12 International Harmonization of National Laws and Policies for
Effective Prevention and Suppression of Intellectual Property
Violation（*）
Invited Researcher: Santanee Ditsayabut（**）
The present interconnected global economy not only benefits legitimate businesses but also fosters
the problem of intellectual property infringement to become a global phenomenon of the 21st century. Dueto the pervasiveness of intellectual property violation, which greatly damages economic prosperity andincreasingly harms public security, a conception of intellectual property rights has shifted from economic
and civil matter to criminal paradigm in the view of law enforcement. In the last decade, many countries
have improved their intellectual property legislations to provide for greater civil remedies as well as stiffer
penalties. Nevertheless, statistical data shows that the trend of intellectual property infringement is still on
the rise. Therefore, it is a pivotal time to consider more on strategies towards the effective intellectual
property enforcement.
This report intends to offer a practical aspect rather than a legislative review. Fighting the threat ofintellectual property crime requires concerted action from all countries. Appropriated legislation has to bein place and in line with international standard and practice. Consistent policy in enforcing the laws is vitalto effective implementation. The objective of the report is to reveal all serious consequences of intellectual
property crime and its link with organized crimes and terrorism and then explore innovative solutions tostrengthen the intellectual property enforcement regime. To achieve this goal, the report begins by
revealing all facts in support of the argument that intellectual property crime is not a victimless crime. It
further examines the relationship between intellectual property crime and other criminal activities,
especially organized criminal groups. An analysis of factors that make intellectual property crime an
attractive illegal business, and any root causes that undermine the effectiveness of law enforcement areincluded. At the end, the report recommends a variety of measures to strengthen existing enforcement
tools and practices, as well as proposes alternative instruments for the better enforcement of intellectual
property.

Ⅰ Introduction
It is well recognized that intellectual
property right is one of the most valuable assets,
which contribute greatly to the development of
economic system in each country. A strong
protection of intellectual property leads tosubstantial investment from foreign countries and,at the same time, encourages local innovation in
the country to be able to compete in the global
market. Given the exorbitant rise of intellectual
property violation, at present the issue of
enforcement of such laws becomes a great
concern to all countries. However, the uniquecharacter of intellectual property coupled with thedisparity of national laws and policy regarding
intellectual property creates a challenging task
for law enforcement in combating intellectual
property violation effectively.
The report observes the current shift fromfavored civil based enforcement towards morecriminal enforcement in some countries. This new
trend is a result of the alleged relationshipbetween intellectual property crime and organizedcrime syndicates as well as terrorist groups.
Therefore, the use of criminal enforcement which
is believed to have more deterrent effect becomesshould be further explored.

Ⅱ International standard on theenforcementofintellectual
property rights
There have been continued efforts toharmonize national intellectual property laws andpractices towards an agreed level universally. One
way of harmonization is to negotiate multilateralagreement dealing with a particular subject. In
this regards, the Paris Convention for theProtection of Industrial Property of 1883 is the(*)

This is a summary of the report published under the Industrial Property Research Promotion Project FY2009
entrusted by the Japan Patent Office.
(**) Public Prosecutor of Office of the Attorney General of Thailand

IIP Bulletin 2010

● 1 ●oldest multilateral Convention concerning
intellectual property rights. It has establishedminimum standard to protect industrial property
in its broadest sense covering patents forinventions, utility models, industrial designs,
trademarks, trade names, marks of origin,inventor certificates, and unfair competition. (*1)
Following in 1886, the Berne Convention for theProtection of Literary and Artistic Works was
successfully negotiated with the aim to protect
the right owners of literacy and artistic works tocontrol and receive payment for the use of their
However,these
twocreativeworks.(*2)
international agreements, besides providing the
seizure of counterfeit products, remain silent onother aspects of industrial property enforcement.
In 1994, the issue of intellectual property
enforcement was first explicitly mentioned ininternational instrument: the Agreement ofTrade-Related Aspects of Intellectual Property
Rights, Including Trade in Counterfeit Goods,
hereinafter referred to as “TRIPS”, in theframework of GATT, the General Agreement on
Tariffs and Trade. (*3) TRIPS establish minimum
standard for legal enforcement measures,
includingrequirementsforadministrative
measures and border measures. (*4) The
provisions on intellectual property rights
enforcement under TRIPS include bothcompulsory and optional obligations. (*5) The
dimension of criminal enforcement is also firstly
stated at the international level in TRIPS.
Nevertheless, in order to strengthen theframework of intellectual property rights
enforcement to better tackle the growing
counterfeit problem worldwide, there has been an
on going effort among highly intellectual property
concerned countries to negotiate a new
plurilateral treaty, so called “Anti-Counterfeiting
Trade Agreement (ACTA)”. (*6) According to the
Sixth Round of Negotiations hosted by the
Republic of Korea in Soul from 4 to 6 November

