Guide

Intellectual property crime and your business

What is intellectual property crime?

Intellectual property (IP) crime comes in many forms, but it generally involves counterfeiting (infringement of trade marks) and piracy (infringement of copyright). IP crime can relate to digital or physical products:

  • Digital IP crime is criminal activity related to digital formats which are protected by copyright, including music, films, software and video games. It covers both copying and distribution of digital files carried out in the course of business, or carried out to such a degree that it has a prejudicial impact.
  • Physical IP crime is criminal activity relating to the counterfeiting of physical products and the infringement of trade marks by copying the branding. It covers a wide range of items from pharmaceuticals and healthcare products to pesticides, tobacco and alcohol, industrial products such as aeroplane spare parts and luxury goods. Physical IP crime also includes copyright piracy of non-digital products such as books, CDs and DVDs.

Protecting your business from counterfeit goods

Counterfeit goods may look like the real thing, but they are unlikely to meet the quality standards you expect from the original. More importantly, counterfeit goods will probably not meet safety standards and this can be extremely dangerous for users and they should be treated as goods of unknown risk. Counterfeit pharmaceuticals, alcohol, electrical products and power tools can be very dangerous for consumers.

Other problems associated with counterfeit goods include the lack of consistency and traceability and a lack of redress if something goes wrong with the purchase. When goods are bought online there is the additional risk of identity theft and fraud if personal information is misused by the criminals online. Furthermore, using pirated software could leave your IT systems exposed to malware or viruses.

Businesses may encounter IP crime in a variety of ways - they may be victims of IP crime or they might be committing acts that infringe the IP of another party. If you buy and then sell counterfeit or pirate goods in the course of your own business you run the risk of committing a criminal offence. Even if you do so unwittingly, you are still at risk of prosecution and you may be open to civil action by the rights holder. You need to have systems in place to prevent problems, and also to deal with problems if they come to light - ie 'due diligence' procedures.