On June 23, 2014 the Ukraine Alliance Against Counterfeiting and Piracy in cooperation with the State Intellectual Property Service of Ukraine carried out the joint social event titled «I Buy Real! I Don’t Buy Fakes!» which was organized in the format of the roundtable «Main areas of the activity of the Ukrainian government authorities for protection of intellectual property rights». The event was held at the Ukrainian National News Agency «Ukrinform» and attended by over 50 participants representing the public and government authorities (law-enforcement authorities, supervisory agencies, courts, local authorities), in particular, Oleksandr Zhuravchak, Deputy Minister of Culture of Ukraine, Mykola Kovinya, Head of the State IP Service, Mykhailo Kunytsky, Director of the Department of Development of Trade of the Ministry of Economic Development and Trade of Ukraine, Denys Mazepa, the Head of the Informatization Department of the Ministry of the Argicultural Policy of Ukraine, Natalia Kovalishyna, Deputy Head of the Main Department of Industry of Scientific and Technical and Innovational Policy, the Head of the Innovational Policy Department of Kyiv City State Administration, Olga Ryabtseva, the Head of the Information and Analytical Department of the Ministry of Industrial Policy of Ukraine, Pavlo Gryn, Representative of the State Security Service of Ukraine, Oleksiy Gashchytsky, representative of the Department of Customs Issues of the Ministry of Revenues and Duties of Ukraine, Andriy Chyharskykh, the Head of the Department of Intellectual Property Protection of the State Service for Combating Economic Crimes under the Ministry of Internal Affairs of Ukraine, Igor Benedysyuk, judge, Secretary of the Fourth court chamber of the Supreme Economic Court of Ukraine, Volodymyr Shchelkunov, President of the Ukrainian National Committee of the International Chamber of Commerce (ICC), the Counsellor to the Prime Minister of Ukraine, John Anderson, Chairman of the Global Anti-Counterfeiting Group (GACG Network), Antonina Pakharenko-Anderson, President of the UAACP.
The social event titled «I Buy Real! I Don’t Buy Fakes!» is a continuation of the educational campaign «Anti-Counterfeiting and Anti-Piracy Days in Ukraine» launched in Ukraine in 2012 by the UAACP together with the State Intellectual Property Service of Ukraine, the State Customs Service of Ukraine, the Ministry of Internal Affairs of Ukraine and ICC Ukraine.
In her opening speech in the beginning of the round table Antonina Pakharenko-Anderson, the president of the UAACP, welcomed the participants of the event and emphasized that the aim of this educational campaign is to combine the efforts of the government, business and consumers in fighting counterfeiting, and to promote shaping of rational consumption pattern and raising awareness of the Ukrainians about the risks and consequences of purchasing counterfeit products. Thanking the participants for their interest in the event, Antonina noted that the representation of the respective agencies and authorities at the event demonstrates that the society is willing to combine its efforts in combating counterfeiting and piracy.
Mykola Kovinya supported his colleague and noted that the high professional level of the attendees points to the fact that carrying out of the annual campaign «Anti-Counterfeiting and Anti-Piracy Days in Ukraine» is a very important and timely event for the society. According to Mr. Kovinya, securing an adequate level of protection of IPRs, advancing its work are priorities for the State IP Service of Ukraine so that the creative people in Ukraine could feel that their work is demanded, respected and their rights are protected.
Volodymyr Shchelkunov stated that the Ukrainians have to realize that cheap counterfeit products is one of country’s main obstacles to development of domestic manufacturing, since infringement of intellectual property rights hampers introduction of innovational manufacturing methods and country’s economic development, while failure to maintain high quality standards in the agrochemical field poses the risk of large-scale technogenic catastrophes. It is particularly important to understand that the counterfeits pose threats not only to the individual consumers but also to the country in general taking into account the tax losses amounting to billions of Hryvnyas, decrease of foreign direct investment due to the country’s loss of investment attractiveness, increasing corruption and crime, the lack of fair competition in the market.
Mykhailo Kunytsky added his word saying that society must be aware about this global problem and think before buying counterfeits.
John Anderson spoke about the role and objectives of GACG which, in particular, include the exchange of best practice in fighting counterfeiting, carrying out joint anti-counterfeiting events including public-awareness campaigns such as World Anti-Counterfeiting Day, annual awards to the governmental and non-governmental organizations for their active and effective anti-counterfeiting activities, and also cooperation in finding solutions to the practical problems related to protection of IPRs in specific countries or regions.
