A new assessment reveals the scale of lost revenues for national budgets as a result ofcounterfeiting
➢14.1% of the losses are in the cosmetics and personal hygiene sector
➢Organized crime groups are increasingly involved in the trade in counterfeit goods
According to a new report released today by the European Union's Intellectual Property Office (EUIPO), the economic and social losses caused by the sale of counterfeits deprive governments of revenue and can fund serious crimes such as drug trafficking and money laundering. The report estimates that EU governments lose up to € 15 billion a year from counterfeit goods on the market as a result of reduced revenue from direct and indirect taxes and social security contributions not paid by illegal producers.
In addition, the Office estimates that the EU is losing approximately € 19 billion in sales in the cosmetics and personal care, wine and spirits, pharmaceuticals, games and toys sectors. Counterfeits are not subjected to the same rigorous tests as the original goods to ensure that they are safe for consumption or use.
Losses from the sale of counterfeit goods, especially in the field of cosmetics and personal hygiene, have increased by more than 2.5 billion euros since the publication of the latest similar analysis of EUIPO in 2019, which is the largest increase among the surveyed sectors. Approximately 14.1% (€ 9.6 billion) of sales of counterfeit cosmetics are lost annually across the European Union. EUIPO's analysis also shows that 97% of counterfeit goods identified as dangerous that are stopped at the EU's external borders raise serious risk to consumer health. Most of the goods were intended for children and were toys or baby hygiene products or clothing.
The survey, conducted by EUIPO and Europol, also revealed theconnection between counterfeiting and other serious crimes. Since 2016, EU law enforcement agencies have carried out 29 large operations against counterfeiting and piracy, which have targeted organized crime groups involved in other serious crimes, includingdrug trafficking and money laundering.
The executive director of the Office, Christian Arshambo, said:"Forgery is not a crime in which there are no victims. Counterfeit products take away sales from legal businesses and deprive governments of much-needed revenue. But as our joint work with Europol shows, the proceeds of counterfeiting can also support serious organized crime.”
The assessments presented here are part of the 2020 Report on the Status of Intellectual Property Infringements, which brings together the reporting work of EUIPO in the field of intellectual property at European and global level, including the results of investigations conducted with the Organization for Economic Co-operation and Development (OECD) and the European Patent Office (EPO).The status report also contains a study on the volume of counterfeit andforgery goods in international trade and on the contribution of industries with intensive protection of intellectual property rights in terms of economic growth, jobs and international trade. The report includes new perspectives on how small and medium-sized enterprises (SMEs) could benefit from intellectual property.
EUIPO
EUIPO is an EU decentralized agency based in Alicante, Spain. It manages the registration of the European Union trade mark (EUTM) and the registered Community design (RCD), providing protection of intellectual property in all EU member states. EUIPO also carries out cooperation activities with EU national and regional intellectual property offices.
The European Observatory on Intellectual Property Infringements was set up in 2009 to support the protection and enforcement of intellectual property rights. It was transferred to EUIPO on 5 June 2012 by Regulation (EU) № 386/2012 of the European Parliament and the Council.
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