Counterfeiting and piracy are terms used to describe a range of illegal activities linked to intellectual property rights (IPR) infringement. Both are serious problems that appear to be growing in scope and magnitude. Piracy and counterfeiting are most likely to occur in case of easily replicable goods such as clothing, luxury watches and designer sunglasses, but now include a growing number of common food and drink brands, pharmaceutical products, chemicals, electronics, computer parts, alcohol, and household products. These products, which are often substandard, can pose significant health and safety risks to consumers. Moreover, it appears that fake products, which have traditionally been sold on open markets, are finding their way into legitimate distribution systems, and thus into the shelves of established shops.

The government is losing huge amount in revenues due to illegal trading in counterfeit and pirated goods. The country is fast growing as an international market and many renowned companies are launching their products. If we ignore counterfeiting, foreign companies might shun Nepal in the future and Nepal’s international reputation will be irreparably damaged. The very future of foreign investment in Nepal depends on the effectiveness of country’s anti-counterfeiting enforcement bodies.

Basic principles for trademark in Nepal can be summarised as “Registration Principle” and “First to File” principle. That is to say, only registered trademark enjoys prima facie protection in Nepal. And, between different applications for identical or similar trademarks, registration is granted to the one who is first to file an application for trademark. Foreign applicants can proceed without even having a registered company in Nepal. These days unauthorised manufacturers blatantly use famous trademarks to sell their products and earn a huge amount of profit. Foreign or domestic companies can take a big step towards avoiding counterfeiting by registering their products in Nepal.

In this regard, the Department of Industry (DoI) should have strong co-ordination with the police to act against the counterfeiters. Counterfeiting requires a strategy that includes ground-level operational raids, seizures, and arrests, as well as the political will. In addition, industry representatives, foreign governments, and intergovernmental organisations should conduct enforcement training seminars throughout major cities of Nepal.

Moreover, new IP law that metes out strict punishment to the violators should be formulated

as soon as possible. We have to provide a stable, safe and secure IP environment for domestic and foreign businesses.

The Nepali enforcement system must include harsh penalties such as destruction of counterfeited goods, seizure of equipment, steep monetary fines and imprisonment for individuals who engage in large counterfeiting operations. The government will need to take some bold steps to check counterfeiting. Subedi is a Supreme Court advocate