The Law

The online market place is subject to the same Intellectual Property (IP) laws, consumer protection laws and legal responsibilities as the physical market place. Under Article 11 of the Intellectual Property Rights Enforcement Directive (2004/48/EC), an administrator or facilitator of an online sales group can be the subject of legal action if material which infringes IP Rights is sold or otherwise made available through their online sales group. Such action may take the form of an application for a Court order requiring the administrator or facilitator to suspend members of the group and not to permit new users to join the group without first supplying contact details.

See the case of L’Oréal SA and Others v eBay International AG and Others.

In addition, if the administrator or facilitator assists members of the group to infringe IP rights with knowledge or reason to believe that their actions are infringing, they may be jointly liable with them for any civil infringements they may be committing. The administrator or facilitator may also expose themselves to criminal liability for aiding, abetting, encouraging or assisting them to commit any offence they may be committing.

The offering for sale, sale and distribution of counterfeit and pirated goods on online sales groups is a criminal offence in the UK which, upon conviction, attracts a maximum prison sentence of 10 years, an unlimited fine or both. It is also a Schedule 2 lifestyle offence under the Proceeds of Crime Act, allowing enforcement agencies to apply for confiscation of criminal assets. People supporting the sale and distribution of counterfeit and pirated goods, as well as those involved in the direct selling of those goods may also face prosecution with regards to Money Laundering offences.

If you are the administrator of a selling group, in order for you to avoid any liability, you should take all reasonable steps and exercise all due diligence to avoid or prevent the commission of any breaches of the intellectual property laws and consumer protection laws by yourself or other members of your selling group.

The Real Deal Online programme may assist you in the discharge of your legal responsibilities in relation to consumer sales by means of your sales group.

The information on this page is for guidance only and is not designed to be a replacement for professional advice.