Yep, looks like an external power filter. I'm not sure of the brand, it doesn't look like any I'm familiar with. Is the sponge you're using made specifically for use in this (or another) tank filter? It looks rolled up in the media compartment.
So long as the sponge you're using is fish safe, it is fine to use. Since you only have one media insert, though, (the sponge), it will be the source for mechanical *and* biological filtration, so to clean it you should squeeze it out in removed tank water or relatively same temp dechlorinated water. (Chlorine can kill off the "good bacteria".) Should you find it necessary to replace the sponge, take a piece of the old sponge and put it amongst the new sponge so as to "seed" your filter with good biobugs.
Now onto your fish problems...
First of all, beautiful fish

Too bad you have such an unfortunate reason for making the video clip. You mention the gills are unable to close, swimming problems, and I notice one fish on the bottom in the video. Are any of these symptoms recent? How long have you had these fish and how long has the tank been set up? It looks like there are 5 fish in this tank - is that correct?
First things first, like Fishyfan suggested, you need to check your water. 8 gallons is not a lot of water for 5 fish. Ideally you'd want 50-60 gallons or more for all those beauties to live healthy lives. Goldfish are fat bodied and produce a lot of ammonia, so they need a good water to fish ratio. They can also grow quite large (commonly 8-9") so they need a lot of physical space to swim around.
It is possible that the root of your problems here is water quality. Even if it isn't, you need perfect water to medicate effectively - anything less will only stress the fish further.
Open gills (when they cannot close) are often a sign of parasites (most commonly flukes), but it could be infection due to poor water as well. If you are brave enough to take your fish out of the water and lift his gill cover, that would be a good indication of what's going on there. The filaments should look bright red, not dark red, brown or pink, and should not be clumped together or have any white patches. The gills should have a clean arch and not be missing any sections or have the edges look tattered.
The fish sitting on the bottom could be due to poor water or parasites; the fish with the swimming trouble, same thing. Fish often flip or have trouble maintaining their position in the water in the presence of another stressor (such as parasites or poor water).
How long since your last addition to this tank? Have you ever had any deaths in this tank, and if so, what symptoms if any did they exhibit? How large are these fish? Also, as Fishyfan asked, how frequently do you do water changes and how much do you change?
Getting your water checked is the most important thing right now. I am in the US and am not familiar with Interpet meds. What are the ingredients of the med you're using and what are its dosing directions? I would not have suggested medicating without further information, but since you've already started, you could carry out the rest of the treatment. If you're going to continue to treat, I'd suggest you do a very large water change on the "hospital tank" every day, since it doesn't sound like it is filtered and even if it is, we don't know that the filter is cycled.