30.01.2024 Intellectual property

Who is responsible for the sale of counterfeit products at the Polish Post offices?

Reports that appeared at the end of November, saying that at the offices of Polish postal operator (Poczta Polska) you could buy handbags confusingly similar to the products of well-known fashion brands, sparked a zealous debate in the media. In its initial statement, Poczta Polska assured that the goods were of lawful origin and had all the necessary certificates, but finally admitted that, by error, the “unapproved goods” had been accepted by its offices. This situation offers a great opportunity to reflect on the protection of trademarks with reputation.

Small bags, big problem. How did Poczta Polska react?

Photos published on Instagram of suspiciously cheap handbags of brands such as Yves Saint Laurent or Gucci available in the offices of Poczta Polska aroused understandable interest – well, in the offices of the public postal operator there were products available for purchase that potentially infringed intellectual property rights of third parties. Of course, the sale of fake goods and their presence on the market is nothing new and, unfortunately, it is not a rare phenomenon either, but in this particular case it was a state-owned company that sold allegedly counterfeit goods.

Increasingly popular posts with photos of the handbags in question were widely commented on, both in the social and mainstream media. They were not left without comment by the interested party either.

However, at first, the postal operator tried to downplay the whole matter, assuring about the authenticity of the goods, which supposed to have all the necessary certificates, and claiming that the supplier was an official distributor of those brands.

The above statement met with unfavourable reactions from the public, to put it mildly, which forced Poczta Polska to change its position. A few days later, it announced that the blame laid with the distributor who had delivered goods that Poczta Polska had not ordered and that they had been “misdirected”. At the same time, Poczta Polska assured that the questioned goods had been withdrawn from sale. It is worth noting that in this later statement, Poczta Polska did not repeat its earlier claim about the authenticity of the bags (which should have been considered doubtful anyway, given their price of about PLN 100).

At such an attractive price, customers of post offices could buy handbags confusingly similar to the models offered by renowned designers, e.g. bags from the Marmont collection made of quilted leather (official price 1,450 EUR) or handbags bearing a mark similar to a registered trademark of luxury brand Yves Saint Laurent.

What is the reason for popularity of counterfeit goods?

Of course, the whole thing can be laughed off – after all, fake goods has always surrounded us, and in recent years they have found their way from street vendors and flea markets to legally operating outlets. What used to be available only on marketplaces from shady vendors is now widely available, also thanks to a well-developed online shopping. Of course, the most popular are counterfeit luxury goods and products with counterfeit trademarks of well-known designers and fashion houses, which can be found in numerous online stores and sales platforms.

It seems that in Poland, but not only, there is a social acceptance for fake goods. Possessing items with a trademark of a well-known brand is seen as an indicator of higher status. However, this is often associated with the need to pay a high price. Hence the popularity of counterfeit goods, which sometimes look confusingly similar to original ones. According to research carried out by the EUIPO in 2022, 37% of young people surveyed (aged 15-24) bought at least one counterfeit product online in 2021.

As you can easily guess, the most important factor encouraging people to buy counterfeit goods is their price (often many times lower than the price of original products) and their availability. In addition, consumers are motivated to buy inauthentic products by a number of other factors, such as practices of their family, friends and acquaintances, not paying attention to whether a product is genuine or not, and not noticing a difference between genuine and counterfeit products.

One can come to a sad conclusion that an average consumer does not see anything wrong in buying inauthentic products. Of course, this is not always the case. Studies show that a large proportion of consumers are aware of negative impact of buying counterfeit goods, but there is still a fairly large group of consumers who are not aware of the risks associated with buying counterfeit goods, or do not see the reprehensibility of such behaviour. On the contrary, the possibility of purchasing goods that are deceptively similar to the one from a well-known, reputable manufacturer is treated by some as a good way to build a seemingly attractive image by possessing fashionable or desirable things.

Therefore, the appearance in the offer of Poczta Polska of bags counterfeiting well-known designers and bearing reputable trademarks, can be treated simply as another distribution channel of inauthentic goods and simply add to infamous statistics of trade with non-original products, but the fact that we are dealing with an entity that is a public postal operator, a company owned by the State Treasury, should trigger a debate on legal aspects of this phenomenon.

Inauthentic products. What is the function of trademarks?

As I mentioned, the public is largely aware of the reprehensibility and unethical nature of purchasing counterfeit products, but consumers are not always aware of the fact that inauthentic goods violate the legally protected interests of others.

The function of trademarks in trade cannot be overestimated. They make it possible to distinguish the goods of one trader from those of another and they act as a carrier of information or advertisement about given goods. An appropriate, attractive and recognizable trademark constitutes a basis for building the trader’s reputation and is often the most valuable asset of the company.

In order to enable effective protection of a trademark, it is necessary to register it and obtain the right of protection.

