Dive Brief:

• The Department of Commerce is looking for input from intellectual property rights holders and online third-party marketplaces on how to best stem the sale of counterfeit goods online, according to a notice on the Federal Register posted this week.
• The request is the result of a Presidential Memorandum released in April, "Memorandum on Combating Trafficking in Counterfeit and Pirated Goods," which called on the Secretary of Homeland Security and Secretary of Commerce to complete a report on the state of counterfeit goods. These comments will help to inform this report, which must be delivered to President Trump by October 30, 2019.
• The DOC wants to better understand what leads to the sale of counterfeit goods, if there are any technological or policy solutions, and if information-sharing or government data could help stop these sales.

Dive Insight:

This interest from the federal government comes at a time when the sale of counterfeit goods has been on the rise thanks in large part to online sales. The Organisation for Economic Co-operation and Development (OECD) and the European Union’s intellectual property office (EUIPO) released a report in March saying counterfeit goods now account for 3.3% of global trade.

Counterfeits can affect a variety of items, including goods like prescription drugs and car parts, which could be dangerous if not sold through the proper channels, OECD said. But footwear, clothing and leather goods are the three most common fraudulent items, it found.

This is an issue online third-party marketplaces like Amazon are already aware of and are taking steps to mitigate. Amazon announced this week it is expanding its Transparency program to Europe, India and Canada. This is an effort to provide a serialized code for items, which helps to authenticate every unit of a product line. It is already used by 4,000 brands in the United States, according to Amazon.

"Counterfeiting is an industry-wide concern — both online and offline. We find the most effective solutions to prevent counterfeit are based on partnerships that combine Amazon’s technology innovation with the sophisticated knowledge and capabilities of brands," Dharmesh Mehta, vice president of Amazon Customer Trust and Partner Support, said in a press release.

When asked if Amazon planned to participate in the DOC public comment period, a spokesperson told Supply Chain Dive, "We continue to work closely with stakeholders in the public and private sectors to protect customers, stop counterfeit goods, and hold bad actors accountable, and we welcome the support and engagement from brands, policymakers, law enforcement and others."

The DOC has not yet received any comment on its request. Comments are due July 29 at 5 p.m. Eastern time.