Counterfeiting and Piracy; The Need For An Effective Border Control Regime

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Introduction

Counterfeiting and Piracy are presently acknowledged as one of the greatest global threats to creativity. Counterfeiting is the act of unlawfully imitating or reproducing items/works protected by the law of trademarks, patents, or copyrights (Intellectual Property- IP), while portraying them as originals. This is usually represented in goods illegally bearing registered/well-known trademarks. Piracy on the other hand is the unauthorized reproduction and distribution of such protected items/works without necessarily representing them as original. This is more common in copyrighted works for example the reproduction and sale of books or CDs containing video recording. For the sake of convenience these two terms will be used interchangeably in this paper.

Nigeria like many other states has various laws and regulatory measures against counterfeiting.  Nevertheless, this illegal trade has not only grown over the years but has metamorphosed into a formidable, sophisticated, and largely ignored sector. For instance in Nigeria, pirated items are presently being sold openly on the streets.

The International Federation of Phonographic Industry (IFPI), upon a research conducted in ten individual music markets including United Kingdom, Germany, and the United States, reported that approximately Twenty billion songs were illegally downloaded in 2005. More recently, on March 19 and 21, 2015 it was recorded that the U.S Customs and Border Protection (CBP) officers seized over $430,000 counterfeit perfumes at the Champlain Port of Entry and $65,200 dollars in fake 100 dollar bills coming from Ecuador at John F. Kennedy’s International airport respectively.  The Business Action to Stop Counterfeiting and Piracy (BASCAP) has estimated the value of these illegal trades to be globally worth $1.7 trillion by 2015.[1]

It is therefore incontrovertible that Counterfeiting is a global issue. However, what is worrisome is that Nigeria has become a dumping ground for counterfeit goods and a safe haven for perpetrators of this vice; a situation which can largely be attributed to the lack of sensitization and weakness of the Nigerian IP enforcement regime.

Due to the transnational nature of counterfeiting, one of the most effective ways to control it is employing an effective border control measure to prevent the importation and circulation of these counterfeits. This article does not seek to analyze the entire IP enforcement regime but focuses on the enforcement of IP through border measures.

Nigeria’s Border Control Regime

Enforcement of IP at Nigeria’s international borders is undertaken by several regulatory bodies which include the: National Agency for Food and Drug Administration and Control (NAFDAC), Nigerian Customs Service (NCS), Standards Organization of Nigeria and the Nigerian Copyright Commission. These bodies are governed by various national and international laws/treaties and they include the: Customs and Excise Management (Disposal of Goods) Act- (CEMA); Trade Related Aspects of Intellectual Property Agreement popularly referred as the TRIPS Agreement; and Paris Convention for the Protection of Industrial Property.

The Trips Agreement

The TRIPS Agreement was established primarily to address the insufficiency of the international IP enforcement regime. A significant innovation of this Agreement is the introduction of border measures. The Agreement allowed genuine manufacturers or right holders, reasonably suspecting the importation or exportation of pirated/counterfeited versions of their works, to make applications to the appropriate authorities (administrative or judicial) for the seizure of such counterfeits at the borders by customs officials.

Nigerian Customs Service and Other Relevant Agencies

The Customs is principally the “gatekeeper” of every nation. Being the agency in charge of all goods entering, transiting and leaving the country through the international borders, its role in combating smuggling and more specifically counterfeiting, can never be overemphasized.

In discharging this function the Nigerian Customs Service has an “Enforcement, Investigation, Inspection, and Intelligence” department which amongst others organizes all anti-smuggling measures at the international borders. It should be noted that irrespective of the NCS’s corroboration with various agencies in this regard (as will be examined shortly), the Service performs the lead role.

The NCS sets out various guidelines to assist in implementing its mandate. In 2010 the Presidential Task Force for 100% Inspection was established to inter alia prevent the importation of contraband goods and ensure the complete inspection of all consignments selected for physical examination.  It involves a strategy where inspections are intensified on consignments with more tendencies to default, than on every shipment. The NCS has additionally established an independent unit- the Customs Intelligence Unit (CIU) – with trained officials who are responsible for obtaining and gathering information necessary to combat counterfeiting and piracy.