2009, the meeting agreed to conclude theproposed ACTA agreement by 2010. (*7)

Ⅲ Trend of intellectual
infringement globallyproperty

The data from the World Custom
Organization (WCO) shows that the trend ofcounterfeit is no longer limited to luxury brandname goods but shifts to the products posing
potential safety and healthy risk such as
pharmaceutical and automobile parts, etc.
According to WCO, more than 12 million ofcounterfeit food and drink products wereintercepted in 2008, which represents an increaseof 2,500 % over the year 2007. (*8) The World
Health Organization (WHO) estimates that 10%of all available pharmaceuticals worldwide arecounterfeit and expects the problem to double by2010 as international criminal networks become
more sophisticated. These data reflect a real storyof counterfeiting in harming people’s lives andsafety. Unfortunately, generally the public is still
misled by regarding counterfeit as economic
crime affecting only rich company selling luxury
brand names and prefers to leave the problem as aduty of brand owners to protect their own
properties rather than responsibilities of the
public at large. This perception is arguable in thecurrent circumstance as there are evidences
showing the following facts:
1

Counterfeit is not a victimless crime
On the contrary, several stakeholders areaffected by counterfeit crime ranging from thedirect right owner to the State as of losing tax
revenue from the sale of counterfeit products.

(*1) See G. Gregory Letterman, Basics of International Intellectual Property Law, 8, 13, (Transnational Publishers, Inc.)(2001).
(*2) See Letterman, supra note 1, at 143.
(*3) See Claudio Dordi, Impact of counterfeiting on international trade; Comments on Anti-Counterfeiting Trade
Agreement (ACTA), available at
http://www.ip-watch.org/files/PE406968EN.pdf (Last visited December 7, 2009).
(*4) TRIPS, Part III-Enforcement of Intellectual Property Rights, Article 41- 61.
(*5) See Dordi, supra note 3.
(*6) The Anti-Counterfeiting Trade Agreement- Summary of Key Elements under Discussion, available at
http://www.ustr.gov/sites/default/files/uploads/factsheets/2009/asset_upload_file917_15546.pdf(LastvisitedDecember 7, 2009).
(*7) Press release, available at http://www.mofa.go.jp/announce/announce/2009/11/1197207_1146.html(*8) See Customs and IPR Report 2008, World Customs Organization, available at
http://www.wcoomd.org/files/1.%20public%20files/PDFandDocuments/Enforcement/IPR%202008%20EN%20web.p
df , at 2 (Last visited December 7, 2009).
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2

A threat of counterfeit to consumers’ healthand safety

As nowadays counterfeiting is found in avariety of products affecting health and safety of
consumers, the problem of counterfeit is coming
closer to our day to day living. So far, hundred
thousands people were reportedly dead becauseof taking counterfeit medicines worldwide.
3

The relationship between intellectual
property crime and other criminal activities

There are many examples suggesting that
intellectual property crime has strong connection
with other types of crime. Discovered cases showthat smuggling of illegal migrants is the source toprovide workers for counterfeit business. Those
undeclared workers will not obtain basic
employment standards required by labour law. (*9)
Violence, coercion and corruption are always
involved in this illegal operation.(*10) There are
evidences that criminal organizations have beenusing counterfeit operation to launder profit fromits primary crime such as drugs trafficking, arms
trafficking, human trafficking, and smuggling of
immigrants, etc. Moreover, a number of terroristgroups has turned to utilize intellectual property
crime to fund their terrorist activities.
4

