4 June 2007 - Governments should work more closely with companies and strengthen enforcement to fight the rising global trade in counterfeit and pirated goods, according to a new OECD report.
Based on data from customs seizures in OECD countries, the report, entitled The Economic Impact of Counterfeiting and Piracy, estimates that trade in counterfeit and pirated goods across national borders may have totalled around USD 200 billion in 2005. The total value of trade in counterfeit and pirated goods, including products made and sold inside the same country, may have been several hundred billion dollars higher, the report said. Its estimate excludes the value of digital products distributed via the Internet.
“Trade in counterfeit goods is a big problem and getting bigger,” said John Dryden, Deputy Director of the OECD’s Science, Technology and Industry Directorate. “It is pervasive, it involves some pretty unsavoury and ruthless characters, and it has serious implications for health, safety, living standards and jobs. It is also a major disincentive to invent and innovate.”
Fake goods are being produced and consumed in most economies, with Asia emerging as the main region for such trade and China as the single largest source of production. The nature of pirated goods varies from market to market, with the main market for counterfeit car parts, for example, being in the Middle East, while consumption of counterfeit tobacco products is highest in Latin America, Africa and Asia. Counterfeit drugs are a major problem in Africa and there have been big seizures in Europe and North America. Counterfeit electrical components, food and drink and household products are appearing worldwide, with Africa, Asia and Latin America key regional markets.
The OECD report makes a number of recommendations for ways to address these issues:
Increase enforcement of existing laws;
Further strengthen co-operation between governments and industry to make current policies more effective and help identify new strategies to fight counterfeiting;
Strengthen criminal penalties to deter criminals and toughen sanctions to more effectively redress the harm caused to rights holders;
Educate consumers to raise public awareness of the growing threat to health and safety of substandard counterfeited products.
One of the biggest challenges facing governments and business is getting reliable and up to date information on the extent of counterfeiting and piracy and the impact on economies. The OECD recommends governments and business invest more in collecting and analysing information; agree a common approach to collecting enforcement data and develop a framework to report the health and safety effects.
See the executive summary here. The full report will be released later this year.
For further information, journalists are invited to contact Marcos Bonturi (Tel. + 33 1 45 24 19 59) or Danny Scorpecci (Tel. + 33 1 45 24 94 33), OECD Science, Technology and Industry Directorate or the OECD Media Division (Tel. + 33 1 45 24 97 00).