Counterfeiting is a global problem, with annual lost revenues worldwide now believed to be approaching € 1,000 billion, a figure which equates to around 7-8% of world trade. Additionally, there are estimated to be some 200,000 jobs lost worldwide each year because of counterfeiting.

Within the EU, businesses which operate internationally are annually losing between € 400 and € 450 billion alone. This figure was published early in 2005 by Commissioner Laszlo Kovacs in a speech he made to the EC. He identified that piracy has risen 400% in the last four years.

Some key areas of losses due to counterfeiting within the EU can be seen in the following Table.

Losses through counterfeiting and piracy

Sector	Annual Losses
Clothing & Footwear	€ 7.5 billion
Pharmaceuticals	€12.6 billion
Tobacco	€ 8.2 billion
Wines & Spirits	€ 0.5 billion
Software	€ 3.8 billion

 

Other studies carried out in the Single Market indicate that counterfeiting/piracy as a percentage of legitimate trade may be as high as 39% in the data processing sector, up to 16% in the textiles and audio-visual sectors, and up to 10% in music and automotive spare parts.

While such revenue or percentage losses are high, they are only part of the total negative costs to society as whole. Counterfeiting is a major force behind the expansion of organised crime, tends to undermine public morality and also encourages corruption at many levels.

Some commentators have indicated that they believe that if losses through counterfeiting begin to exceed 10% of world trade there is a danger that some national or global economies may begin to become unstable.

Only a fraction of counterfeits entering the Single Market are seized by Customs

Statistics published by the European Commission in February 2005 show a significant increase in the amount of counterfeit and pirated articles seized at the EU's external borders in 2003. Customs officials seized almost 100 million of such articles in 2003 compared with 85 million in 2002, of an estimated value of one billion euros. Of particular concern in terms of consumer health and safety is the increase in the number of seizures of games and children's toys, with 12 million seizures representing a 996% increase over 2002. Seizures of food products and medicines increased in the same period by 77%. The trend in recent years of a move from smuggling luxury goods to smuggling more everyday products continued in 2003.

Statistics on EU seizures can be viewed at:

Connect to EU Statistics