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02 March 2021
With e-commerce booming, it is safe to say that online marketplaces have disrupted the retail scene. For example, according to a recent ranking of online marketplaces, Amazon receives approximately 6 billion views a month globally, while in Southeast Asia, Shopee and Lazada attract more than 400 million views a month combined.
However, while it is now easier than ever for sellers to connect with buyers, e-commerce platforms are accessible to both authentic and counterfeit sellers. Anyone may register an account and begin selling immediately, without the need to undergo scrutiny or due diligence.
In A&M Beauty Wellness Sdn Bhd v Shopee Mobile Malaysia Sdn Bhd,(1) the high court recently provided some clarification on the extent of liability that online marketplaces such as Shopee and Lazada have regarding IP infringements by sellers
After receiving no favourable response to its complaints, the plaintiff in A&M Beauty applied for a court injunction against Shopee to prevent the sale of goods bearing its AM brand name by unauthorised third parties on the platform.
While the postings on Shopee were not disputed, the high court refused to grant the injunction against Shopee on the following grounds:
The court also found that as the plaintiff was not the registered owner, it had no locus standi to seek such reliefs and had failed to provide a meaningful undertaking as to damages. The court further held that monetary compensation was an adequate remedy in this circumstance.
Allowing easy access and registration of thousands (or millions) of active seller accounts is a cornerstone of the online marketplace and one of the reasons for its success. This decision will provide palpable relief to online marketplaces, whose continued existence arguably benefits the public by encouraging competition and stimulating the economy.
Nonetheless, it is equally undisputable that counterfeiters are thriving, with online marketplaces offering them more channels to exploit. Additional measures to curb counterfeits would therefore be welcome.
For further information on this topic please contact Bahari Yeow Tien Hong, Lim Zhi Jian or Sabrina Sharin at Gan Partnership by telephone (+603 7931 7060) or email (email@example.com, firstname.lastname@example.org or email@example.com). The Gan Partnership website can be accessed at www.ganlaw.my.
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