There is a need to devise new and innovative legal instruments to check brand piracy, Union minister for law, justice & company affairs Arun Jaitley said.
"Brand Piracy is commercial theft. When an infringer hijacks the brand name, appearance, packaging etc, he is pocketing the benefits of the genuine brand and company. Through this counterfeiting and pass off activity, copiers and infringers disrupt a large part of the economic activity," he added.
He was speaking at a workshop on Trademark Protection, 'Protecting brands - a war against counterfeiting,' organised by the Federation of Indian Chambers of Commerce and Industry (Ficci) in association with the Administrative Staff College of India (ASCI) and Consumer Education and Research Center (CERC) today.
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Spurious and sub-standard products have made inroads into the fast moving consumer goods (FMCG), drugs and medicine, music, IT, beverage and food industries. The pharma industry alone loses approximately Rs 4000 crore due to counterfeiting. Of the total Rs 60,000 crore FMCG market, Rs 2,600 crore is actually counterfeit products.
Bharat Patel, chairman of BPC, outlined the ill effects of counterfeit and pass-off products on consumers, companies, and the economy. "The consumer runs a health and safety risk. He is also cheated as he pays for a sub-standard product believing it to be an original," said Patel.
"If we look at India as a brand, we see that the brand is suffering and its equity is eroding. India is seen as a market for counterfeiters, whose borders are porous and as a country where laws don't work," said Balakrishna Gandhi, senior faculty member, ASCI.
"The problem of brand piracy has moved from the rural markets to the urban now," pointed out Ashok Chhabra, executive director, Procter & Gamble. Hindustan Lever (HLL) for instance conducted at least 200 raids in the last year. M K Sharma, vice chairman, HLL, said out of the total counterfeiting of HLL products, 75 per cent is sold in the rural markets while 20 per cent reaches urban slums and five per cent is sold in up-market localities. He also noted that the market for counterfeit products is most prevalent in the 'Hindi-belt' where literacy levels are low.
"There is a need for greater symbiosis between existing laws and enhanced co-ordination between the enforcement agencies including the central and state governments and the police to sort the problem," said R S Lodha, president, Ficci.