Oleksandr Zhuravchak noted that recently creative people are increasingly interested in intellectual property issues since they understand that it is not just a whim but a real challenge of the present time. Therefore, the Ministry of Culture of Ukraine will put all efforts to support the activities aiming at raising public awareness on these issues.
The detailed overview of threats posed by counterfeit and pirated products to the modern society was made by Antonina Pakharenko-Anderson. She told that production and dissemination of counterfeits is a criminal activity to which each of us is exposed. According to the latest data released by the UN, the world sales volumes of counterfeits amount to 0 billion per year. Nearly all consumption goods are subject to counterfeiting. Counterfeits are sold virtually in all countries of the world and constitute an inescapable part of any significant manufacturing sector. This illegal business can only be compared to arms and drugs trafficking, therefore it already became the part of huge industry involving not only IPR infringements but also the other crimes. Illegal manufacture, distribution and sale of counterfeits is an essential income source for the criminals that facilitates laundering of illegal profits while the costs received from the trade in counterfeits are used for the further manufacture of counterfeits as well as for the other illegal activities. At the end of her speech Antonina Pakharenko-Anderson addressed all the attendees with the following appeal: «If we are choosing the civilized and safe product market in our country, we then must shape an active civil position and a particular shared responsibility for the consequences and results of passiveness and inertia in the course of manufacture, distribution and purchasing counterfeit products. Inertia is dangerous since it generates impunity, increasing crimes and corruption in society».
Mykola Kovinia spoke about the role of the State Intellectual Property Service of Ukraine in implementation of the state policy in the field of intellectual property. According to Mr. Kovinia, the State IP Service has to make all possible efforts to achieve the following objectives: ensuring that IP rights of all participants of civil relations could be acquired and protected at the levels of economically developed countries; active promotion of social and economic development of Ukraine, Ukraine’s accession as an equal partner to the European Community; improvement of Ukraine’s investment climate and providing support to the entrepreneurship; improvement of our country’s international image and Ukraine’s active participation in all international processes in the field of IP; raising awareness and cultural level of the Ukrainian society in the field of intellectual property; creation of conditions for realization of citizens’ constitutional rights for the accessibility of education in the field of intellectual property, technology transfer and innovations; meeting the needs of the national economy in specialists in the field of IP; improvement of the quality and the level of training, re-training and professional advancement of specialists in the field of IP, in particular, officials of state and local authorities, judges, etc.; introduction of the new approaches to methodological guidance in education related to training the specialists in intellectual property; improvement of mechanisms of supporting entrepreneurship, in particular, small and medium enterprises.
Oleksiy Gashchytsky told the participants about the role of Customs in fighting IPR infringements by stopping counterfeits from entering the territory of Ukraine. He released the most recent statistical data according to which, as of June 20, 2014, the number IP objects registered in the Customs Register of Ukraine was 1,883 including trademarks, inventions, utility models, industrial designs, plant varieties, with the number of registrations permanently increasing. In particular, in 2013 the number of customs suspensions of goods suspected of IPR infringement was 2791, while from the beginning of 2014, as of June 20, there were 1308 such cases; during 2013 the customs initiated 21 cases related to violation of customs rules based on the facts of transportation of goods with infringement of IP rights, while the value of infringing goods (confectionaries, automobile spare parts, glass insulators, seals, mobile phones, sports apparel etc.) was over UAH 981,000. Mr. Gashchytsky provided an example of a recent violation, namely in April 2014 Pivdenna customhouse under the Ministry of Revenues and Duties initiated a proceedings on violation of customs rules based on the fact of transportation into the customs territory of Ukraine with infringement of IP rights of mobile phones and tablet computers in the amount of 100 items to the value of 541,866 UAH from Moldova.
