This article is authored by Saumya Verma, Research Scholar, currently pursuing her Ph.D. in IPRs and Geographical Indications at Rajiv Gandhi National University of Law, Punjab.

The UNIQLO Sling bag attained lots of popularity through Instagram reels and TikTok owing to its attractive features like large size, stylish design, plenty of colour options and affordable pricing i.e. £ 14.99 in the United Kingdom. There’s a trend going on in the world of fast fashion that whenever any big brand releases its product, the consumers start searching for its affordable dupe in the e-commerce platforms so as they could flaunt it on their social media profile to get more followers and likes. The similar thing happened with this case where the sharp-eyed consumers following latest trend started searching ‘Dupes of UNIQLO Crossbody Bag’ on the websites where there is a possibility to get the cheap copies of the famous brands i.e. on SHEIN or Alibaba.

The e-commerce platforms like SHEIN or Alibaba are operated from China to monitor the hot picks in the market and create their replicas at a very low price. Currently, the brand SHEIN has been alleged to steal the design of the sling bag of UNIQLO. Consequently, UNIQLO filed suit against SHEIN for violating its Designs Law by producing the counterfeited product of its originally designed sling bag, therefore seizing a considerable portion of the UNIQLO profits which it legitimately deserves. The suit has been filed at the Tokyo District Court in 2023, which found the counterfeit products of their bags being sold in the shopping outlets as well as the e-commerce hubs.

UNIQLO asserts that the marketing of counterfeits of its bag by SHEIN would substantially weaken the customer trust in their brand and its products. It further claims that its rivals are using the popularity of its brand and illicitly copying their product designs to sell it off in a very low cost to establish their own brand identity which is a clear violation of UNIQLO’s IPR. According to the Designs Law of Japan, the sale of counterfeited products lacking any original value or creativity is strictly prohibited. UNIQLO further claims that the business and marketing strategy of SHEIN to replicate a protected ‘Goods Configuration’ is very similar to the protective clothing in United States of America. Therefore, UNIQLO has alleged SHEIN for design and copyright infringement as well as unfair trade practices. There are other fashion brands also which have filed suit against SHEIN accusing it for the similar reason. Temu is one such company which has sued SHEIN for its ‘anti-competitive conduct’ and is allegedly trying to expand its supremacy among fast fashion brands in America.

The fashion brand, SHEIN was established in Nanjing, China during global financial crisis of 2008. It is building its logistics hub in Guangzhou. Its business strategy includes aggressive advertising on social media websites like TikTok, YouTube, Instagram, Facebook etc. Consequently, it has gained immense popularity among the influencers and consumers. The affordable prices and fashionable designs of its products (as similar as to the big brands) have earned it a fan following in middle- and low-income countries like India. This has allowed SHEIN to expand its market. On the other side, UNIQLO is a Japanese fashion retailer which started as ‘Ogori Shoji’ in Yamaguchi Prefecture and expanded to 22 other stores under the supervisory of Tadashi Yanai. In 2021, it emerged as the most popular fashion brand with a market capitalization of $103 billion, transcending market capitalization of ZARA i.e. approx. $99 billion.

The current lawsuit between UNIQLO and SHEIN highlights an interesting transnational dispute centered around design and copyright infringement. The Article 2 of Designs Law of Japan defines design as embodying the ‘Shape’, ‘Patterns’, ‘Colours’ or any other combination of these elements on a product or part of it that prima facie creates an aesthetic impression for the consumer/observer. The priority system established under the Paris Convention is also applicable under the Japanese Designs legislation, provided that the application for design registration is submitted within six months of the earliest effective priority date of a foreign application. The grace period has been kept up to six months in Japan during which novelty of design remains preserved. According to Article 21 of the Designs law in Japan, the design patent lasts for 20 years from its date of registration.

