Best Practices for Landlords, Governments and Enforcement Agencies

BASCAP Measures to Engage Landlords in the Fight against Counterfeit and Pirated Goods

Best Practices for Landlords, Governments and Enforcement Agencies

The paper, “BASCAP Measures to Engage Landlords in the Fight against Counterfeit and Pirated Goods: Best Practices for Landlords, Governments and Enforcement Agencies”  is the latest action by BASCAP to engage with intermediaries following the publication of its March 2015 BASCAP report Roles and Responsibilities of Intermediaries – Fighting Counterfeiting and Piracy in the Global Supply Chain. The report sets out cross-cutting measures and best practices for intermediaries—ranging from shipping companies to online search engines and physical and online marketplaces.

Where current efforts have been inadequate in protecting against intellectual property rights (IPR) infringements, BASCAP has introduced a collection of better, or best, practices to help responsible intermediaries more effectively deal with vulnerabilities in their operations. These recommendations aim to challenge the status quo and offer a roadmap for discussion, collaboration and resolution.

Landlords and property owners can become intermediaries in the illicit trade supply chain if they rent—knowingly or unknowingly—their property to those involved in counterfeiting and other IPR infringing activities, whether for production, storage, distribution or retail use.
While instances exist of reputable retail outlets selling trademark-infringing goods, the focus of this paper is on counterfeit and pirated goods sold at markets or in small shops that “specialize” in offering fake goods. While landlords may oversee multiple properties or dozens of tenants and may be more concerned with collecting rent from business owners than monitoring tenant activities, they are nonetheless important intermediaries in the supply of goods.

Landlords are becoming more vulnerable as law enforcement officials, supported by new laws and regulations in some areas, are increasingly targeting owners and landlords that support counterfeiting operations. A recent increase in the number of prosecutions confirms that landlords who are not vigilant about the activities that are taking place in their premises, are becoming victims of counterfeiters and incurring a dramatic increase in costs in damage penalties and legal fees.

The paper addresses a wide range of challenges faced by landlords and presents measures designed to assist them in keeping fakes out of their facilities:

  • Landlords should take steps such as sustained due diligence checks, implementation of strict policies in physical markets to ensure tenants are not engaging in illegal activities, and increased cooperation with brand owners to facilitate the detection of infringing goods. The paper also contains model provisions for landlords to include in their lease agreements to ensure that tenants who engage in counterfeit and pirated goods face extreme consequences including termination of the lease, eviction and forfeiture of the deposit amount.
  • Governments need to clarify the conditions under which a landlord may be liable for tenants engaging in counterfeit and pirated goods and enforce sanctions against landlords who fail to take appropriate actions to deter IP infringing activities on their premises.
  • Enforcement agencies should conduct regular and sustained enforcement actions and promote and implement voluntary programs for landlords to avoid renting of premises to criminals engaging in counterfeit and pirated goods.

If rights holders, trade inspectors and landlords work together to identify and address risks and then implement clear policies, they can effectively deny commercial premises to counterfeiters. This would have a substantial negative impact on counterfeiters’ ability to continue their operations. BASCAP’s Best Practices for Landlords, Governments and Enforcement Agencies provides a blueprint for all parties to effectively remove fakes from physical markets. Consistent and enduring application of these practices in markets is the best defense for disrupting trade in counterfeit and pirated goods and the best protection of shoppers from fraud.