MOODLE ACTIVITY TASK 3

EVER BOUGHT FAKE GOODS?

BUYING COUNTERFEITS WHILE ON HOLIDAY IN
HONGKONG
TASK 1

The video focuses on tourists buying counterfeits while on holiday, mainly in Hong Kong
which is considered a shopping heaven for tourists. According to statistics 54% of tourist
expenditure is on shopping in Honk Kong as compared to other places where a combination
of activities is the main tourist expenditure. It is discussed that an aspect of shopping is
buying counterfeit products while on holiday. Counterfeits are products that are fake or
imitation of the real product as usually these fake products have some characteristics of the
real product. Such as designer labels that are copied. There are 2 types of counterfeit
products the first one is deceptive counterfeits where the consumer does not know the
product is fake while the other one is non-deceptive counterfeits where the customer is
aware that the product is fake. It is also learned that Hong Kong is the second most famous
place to go for counterfeit products while China being at number 1.Examples of common
counterfeits are electronic goods such as phones and designer wear such as Gucci and Loui
Vuitton. Counterfeits are damaging to the designer brands in terms of revenue. As people
spend money on fake products rather than the genuine product. This becomes a question of
intellectual property rights. It raises questions at ethics. Tourists who come from countries
which has strong intellectual rights buy counterfeit products. The term given to tourists
rationalising their decision is called neutralization. Which is shown in their behaviour such as
if everyone is doing buying counterfeits then I should too. While the other one is related to
condemn the condemner. Eg; Designer brands sometimes use child labour to manufacture
their products, tourists do not support this so they buy counterfeits to make designer
brands lose money. Finally the question comes to what should authorities do about the
issue of selling and buying counterfeits. Whether to punish the seller or the buyer? Whether
to stop the supply or the demand? As this has had a negative impact on the designer
industry as they are losing money. Also it is a question of ethics on tourist.

TASK 2

“Counterfeiting of fashion brands is a multi-billion dollar industry with an increasing number

of goods being counterfeited”[CITATION Pra20 \l 3081 ]. “With the luxury market value
growing at such a phenomenal rate, many luxury designer brands have become targets for
counterfeit producers”[ CITATION Pha09 \l 3081 ]. “The growth in the counterfeit market can
be attributed to the increase in world trade and emerging new markets”[ CITATION Pha09 \l
3081 ]. “As a result of fast-paced technology advancements, luxury goods are easier to
counterfeit, as technology is more easily available. Luxury brands are vulnerable targets for
counterfeiters, as they are popular with consumers. As very little research and development
costs are incurred, they are less expensive to manufacture. Luxury goods are replicated even
to the slightest detail in colour, design and range. All these come to the consumer at a
fraction of the original price, making them a welcomed alternative to original luxury
goods”[ CITATION Pha09 \l 3081 ]. “There are situations where consumers are ‘willing
accomplices’ rather than victims of deception, especially in cases of prestige
goods”[ CITATION Pha09 \l 3081 ].

However due to the sale of counterfeit products many luxury brands such as Cartier, Loui
Vuitton, Dior are incurring loss in revenue as well as loss of exclusivity and uniqueness to the
brand. The demand for Luxury goods is affected as there are many imitations available in
the market. Buying of fake goods displays the lack of ethics amongst tourists since
counterfeit goods are illegal. “Consumers rationalise purchasing counterfeits as justifiable
because they perceive themselves to be less unethical or illegal. Hence, consumers feel less
responsibility as a counterfeit patron. The ‘Robin Hood Mentality’ creates very little
consumer sympathy for gigantic multinational corporations that complain about profit lost” [
CITATION Pha09 \l 3081 ].

Tourists are knowingly purchasing counterfeit products therefore Anti-Counterfeiting forces

are losing the battle and not effective in stopping the sale of fake goods. “Many countries
have implemented anti-counterfeiting strategies to curb the problem. For example, the
French authorities have imposed a fine on those who bring fake designer goods into the
country. Singapore has always been supportive of the fight against piracy and
counterfeiting. Intellectual Property Office of Singapore (IPOS) has set up a special taskforce
to protect trademarks, designs and patent rights both locally and internationally. Yet this
has not deterred locals from purchasing counterfeit brands when they are overseas
travelling for pleasure or work”[ CITATION Pha09 \l 3081 ].

“While designers may assert their moral right to benefit from their work, an equal moral
argument might be made in favour of counterfeiters. Given that many operate in countries
where they face economic hardship, some might consider it a basic human right to make a
living whatever way one can in order to survive. The question then becomes which moral
right takes precedence –that of the designer or the counterfeiter. Similarly, although
designers might argue that counterfeiting deprives them of their legitimate economic rights
to benefit from their work and will harm society in the long term, it could be argued equally
on utility grounds that counterfeiters are merely serving a market of consumers that would
otherwise not be able to afford the legitimate product. In such circumstances, it could be
argued that the welfare of society as a whole may be in-creased by relaxing copyright
restrictions and that counterfeiters perform a social service” [ CITATION Hil04 \l 3081 ].

To conclude Ethically-minded consumers do not buy genuine items if they have high self-
image, whereas unethically-minded consumers will do so if they have high self-image
however “intellectual property is particularly prone to ethical disputes because there are
many different types of intellectual property to which rights can be attached and there is a
variety of different values according to which claims can be assessed. It is, therefore,
necessary to distinguish carefully between different types of counterfeiting and different
bases for ethical claims”[ CITATION Hil04 \l 3081 ].
BIBLIOGRAPHY

Hilton, B., Choi, C. J. & Chen, S., 2004. The Ethics of Counterfeiting in theFashion Industry: Quality,
Credenceand Profit Issues. Journal of Business Ethics, Volume 55.

Phau, I., Teah, M. & Lee, A., 2009. Targeting buyers of counterfeits of luxury brands: A study on
attitudes of Singaporean consumers. Journal of Targeting, Measurement and Analysis for Marketing,
Volume 17, pp. 3-15.

Pratt, S. & Zeng, C. Y., 2020. The economic value and determinants of tourists’ counterfeit purchases:
The case of Hong Kong. 26(1).