Most industries use technology across their businesses and are committed to using it in a responsible way. Unfortunately, those that choose to provide, or facilitate, access to forms of illegal content for financial gain or with nefarious intent do not take their responsibilities as seriously. They place the public in harm’s way by providing access to unsafe products or malware, while reducing the income of creators and businesses who are attempting to make a legitimate income.
We believe that all digital service providers share a responsibility and duty to help reduce intellectual property theft that either takes place on their services, or is facilitated by their services. Large technology companies and service providers have even greater responsibility given their powerful status in the digital eco-system.
The COVID-19 pandemic has brought a surge in online piracy with UK traffic to illegal film and TV sites increasing by nearly 60% during the first lockdown. Although there has been some active intervention by authorities, both in the UK and right across Europe against some of the most active online pirate groups, investigators who collate the evidence required for intervention by authorities, have come across common challenges and deficiencies within the current UK and EU legislative frameworks.
Counterfeiting and Piracy
Counterfeiting and piracy is a significant drain on the UK economy. Figures from the IP Crime Report 2019-20 estimates that the loss to the UK economy through counterfeiting and piracy is £9.3bn per year and 60,000 job losses.
Tackling counterfeiting and piracy is crucial to delivering on the UK’s ambition to grow our IP rich industries.
There are a whole range of initiatives that are being deployed to achieve this aim including education campaigns, directing consumers to legitimate sites, growing the number of legal services that are available, civil action to block access to illicit services, and law enforcement activity to disrupt the criminals who run the illicit services. We believe that regulatory interventions in the digital policy space should have the objective of delivering fair trading, open choices, trust and transparency, as highlighted by the advice of the Competition and Markets Authority and the Digital Markets Taskforce, published in December 2020.
Counterfeiting is playing an ever more important role in the international organised crime fraternity and no single body is going to crack this problem. No matter how high our sanctions are, they will not match the profits being gained from this global international crime. However, if criminals believe they are likely to be caught and punished quickly they may take a different view of the benefits associated with IP crime, however a true response cannot be accomplished unless we are truly inclusive.
This can only be achieved if we collaborate in end-to-end, cross-sector, cross-border, multi-agency approaches.
’Know Your Business Customer’
Operators of scam websites, illegal gambling, sexual abuse materials and other forms of online harms tend to hide their true identity when signing up for service, and are able to continue providing harmful content to the public because online hosting providers cannot identify those operators.
In spite of Article 5 of the E-Commerce Directive establishing general information requirements for service providers, they continue to provide fake names, fake addresses and contact details and operate in complete anonymity.
Intermediaries such as hosting providers, online advertising companies, proxies and payment gateways and marketplaces providing commercial services to online businesses should implement a “Know Your Business Customer” (KYBC) protocol. Fixing this gap in the law would fulfil the original intent of the self-disclosure scheme by ensuring that consumers and other businesses know who they are dealing with when they interact with online services.
It is important that all providers of critical business infrastructure take greater responsibility to ‘Know their Business Customers’, and have an obligation to have verification protocols in place to ensure that such business customers are engaged in legitimate business activities. Where they are found to be engaged in illicit activity, such as IP infringement, there must be a clear process in place to prevent that activity. Such a process could at last provide for meaningful consequences – in the form of loss of access to business-critical UK infrastructure (hosting, payments, etc.) – whenever illicit businesses choose to ignore the self-disclosure regime of the E-Commerce Directive.