Counterfeit Goods And Criminal Penalties In China
Legal Framework for Counterfeit Goods in China
China has developed a robust legal regime to combat counterfeiting due to its impact on economic interests, public safety, and intellectual property rights.
Criminal Law of the People’s Republic of China (1980, amended 1997, 2011, 2020)
Article 141: Producing or selling counterfeit or inferior goods is punishable.
Article 142: Selling counterfeit or fake trademarks is criminalized.
Article 143: Producing or selling counterfeit pharmaceuticals, foods, or explosives carries severe penalties.
Trademark Law (2019 amendment)
Strengthens protection of registered trademarks.
Introduces enhanced administrative penalties and criminal liability for intentional infringement.
Consumer Protection Law (2013 amendment)
Provides civil remedies and administrative sanctions for counterfeit or substandard products.
Cyber Regulations
Online marketplaces are liable for counterfeit goods sold on their platforms.
Detailed Case Analyses
Case 1: Guangzhou Fake Luxury Goods Factory (2017)
Facts:
A large factory in Guangzhou was producing counterfeit designer handbags and watches for domestic and international markets.
Legal Proceedings:
Authorities seized 50,000 items and arrested 12 individuals.
Prosecuted under Articles 141 and 142 of the Criminal Law for producing and selling counterfeit goods.
Sentences ranged from 5 to 12 years imprisonment.
Significance:
Demonstrated large-scale industrial counterfeiting.
Emphasized criminal law penalties combined with seizure of counterfeit goods.
Case 2: Shenzhen Online Counterfeit Electronics Ring (2018)
Facts:
A group sold fake mobile phones and accessories through e-commerce platforms.
Legal Proceedings:
Prosecuted under Article 141 for production and sale of counterfeit goods and Article 140 for fraudulent commercial activity.
Court ordered imprisonment from 3 to 8 years, with fines and confiscation of equipment.
Significance:
Showed application of criminal law to online counterfeiting.
Emphasized cooperation between cyber police and e-commerce platforms.
Case 3: Counterfeit Pharmaceuticals in Jiangsu Province (2015)
Facts:
A pharmaceutical company produced substandard and counterfeit drugs sold nationwide, causing health risks.
Legal Proceedings:
Prosecuted under Article 143 (producing/selling counterfeit pharmaceuticals).
Executives received life imprisonment; factory confiscated.
Significance:
Demonstrates stricter penalties when counterfeit goods endanger public health.
Case highlighted the need for forensic examination to prove product falsification.
Case 4: Beijing Trademark Counterfeit Case (2016)
Facts:
A group was caught producing shoes and clothing with logos of major international brands.
Legal Proceedings:
Prosecuted under Article 142 (selling counterfeit trademarks).
Sentences ranged from 2 to 6 years, depending on individual involvement and scale.
Court emphasized intent to deceive consumers and profit motive.
Significance:
Reinforced criminal liability for trademark infringement.
Clarified that even imitation goods with clear logos constitute a serious criminal offense.
Case 5: Fake Food Products in Sichuan (2019)
Facts:
A food company mixed substandard ingredients and sold them as premium products.
Legal Proceedings:
Prosecuted under Article 143, focusing on public health risk.
Sentences: 8–10 years imprisonment; fines imposed on company and individuals.
Significance:
Illustrates criminal law protection of consumer safety.
Shows heavier penalties for counterfeiting that endangers health compared to ordinary counterfeit goods.
Case 6: Counterfeit Cosmetics in Shanghai (2020)
Facts:
A cosmetic factory produced fake luxury skincare products and sold them through social media channels.
Legal Proceedings:
Prosecuted under Articles 141 and 142, with additional fines under Consumer Protection Law.
Sentences ranged from 3 to 7 years, confiscation of products, and destruction of counterfeit goods.
Significance:
Demonstrates modern counterfeiting issues via online and social media platforms.
Courts emphasized intent to deceive consumers and scale of operation.
Case 7: Cross-Border Counterfeit Luxury Goods (Yunnan, 2021)
Facts:
A smuggling network imported counterfeit handbags and watches from abroad and distributed them in China.
Legal Proceedings:
Prosecuted under Articles 141–142 for production, sale, and import of counterfeit goods.
Life imprisonment recommended for main ringleader due to scale; accomplices received 5–12 years.
Significance:
Shows application of criminal law to international counterfeiting networks.
Highlights cooperation between customs, police, and judicial authorities.
Key Legal Principles in Counterfeit Goods Prosecution
| Principle | Explanation | Case Example |
|---|---|---|
| 1. Scale matters | Larger operations receive harsher sentences. | Cases 1, 7 |
| 2. Public health risk | Counterfeit pharmaceuticals/food incur heavier penalties. | Cases 3, 5 |
| 3. Trademark infringement | Even imitation goods with logos are criminalized. | Cases 4, 6 |
| 4. Online sales liability | Internet and social media sales are fully prosecutable. | Cases 2, 6 |
| 5. Cross-border smuggling | Import/export of counterfeit goods leads to severe penalties. | Case 7 |
Conclusion
China’s approach to counterfeit goods combines:
Strict criminal penalties for large-scale production, sale, or import of counterfeit goods.
Special protections for public health when counterfeit products endanger consumers.
Enforcement on online platforms to curb digital counterfeit markets.
Enhanced judicial oversight for intellectual property violations.
The cases above—from Guangzhou factories to online counterfeit electronics—demonstrate how criminal law reforms, trademark law, and consumer protection law work together to combat counterfeiting in China.
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