Factors that make counterfeiting
attractive illegal activity

anCounterfeiting is regarded as a low risk-highreturn crime. Comparing with other criminal
activities, counterfeiting yields far more profit
and is very easy to enter into this illegal business.
For example, drugs dealer may make 100% profit
margin from selling cocaine while counterfeitercan earn up to 900% profits from the sales ofpirated computer software.(*11) In addition,
counterfeit offence carries much lower sentence

worldwide. (*12) Taking the narcotic crime forillustration, penalty for drug trafficker in mostcountry ranges from a long jail term up to life
imprisonment and eventually death penalty insome countries while counterfeiter would likely
to receive monetary fine and short term
imprisonment or even as lenient as probation.
Moreover, public perception that intellectual
property crime is a white crime supports asoaring of consumer demand for counterfeit
products. Lastly, with the emergence of internet,
online distribution channel of counterfeit goods is
introduced, in which sellers and buyers areanonymous and the access is surprisingly easy.

Ⅳ Overview of the intellectual
property enforcement system in
selected countries
In consideration of the intellectual property’s
enforcement regime, it is normally divided into
three aproaches: civil enforcement, criminal
enforcement, and administrative enforcement. (*13)
The report reviews these three aspects ofenforcement in the U.S., Japan and Thailand.
1

The United States of America

The U.S. enforcement system to protect
intellectual property rights has relied on civil
remedy. Nevertheless, in recent years, its
strategy has changed to focus more on criminal
enforcement. The effort to fight against
intellectual property crime, especially when
criminal organizations involve, can be viewed
through a number of law amendments andenactments. For instances, various intellectual
property crimes(*14) are included as predicatedoffenses punishable under the Racketeer
Influenced and Corrupt Organizations Act (RICO).

(*9) See Michael Blakeney, International proposals for the criminal enforcement of intellectual property rights:
international concern with counterfeiting and piracy, 9, I.P.Q. 2009, (2009).
(*10) See ECAP II European Commission/European Patent Office, available at
http://www.ecap-project.org/fileadmin/ecapII/pdf/eu/pr_enforcement/customs_handbook/2_impact_on_counterfeiting_
and_piracy., pdf, at 17, (Last visited November 9, 2009).
(*11) See Zachary A. Pollinger, Counterfeit Goods and Their Potential Financing of International Terrorism, Michigan
journal of business, Volume 1, Issue 1, January 2008. Available at http://michiganjb.org/issues.shtml, also see theInternational Anticounterfeiting Coalition. Available at http://www.iacc.org (Last visited November 9, 2009).
(*12) See Michael M. DuBose, Criminal Enforcement of Intellectual Property Laws in the twenty-first Century, 483-484,
29 Colum. J.L. & Arts 481.
(*13) See Christopher Heath and Laurence Petit, Patent Enforcement Worldwide: A Survey of 15 Countries, 5, IIC
studies in Industrial Property and Copyright Law, 2nd ed., (HART Publishing) (2005).
(*14) Namely counterfeit labeling, 18 U.S.C. § 2318 ; criminal Copyright infringement, 18 U.S.C. § 2319 ; trafficking inrecordings of live musical performances, 18 U.S.C. § 2319A ; and trademark counterfeiting, 18 U.S.C. § 1961 (1)(B).

