Apr 23, 2026 | Doing business well inevitably leads to infringement: Five strategies for SME owners to protect their rights

Doing business well inevitably leads to infringement:
Five strategies for SME owners to protect their rights

1. Many Hong Kong SME owners think, “Infringement? It’s a small matter, let it be.” If you think this way, you’re making a big mistake. Infringement is like an anthill; if you ignore it at first, it will be everywhere in a few months. Soon, the market share of infringing goods will far exceed your genuine products. Customers will start patronizing infringing stores because of the lower prices, retailers will be forced to sell infringing goods, and your market share will be eroded.

2. Therefore, when you encounter infringement, you must fight it, and the sooner the better. The following five strategies are the most effective in practice.

First Strategy: Control online platforms and issue warning letters to cool things down

3. Nowadays, infringement activities are concentrated online. Whether it’s Facebook, Carousell, or HKTVmall, once you find someone selling your infringing goods, you must issue a stern warning letter immediately. Don’t underestimate the power of a warning letter. If the letter is strongly worded and the legal arguments are clear, most platforms and infringers will immediately remove it to avoid trouble. Even if infringement has become rampant, a concentrated wave of warning letters can reduce overt infringement by up to 90% within six months.

4. This step has the lowest cost and fastest return, making it crucial for stopping the bleeding.

Second Strategy: Use a court lawsuit as a “sacrifice” to deter others

5. Some infringers may ignore warning letters. In this case, consider filing a lawsuit, targeting one or two of the most representative and stubborn infringers. Experience shows that most infringers will stop immediately after receiving a court summons. They’ve calculated that losing the case means not only financial losses but also hefty court fees and wasted time and energy—costs far exceeding any potential profit from a lawsuit.

6. Unless they are bitter business rivals, most normal businesspeople will surrender upon receiving a summons. Court proceedings employ a “leniency for surrender, severity for resistance” strategy, aiming to achieve maximum victory with minimal cost.

Third Strategy: Issue a Strong Statement to Deter the Market

7. Litigation isn’t just about the courtroom; it’s also about the market. After launching an operation, a strong statement should be issued to the public and customers. The content must be firm: stating that you “will never let any infringer go,” who you’ve already sued, and that you’re applying for injunctions and pursuing damages. This statement serves two purposes: first, it warns hesitant infringers that you are serious; second, it persuades customers that buying genuine products provides protection. This psychological warfare can often change the entire market atmosphere.

Fourth Strategy: Approach “Counterfeit” Customers with a Genuine Approach

8. There’s a group of customers who will buy genuine products from you, but then, tempted by lower prices, buy counterfeit goods from neighboring shops (i.e., “counterfeit” products). For these customers, it’s not advisable to eliminate them immediately; instead, a gentle approach is needed. You can proactively contact them, gently informing them to stop the infringement, while demonstrating your determination to combat it. When they see that you’ve actually prosecuted a few persistent individuals, and that continuing to “counterfeit” might make them the next defendant, most will obediently return to buying genuine products from you. After all, no one wants to get into legal trouble for a small amount of money.

Fifth Strategy: Report to Customs, Criminal Prosecution Creates a Ripple Effect

9. If the infringement involves registered trademarks or copyrights, it goes beyond the civil realm and becomes a criminal offense. You can decisively report it to Hong Kong Customs.

10. Customs has the right to investigate and prosecute; even successfully prosecuting only one or two cases can have a huge ripple effect. Because once criminally convicted, infringers not only have a criminal record but also face imprisonment. This deterrent effect of criminal liability is far greater than civil compensation and is the most effective way to deter the entire industry.

In conclusion: Combating infringement is a battle we cannot afford to lose

11. Infringers are like vultures; they swarm to you at the smell of money. If you choose to ignore them, they will only multiply and eventually devour your market. SMEs have limited resources, but by adhering to the principle of “early detection and early handling,” and making good use of warning letters, civil litigation, criminal reports, and public relations, they can absolutely protect their hard-earned brand and market share at the lowest possible cost.