A very significant development which has gained countless success is the NCS’s partnership with other federal agencies such as the Standards Organization of Nigeria (SON), National Agency for Food and Drugs Administration and Control (NAFDAC), National Drug Law Enforcement Agency (NDLEA)  and Nigeria Copyright Commission (NCC), in carrying out joint inspection of cargoes at the borders. For instance it was reported in 2012 that with the combined efforts of the NCC and NCS, thirteen containers stacked with pirated items were confiscated at different seaports in Nigeria. Similarly in 2015 NAFDAC, along with the NCS impounded over five (5) containers containing suspected counterfeit drugs worth N270 million (approximately 13,567,851 US Dollars).

Challenges in the Border Control Regime

The various strategies employed to prevent the importation of counterfeits seem insufficient in the light of the prevailing circumstances. Some of the key challenges encountered in the enforcement of these measures are worthy of mention.

1. Integrity

Low integrity amongst the staff of most of the key agencies involved in this process is one of the greatest challenges faced in the enforcement of border measures.  Integrity is not only limited to bribery and corruption but also includes the inefficacy of the services provided. This has resulted in the loss of public trust, noncompliance by stakeholders, unnecessarily obstacles in supposedly normal processes, loss of trade and investment, consequential revenue loss and so much more.

2. Paucity of legislative frameworks

The NCS presently operates under the CEMA which is largely outdated and fails to provide adequate legal frameworks for the discharge of its functions. There are no legal basis for the implementation of major international agreements to which Nigeria is signatory to.  Unlike Nigeria, states like Australia, Canada, New Zealand, Republic of Korea, Switzerland, Turkey, South Africa, Indonesia , United States etc., have included similar provisions in their substantive IP laws and/or have enacted special laws too. The Canadian Combating Counterfeit Products Act and The South African Counterfeit Goods Act are few examples in this regard. As a result, modern techniques and enforcement procedures such as the TRIPS Agreement provisions on border measures which have gained tremendous success internationally have not been effectively implemented in Nigeria.

3. Unreasonable delay

The collaboration of the NCS with other federal agencies is unarguably very beneficial for the purpose. However this strategy has been heavily criticized for amounting to needless duplication of process resulting in unnecessary delays and reduction in the efficiency of these agencies.

Ignorance and/or unwillingness of right holder to enforce their IPRs and explore available remedies are also part of the challenges

For instance, at the just concluded World IP Day seminar (April 26, 2015) sponsored and widely publicized by the IP Committee of the Section of Business Law branch of the Nigerian Bar Association, where information and knowledge about IP protection is shared, only a few rights holders were present.

4. Financial constraints and Inadequate experience of officers at the relevant agencies.

Conclusion and Recommendations

The fight against counterfeiting is largely multifaceted with border control being just one arm. Still, it is more effective to seize a consignment of counterfeit or pirated goods at the borders or in transit than after circulation of the goods in the market. Providing a successful border control system would go a long way in curbing Counterfeiting and Piracy as the large number of counterfeits currently being flooded into the country would be contained.

To achieve this, the gaps in the present borders control regime must be addressed. There is an eminent need for an overhaul of the current NCS legislation; an improvement in the funding and training of the relevant agencies and their officers respectively; provision of regulatory and supervisory measures to checkmate corruption and integrity issues; creation of massive public awareness of the dangers of Piracy and Counterfeiting, the existence of IPRs as well as the remedies and enforcement measures available; adequate sensitization of stakeholders such as the officers of the relevant agencies;  and the adoption of the Single Window System(SWS- which requires customers to deal with a single agency at the customs rather than different agencies) to curb unnecessary delays. 

In the alternative, an improved coordinated border management scheme is highly recommended between the relevant agencies to improve communication between them and facilitate more efficient risk management procedures.

The importance of coordination of border control measures in this regard, can never be over flogged.  Nevertheless, this strategy is more likely to succeed if it goes beyond federal agencies to include other relevant stakeholders such as manufacturers, right holders, exporters, importers, carriers etc. Such coordination if achieved will go a long way in addressing most of the hiccups encountered in the present regime and ultimately strengthening the Nation’s stance in combating counterfeiting and to a very large extent the importation of pirated materials.

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