No one can deny Hong Kong’s inclination for a bit of glitz and bling, so it is probably a good thing that a recent case in Hong Kong has confirmed that designs of jewellery can be protected in law.

Richemont, the holding company for luxury brands such as Cartier and Van Cleef & Arpels (VCA), in February obtained a court order by consent preventing the defendants – a local jewellery manufacturer and retailer known as De Brilliant Jewellery Limited – from reproducing, selling or distributing copies of Richemont’s original designs or allowing third parties to do so.

The order was significant in that De Brilliant admitted copying the pieces and acknowledged the validity of Richemont’s IP rights in the works. It is hoped the order – believed to be the first of its kind in Hong Kong – will serve as a significant deterrent to other counterfeiters in the Asia Pacific region.

Exclusivity at a Premium

Richemont brought forward evidence about the exclusivity of the Cartier and VCA designs, and demonstrated the time, effort and expense that it had devoted into protecting this exclusivity over the years. Cartier and VCA make only a small number of pieces each year which together form an annual collection that the brands then promote, incurring significant time and expense.

The order recognized that the pieces concerned had achieved wide recognition in Hong Kong, China and elsewhere as belonging to Cartier and VCA and as such were far from commonplace. Richemont also provided clear chain-of-title evidence to establish that they own the copyright and that it subsisted in the design drawings for each of the Cartier and VCA jewellery pieces.

Richemont argued that if the defendants were allowed to continue with their activities, there would be a proliferation of cheap imitations in the marketplace which would adversely affect its reputation and brand value.

Under the terms of the consent order, De Brilliant was stopped from producing any further copies of the infringing pieces and had to hand in all moulds used in manufacturing the fakes together with leaflets, catalogues and sales figures. De Brilliant also had to hand in details of their customers to whom they had sold the fakes.

The Fight Against Fakes

It appears that Hong Kong may be stepping up its fight against counterfeiters. In March this year, it was reported that customs officers had seized about 200 suspected counterfeit items from the Hong Kong jewellery fair, having swooped on five booths after a tip-off. Three men and five women were arrested.

Last September, officers were reported to have arrested an exhibitor and seized 90 necklaces and pairs of earrings worth HK$56,000 (US$7,155) after she allegedly sold suspected counterfeit products to an undercover officer. Officers seized 90 items that allegedly copied VCA product designs. Under Hong Kong’s trades descriptions law, possessing or supplying goods with a false trade description is an offence carrying a fine of HK$500,000 (US$63,900) and imprisonment for five years.

A Global Problem

The problem of counterfeiting remains a global concern. A report last year by the Organization of Economic Cooperation and Development (OECD) and the European Union’s Intellectual Property Office found that imports of counterfeit and pirated goods are worth nearly half a trillion US dollars a year, or around 2.5 percent of global imports.

The report, Trade in Counterfeit and Pirated Goods: Mapping the Economic Impact, put the value of imported fake goods worldwide at US$461 billion 2013, compared with total world trade imports of US$17.9 trillion. The report estimated that up to 5 percent of goods imported into the EU were fakes, with China the top producer.

Actions such as those taken by Richemont in Hong Kong should serve as useful deterrent to those attempting unfairly to exploit the value and recognition enjoyed by luxury brands and Hong Kongers can rest assured that their latest flashy designs are protected by law.