Retailers could face tough financial sanctions on own-brand products under proposals from the European Commission’s Internal Market and Services Directorate General (DG Markt).
A DG Markt report said “parasitic” own-label products, which copy existing brands, should be stamped out. It has recommended tougher financial sanctions from specialised intellectual property (IP) judges. The IP office is due to report on the matter to the British Government in May.
Retailers have been accused of misleading consumers into thinking they are buying branded goods, and British Brands Group (BBG) is lobbying for brand owners to be able to take civil action.
BBG director John Noble said: “Retailers who mimic brand packaging have no need to do so. It is blatant free riding that does their shoppers no favours.”
Shore Capital analyst Clive Black said a short-term impact was unlikely but “over time it may inhibit own-label progress”.
A BRC spokesman said: “If customers really bought an own-brand product by mistake, then felt they’d been conned by something inferior, they wouldn’t buy it again and own-brands would be in serious decline.”