Counterfeiting- a global pandemic

Counterfeiting is a global pandemic. The statement is gospel truth – a reality which regularly haunts governments, businesses and consumers. No wonder, everyone is suffering from the menace of counterfeit products which is regularly confirmed by news and reports coming from different parts of the world. So, whether you buy a luxury handbag from a mall in Dubai or a costly sports watch from a store in Madrid or even something as simple as a pain-relieving pill from a pharmacy shop in India – the genuineness of each of the items lurks in uncertainty.

Counterfeiting has spread like a disease affecting every industry and rarely any product stands a chance against it. But, long ago, counterfeiting was just limited to currency. Some of the earliest reports of counterfeiting date back to 18th century when counterfeiters tried their best to copy currency coins and later switched to paper currency bills.

Many experts believe that rapid globalization is one of the reasons behind rampant counterfeiting. They claim that in a bid to increase profits corporate giants shifted their manufacturing facilities in countries with cheap land and labour. However, they did not realise that the countries did not have regulations and laws in place, to counter duplication. This loophole paved way for counterfeiting of original products. It was usually done with the help of employees or workers who sold the manufacturing process and technology to forgers. With the passage of time, as technology became accessible organized crime syndicates got involved in the business of counterfeiting on a much larger scale.

Since, there were no stringent IP (Intellectual Property) regulations counterfeiters were able to sell them locally with ease and even smuggled them to other parts of the world. Gradually, cheap grade goods were welcomed by the masses, all over the world, as they were affordable and visually appealing – just like the original products. This dealt a severe blow to the profits and image of legitimate companies and brands. According to a report by OECD (Organisation for Economic Co-operation and Development) United States, Italy, France, Switzerland, Japan and Germany are the hardest hit countries, with the majority (83%) of fake goods originating (not surprisingly) from China and Hong Kong. European brands are among the most impacted, with an estimated 5% of all goods imported into the European Union (EU) being fake. This represents as much as $118 billion.

Another factor behind the growth of counterfeiting worldwide is the rise of free trade zones in different parts of the world. Free trade zones provide tax advantages and other exemptions which helps to boost the economy of the host country. However, it also leads to a rise in counterfeiting and piracy as there are little checks and easy transport facilities available in these zones.

Nowadays, counterfeiting has intruded the online marketplace. We regularly encounter spurious websites and social media links on the web which showcase alluring deals on different kinds of products. But do we really know how the product actually looks like? What is the credibility of the website? How to determine the genuineness of the online product? Despite the uncertainties, we fall into temptation and buy those products, without thinking about the repercussions. According to International Trademark Association, “Criminals prefer to sell counterfeits on the Internet for many reasons. They can hide behind the anonymity of the Internet with the Dark Web even their IP addresses can be hidden. The Internet gives them the reach to sell to consumers globally-outside of the national limits of law enforcement.”

Governments across the word are taking strict measures to curb the menace of counterfeiting. New regulations and laws are being implemented. International brands are spending millions on creating awareness about their counterfeited products. Most importantly, the anti-counterfeiting industry has witnessed a significant growth as more companies are using different kinds of anti-counterfeiting solutions to secure their products against duplication. Finally, the global problem of counterfeiting must be addressed on multiple fronts with collaborative efforts of the government, industry players and anti-counterfeiting solution providers.