Cracking Piracy

Perfume Piracy Case Ends Bank Secrecy

Davidoff1 source Davidoff, Imago [M]
Hot, hot, hot.
  • Why it matters

    Why it matters

    The court ruling relaxing bank secrecy could have major impact on Germany’s banking system, sparking higher costs and a closer look at the legality of  clients’ actions.

  • Facts

    Facts

    • In the perfume case, the culprits managed to sell about €11,000 in counterfeit perfumes before the authorities stepped in.
    • French cosmetics maker Coty petitioned a court in eastern Germany for the release of the names of the accountholders who committed the act of product piracy.
    • When the case was referred the BGH, Germany’s highest court, it in turn referred it to the European Court of Justice (ECJ).
  • Audio

    Audio

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What started as a marginal court case in Germany could have a major impact on the country’s banking system. An investigation into an online seller of fake perfumes has led to a radical change in bank secrecy rules.

Bank secrecy has been under fire from all angles over the past few years. Much of the focus has been on countries like Switzerland and Luxembourg, which have been forced by authorities of late to end their own bank secrecy rules and even give up the names of clients that evaded taxes by parking money in their banks.

In Germany, which also tends to place a premium on data protection and the privacy of customer information, a court ruling Wednesday could have a similar effect.

It began with a classic case of counterfeiting. The online seller of counterfeit versions of Davidoff Hot Water was operating under a pseudonym on eBay. The maker of the original perfume, Coty, wanted to uncover the suspects’ real names by using the account data provided to eBay.

It proved a lengthy journey, pitting the cosmetics giant against the mid-sized savings bank, Sparkasse Magdeburg, a savings bank in eastern German that hosted the sellers’ accounts.

The savings bank initially resisted Coty’s request for the seller’s identity, citing secrecy requirements. That has now been overruled by the first civil division of Germany’s Federal Supreme Court.

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