New administrative remedies against online infringement become available

New effective tools have become available to IP rights holders who have been the victims of pirate websites offering copies of original products or fake copyright works, often at rock-bottom prices.

The Antitrust Authority (AGCM) - which is also in charge of preventing unfair commercial practices - and the Telecommunications Authority (AGCOM) have recently taken the lead in this field. Over the past few months, AGCM has become more and more active in the fight against websites that sell fake goods, often reproducing the visual aspect of the original websites. To fight the spread of unfair trade practices online, and thus protect both the market and consumers, AGCM has the authority (limited to the Italian territory and enforced with the support of the Postal Police) to shut down clone websites. In this respect, after several reports by INDICAM (the Association of Trademark Owners for the Fight against Counterfeiting, which is the main Italian private association active in the fight against counterfeiting and piracy), AGCM closed down hundreds of clone websites, and other similar measures are following at a fast pace (for further reference, see Decisions 24166/13, 24167/13, 24329/13, 24353/13, 24354/13, 24381/13, 24582/13, 24583/13 and 24647/13, all available on AGCM's website).

While AGCM focused on websites selling copies of products mainly protected by registered trademarks or designs, AGCOM concentrated its efforts on copyright infringement. Copyright is widely used for the protection of industrial designs (see, eg, the well-known Arco lamp, designed by the Castiglioni brothers and produced by Flos, which gave rise to a landmark decision of the Court of Justice of the European Union (ECJ) in Case C-168/09).

AGCOM recently adopted Resolution No 680/13/CONS, “Regulation on the Protection of Copyright on the Internet” (available on AGCOM's website and due to enter into force on March 31 2014), which provides a fast, economical and simplified procedure for the removal of copyright-infringing online content. Under the procedure, rights holders may submit a complaint to AGCOM through a dedicated form on the authority's website. In case of infringement for financial gain, the authority shall use a simplified procedure (to be concluded within 12 days of the filing of the complaint) by sending a communication to the uploader of the infringing material and to the web page/website manager requesting the removal of such infringing material within three days of receipt of the communication. Should the latter fail to comply with the request, AGCOM has the authority to ask the internet service provider to remove the infringing material if the website is located in Italy, or to disable the access to the website if it is located abroad. However, the regulation has been challenged before the Administrative Court of Lazio on the grounds that it exceeded the scope of AGCOM's authority. The case is now pending before the court.

Although these new procedures are very attractive for rights holders due to the low costs involved, they have their limits. Illicit websites and contents often re-appear almost identically elsewhere. Further, in an increasing number of cases, counterfeiters simply remove (temporarily) the products affected by the judicial injunction from the website, leaving the other fake products online, which allows them to earn enough money to make their infringing activities worthwhile. There is thus a real "industry of fakes", based in the Far East and operating on demand.

A way to deal effectively with such phenomenon, and thus make counterfeiting unattractive, has recently been identified in a type of class action brought by all the producers who had fallen victim to the same counterfeiter, in order to obtain a broad spectrum of judicial remedies. The action related to all, or almost all, the copies manufactured by a single counterfeiter, so as to deal with the problem in a single blow and deter further violations. When Community trademarks and designs are concerned, a viable legal basis for such proceedings may be found in the rules governing the scope of injunctions for infringement of such rights (see the decision of the ECJ in Case C-235/09: “The scope of the prohibition against further infringement or threatened infringement of a Community trademark, issued by a Community trademark court whose jurisdiction is based on Articles 93(1) to (4) and 94(1) of [the Community Trademark Regulation (40/94)], extends, as a rule, to the entire area of the European Union”).

In this regard, similar actions are conceivable in almost all trade areas, as long as they are carried out seriously and preceded by professional juridical work, together with intelligence activity aimed at rebuilding the counterfeiting chain, and identifying the individuals involved and the counterfeiters’ headquarters in Europe - and, if possible, their current accounts (see here for further details on the tools available in Italy to fight counterfeiting).

Such initiatives, taken as a whole, will help the fight against online counterfeiting. Italian judges have been increasingly conscious of this issue, as demonstrated by the extremely detailed report on online counterfeiting recently produced by Judge Marina Tavassi, president of the IP and Corporate Division of the Court of Milan (the most important court in the country). Italy seems to have reached a key moment, as operators have a better awareness of their rights and of the tools available to defend them.

Cesare Galli, IP Law Galli, Milan