Gowling WLG (International) Inc - Russia
While counterfeit products and internet piracy are a constant concern for IP owners in Russia, the covid-19 pandemic has significantly heightened the need for more scrutiny in this area.
According to the results of a European Commission-led public consultation in February 2020, the creative industry has seen an upsurge in copyright infringement cases since the onset of the pandemic. Lockdowns and other restrictive measures across the globe have greatly increased user demand for creative content and online entertainment, while simultaneously leading to a consumer focus on e-commerce. Unfortunately, this has also created opportunities for illegal resources and infringers.
Know your enemy
The European Commission has created a Counterfeit and Piracy Watch List of websites and marketplaces outside the European Union that are involved in distributing counterfeit products for profit. The aim is to keep website operators, service intermediaries, law enforcement agencies and consumers informed of the magnitude of the problem.
The list is divided into four main sections:
- websites containing pirated content;
- e-commerce platforms;
- online pharmacies; and
The list includes a number of notoriously famous physical marketplaces in Russia, including:
- Gorbushkin Dvor (Moscow);
- Dubrovka (Moscow);
- Sadovod (Moscow); and
- Taganskiy Ryad (Yekaterinburg).
Gorbushkin Dvor has secured the dubious title of largest wholesale and retail site for the sale of counterfeit products in Russia. However, the pandemic-driven rise in e-commerce is the greatest cause of concern at the moment.
The European Commission reported that stakeholders of various industries frequently complain about ‘tiu.ru’ (Russia) and ‘prom.ua’ (Ukraine), both owned by the company EVO. These platforms are allegedly selling large volumes of
- counterfeit spare parts for cars and motorcycles;
- shoes and accessories;
- materials for repair;
- beauty and health;
- sport and leisure goods; and
The website administrators are said to be generally ignoring complaints from rights holders or are slow to respond.
Europol’s Report on Viral Marketing, counterfeits, sub-standard goods and IP crime during the covid-19 pandemic observed that shortages of genuine products – particularly pharmaceutical and healthcare products – were quickly exploited by opportunists offering counterfeit products that are a threat to health and safety and in some cases put lives at risk.
The watch list tackles online pharmacies selling fake drugs and medications without prescription verification by making the domain registrars take responsibility for their clients’ unlawful actions. Some registrars are known to provide the technical means for pharmacies to evade website blocks by the authorities and migrate quickly from one address to another. According to the European Commission, Russian registrars R01, Regtime and Reg.ru have refused to cooperate with rights holders in disrupting illicit online pharmacy networks. As a result, they are now on the watch list with other unfair market players.
Russian websites and pirated content
The watch list names many websites said to have pirated content whose hosting and/or administration is believed to be in Russia, and/or that are used by Russian consumers. The most widely known purveyors of pirated video content are the streaming websites ‘seasonvar.ru’ and ‘rezka.ag’. These resources were blocked by Russian court decisions but remain available for access in other countries. In June 2020, more than 45 million views were registered on each website.
With 1.75 billion visits registered in July 2020, social network VKontakte (‘vk.com’) is a popular leader in Russia and other Russian-speaking countries (VKontakte is also available in many other languages, including English). ‘vk.com’ had previously taken measures to prevent violations but was nonetheless included on the watch list because industry stakeholders viewed these measures to be inadequate. In a promising step forward, Vkontakte’s administration later announced to the European Commission that it was introducing new technology to automatically search for violations.
‘rapidgator.net’ is a direct file hosting service that is hosted in Switzerland, though believed to be administrated from Russia, earning as much as $3.7 million annually through various user reward systems and advertising. Rights holders can open accounts and report inappropriate content; while its administrators delete the reported content, they leave other uploads of the same content untouched and do not prevent re-uploads. This resource is now blocked in Russia.
Two stream-ripping music services – ‘flvto.biz’ and ‘2conv.com’ – are reportedly administered by a single individual from Russia. Their websites help to convert YouTube videos to mp3 audio files. In July 2020, flvto.biz had 54.3 million visits, of which 16.74% were from Brazil; while 2conv.com had 25.5 million visits, of which 18.73% were from Germany. Both resources are currently blocked in Russia.
Representatives of the audiovisual industry reported ‘rutracker.org’ for inclusion in the watch list because of its facilitation of file exchanges via torrents. The resource is an alleged successor to the now-blocked Russian website ‘torrent.ru’. The resource has about 1.5 million active torrents and 13.9 million registered users. Russia and Singapore have made blocking judgments. In June 2020, 40.05 million views were registered, of which 45.92% were from Russia.
The watch list also calls out the sci-hub and library genesis resources, which comprise a whole network of mirror websites. These resources have a very high number of reported copyright infringements related to scientific, technical and medical publications.
In view of the heightened risk of online IP infringement, governments around the world are being forced to step up their law enforcement game and take initiatives to protect the businesses’ intellectual assets. In September 2020, Russia joined WIPO ALERT – a WIPO initiative for creating an international online database of websites flagged for regular copyright and neighbouring rights infringement.
In the past four months, Russia has added more than 1,700 websites to the database, making it one of the leaders among other member states, which include Brazil, Italy, Japan, South Korea and Spain.
The WIPO ALERT approach is based on legal as well as economic methods for curbing copyright infringement on the Internet. Pirate websites usually get the bulk of their profits from advertising. Now advertisers, advertising agencies and their technical service providers can join the WIPO ALERT system to access lists of suspected infringing websites around the world. These lists can then be used to guard against reputational risks for advertising clients. At the same time, the system helps to cut off income resources for offending website owners.