Customs response to latest trends in counterfeiting and piracy
The Commission proposes a series of customs measures aimed at protecting the EU more effectively against counterfeiting and piracy. These measures include improving legislation, strengthening partnership between customs and businesses and increasing international cooperation.
Communication of 11 October 2005 from the Commission to the Council, the European Parliament and the European Economic and Social Committee on a customs response to latest trends in counterfeiting and piracy [COM(2005) 479 final - not published in the Official Journal].
This Communication sets out a range of initiatives aimed at cracking down on counterfeiting and piracy. The measures in question will be implemented by customs.
Problems and threats
The industrial production of counterfeit goods poses a threat to:
- the health, safety and jobs of EU citizens (e.g. fake medicines or foodstuffs);
- the competitiveness and trade of the European Community (EC);
- investment in research and innovation in the EC.
There was a 1000 % increase in counterfeiting and piracy between 1998 and 2004. In 2004 alone, 103 million fake or pirated articles were seized by customs officials in the EC; 4.4 million of these were fake foodstuffs and alcoholic drinks. Much of this traffic is sold on the black market, which means losses of tax revenue for Member States.
Most of the products seized are household items, with growing numbers of sophisticated hi-tech products being faked. The quality of these counterfeits is now so good that it is becoming difficult to distinguish the real article from the fake. What is more, high profits and relatively low risks make counterfeiting and piracy lucrative for those involved in organised crime.
Recommendations and Action Plan
The Commission proposes a range of recommendations aimed at tightening customs controls to help combat counterfeiting and piracy in the Community.
In its action plan, the Commission considers measures to be necessary in the following areas:
- increasing protection at the level of Community legislation and operational performance;
- strengthening the partnership between customs and businesses;
- improving international cooperation.
Customs controls on inbound traffic need to be improved and the suitability of the existing legal and operational measures has to be examined. Two concerns in particular must be addressed. The first involves the simplified destruction procedures that will reduce costs to businesses and public administrations alike. The second relates to the fact that travellers are currently permitted to import small quantities of personal-use items that may be counterfeit.
New techniques and instruments are needed to ensure that operational capacity is consistently high. Actions have to be developed and brought together in a new operational control plan based on risk management. The EU's Customs Information System (CIS) enables the national customs services of Member States to exchange and search for customs information.
Effective customs enforcement can be guaranteed only if businesses are also fully involved. Improving the early exchange of information between businesses and customs is also important. A possible solution could take the form of an EU electronic information system for intellectual property rights.
The main region producing counterfeit goods is Asia, and China in particular. International cooperation is crucial in halting the production and export of counterfeit goods. The Commission intends to:
- introduce export and transhipment controls;
- exploit and extend Customs Cooperation Agreements to cover regions where there is a significant level of counterfeit production;
- enhance the World Trade Organization (WTO) agreement on trade-related aspects of intellectual property rights (TRIPS);
- strengthen cooperation with the World Customs Organization (WCO), Europol and Interpol;
- enter into bilateral arrangements, especially with China.