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2

Japan

Japanese system relies on amicable
resolution and civil settlement. Nevertheless,increasing global recognition of the need for
criminal enforcement brought about the change in
intellectual property laws in Japan. Recently thelaws have been amended to raise penalty for
intellectual propertyoffenses. However, infringers
were usually not served real imprisonment term
as courts mostly ordered suspension of
imprisonment for some certain periods.
3

Thailand

Enforcement of intellectual property in
Thailand favors criminal proceeding over civil
procedure. The government’s strategies mostly
focus on criminal enforcement. The Department
of Intellectual Property of Thailand (DIP) iscurrently proposing a draft amendment on the
Copyright Act of 1994 and the Trademark Act of1991. The main idea of this amendment is to curbwith the demand of consumers which is viewed asa factor contributing to the rise of infringement.
According to the proposed amendment of bothLaws, the act of buying or possessing counterfeit
goods is criminalized. Additionally, criminal
punishment will be extended to the landlord ofproperty used for committing piracy act anddistributing counterfeit products. (*15)

Ⅴ Analysis of the Enforcement
System1

The deterrent effectproperty enforcementofintellectual

While civil remedy might be the best way torecover the loss of intellectual property’s rights
owners, it is doubtful whether civil enforcement
is an appropriate tool to stop further counterfeit
epidemic done by criminal syndicates, as well as
terrorist groups. According to the US government
officer, criminal enforcement is “warranted topunish and deter the most egregious violators:

repeat and large- scale offenders, organized crimegroups, and those whose criminal conduct
threatens public health and safety.” (*16)
Nevertheless, the “over-use” of criminal
proceedings in Thailand is often criticized as noteffective. (*17) Resulting from the frequent raid in a
flea market strategy, defendants in intellectual
property cases in Thailand are mostly the ownersof small shops selling counterfeit products which
can be regarded as ‘a small fish’. Consequently
because of a small amount of seized goods and adefendant’s guilty plea, court is unlikely to give
an imprisonment sentence. Having chance topersonally interview with 5 vendors arrested for
trademark and copyrights infringement inThailand, most of them admitted that they willcontinue to sell counterfeit products again after
paying fine. All of them knew that if they pleaded
guilty, they will not receive a real term
imprisonment. One defendant, called “Noi”, toldthat her store was raided before several times but
she was not arrested at those previous raids. She
believed that she will not be incarcerated for her
first time offense as court usually gives a
judgment of imprisonment without suspension
only for the third or fourth time offender. Similar
stories have been told in many reports. Therefore,
it is doubtful whether the current sentencing
practice has enough deterrent affect onprospective counterfeiters or is only regarded asa cost of running counterfeit business.
2

Factors undermining enforcement

In general, most factors that undermine theeffectiveness of intellectual property enforcement
are corresponding factors that attract infringers to
involve in intellectual property violation. The
followings are illustrations of some factors
effecting intellectual property enforcement.
(1) Not a priority crime
Among other crimes, law enforcement often
attaches less concern to intellectual property
crimes. Police agency usually focuses on crimes
affecting physical injuries or lives such as robbery(*15) See Stricter IP Laws in Thailand – A New Beginning, Patrick Mirandah Co. intellectual property law specialist,
available at
http://www.mirandah.com/Stricter_IP_Laws_in_Thailand_-_A_new_beginning.aspx (Last visited November 18, 2009).
(*16) See U.S. Department of Justice, Prosecuting Intellectual Property Crimes, 5-6 (3rd ed. 2006), available at
http://www.usdoj.gov/criminal/cybercrime/ipmanual/ipma2006.pdf (Last visited October 24, 2009).
(*17) See Paul Goldstein, Joseph Straus, Intellectual Property in Asia: Law, Economics, History and Politics, 311, (MPI
Studies on Intellectual Property, Competition and Tax Law) (2009), See also Weerawit Weeraworawit, Asia,Intellectual Property at the Cross-roads: The Changing IP Landscape and its Implications on Global IP
Strategies/Policies, Recent Developments in Intellectual Property Law & Policy in Asia (IPA Fordham, 3rd Annual
Asian IP Law and Policy Day, New York, Apr. 2006, Working Paper).
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or narcotics. As a result, the lesser resources areallocated to take care of counterfeit problem andthe slimmer chance to discover this crime.

prevention and suppression of intellectual property
violation. Below are approaches suggested tostrengthen the intellectual property enforcement.

(2) Lack of special skill and strategic
approach needed to enforce the law
To discover intellectual property violation ismore complicated than other crimes and needs
special expertise from law enforcement officials
which is still lacking. (*18) Cooperation among
related agencies for a holistic approach iscurrently not enough to strategically track down
the counterfeit criminal enterprises : the ‘big
fish’.

