Mitigating Trademark Infringement Through the Federal Competition and Consumer Protection Act

CONTRIBUTOR BY BETSEABASI ASUQUO

Introduction

Trademark infringement refers to the unapproved utilization of a trademark or service mark, often associated with goods or services, which has the potential to cause confusion, deception, or misinterpretation regarding the origin of the product or service.^[1] Trademark infringement frequently results in consumer confusion because the unauthorized use of a similar mark can create difficulty for consumers in distinguishing between a brand and the infringing party. This confusion can erode the trust and loyalty that customers have developed over time, leading to loss of customers and business opportunities.^[2]

In the current highly competitive market environment, trademarks play a foundational role in establishing brand identity and fostering consumer trust. Nevertheless, the surge in counterfeit products, online infringement, and unauthorized exploitation of intellectual property presents considerable obstacles to preserving the integrity of trademarks.
The outcomes of violating intellectual property rights can be significant, resulting in legal actions like litigation, financial penalties, and other sanctions. In specific cases, the entity engaging in infringement could be held accountable for compensatory payments, covering lost profits and compensation for damaging the reputation of the intellectual property owner.^[3]

The Federal Competition and Consumer Protection (FCCP) Act stands as one of the crucial legislative tools aimed at safeguarding these trademarks and ensuring fair competition within the market.

This article seeks to explore comprehensively the challenges and potential solutions related to trademark infringement under the FCCP Act.

Trademark Infringement Prohibition under the Federal Competition and Consumer Protection Act, 2018

The Federal Competition and Consumer Protection Act, 2018 (FCCPA) is the main statute governing consumer protection and competition regulation in Nigeria. The FCCPA established the Federal Competition and Consumer Protection Commission^[4] (FCCPC) and the Competition and Consumer Protection Tribunal (CCPT)^[5] for the development and promotion of fair, efficient and competitive markets in the Nigerian economy to facilitate access by all citizens to safe products and secure the protection of rights for all consumers in Nigeria; and for related matters.^[6] The FCCP Act was enacted to fortify consumer confidence and protect the integrity of brands. The Act has made provisions to tackle trademark infringements and created liability for such infringements. These provisions will be examined anon.

Section 125 of the Act^[7] creates liability for any person who during the marketing of a good creates a false impression, whether directly or indirectly, leading them to believe that a product is what it is not. Subsection 2 of the same provision, goes ahead to create similar liability for any person who, acting on behave of a producer or supplier, falsely represents facts that are not true.

An interpretation of the above will include the fact that if a person creates his product or service to closely resemble another brand’s, or in his marketing strategy, he leads consumers to believe that his product is from a brand, or is affiliated with a brand, where that is not the case, then he will be liable to any person misled as well as the original owners of the brand.

Enforcement Mechanisms Against Trademark Infringement under the Federal Competition and Consumer Protection Act, 2018

To carry out its aims and objectives, the Act established an enforcement commission, the Federal Competition and Consumer Protection Commission. One of the responsibilities of the Commission is the sealing up of any premises where there is reasonable suspicion that the premises contain, harbour or is being used to produce or distribute goods or services that are dangerous to consumers, substandard or fake.^[8]

The Commission is also authorized to enter and search any premises and inspect, them to ascertain whether any undertaking has engaged, is engaging, or is likely to engage in conducts constituting a contravention of provisions of the Act.^[9] Such actions include trademark infringements. What is amazing and interesting to note is that the process has been significantly shortened, as the bureaucracy surrounding the issuance of a search warrant has been eradicated. The Commission’s authorized officers can search and seize, pending the issuance of a search warrant, where there is a belief that a violation of the provisions of the Act is being or will be committed.^[10] The Executive Vice-Chairman only needs to depose to an affidavit stating these facts.^[11] This provision will potentially hasten the process of securing evidence for prosecution of counterfeiting and trademark infringement cases.^[12] Also, where a person tries to obstruct an authorized officer from carrying out his duties in this regard, such a person is liable to imprisonment, a fine, or both.^[13]

Furthermore, the Commission is authorized to publish periodically, a list of goods and services, which have been banned or restricted for being harmful, fake or substandard.^[14] The Commission has published on its website a list of items which have been completely prohibited, and this includes all counterfeit/pirated materials or articles.^[15]

The Act has also established a Tribunal^[16] to adjudicate over conducts which are prohibited under the Act,^[17] with jurisdiction throughout the federation.^[18] The Tribunal enjoys concurrent jurisdiction with the Federal High Court, as appeals from it lie directly to the Court of Appeal.^[19] The Tribunal is empowered to deliver administrative penalties for non-compliance with provisions of the Act, or non-compliance with an interim order of the Tribunal.^[20] Penalties awarded by the tribunal are binding on parties and can be enforced by registering them with a Federal High Court.^[21] The Tribunal can also hear appeals arising from the actions of the Commission.^[22]

