IFPI Comment on European Commission's launch of Action Plan to combat counterfeiting and piracy

Brussels, 12 October 2005

Frances Moore, IFPI Regional Director for Europe, said: "We welcome the Commission's new action plan to improve the operational performance of national customs authorities in the fight against counterfeiting and piracy. It is a multi-pronged approach which for the first time is commensurate with the size of the problem.

"For the music industry alone, the pirate market is estimated to be worth US $4.6 billion at pirate prices worldwide. Commercial losses to the music industry from piracy are substantially higher.

"According to the latest figures from the Commission, it made some 18.5 million seizures of optical discs (including CDs and DVDs) in 2004."

Specifically, IFPI welcomes:

The strengthening of external borders. This is especially needed for some of the new EU Member States since surrounding countries such as Russia, Bulgaria and Ukraine take advantage of those new countries with weaker border protection to export pirate products into the EU.
Piracy is a very sophisticated illegal business with highly developed distribution networks and the new Customs Information System should help to dismantle these networks.
By bringing airlines, shipping companies and express couriers into the fight against counterfeiting and piracy, the Commission will be making it more difficult for these pirate networks to operate.

For further information contact: Francine Cunningham, IFPI European Office, Tel: + 32 2 511 92 08

Email: Francine.cunningham@ifpi.org

IP/05/1247

Brussels, 11 October 2005

Customs: Commission launches Action Plan to combat counterfeiting and piracy

(See also MEMO/05/364)

The European Commission has presented a package of measures to strengthen protection for the EU and its citizens against counterfeiting and piracy. The measures proposed for action in 2005 and 2006 would increase Community level protection through improved legislation and operational controls, strengthen the customs/business partnership and reinforce international co-operation in this area. Statistics showing the amount of counterfeit and pirated articles seized at the EU's external borders in 2004 demonstrate that counterfeiting is a growing and increasingly dangerous phenomenon. The 103 million counterfeited and pirated goods seized in 2004 represent an increase of more than 12% compared to 2003 and 1000% compared to 1998. Fake foodstuffs, medicines, household items and car parts, that can damage the health and safety of consumers, are continuing to grow in number and the higher quality of fakes is making detection more difficult.

"The growing number of counterfeit seizures at the EU's external borders has convinced me of the need to put in place a strategic plan for short term action" said EU Taxation and Customs Commissioner Laszlo Kovacs. "The international criminal networks behind this activity are quite clever in avoiding customs controls, but by mobilising our forces we can protect EU citizens against this menace".

The Commission's Action Plan includes, the following proposed actions:

A new business-customs working group to consider whether there is a need to refine EU anti-counterfeit legislation in order to increase protection for legitimate business while keeping down costs.
A new Task Force of Member States' Customs experts with the task of improving anti-counterfeiting controls.
The completion of an anti-counterfeiting risk management guide to be distributed to Member States as well as to our international partners
A new electronic system of secure, real-time transmission of information. This would combine what the Community customs risk management systems offer with the possibility for customs to accede to listings of companies and intellectual property databases and would also facilitate the life of rights-holders who wish to transmit information to the competent authorities.
The Commission will promote the signature of memoranda of understanding with major trade representatives such as airlines, shipping companies and express carriers with a view to improving information exchange and creating a better awareness of the risks posed by the traffic in fakes.
With regard to reinforcing international co-operation, the Commission will, together with Member States, consider possible amendments to the World Trade Organisation Intellectual Property Rights ("TRIPS") Agreement so that countries apply anti-counterfeiting controls not only on imports but also on exports, transit and transhipment movements. This line will also be promoted in the context of co-operation with other international organisations. Above all, efforts will be made to fully implement, strengthen or develop bilateral customs-co-operation agreements with China, the USA, Japan and other trading partners.

The statistics of seizures for 2004 show that the amount of counterfeit and pirated articles seized at the EU's external borders is continuing to increase. These threaten the health and safety of EU citizens, their jobs, Community competitiveness, trade, and investment in research and innovation. Seizures in 2004 increased by almost 1000% compared to 1998. Customs now seize more than 100 million articles per year, and from 2003 to 2004 the number of customs operations involving fakes more than doubled to 22,000 annually. The large increase in fake goods which are dangerous to health and safety is continuing. The counterfeiting of toys and games also grew exponentially making toys the third most counterfeited product found at our external borders in 2004 (more than 18 million objects seized)! Counterfeit medicines represent a rise of more than 45% from 2003! Counterfeit foodstuff, drinks and alcohol seizures increased by 200% compared to 2003 to a figure of 4.5 million. Most fakes are now household items rather than luxury goods and the high quality of fakes often makes identification impossible without technical expertise. One of the reasons for this explosion in trade in fakes is that criminals can now produce them on an industrial scale. This provides not only increased profits but also a new mechanism for efficient money laundering.

For the Commission Communication on a Customs response to latest trends in Counterfeiting and piracy see:

http://europa.eu.int/comm/taxation_customs/customs/customs_controls/counterfeit_piracy/index_en.htm