28 February 2013

Kenya: Counterfeiters May Soon Serve a 15-Year Jail Term

Manufacturers and retailers of counterfeit goods could get up to 15 years in jail if new proposals on the anti-counterfeits act are passed. Proposed amendments will also see culprits pay fines based on the estimated market value of the goods impounded.

First time convictions will attract a fine of not less than three times the value of the goods with a minimum of Sh200,000 or imprisonment for a maximum of five years or both.

Subsequent offenses will get a fine of five times the value of goods with a minimum of Sh500,000 and or a maximum of 15 years imprisonment.

The Anti-Counterfeit Agency chief executive Stephen Mallowah said the stiffer penalties will deter further spread of the criminal activities that has seen businesses and government lose billions every year.

Currently, offenders get a maximum fine of Sh800 000 or a jail term of 10 years.It will also be an offense under the law to be found in possession or control of labels, patches, stickers, or packaging of any type with a counterfeit mark that s likely to confuse or deceive the consumers. This will attract a Sh5 million fine or five year imprisonment or both.

Mallowah presented the proposals at a workshop bringing together local manufacturers, Kenya Revenue authority, Kenya Bureau of Standards and the police of address the counterfeit problem.

Kenya Association of Manufacturers estimate that East Africa region losses about $500million per annum on counterfeits trade.It further estimates that some companies have lost 70 per cent of their market share to the illegal goods locally made goods under greatest threat are alcoholic and soft beverages, cigarettes, medicines, dry cell batteries, seeds and fertilisers and cosmetics. Electronics make the largest share of imported fakes.

"Consumers also have a big role to play in driving this trade...our research showed the preference for counterfeits increased by the level of education and income," Mallowah said.

KRA and the police acknowledged there is a big problem but said they cannot do anything in instances where the rightful intellectual property rights owners fail to report.

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