The Toy Association‘s new white paper, The Real Threat of Fake Toys: The Increase of Knockoff and Counterfeit Toys Sold Online & How to Fight Back, identifies three main factors contributing to the upsurge in knock-off, counterfeit, and otherwise illicit toys being sold via online marketplaces.
The rise of counterfeit and knockoff toys hit the mainstream last month when a child was injured playing with what was thought to be a popular magnetic toy. Instead, it was a cheap knockoff sold by a third-party vendor on a leading retail website. The toy may have looked authentic at a glance, but it did not comply with the strict safety standards and regulations that are in place in the U.S.
On a daily basis, there are reports of countless seizures of counterfeit toys from around the globe, and the number is rising at an alarming rate. One of the biggest problems facing the industry and consumers is the lack of vetting over third-party sellers on popular websites. What you see isn’t always what you get, and kids get put at risk.
The Toy Association suggests three main solutions to combat each of these factors contributing to the problem:
- Solution to Insufficient Vetting by Marketplaces: The Toy Association proposes online marketplaces need to do more to proactively screen sellers and products. Marketplaces could be required to collect verified contact information, such as screening sellers similar to the way certain social media channels have proposed verifying authenticity and contact information for those seeking to run certain political or issue ads. Products could be screened to demonstrate legitimacy and safety of the products and instituting improved tracking of products to sellers.
- Solution to the Burden of Enforcement Disproportionately Placed on Rights Holders: Online marketplaces should work with industry organizations and brand owners to create programs that give the presumption to IP rights holders, and provide more streamlined removal processes, a direct point of contact for the industry, trainings to industry groups on best practices, and more transparency to stop culprits.
- Solution to a Lack of Consumer Awareness: More consumer education on the risks of buying online is needed. If online marketplaces refuse to monitor sellers and products as proposed above, one option is to allow rights holders to create “official” product listings. This would help identify authentic product listings for consumers, who could then feel more confident when making a purchase that the product is real. Along the same lines, a “verified” stamp for sellers similar to the verified stamp as seen on many social media sites could also be instituted.
The white paper also offers initial policy solutions to address the issue such as amending the Digital Millennium Copyright Act (DMCA) to require safety certifications be provided for all toys sold on marketplaces, and empowering Customs and Border Protection (CBP) to improve targeting of de minimis shipments.
The report is intended to be a living document that will be updated as developments occur. Member and consumer experiences, engagement with platforms, and policy updates will all be considered in future revisions.