The role of the police in combating IP infringements, in particular stopping manufacture and sale of counterfeits, was the topic of the report of Andriy Chygarskykh. According to Mr. Chyharskykh, police is consistently taking measures to detect and investigate criminal offences in the field of intellectual property, create and improve the legislative base necessary for combating these negative phenomena, develop the methods of documenting the new forms of crimes. The main focus is combating copying and distribution of pirated audio-visual products in the territory of the country, first of all the CDs, unlicensed computer software, as well as detection of the facts of manufacture and distribution of counterfeit products with the unlawful use of trademarks of famous domestic and foreign manufacturers. In particular, as result of the actions taken in 2013 the police initiated 846 criminal proceedings based on the facts of criminal offences related to infringement of intellectual property rights, in particular 433 criminal cases based on the facts of infringement of copyrights and related rights, 91 cases based on the unlawful distribution of compact discs, 296 cases based on the facts of unlawful use of trademarks, and 26 cases based on the facts of infringement of objects of industrial property. During the year 2013 the subdivisions of the Department of the State Service for Combating Economic Crimes of the Ministry of the Internal Affairs of Ukraine 110 clandestine workshops producing various counterfeit goods were liquidated, in particular 40 workshops dealing with copying pirated audio-visual products and 70 workshops dealing with production of counterfeit goods with the unlawful use of trademarks of famous domestic and foreign manufacturers. The police ceased from the infringers 651,000 copies of audio-visual products for the total amount of UAH 31 million, and counterfeit goods produced with unlawful use of trademarks for the total amount of UAH 31 million. The number of IP-related criminal proceedings initiated from the beginning of 2014 is 306, including 157 cases based on infringement of copyright and related rights, 36 cases based on unlawful distribution of CDs, 108 cases based on the unlawful use of trademarks, and 5 cases based on infringement of rights to the objects of industrial property. 28 clandestine workshops were liquidated including 23 workshops dealing with production of counterfeit goods with unlawful use of trademarks, and 5 workshops dealing with copying of pirated compact discs with the recordings of audiovisual works and phonograms. The total value of counterfeit and pirated goods seized from the infringers is UAH 7,3 million.
Igor Benedysyuk is certain that specialization of judges is a guarantee of effective enforcement of intellectual property rights. According to Mr. Benedysyuk for the time being the judges are not afraid of the cases related to protection of IP rights, like they were ten years ago. However, specialization in the field of intellectual property still remains extremely important since the number of such cases increases while not every judge has enough expertise and experience in this field. Mr. Benedysyuk expressed his hope that someday there will be separate patent court created in Ukraine, however for the time being it is important to pay most attention to specialization of judges of general courts.
The practical issues of defending intellectual property rights and fighting counterfeiting were covered by the report of the lawyer of Pakharenko & Partners IP and Law Firm,Yevhen Rogozyansky. Mr. Rogozyansky noted that the problem of counterfeits significally increased over the last years. The reason for that lies in many factors among which the most important ones are the following: low awareness of the society about the appearance and features of original products, their functional properties etc. An opportunity to gain excess profits puts unfair manufacturers up to crime, namely they produce counterfeit products, often ignoring quality standards and forgetting about the safety of the consumers who purchase low-quality counterfeit products sold under the guise of world’s famous brands.
Ukrainian legislation provides the companies a variety of ways to protect their rights; however this does not solve the problem at its core since there is a lot of underdeveloped issues in the legislation, the drawbacks that allow counterfeits to appear in our market.
The speaker focused on legislative deficiencies which allow counterfeits to enter Ukrainian market. In particular, he noted that the current criminal legislation does not provide for the personal responsibility of the persons involved in the whole chain of distribution of counterfeits, form their manufacture to the sale. Yevhen Rogozyansky also pointed to the drawbacks of customs legislation which in certain circumstances allows counterfeits to enter the market, namely allowing declarants not to indicate information about a trademark in a customs declaration; certain legislative deficiencies that prohibit customs authorities in the course of drawing up protocols under Articles 472, 282 and 283 of the Customs Code of Ukraine to inspect the goods for infringement of intellectual property rights; inconsistency of the provisions of the Customs Code and the Law of Ukraine «On Consumer Rights Protection» with regard to destruction of counterfeit goods.
The lawyer also pointed to the lack in the provisions of the Customs Code and the Law of Ukraine «On Execution Proceedings» of norms providing that a right holder is a participant (party) in execution proceedings in case of drawing up by customs authorities of the protocol on violation of customs rules in the field of intellectual property, and provided the detailed description of the problem of the lack of specialized institutions dealing with destruction of certain types of counterfeit products, in particular, the specific categories of dangerous goods.
Before the event started and after its conclusion all the participants could have a chat in the informal atmosphere, discuss the problematic and thorny issues over a mug of coffee. All the attendees could also view and touch the samples of counterfeit goods from the «Museum of counterfeits» organized by the UAACP, and to receive educational materials related to combating counterfeiting and piracy.
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