The design infringement assessment in Japan closely resembles the infringement test applied in the United States. According to the Article 20 of the Japanese Designs Statute, the assessment of the deceptive similarity among the counterfeited product and original product relies on the ‘Ecstatic Expression’ that a particular design creates in the eyes of the observer/consumer. The test is based on the shared aesthetic appeal formed from the perspective of an average consumer. If the product’s aesthetics appeals equally in the eyes of an average consumer, then it is considered as the infringement of design. While determining the infringement in any case, it is crucial to demonstrate the pattern as well as the key designs which attract the attention of the buyers.

Even if the design which has been counterfeited or infringed, have not been registered under the designs statute can be protected under the Japanese Unfair Competitive Prevention Act on the basis of fulfilment of certain conditions as provided under the said law. This particular law deals with the conduct related to unfair competition and includes several aspects of intellectual property concerned violations. As per the Japanese law, the sale of product that is a counterfeit of someone else’s design is not allowed until unless three years have been passed since the day the originally designed product was first sold in Japan. According to Article 20 of the Designs law, a design right is enforceable once its registration is done.

There’s a strong probability that the continuing lawsuit between UNIQLO and SHEIN can transform the IPR protection in the global fashion industry. This case may establish fresh standards for defining, interpreting and defending the originality of a design in the era when the designs are being increasingly replicated digitally. The fashion brands all over the world will be closely watching this legal tussle and its outcome that may have significant impact for design practices, protection measures and legal strategies. As the business approach and success of the brands like SHEIN banks heavily on the algorithm-based methodology which is rapidly changing the prevalent fashion designs, this lawsuit can be proved to be a roadblock to this core business tactic of SHEIN. If the verdict goes in favour of UNIQLO, in that case SHEIN will be forced to revise its business approach and manufacturing techniques. This will need substantial investment in proposing novel designs and an improved compliance mechanism.

The verdict may possibly lead to a meticulous review of the existing Designs legal framework in not only the two countries but in the whole world. It is expected that the judgment will have a significant impact on slowing down the creation of deceptively similar designs and sale of such counterfeited products bearing the imitated designs violating IPRs. The stride of innovation and novelty in design protection is expected to accelerate because of the significant investments in artificial intelligence and machine learning technologies that may effectively identify the design similarities. This could provide impetus for the new startup ecosystem fixated on the advanced technologies for the protection and authentication of designs giving rise to new market opportunities.

The international aspect of this dispute underscores the requirement of a more robust intellectual property protection frameworks. The present litigation is expected to have significant financial implications as well that may affect market valuation, investment approaches and competitive landscape in the fashion industry. This litigation prompts deep reflection on creativity, novelty and originality in today’s digital atmosphere, compelling careful consideration of the fine line while interpreting the ongoing fashion trend and design piracy. This will lead to stricter design registration procedures, sturdier enforcement mechanism, and clearer standards for design originality. For UNIQLO, it’s not just another common lawsuit but it is a strategic declaration about the relevance of an original design. It will position its brand identity as a defense of its novel expression and integrity which in will bolster the brand reputation in the fiercely competitive fast fashion landscape.

Other References:

1. Fast fashion global market report 2021. (2021, May 27). Business Research Insights
2. Liang, Y., Lee, S.‐H., & Workman, J. E. (2020). Implementation of artificial intelligence in fashion: Are consumers ready? Clothing and Textiles Research Journal, 38(1), 3‐18.
3. McCann, M. (2021, May 24). How Shein surpassed Amazon as the most downloaded shopping app in the U.S. Modern Retail.

About Author:

Author is a former Law Officer, Canara Bank, Bengaluru, India (A Public Sector bank in India). She possesses expertise in legal drafting, the SARFAESI procedure, providing legal advisory services, and handling debt recovery cases under the RDDBFI and Insolvency and Bankruptcy Act. She has also worked as an Insolvency and Bankruptcy Code Professional for Manupatra Information Solutions Pvt. Ltd. She is currently pursuing her Ph.D. in IPRs and Geographical Indications at Rajiv Gandhi National University of Law, Punjab. She is an author and extensively written for renowned books, journals, blogs and newspapers.