Tuesday, 23 December 2008

Kenya: End of the road for Anti Counterfeit Bill 2008

With parliament having gone on recess last week, debate on the anti counterfeit bill 2008 (bill) has come to an end , meaning that the process of enacting a law to deal with counterfeits may have to start all over when parliament resumes in March next year.

The big question is whether the bill will ever see the light of the day given the crowded calendar of the parliament. It will be recalled as posted here that the bill was first introduced in parliament in 2007, getting to the first reading before the House was dissolved just before the general elections. This time round the bill managed to get to the second reading.

The bill has had it share of controversy notably between the manufacturers and the civil society. The major point of divergence is the definition of counterfeit goods. While the manufacturers, who are hardest hit by proliferation of counterfeit products support the bill, the coalition on access to essential drugs are opposed to certain clauses of the bill arguing that the bill will curtail parallel importation of drugs. The argument goes on to suggest that Medicines are essential and lifesaving and therefore counterfeit medicine should be distinguished from other counterfeit goods such as DVDs, batteries.

Afro Leo , concerned about the proposal to distinguish counterfeit medicine from other counterfeit goods, wonders whether lifesaving medicine would come in handy if a counterfeit battery exploded and caused injury to a user. On the other hand, borrowing from the animal kingdom, he wonders whether the proposal is to do with a counterfeit kingdom where all counterfeit goods are manufactured equal but some are more equal than others.

Perhaps the break is a good opportunity for the drafters of the bill and two opposing sides to come together, agree on the way forward, and also iron out the glaring defects in the bill. As previous posted here it is questionable what the intention is when the bill recognises IP rights “subsisting in Kenya or elsewhere” given that IP rights are territorial.

An even bigger question is whether the bill is necessary at all. Is it really necessary to enact a new law to increase the penalties? Contrary to current thinking, the problem of tackling counterfeits is not the absence of a relevant law; rather the core issue is lack of enforcement of the existing laws and the minimal penalties imposed by such pieces of legislations. As recently posted here, when counterfeit drugs worth Ksh 5 million were intercepted, the court imposed the maximum penalty – a paltry Ksh. 5000 provided under the pharmacy and poisons Act. Is it necessary to enact a new law or just a matter of amending the existing ones to enhance the penalties and fines?

The other problem inherent with the existing IP laws is that enforcement of IP rights is primarily the mandate of the right holder. However, some of the laws like the copyright Act 2001 and the pharmacy and poisons Act provide for inspectorate officers who are mandated to scout for infringement activities. The bill proposes to establish a new agency to combat counterfeiting. It is therefore debatable whether a new and parallel agency will add any value or shouldn’t it be more efficient to empower the existing enforcement agencies and the police to investigate and act in cases of counterfeiting.



Boarder measures

It also noted that none of the of the existing IP laws provide for boarder measures as stipulated under Section 4 of the TRIPS Agreement and presently the custom authorities have no mandate to stop counterfeit goods at the boarder point. While it is noted that the greater percentage of the counterfeit goods flooding the Kenyan market are imported, the customs department if empowered can play a bigger role in preventing entry of such goods at the entry points.

Perhaps the government should consider amending the relevant laws such as the trade marks Act and the copyright Act to enable a right holder, who suspects that the importation of counterfeit trademark or pirated copyright goods may take place, to lodge an application in writing with the customs authorities, for the suspension of the release of such goods.

The customs and tax authorities should also be authorized to alert holders of IP right if they discover possible infringements while performing their duties at the borders. Such mandate would help the IP holders to discover possible infringements more easily and thus facilitate enforcement of their rights.

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