Tomorrow 8th June is World Anti-Counterfeiting Day!
As the warm weather returns and many consumers look forward to vacations abroad, World Anti-Counterfeiting Day serves as a timely reminder to be cautious when purchasing products, especially counterfeit ones.
Consumer behavior
According to the IP Awareness Report published by the European Union Intellectual Property Office (EUIPO) for the period of 2023 [1], 13% of EU citizens intentionally purchased fake products, with this figure increasing to 19% among Luxembourg consumers.
Regarding these statistics, especially for young citizens in the EU, the impact of online resources must also be taken into consideration. As revealed by the EUIPO survey, the percentage of young consumers aged 15-24 who intentionally bought counterfeit products online reaches 34% in Luxembourg and 37% in the EU [2].
Buying counterfeit products online
Regarding the digital content, 21% of the Luxembourg citizens downloaded/streamed from illegal sources while the European average is 14%.
The results for “EU youth” using illegal resources for download or streaming show that 28% of Luxembourg consumers and 21 % of European ones do it intentionally. The vast majority of young consumers simply do not use illegal sources for digital content, and we can rejoice at this news.
Download/streamed from illegal sources
Most of the European citizens consider acceptable to choose the pirate alternative when the content they are looking for is not available in their legal platform subscription. However, this is important to note that if an affordable legal option is available, 80% of Europeans choose to access online content through legitimate sources.
As a EUIPO/OECD report [3] showed that the amount of counterfeit goods imported into a nation is correlated with the degree of e-commerce development in that nation, development of e-commerce and new technologies must not be at the expense of intellectual property rights.
The European Commission issued in March 2024 thus a Recommendation [4] with “strategic initiatives to combat counterfeiting and strengthen the enforcement of intellectual property rights, setting out dedicated tools to increase companies’ resilience and ability to better protect their intangible assets, including against cyber-theft”.
Economic and social costs of counterfeiting in the EU
The economic consequences of counterfeiting activities in Europe have been assessed by the EUIPO in a study focusing on the clothing, cosmetics, and toys sectors [5]. It allows to place figures on this phenomenon and quantify its various consequences, mainly:
the loss of jobs throughout the value chain;
the economic loss for the legitimate seller;
the support to organised crime;
the negative effects on the institutional and legal environment; and
the safety and wellbeing threats.
Awareness of the consequences of buying intentionally – or not! – counterfeit products is essential. Indeed, losses to genuine industries attributed to the sale of counterfeit goods in their markets are logically predicted to increase with the number of consumers who acknowledge buying fake goods.
Counterfeit products also represent a thread for their purchaser’s health and safety. Cosmetic products are especially concerned here but other goods like toys can be dangerous for kids too. The among of dangerous products represent 15% of the counterfeit goods seized at the EU borders, as highlighted in the IP Crime Threat Assessment 2022 [6].
In addition, intellectual property crime is connected to many types of criminal activity, including as money laundering, document fraud, cybercrime, fraud, drug manufacturing and trafficking, and terrorism [7].
Illegal companies involved in manufacturing and selling fake products are likely not registered businesses and do not pay taxes. As a result, a significant portion of their unlawful operations likely involves organized criminal groups participating in money laundering and tax avoidance.
In summary, being aware of the existence and implications of intellectual property rights enables consumers to make informed decisions, both when travelling abroad and in their daily lives, including online.
Importance of IP rights
As each individual is a consumer and potential IPRs owner, everyone gains from the robust protection and enforcement of intellectual property rights. Effectively protecting intellectual property rights (IPRs) is therefore crucial.
Jurisconsul Law Firm offers a tailored range of legal services for intellectual property protection, from identifying valuable assets that can be protected through IPRs to enforcing those rights. Our services include, among others, strategic advice for trademark and domain name portfolios, copyright licensing and transfer agreements, dispute resolution, and litigation.
[2]https://app.powerbi.com/view?r=eyJrIjoiNDZkODM3ZmEtZGYzOS00N2UxLThiMDktODVkZWViYmQzZWVmIiwidCI6IjMwYmEwYzY1LTA0YmItNDRlOS04YmQwLWNjZGFhNWIxYWRjYiIsImMiOjl9&embedImagePlaceholder=true
[3] EUIPO/OECD report on ‘Misuse of e-commerce for trade in counterfeiting’
[4] Commission Recommendation on measures to combat counterfeiting and enhance the enforcement of intellectual property rights, C(2024)1739, available on: https://single-market-economy.ec.europa.eu/publications/commission-recommendation-measures-combat-counterfeiting-and-enhance-enforcement-intellectual_en
[7] The EUIPO/EUROPOL (2020) report provides a few case examples.