Registration of a trademark gives the trader an exclusive right to use the trademark in a commercial or professional manner, and also provides them with a weapon to fight unfair competition.

Of course, although registering a trademark and obtaining the right of protection is a very effective tool in building the position of one’s own brand on the market, it is not a perfect and 100% effective solution. This is evidenced, for example, by numerous trademark infringement cases, manifested by the presence of counterfeit goods or replicas in the trade. Article 305 paragraph 1 of the Polish Industrial Property Law1

provides for criminal liability of an entity which, for the purpose of placing on the market, marks goods with a counterfeit trademark or a registered trademark while not being entitled to use or distributes goods bearing such marks. The penalty for this act is a fine, restriction of freedom or imprisonment for up to 2 years. If the perpetrator has made himself, by committing the above mentioned offence, a permanent source of income or commits the offence in relation to a good of significant value, he will be subject to imprisonment for between 6 months and 5 years (paragraph 3).

It should be remembered that the offence described in Article 305 of the Industrial Property Law is prosecuted at the request of the aggrieved party.

What is a counterfeit mark?

A definition of a counterfeit trademark is contained in Article 120(3)(3) of the Industrial Property Law. This term refers to identical marks unlawfully used or trademarks that in normal conditions of trade cannot be distinguished from registered trademarks, for goods covered by protection. An identical mark is a pretty straightforward term. A mark is identical where it reproduces, without any modification or addition, all the elements of the registered trademark or where, viewed as a whole, it contains differences so insignificant that they may go unnoticed by the average consumer. This is what the Court of Justice ruled in its judgment in Case C-291/002.

The second term included in this definition is the mark that in normal conditions of trade cannot be distinguished from registered marks. In legal literature, such a designation is referred to as a similar mark. Such a mark differs from a registered (original) mark, but the differences are so insignificant that the recipients of the mark mistakenly assume that they are dealing with the original mark. Here, the marks in question cannot be distinguished “in normal conditions of trade”. This concept means that a trademark can perform the function of indicating the origin of goods from a specific trader3.

The assessment of the “normal conditions of trade” includes an assessment of such factors as the type of goods (consumer goods, luxury or specialty goods), the circle of average consumers (ordinary consumers, professionals) or the way the goods are distributed.

Marking and trading. When do we talk about an offence?

The offence under Article 305 of the Industrial Property Law has been defined in two variants. The first is to mark goods with a counterfeit or registered trademark. The second is the trade in goods marked in this way. The first variant is about affixing the mark on goods or their packaging or on documents and using it for advertising, as well as altering, forging or deleting (also partially) the existing marks4.

It seems that the criteria of an act in this variant are also fulfilled where the goods are marked only with an element of a registered trademark, provided that such an element is so characteristic that it allows the mark to be identified.

It should be borne in mind that marking goods with a counterfeit trademark is a criminal offence only  if the purpose of such practice is to place the goods on the market. Thus, a mere production of counterfeit trademarks does not constitute an offence.

The second variant of the offence in question consists in trading in goods marked in this way. In this case, we are talking about every phase of trading, not just placing the goods on the market. It is therefore a question of any act on the basis of which the goods bearing such a mark are made available to purchasers and as a result of which there is a transfer of control over the goods. This applies not only to a contract of sale, but also, a lease, exchange, lending for use, etc.

Therefore, an offence in the latter variant may be committed by both the producer who places the goods on the market by making them available to the distributor, the distributor or wholesaler who sells the goods to retail outlets, and the retailer.

Poczta Polska under scrutiny

The case of handbags marked with counterfeit trademarks offered for sale at the offices of Poczta Polska, would potentially deal with an act defined in Article 305 of the Industrial Property Law in the second variant.

However, the application of that provision would require certain findings. The first step would be to determine a person who would be held responsible. The responsibility of the manufacturer of these bags and their distributor would need to be examined too. However, when we start to examine the potential liability of Poczta Polska, the matter becomes more complex. The first step would be to determine whether the goods were ordered centrally and then distributed internally to individual offices and district branches, or whether their purchase was an initiative of the heads of individual post offices or directors of individual Regions of Poczta Polska Network.

The next step would be to assess whether the criterion of a counterfeit trademark has been fulfilled. Of course, in this case, it could only be a mark “which cannot be distinguished in normal conditions of trade from a registered mark”, i.e. a similar mark.

However, a possible criminal proceeding under Article 305 of the Industrial Property Law can only be considered if the aggrieved party, i.e. one of the fashion houses (Gucci, Yves Saint Laurent) whose trademarks have been potentially counterfeited, files an appropriate application.

So far, it is known that the trademark owners have been notified about the case.

Protection of competition and consumers – see how we can help:

Piotr Dudek Director of the New Technologies, Defence & Aerospace Department, Advocate
TGC Corporate Lawyers
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