A VERY ‘REAL’ PROBLEM
Vendors are finding it extremely difficult as counterfeit and pirated products looking exactly like the real ones, are flooding the market. They are engaging various law enforcement agencies to tackle the problem
Fake, phony, counterfeit, bogus, copied, fictitious, forged, pseudo, pirated, grey, sham, lookalike, imitation and many more words are can be used to describe counterfeit products. The market for reverse engineered or fake products has increased to hundreds of billion dollars and has grown at a large scale in last two decades. This business is rampant in India and is causing a colossal revenue loss to the entire business ecosystem.
A typical dictionary definition states “To counterfeit is to sell or market a non-genuine product as a genuine.” In a generic sense, such products are sold under the name of renowned brands or companies and an unwary consumer s misled to believe that the product originates from the same manufacturer or vendor. When an individual deals in such a sham it is nothing but cheating a customer and making the person believe that he is buying the original branded product from the same company or braiters as a prime location for the production of counterfeit goods both for domestic sales and exports.
The International Chamber of Commerce (ICC) sees an even bigger problem. When factoring in the counterfeit market within countries, plus the value of pirated digital material, the ICC estimates counterfeit goods were worth $650 billion in 2008. The ICC said that the cost of lost tax revenue and additional welfare spending due to counterfeit goods was $125 billion in developed countries alone. And 2.5 million jobs have been lost as a result of fake products. By 2015, ICC expects the value of counterfeit goods globally to exceed $1.7 trillion. That’s over 2% of the world’s total current economic output.
On the other hand, as per the World Intellectual Property Organization (WIPO), counterfeiting business is costing the global economy more than US $100 billion every year.
According to an estimate by the Associated Chambers of Commerce and Industry of India (Assocham), based on a recent study, widespread sale of counterfeit products across various sectors like electronic goods, automotive components, consumer durables, pharma, herbal medicines and cosmetic products has become so alarming as to capture a market of ` 55,000 crore by 2013. On account of the increasing sale of fake products in the absence of regulations, the revenue loss to the exchequer would have exceeded ` 5,000 crore for FY12.
“Delhi is the hub of counterfeit products as nearly 75 per cent of such products originate here. FMCG companies face upto 45 per cent loss and an average loss of around 25 per cent in their market share of their well-known products,” said D S Rawat, secretary general, Assocham.
“The total sale of contraband electronic items, consumer durables, automotive compo-