1(3) Corruption among law enforcement
officials
Corruption problem is another cause
weakening the enforcement ability. Bribery of
government officials responsible for enforcing thelaws and regulations is commonly used byinfringers to diminish the risk of prosecution andassist in securing their illegal business. (*19) With
the influence of corruption, bribed customs
officers will turn blind eyes on illicit products atthe border; market obviously selling fake will not
be raided; corrupted police will not take any
action upon reported of counterfeit cases. (*20)

Ⅵ Strengthening the enforcement ofintellectual property rights
While globalization opens the door for more
effective international trade and commerce, it has
adverse affect upon traditional legal enforcement
regime when exploited by criminals. In this digitalera, infringers can easily operate their businesses
across border. They also take advantage ofjurisdictional arbitrage by choosing theircounterfeit production place in a country where
there is still insufficient protection of intellectual
property rights and exporting to other countries.
Since the emerging of TRIPS, legislations andpractices in most countries have been enhanced tocomply with this global standard to protect
intellectual property rights. However from therising of statistics in infringement cases asmentioned earlier, more shall be done for better

Strengthen the law

A good legislationis essential to combat
intellectual property violation. While intellectual
property violation has already reached a stage ofglobal problem, legislative measures, particularly
penalty sanction in each country are varied widely.
According to the comparative study ofanti-counterfeiting policies in 14 countries
conducted by OECD, the imprisonment terms
provided by law for trademark violation are
ranging from three months in Brazil to the
maximum 10 years in the United States andJapan.(*21) This wide range of disparity in law
reflects an inconsistency of enforcement regime
worldwide. Weak legislation not only has illdeterrent effect but also creates difficulties forlaw enforcement in dealing with offenders.
Therefore, harmonization of intellectual property
laws is important to promote a legal framework ineach country to the globally accepted standard
which will foster the enforcement of intellectual
property.
Concerning organized counterfeit crime,
there are several international agreements
providing extensive measures to fight withorganized crime syndicates appropriately. Those
measures include innovative tools such as civil
forfeiture and asset recovery which are normallynot provided in general enforcement regime.
However, those agreements commonly require
the seriousness of the underlined offences
committed by criminal organizations. Whether an
offense is serious or not would determine by its
penalty: usually four years imprisonment either
minimum sentence or maximum sentence.
Therefore, sentence of intellectual property
offence in each country should be raised to thelevel qualified for common ‘serious crime’
definition in order to have more legal measuresavailable for law enforcement.
Other areas of law that may contribute to theeffectiveness of intellectual property enforcement
should also be explored such as proceeds of crime(*18) Testimoony of Ronald K. Noble, Secretary General of INTERPOL before the United States House Committee on
International Relations, One hundred eight congress on July 16th 2003, The links between intellectual property
crime and terrorist financing. Available at
http://www.interpol.int/Public/ICPO/speeches/SG20030716.asp?HM=1(*19) See The economic impact of counterfeiting and piracy, 153, (OECD) (2008).
(*20) See Id. at 52.
(*21) See Id. at.217, 241, 256.

IIP Bulletin 2010● 5 ●legislation. In this regards, it is recommended to
add intellectual property offence in the list ofpredicated offences under national money
laundering law and law dealing with organizedcrime. Making intellectual property offence anextraditable offence in the extradition agreement,
either multilateral agreement or bilateralagreement is also advised to provide no safe
haven for counterfeiters.

4

Trace the money trail and enforcing
money laundering law

As internet and high technologies offer moresophisticated method in conducting intellectual
property violation, law enforcements have toadvance themselves with new counter- measuresthat can compliment traditional enforcement
methods. Training on special techniques forbuilding a case against counterfeit organizations
is recommended. (*22) Consistent training andregular meeting to share experiences and bestpractices among law enforcement personnel arenecessary as well in order to sharpen theirenforcement skills.

