US Trade Office Wants ICANN and Governments To Help Stamp Out Online Counterfeit Goods

A report from the Office of the United States Trade Representative (USTR) is critical of registrars that have allowed domain names to be registered and used in the distribution of unauthorised copyright-protected content. And it is urging governments and ICANN to get involved to address the problem.

According to the report, one respondent identified several registrars that have apparently refused requests to lock or suspend domain names used to sell suspected counterfeit pharmaceuticals to consumers worldwide. While this is conduct is a threat to brand owners, it also presents a public health challenge, and requires a coordinated response by governments and a variety of private sector stakeholders.

According to 2012 report from the National Association of Boards of Pharmacy, an estimated 96 percent of online pharmacies targeting US consumers are operating in violation of applicable US law and standards.

The report also cites a World Trade Organisation report estimating 50 percent of websites worldwide that hide their physical address are selling illicit pharmaceuticals, including those labelled with counterfeit trademarks. The website www.LegitScript.com has reviewed over 40,000 online drug sellers, but found fewer than 400 to be legitimate. Studies have found that counterfeit anti-cancer, anti-HIV/AIDS , and other medications are not only ineffective, but in some cases may contain toxic or deadly adulterants, such as rat poison.

With relatively few lawful sources amidst a sea of harmful ones, the public faces a substantial risk when navigating these online pharmaceutical markets. In addition to the public health and safety risks, there is also economic harm. Illegal online pharmaceutical sellers can generate significant revenues each month, diverting income from legitimate innovative and generic pharmaceutical manufacturers , and depriving governments of tax revenues from legitimate sales.

The USTR says registrars can play a critical public safety role in the internet ecosystem. Ignoring that role, or acting affirmatively to facilitate public harm, is of great concern. One of the registrars nominated in response to USTR’s Federal Register Request, Tucows.com, appears in the List of companies of concern and is an example of this concern. The USTR is urging trading partner governments and ICANN to investigate and address this very serious problem.

But Tucows denies it is implicated in the problem. The registrar told Reuters ‘it took down dozen of sites every day but unlike some competitors, it considered all complaints carefully to ensure they were justified.’

“We want to make sure that our registrants are protected and respected as well as making sure there are not bad actors on our system, and that requires striking a balance on a daily basis,” said Graeme Bunton, Tucows manager of public policy.