IPR Infringements
An entity infringes an intellectual property right (IPR) when they use an intellectual property (IP) without the permission of the owner. The unauthorised use of an IP is potentially a serious crime.
Counterfeiting and piracy are IPR infringements which refer to the unauthorised use of trademarks and copyright, respectively.
Organised criminals often smuggle counterfeit and pirate goods using the same trade routes developed for the smuggling of narcotics and weapons. Indeed, the profitability of counterfeit and pirate goods often exceeds that of other criminality, including narcotics.
Impact on Society of IPR Infringements
Economy
A 2019 study by the European Union Intellectual Property Office (EUIPO) and Organisation for Economic Cooperation and Development (OECD) estimated that the international counterfeit and pirate trade was worth up to USD$ 509 billion per year. However, this estimate did not include domestically produced and consumed products or non-tangible digital products. If these types of products were included, the EUIPO and OECD Study estimated the value of the international counterfeit and pirate trade would be several hundred billion dollars more than USD $ 509 billion.[1]
The EUIPO and OECD Study highlights the scale of funding Governments and legitimate businesses are losing to the counterfeit and pirate trade. Funding which could be used to improve society (e.g. build schools, construct hospitals et al) and create jobs.
Health and Safety
The EUIPO and OECD Study also revealed counterfeiting is not confined to luxury items, such as designer watches and clothing, but has expanded to include pharmaceuticals, food, drink, medical equipment, personal care items, toys, tobacco and automotive parts, threatening consumer health and safety.
Interpol states “Trademark counterfeiting and copyright piracy are serious intellectual property crimes that defraud consumers, threaten health and safety, cost society billions of dollars in lost government revenues, foreign investments or business profits and violate the rights of trademark and copyright owners. Imitation products pose a significant safety threat to consumers worldwide. Unsuspecting customers put their health, and even life, in jeopardy each time they use counterfeited products, counterfeited alcoholic beverages and food products or travel in automobiles and aircrafts maintained with substandard counterfeit parts.”[2]
Whilst the World Health Organisation (WHO) claims that “Counterfeit” medicines and other health products can have harmful effects on a patients’ health, including death.”[3]
Organised Crime
The United Nations Office on Drugs and Crime (UNODC) has estimated the global market for illicit drugs to be over USD$ 320 billion.[4] This is less than the EUIPO and OECD estimate for the value of the international counterfeit and pirate trade, of up to USD$ 509 billion, and highlights the attraction of counterfeiting and piracy to organised crime, especially when you contrast the resources Governments and law enforcement agencies allocate to fighting the illicit drug trade with the resources allocated to the counterfeit and pirate trade.
According to Interpol, “Transnational organized criminals generate hundreds of billions of dollars annually from the manufacture and distribution of fake (counterfeiting and pirate) products, due in part, to the relatively low level of risk and comparatively high level of profit. There is an ever growing need for facilitation and coordination of international efforts in combating this criminality, which operates across international borders and has very serious consequences for the public.”
[1] Trends in Trade in Counterfeit and Pirated Goods, EUIPO and OECD, 2019.
[2] International Intellectual Property Crime Investigators College, Interpol, 2016.
[3] International Medicinal Products Anti-Counterfeiting Taskforce, 2015
[4] United Nations Office for Crime and Drugs, Annual Report, 2014.