Though various third parties have published guidelines for spotting a counterfeit Rolex, the luxury watch company has its own, interesting system to differentiate between authentic and fake pieces. The Fashion Law explains that even watches manufactured in Rolex’s own workshops can fall under the "counterfeit" category.
The Swiss company determines that any Rolex watch that has been altered using non-authentic or unapproved Rolex parts is counterfeit. According to the watch company, any non-Rolex components will impact the watch's aesthetics and functionality, so much so that Rolex can no longer guarantee the watch’s quality. Thus, Rolex deems these watches counterfeit.
Rolex's definition goes beyond the US Trademark Act of 1946, which protects companies against trademark infringement, and defines "counterfeit" as anything having a "spurious mark identical with, or substantially indistinguishable from, a registered trademark."
Head over to The Fashion Law for a full rundown of the legal ramifications.