Challenges

Some of these challenges and shortcomings of the FCCP Act include:

1. With the rise of e-commerce and digital platforms, trademark infringement has extended into the online sphere. However, the Act has not explicitly stated how such unauthorized use of trademarks on websites or social media can be combatted. It empowers the Commission to search premises, which is a measure against physical counterfeiting activities, without any reference to counterfeiting activities going on in cyberspace, such as using well-known slogans to advertise.
2. The Act restricts the issuance of search warrants to Judges^[23], unlike normal search warrants that can be issued by Magistrates that are easily accessible. It is no secret that Judges are already considered as being too busy with a lot of workloads. Also, there are no judicial divisions for effective administration of the Tribunal. This could lead to a backlog of cases.
3. Weak enforcement mechanisms and inadequate penalties for infringing parties, fail to serve as a sufficient deterrent. Despite the establishment of the Tribunal, there are no mechanisms in place to enforce the decisions of the Tribunal, if any. One has to proceed to the Federal High Court for enforcement, effectively shooting the Act’s efforts at timely interference in the leg.

RECOMMENDATIONS

The implementation of the Federal Competition and Consumer Protection Act represents a positive step forward in addressing issues related to trademark infringements. However, it could be better placed to achieve its objectives if it is reviewed to close some gaps like:

1. Including effective enforcement procedures and systems for administrative awards.
2. Creating judicial divisions for the Tribunal for effective administration.
3. The Act could also consider a collaboration between customs authorities and trademark enforcement agencies to intercept illicit products effectively.
4. The Act could incorporate liability and sanctions for trademark infringements in cyberspace to deter those dabbling in the act.
5. Implement detailed and stricter penalties for infringement of counterfeiting laws.

CONCLUSION

In the pursuit of fortifying trademark protection, the examination of challenges and recommendations within the FCCP Act framework illuminates a multifaceted landscape. However, within these challenges lie promising avenues for improvement. The recommendations put forward, present a viable path toward bolstering the FCCP Act’s effectiveness.

1. Winston and Strawn, ‘What is Trademark Infringement’, Available at https://www.winston.com/en/legal-glossary/trademark-infringement Accessed on 20/11/2023 ↑
2. Austan Wellman, “5 Ways Trademark Infringement Can Damage Your Brand’s Reputation”, Available at https://fargopatentlaw.com/blog/trademark/trademark-infringement-risks/#:~:text=Legal%20Consequences%20and%20Damage%20to,customers%2C%20partners%2C%20or%20distributors. Accessed on 20/11/2023 ↑
3. “What Is Intellectual Property Infringement”, Available at https://vakilsearch.com/blog/what-is-intellectual-property-infringement/#:~:text=The%20consequences%20of% 20intellectual%20property,the%2 0intellectual%20property%20owner%27s%20reputation. Accessed on 20/11/2023 ↑
4. Part II of the Federal Competition and Consumer Protection Act, 2018 ↑
5. Part VII of the FCCP Act ↑
6. The Federal Competition and Consumer Protection Act, 2018 (FCCPA), Resources & Library,Available at, https://fccpc.gov.ng/resources-library/fccpa/#:~:text=The%20FCCPA% 20established%20the%20 Federal,to%20safe%20products%20and%20secure Accessed on 20/11/2023 ↑
7. FCCP Act ↑
8. Section 18(1)(f) of the FCCP Act ↑
9. Section 27(1) of the FCCPC Act ↑
10. Section 27 (3) of the FCCP Act ↑
11. Section 27(4) of the FCCP Act ↑
12. Temiloluwa Oladele, “Nigeria: The Federal Competition And Consumer Protection Act: Curbing Counterfeiting And Trademark Infringement”, Available at https://www.mondaq.com/nigeria/trademark/891352/the-federal-competition-and-consumer-protection-act-curbing-counterfeiting-and-trademark-infringement#:~:text=The%20FCCPA%2C%20which%20establishes%20the,trademarks%20against%20counterfeiting%20and%20infringement. Accessed on 20/11/2023 ↑
13. Section 28(4) of the FCCP Act ↑
14. Section 17(n) of the FCCP Act ↑
15. FCCPC, “Absolutely Prohibited Product List. Available on https://fccpc.gov.ng/resources-library/publications/absolutely-prohibited-product-list/ Accessed on 23/11/2023 ↑
16. The Competition and Consumer Protection Tribunal (“CCPT”) ↑
17. Section 39(2) of the FCCP Act ↑
18. Section 39(3) of the FCCP Act ↑
19. Section 55 of the FCCP Act ↑
20. Section 51 of the FCCP Act ↑
21. Section 54 of the FCCP Act ↑
22. Section 38 of the FCCP Act ↑
23. Section 28 of the FCCP Act ↑