[Federal Register Volume 84, Number 132 (Wednesday, July 10, 2019)]
[Notices]
[Pages 32861-32863]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-14715]


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DEPARTMENT OF COMMERCE

[Docket Number: 190703544-9544-01]


Comment Request; Report on the State of Counterfeit and Pirated 
Goods Trafficking and Recommendations

ACTION: Notice; request for comments.

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SUMMARY: The Department of Commerce is seeking comments from 
intellectual property rights holders, online third-party marketplaces 
and other third-party intermediaries, and other private-sector 
stakeholders on the state of counterfeit and pirated goods trafficking 
through online third-party marketplaces and recommendations for curbing 
the trafficking in such counterfeit and pirated goods. All responses to 
this notice will be shared with interagency teams, and specifically the 
Department of Homeland Security (DHS), for use in preparing a report 
for the President as directed by the April 3, 2019 Presidential 
Memorandum on ``Combating Trafficking in Counterfeit and Pirated 
Goods'' (Presidential Memorandum).

DATES: Comments must be received by 5:00 p.m. Eastern time on Monday, 
July 29, 2019.

ADDRESSES: You may submit comments and responses to the questions below 
by one of the following methods. All comments must be submitted through 
the Federal eRulemaking Portal at http://www.regulations.gov, Docket 
No. DOC-2019-0003, unless the commenter does not have access to the 
internet. Commenters who do not have access to the internet may submit 
the original and one copy of each set of comments by mail or hand 
delivery/courier as noted in option (b) below.
    (a) Electronic Submission: Submit all electronic comments via the 
Federal e-Rulemaking Portal at http://www.regulations.gov (at the home 
page, enter [DOCKET NUMBER] in the ``Search'' box, click the ``Comment 
Now!'' icon, complete the required fields, and enter or attach your 
comments). The materials in the docket will not be edited to remove 
identifying or contact information, and the Department cautions against 
including any information in an electronic submission that the 
submitter does not want publicly disclosed. Attachments to electronic 
comments will be accepted in Microsoft Word, Excel, or Adobe PDF 
formats only. Comments containing references to studies, research, and 
other empirical data that are not widely published should include 
copies of the referenced materials. If you want to submit a comment 
with business confidential information that you do not wish to be made 
public, submit the comment in the manner detailed below. Submissions of 
``Business Confidential Information'': For any comments submitted 
electronically containing business confidential information, the file 
name of the business confidential version should begin with the 
characters ``BC''. Any page containing business confidential 
information must be clearly marked ``BUSINESS CONFIDENTIAL'' on the top 
of that page and the submission should clearly indicate, via brackets, 
highlighting, or other means, the specific information that is business 
confidential. If you request business confidential treatment, you must 
certify that the information is business confidential and would not 
customarily be released to the public. Filers of submissions containing 
business confidential information also must submit a public version of 
their comments. The file name of the public version should begin with 
the character ``P''. The ``BC'' and ``P'' should be followed by the 
name of the person or entity submitting the comments or

[[Page 32862]]

rebuttal comments. Failure to follow these procedures may result in the 
public posting of the submissions in their entirety. If these 
procedures are not sufficient to protect business confidential 
information or otherwise protect business interests, please contact 
Raquel Cohen at [email protected] to assess whether alternative 
arrangements are possible.
    (b) Written/Paper Submissions: Commenters who do not have access to 
the internet may send written/paper submissions to: The Office of 
Intellectual Property Rights (OIPR), International Trade 
Administration, U.S. Department of Commerce, 1401 Constitution Ave. NW, 
Room 21028, Washington, DC 20230. Submissions of ``Business 
Confidential Information'': Please review the ``Business Confidential 
Information'' instructions noted in (a), above.

FOR FURTHER INFORMATION CONTACT: For questions about this notice, 
contact Raquel Cohen at the U.S. Department of Commerce, International 
Trade Administration, Office of Intellectual Property Rights, by email 
to [email protected], telephone number (202) 482-4146.

