believing that the replicated item is an original, or that originates from the same source.

Counterfeiting is constituted when:

  • Individuals or entities manufacture counterfeit goods, other than for private or domestic use;
  • Individuals or entities otherwise deal in the counterfeit goods (including selling, offering for sale, distributing, importing, exporting and possessing for purposes of trade).

Anti-Counterfeiting Trade Agreement

The Anticounterfeiting Trade Agreement (ACTA) is drafted (proposed) legislation aimed at combating counterfeiting and piracy on a commercial and international scale. The draft agreement was signed by several countries including Australia, Canada, Japan, Morocco, New Zealand, Singapore, South Korea, and the United States. South Africa was not a signatory to this agreement, and the agreement was eventually never signed into force after being rejected by a majority of the European Parliament in 2012.

Anticounterfeiting legislation is enforced separately in the various jurisdictions (countries) in accordance with the legislation in force in the particular country. However, Adams & Adams collaborates with international organisations and law enforcement agencies, e.g. INTERPOL, across various countries to fight counterfeiting on an international scale.

Anti-Counterfeiting Measures

Dealing in counterfeit goods is prevalent in all markets and facets of society. The highest volumes of imported counterfeit goods in South Africa are suspected of entering through Durban harbour and eventually being distributed from Johannesburg.

Numerous factories and manufacturing facilities producing counterfeit goods have been discovered and shut down by Adams & Adams in collaboration with the authorities. Many of these illegal manufacturing facilities were based in smaller rural areas and towns.

Adams & Adams make use of several internal investigators to get to the bottom of counterfeiting activities. In addition, Customs and other branches of law enforcement alert Adams & Adams of counterfeiting activities pertaining to the firm’s clients. We, further, have a team monitoring online activities pertaining to dealing in counterfeit goods.

If the unauthorised goods in question constitute substantial identical copies or colourable imitations (calculated to confuse) of the genuine goods and protected IP Rights in question, the goods will be considered as being counterfeit.

Anti-Counterfeiting Legal Assistance

Adams & Adams has one of the largest Anti-Counterfeiting legal teams, consisting of attorneys, as well as other professional and support staff, dedicated to combatting the trade in counterfeit goods in Africa and further abroad.

We are the only firm with internal investigators based across several jurisdictions, dedicated to pro-actively investigating and assisting our clients with effective and sustainable Anti-Counterfeiting measures.

Our team is well informed and equipped to deal with any client queries related to the prevention and detection of counterfeiting as well as the enforcement of legal action across Africa to clamp down on counterfeit goods. For more information, contact us.