Intellectual property crime is mainly
motivated by financial gain. Thus, depriving
criminals of their proceeds of crime is an effective
way to diminish the incentive to enter into
counterfeit business. Particularly in case of crimecommitted by criminal organizations, asset
confiscation under money laundering law is often
considered as the most effective form ofpunishment
anddeterrence
thereof.(*24)
Conducting money trail investigation on the
profits of large scale infringement is beneficial
because, in the end, it would enable law
enforcement agency to forfeit all proceeds ofcrime based on either intellectual property laws
or money laundering law. Moreover, as known
that profits from counterfeiting have been used tosupport illegal activities of criminal organizations
and terrorist groups, conducting money trail
investigation will help discover such relationshipso that law enforcement can completely shut
down the organization and stop their other illegal
activities as well.

3

5

2

Strengthen
theenforcements

capacityoflaw

Differentiate enforcement policies fordifferent types of infringement

Unlike other crimes, the level of culpabilityof offenders in intellectual property crimes isvaried vastly depending on various factors.
Therefore, using the same scale of enforcement
based on any single factor may not fit all types ofinfringers appropriately. For individual offenders,
especially those who sell counterfeit or pirated
products for a day to day living, a short term
imprisonment will not deter them from continuingcounterfeit business as long as they have no otherways for better earning. To stop the organizedcriminal groups from engaging in counterfeit
businesses, enforcing real imprisonment sentenceis necessary to remove opportunity to further
their illegal activities. Therefore, it is suggested
to review the penalty scale in response of thedifference between petty counterfeit crime doneby individuals and counterfeit business run byorganized criminal networks in order to secure
deterrent penalties in intellectual property
cases.(*23)

Strengthen cooperation among all stakeholders

Active cooperation from all stakeholders inthe stream of intellectual property enforcement isnecessary to discover intellectual property crimeand finally bring offenders to justice. Without
partnerships with private sectors who are thevictims or potential victims of intellectual
property crime, it is difficult for law enforcement
to render its duty effectively. Joint enforcement
activities among related government agencies
should be encouraged. Further, international
cooperation, either through informal channel of
INTERPOL or formal channel of mutual legal
assistance and extradition should be strengthened
in order tobring offender to justice regardless ofjurisdiction constraint.
6

Limit theproducts

availabilityofcounterfeit

One factor driving the rapid growth ofcounterfeiting is consumer’s demand. In the
countries where consumers can easily access to(*22) See Gregory F. Treverton et al., Film Piracy, Organized Crime and Terrorism, 144, (the RAND Corporation) (2009).
(*23) See Counterfeiting & Organized Crime, 19, Union des Fabricants 2003, available at
http://www.gacg.org/content/upload/documents/rapport_uk.pdf (Last visited November 11, 2009).
(*24) See Blakeney, supra note 9, at 18.
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open places selling counterfeit products such asflea market or street vendors, the consumption
rate is soaring. Therefore, limiting the availabilityof counterfeit products in the market, including
online channel will have great effect on the
consumption of consumers.
7

Raising public awareness

General misperception of counterfeiting as
only harm to the wealthy business enterprises
misplaces the gravity of intellectual property
offences to the lesser attention they deserve. A
survey conducted by RAND suggested thataround 70 % of pirates said they would be lesslikely engaged in piracy if they know of the factthat they might support organized crime andterrorism. (*25) Therefore, correcting public
perception and raising public awareness ofnegative impact of counterfeiting would help
reducing consumers’ demand for counterfeit
products.

Ⅶ Conclusion
The enhancement of the intellectual property
enforcement requires various approaches. Even
though, this report attaches more weight oncriminal enforcement, it recognizes that holistic
approach should be developed to tackle theproblem more effectively. Civil enforcement toaward appropriate remedies to the rights owners
and administrative enforcement, especially bordercontrol on suspected goods in violation of
intellectual property rights should not be
neglected. (*26) With the concerted actions andstrong political wills from all countries to fightwith intellectual property violation, the goal ofintellectual property enforcement will not be
impossible to achieve.

(*25) See Treverton, supra note 22, at 140.
(*26) See Blakeney, supra note 9, at 16.

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