SUPPLEMENTARY INFORMATION: Section 2 of the Presidential Memorandum of 
April 3, 2019, ``Combating Trafficking in Counterfeit and Pirated 
Goods,'' directs the Secretary of Homeland Security, in coordination 
with the Secretary of Commerce and in consultation with other agencies 
and offices to prepare and submit a report to the President on the 
``State of Counterfeit and Pirated Goods Trafficking and 
Recommendations,'' with particular emphasis on the role of online 
third-party marketplaces and other third-party intermediaries, and, 
consistent with applicable law, to consult with intellectual property 
rights holders, online third-party marketplaces and other third-party 
intermediaries, and other private-sector stakeholders in preparing the 
report. Specifically, the report shall:
    (i) Analyze available data and other information to develop a 
deeper understanding of the extent to which online third-party 
marketplaces and other third party intermediaries are used to 
facilitate the importation and sale of counterfeit and pirated goods; 
identify the factors that contribute to trafficking in counterfeit and 
pirated goods; and describe any market incentives and distortions that 
may contribute to third-party intermediaries facilitating trafficking 
in counterfeit and pirated goods. This review should include data 
regarding the origins of counterfeit and pirated goods and the types of 
counterfeit and pirated goods that are trafficked, along with any other 
relevant data, and shall provide a foundation for any recommended 
administrative, regulatory, legislative, or policy changes.
    (ii) Evaluate the existing policies and procedures of third-party 
intermediaries relating to trafficking in counterfeit and pirated 
goods, and identify the practices of those entities that have been most 
effective in curbing the importation and sale of counterfeit and 
pirated goods, including those conveyed through online third-party 
marketplaces. The report should also evaluate the effectiveness of 
Federal efforts, including the requirement for certain Federal 
contractors to establish and maintain a system to detect and avoid 
counterfeit electronic parts under the Defense Federal Acquisition 
Regulation Supplement (DFARS) 252.246-7007, as well as steps taken by 
foreign governments, such as France and Canada, to combat trafficking 
in counterfeit and pirated goods.
    (iii) To the extent that certain types of data are not currently 
available to the Federal Government, or accessible in a readily usable 
form, recommend changes to the data collection practices of agencies, 
including specification of categories of data that should be collected 
and appropriate standardization practices for data.
    (iv) Identify appropriate administrative, statutory, regulatory, or 
other changes, including enhanced enforcement actions, that could 
substantially reduce trafficking in counterfeit and pirated goods or 
promote more effective law enforcement regarding trafficking in such 
goods. The report should address the practices of counterfeiters and 
pirates, including their shipping, fulfillment, and payment logistics, 
and assess means of mitigating the factors that facilitate trafficking 
in counterfeit and pirated goods.
    (v) Identify appropriate guidance that agencies may provide to 
third-party intermediaries to help them prevent the importation and 
sale of counterfeit and pirated goods.
    (vi) Identify appropriate administrative, regulatory, legislative, 
or policy changes that would enable agencies, as appropriate, to more 
effectively share information regarding counterfeit and pirated goods, 
including suspected counterfeit and pirated goods, with intellectual 
property rights holders, consumers, and third-party intermediaries.
    (vii) Evaluate the current and future resource needs of agencies 
and make appropriate recommendations for more effective detection, 
interdiction, investigation, and prosecution regarding trafficking in 
counterfeit and pirated goods, including trafficking through online 
third-party marketplaces and other third-party intermediaries. These 
recommendations should include suggestions for increasing the use of 
effective technologies and expanding collaboration with third party 
intermediaries, intellectual property rights holders, and other 
stakeholders.
    (viii) Identify areas for collaboration between the Department of 
Justice and Department of Homeland Security on efforts to combat 
trafficking in counterfeit and pirated goods.
    The Presidential Memorandum defines:
     ``Online third-party marketplace'' to mean ``any web-based 
platform that includes features primarily designed for arranging the 
sale, purchase, payment, or shipping of goods, or that enables sellers 
not directly affiliated with an operator of such platforms to sell 
physical goods to consumers located in the United States;'' and
     ``Third-party intermediaries'' to mean ``online third-
party marketplaces, carriers, customs brokers, payment providers, 
vendors, and other parties involved in international transactions.''
    The Secretary of Homeland Security, in coordination with the 
Secretary of Commerce, and in consultation with relevant agencies 
(``interagency''), is required to deliver this report to the President 
by October 30, 2019. A public version of the report will be published 
in the Federal Register within 30 days thereafter.
    In response to this directive, as part of its coordination in 
preparation of the report, the Department of Commerce is facilitating 
stakeholder outreach to better understand, inter alia:
     The extent to which online third-party marketplaces and 
other third-party intermediaries are used to facilitate importation and 
sale of counterfeit and pirated goods;
     The existing practices of online third-party marketplaces 
and/or other third-party intermediaries that are most effective in 
curbing importation and sale of counterfeit and pirated goods; and
     Recommendations for potential policy, administrative, 
regulatory, and/or legislative changes by the Federal Government that 
could be effective in curbing the importation and sale of counterfeit 
and pirated goods through online third-party marketplaces and/or 
enabling more effective law enforcement regarding the importation and 
sale of such goods.
    In preparing the report, the interagency already is considering

