Transcript GLOBAL AUTOMOTIVE ANTI COUNTERFEITING ALLIANCE

GLOBAL AUTOMOTIVE
ANTI COUNTERFEITING
ALLIANCE
Alexander Theil
AASA China Aftermarket Forum Meeting
Shanghai, June 7, 2007
Counterfeit auto parts are a public
SAFETY hazard!!!
Everybody is a potential victim!!!
Women
Children
Senior Citizens
Drivers
Passengers
Pedestrians
BACKGROUND
Counterfeit Automotive parts are a
growing global phenomena.
Current Anti-Counterfeiting programs
unable to deliver satisfactory results
Considerable
Frustration,
even
Resignation within Industry due to limited
progress
BENCHMARK
Automotive Industry is not sufficiently
organized to effectively compete with other
Industries such as
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Motion Picture Industry (MPA)
Phonographic Industry (IFPI)
Software Industry (BSA)
Pharmaceutical Industry (PHARMA)
Despite the fact that auto parts are a public
health and safety concern, enforcement
authorities spend more efforts for these
industries than for the automotive industry.
WHY NOW
In most countries in Asia, the above Copyright
Industry Associations dominate
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the public dialogue regarding counterfeiting
law enforcement agenda
They have now also started to dominate the
agenda setting with the Chinese government.
Enforcement results for the Auto Industry in
China are going to get considerably worse unless we act !!!
CURRENT SYSTEM
Each company running own enforcement
program with ad hoc cooperation
between brand owners
Investigations and enforcement usually
outsourced
Most cases involve many brand owners,
usually service providers coordinate
enforcement actions
CURRENT LIMITATIONS
Governments do not wish to be seen to
support just one company, one country or one
region.
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However, they are willing to listen to a global
industry perspective, in particular if this also extends
to the local industry
Criminal law enforcement agencies in many
countries will not take cases unless ALL brand
owners involved commit to support the case.
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These agencies will focus on industries which have
organized themselves and will ignore those which
have failed to do so.
SOLUTION
Global Automotive Brand Owners
Anti-Counterfeiting Alliance
(“Automotive Alliance”)
To be effective the Alliance has to be Global in
nature, i.e. it has to be perceived as representing
the industry as a whole, without any national or
regional limitations.
Representation of Industry as a Whole
Being global in nature will allow the Alliance
to advance its agenda independent from
wider geo political developments
The Alliance will provide a competent and
reliable point of contact for governments,
law enforcement, media, etc.
– In every key country, there will be
dedicated resources,
contact points, or
hotline
Coordination of Local / Regional /
International Cases
Alliance coordinates all Investigations and Enforcement
actions involving more than one Brand.
Oversee service providers on behalf of the individual
companies
– Ensure quality of investigative work
– Ensures that fees charged are appropriate.
Every case will be analyzed from an International
perspective to identify the global networks the
counterfeiters are operating
Disaster regions, i.e. regions in which counterfeiting is of
particular eminence will be identified.
– Specific programs will be established to address the particular
situation in each disaster region.
– These all encompassing programs will be tailor made to address the
specific problems in each region.
– They will include investigations, as well as aspects of enforcement,
education, public policy, public relations, government lobbying, etc
Supervision of Enforcement Actions
Alliance officials/employees will
Attend raid actions whenever possible
Conduct post raid follow up
Lobbying and Government
Representation
Lobbying on case related details,
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Higher level enforcement
Ministerial level enforcement officials,
Local governments
Regional governments
National governments
Lobbying on public policy debates to influence
changes in policy
– Intellectual Property laws
– Law enforcement implementation rules and guidelines
Customs Training and Alerts
Main Goal is to Focus Government resources onto the
Automotive Industry instead of other industries.
One Alliance official could be responsible for
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Training,
Customs response
Product inspection services
Lobbying
Etc.
The health and safety aspect of the automotive industry
should provide us with a natural ranking on top of the
priority list
BENEFITS
Substantial Cost Savings
Dramatically Better Results
– Quantitatively numbers of seizures, prosecutions, and
compensation will increase dramatically.
– Qualitatively the information obtained in the course of
the cases will allow us to
strategically address the global networks and the organizers
behind the scene.
This in turn will eventually create a deterrent effect and will
result in discouraging counterfeiters from the automotive
industry as a whole.
Increased Policy Influence
STRUCTURE
TOP-DOWN APPROACH (Asia Wide)
Supervisory Board
Chairman Asia
MD
China
Enforcement
Manager
Enforcement
Manager
MD
India
Enforcement
Manager
MD
ASEAN
MD
Korea
Fulltime Alliance Employee
Member Employee
STRUCTURE
BOTTOM-UP APPROACH (China Only)
Supervisory Board
Chairman
Enforcement
Manager
Enforcement
Manager
Vice
Chairman
Vice
Chairman
Enforcement
Manager
Enforcement
Manager
Vice
Chairman
Vice
Chairman
Fulltime Alliance Employee
Member Employee
BACK UP 1: STRUCTURE
BOTTOM-UP APPROACH (China Only)
SUPERVISORY BOARD:
Consisting of representatives of all Alliance member companies
CHAIRMAN:
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Manages the Alliance on behalf of the Supervisory board.
Represents the Alliance towards government, public, etc.
(In the long term this position should be a full time Alliance employee, but for the start
up stage the function shall be performed by a representative elected from within
Supervisory board members)
VICE CHAIRMEN (x numbers) :
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Assist the Chairman in representing the Alliance toward governments, public, etc. (lobbying,
marketing)
(This function shall be performed by a number of representatives elected from within
the Supervisory board)
ENFORCEMENT MANAGER(S):
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Coordinating all Alliance investigations
Supervising Alliance raid actions and conducting post raid follow-up (particular the second
element will result in drastic cost reductions).
Contact point for customs seizures and responsible for customs training
Full time position(s) reporting to the Alliance Chairman.
BACK-UP 2: “Typical” Case:
FENGHUA YLJ
Raid Action in Zhejiang Province in December 2006 resulted in
seizure of US$1,2 million worth of products (based on dealer price)
CUSTOMERS:
Identified over 100 companies in 35 countries including Asia, Middle
East, Europe, Africa, South America
SOURCES:
Identified over 100 manufacturers of various auto parts, all located in
China.
Follow-up investigations already led to seizures in Dubai, Germany,
Poland, Romania, Hungary. Value of additional products, labels,
packaging seized, and sales information discovered worth US$38.4
million (retail value of case so far ca US$80 Million)
Further investigations in other countries around the world ongoing
Counterfeit auto parts are a public
SAFETY hazard!!!
Everybody is a potential victim!!!
Women
Children
Senior Citizens
Drivers
Passengers
Pedestrians