Manufacturers lose $70 billion yearly to counterfeits

BERLIN: Manufacturers in the EU suffer revenue losses of $70 billion per year as a result of counterfeit goods being brought into the region, the European Union Intellectual Property Office (EUIPO) said in a report on Wednesday.

The report predicted higher revenue losses for manufacturers in the future, with up to $99 billion expected to be lost to counterfeiters.

“Lenient sentences and high returns on capital are incentives for criminal gangs to engage in counterfeiting activities,” said the EU agency, which is based in Spain.

As counterfeiters have become more professional, the range of counterfeit products they offer has increased, with almost all branded products — not just luxury goods — being imitated in the shadow economy.

The report analysed 13 industries and their supply chains, finding that the most commonly counterfeited products included watches, shoes, perfume, cosmetics, and leather products.

Low prices and “a low degree of social stigma” around purchasing counterfeit goods are among the reasons for consumers to buy fake goods, according to the report.

The economic damage of the counterfeit economy is said to cost individual EU citizens $135 per capita.

The report found that Albania, Morocco and the Ukraine were the main transit countries for fake goods to enter the EU. — dpa