[[Page 32863]]

information and recommendations submitted by stakeholders in response 
to other U.S. Government solicitations for public submissions, 
including those received in connection with USTR's annual Special 301 
Report on intellectual property protection and Review of Notorious 
Markets for piracy and counterfeiting. For this notice, the Department 
particularly is seeking input beyond that provided through those other 
process.
    In addition, the interagency currently is considering potential 
``best practices'' guidance for online third-party marketplaces 
designed to prevent counterfeit and pirated goods from being offered 
for sale, such as:
    i. Conducting an advance vetting of the potential sellers/vendors, 
including to ensure that the goods are not being produced by forced 
labor (19 U.S.C. 1307; 18 U.S.C. 1589);
    ii. establishing and enforcing a ``prohibited items'' list of those 
goods that may not be sold through the marketplace (due to, e.g., the 
risks to public health and safety that would be posed by counterfeit or 
pirated versions of such goods and/or the high likelihood that such 
goods would be counterfeit or pirated in light of the nature of the 
authorized distribution channels for the legitimate versions of those 
goods);
    iii. taking down listings for counterfeit and pirated goods;
    iv. notifying customers that the marketplace has determined that 
the customer has, or may have, purchased counterfeit or pirated goods, 
and providing appropriate remedies to such customers; and
    v. notifying other third-party intermediaries, intellectual 
property rights holders, other stakeholders, and law enforcement that 
the online third-party marketplace has determined that a particular 
seller/vendor has been supplying counterfeit or pirated goods.

Request for Information and Recommendations

    Given the nature and import of the Presidential Memorandum, the 
Secretary requests information and recommendations from interested 
stakeholders, including but not limited to: Intellectual property 
rights holders affected by the importation and sale of counterfeit and 
pirated goods through online third-party marketplaces or other third-
party intermediaries; online third-party marketplaces and other third-
party intermediaries; and other affected persons or entities.
    Respondents may address any, all or none of the following 
questions, and may address additional related topics that have 
implications for combating the trafficking in counterfeit and pirated 
goods. Please identify, where possible, the questions your comments are 
intended to address.
    Respondents may organize their submissions in any manner, and all 
responses that comply with the requirements listed in the DATES and 
ADDRESSES sections of this notice will be considered. Reminder: 
Respondents have the burden to request that any information contained 
in a submission be treated as ``Business Confidential Information'' and 
must certify that such information is business confidential and would 
not customarily be released to the public by the submitter.
    While the Department welcomes all input considered relevant to the 
development of a report on the state of counterfeit and pirated goods 
trafficking through online third-party marketplaces and recommendations 
to combat such trafficking, the Department specifically seeks the 
following types of information and recommendations:
    1. How are your interests affected by counterfeit or pirated goods 
imported through online third-party marketplaces and other third-party 
intermediaries as those terms are defined in the Presidential 
Memorandum? (Specific examples and/or data would be helpful, including 
on the origins of counterfeit and pirated goods and the types of 
counterfeit and pirated goods that are trafficked. Information that is 
not publicly available can be submitted as ``business confidential'' in 
accordance with the instructions in the ADDRESSES section).
    2. What factors contribute to trafficking in counterfeit and 
pirated goods through online third-party marketplaces or other third-
party intermediaries, and what market incentives and distortions may 
contribute to the use of online third-party marketplaces and other 
third-party intermediaries to traffic in counterfeit and pirated goods?
    3. Are there effective technologies, the use of which--by the 
private sector and/or law enforcement agencies--could substantially 
reduce the sale and importation of counterfeit and pirated goods 
through online third-party marketplaces and/or enable more effective 
law enforcement regarding the trafficking in such goods? Please 
reference and provide copies of any available studies that demonstrate 
the efficacy of such technologies, or any available data that may be 
used to do so.
    4. To what degree can expanded collaboration and information 
sharing among online third-party marketplaces, other third-party 
intermediaries, intellectual property rights holders, other private-
sector stakeholders and/or U.S. law enforcement organizations 
substantially reduce trafficking in counterfeit and pirated goods and/
or enable more effective law enforcement regarding the trafficking in 
such goods?
    5. Are there Federal agency data collection or standardization 
practices, or practices involving provision of data to parties, that 
could promote more effective detection, interdiction, investigation or 
prosecution of underlying violations of U.S. customs laws and of 
intellectual property rights?
    6. What existing policies, procedures or best practices of online 
third-party marketplaces, other third-party intermediaries, 
intellectual property rights holders, and/or other private-sector 
stakeholders have been effective in curbing the importation and sale of 
counterfeit and pirated goods, including those conveyed through online 
third-party marketplaces?
    7. What additional policies, procedures or best practices of online 
third-party marketplaces, other third-party intermediaries, 
intellectual property rights holders, and/or other private-sector 
stakeholders can be effective in curbing the importation and sale of 
counterfeit and pirated goods, including those conveyed through online 
third-party marketplaces? What would it cost for industry to adopt such 
practices?
    8. What policy remedies, including administrative, regulatory, or 
legislative changes by the Federal Government (including enhanced 
enforcement actions) could substantially reduce the trafficking in 
counterfeit and pirated goods and/or promote more effective law 
enforcement regarding the trafficking in such goods? Please reference 
any available analyses that shed light on the efficacy and potential 
impacts of such proposed remedies.

    Dated: July 5, 2019.
Earl Comstock,
Director of the Office of Policy and Strategic Planning, Department of 
Commerce.
[FR Doc. 2019-14715 Filed 7-5-19; 4:15 pm]
BILLING CODE 3510-17-P