54 billion Euros in damages caused by counterfeiting in Germany

Approximately every tenth company is a victim

Product and brand counterfeiting costs the Germany economy more than 54 billion Euros and roughly half a million potential jobs a year. This is the conclusion of a recently published study carried out by the Institute for German Economy (Institut der deutschen Wirtschaft, aka IW) on behalf of the New Social Market Economy Initiative (Initiative Neue Soziale Marktwirtschaft) and based on surveys from industry, business-related services and the construction sector. According to this study, ten percent of all companies in Germany were affected by trademark infringement in the last five years.

Apparently companies from the industrial sector were the most frequently affected. Almost every third mechanical engineering company indicated that they were a victim of product and brand counterfeiting. Additional factors here are the size and innovative power of the company: According to the study, companies with 250 employees and more were affected three times more often than companies with less than 19 employees. Innovators are also affected three times more frequently than non-innovators – in fact, six times more frequently in terms of trademark violations. In addition, the likelihood of being damaged by trademark infringement also increases with the degree of globalisation.

Majority of counterfeits come from Asia and Eastern Europe

According to the study, China tops the list of counterfeit country of origin from the point of view of international companies, followed by Eastern Europe and other Asian countries. But smaller companies assess this without an international reference: Their protective rights are mainly violated by small, less innovative, or weakly internationalised companies from Germany.

The IW sees the need for action when it comes to improving protective measures, especially the enforcement of property rights in non-EU countries, the expansion of bilateral agreements or the use of brand protection programs on Internet platforms. But just as important for the fight against product and brand counterfeiting is raising public awareness of the potential dangers to people and the environment through international trade with illegal imitations.

Sources

Institut der deutschen Wirtschaft

Article produced in cooperation with Anti-Piracy Analyst, February 2019 issue