I’m Dreaming of a Fake Christmas…

by Wayne Beynon on December 20, 2012

Wayne Beynon, is one of the team of IP lawyers at Cardiff and London based law firm, Capital Law, with a particular expertise in intellectual property disputes, including claims for trademark infringement, passing off, design right infringement and patent infringement.

With fake goods flooding the UK at an unprecedented rate, our counterfeit culture is growing as never before.

As one of a team of IP lawyers, who specialises in trademark infringement I am all too aware that this epidemic of fake, phoney and imitation goods has far reaching consequences that go beyond simply breaking the law; it is a global contagion that is pouring billions into the criminal underworld every year.

UGG boots, iPads, GHD hair straighteners, Christian Louboutin’s…  all products that are often desired and frequently counterfeited, making them huge money spinners for the organised crime gangs that are responsible for a global trade in counterfeit goods said to be worth hundreds of billions of pounds every year.

Such is the scale of the problem that the International Chamber of Commerce recently predicted that by 2015 the global value of counterfeit goods is set to exceed $1.7 trillion. That’s over 2% of the world’s total current economic output. Harrowing stuff.

The problem is exacerbated still further at Christmas when the market is flooded with fake goods to cope with the extra demand from consumers who are desperate to get their hands on desirable goods at knock down prices. A trend that is intensified during periods of economic hardship, which in a cruel twist of fate creates a boom time for the criminal gangs; one of the few sectors of society who can boast a healthy balance sheet during a recession.

You get what you pay for

The whole ‘business’ of counterfeit goods has simply exploded, and in 2012 it goes way beyond dodgy Gucci bags and knock off DVDs and albums. These days, virtually anything and everything from cosmetics, perfumes, homeware, the latest technology launches, drugs and pesticides can be faked and in the most convincing way possible.

Of course in life you generally get what you pay for, and so even if on first impressions your new Xbox/Chanel handbag/Dior perfume look legitimate, chances are they are at best inferior and at worst dangerous.

Counterfeit goods often come with serious health and safety implications. For example, the base ingredient used in many fake perfumes is often horse urine, and there are dangerously high levels of mercury found in fake cosmetics. High levels of carcinogens such as lead and nickel are also found in fake jewellery.

And of course barely a year goes by when Christmas isn’t followed by a litany of stories reporting on shoddily made fake children’s toys catching on fire/falling apart/oozing toxic stuffing and other horror stories that generally result in the injury or death of an infant.

So who’s to blame?

The trade in counterfeit goods is undoubtedly a global problem, and one that is being used as a method to finance weapons smuggling and human trafficking, so much so that it is even beginning to rival the international trade in illegal drugs. It is an underworld business that is funding an epidemic of human misery.

But where are all the counterfeit goods coming from? The truth is that there are criminal gangs in every country on earth, however, for the major players we need to look to the growing international superpowers.

As production is increasingly internationally outsourced by companies that own the patents and copyrights, there’s more opportunity for corruption and fraud to find its way into the manufacturing and shipping process.

Growing super powers like India and China are building ever more sophisticated factories to cope with growing demand for their manufacturing skills. And as these genuinely legitimate operations grow, so do the volume and quality of the type of products that can be counterfeited.

Closer to home

The problem the UK border agency has in stemming the flow of counterfeit goods from abroad is well documented. Although of course some successes have been reported, people may remember the seizure of 45,000 pairs of fake UGG boots last year in Southampton, a major coup for the agency.

However, no one is under any illusion that we are winning the war against a tsunami of counterfeit goods that shows no signs of abating any time soon.

Of course, not everyone out there who breaks the law in this regard is part of an underworld criminal gang, producing millions of pounds worth of fake goods every year. Many are just ordinary working folk who fall foul of the copyright and patent laws due to an ignorance of topics they should certainly be far more aware of.

Thankfully the message is getting out and many clients are far more astute when it comes to copyright matters, often getting legal advice before making what could potentially be an illegal business decision, that could cost them thousands, if not millions down the line.

As for the international criminal gangs, all intellectual property and trademark infringement laws will continue to remain meaningless.

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