EU report on IPR infringement shows how firms benefit from IP ownership, and reveals the evolution of counterfeiters' tactics.
The EU Intellectual Property Office (EUIPO) report, based on a synthesis of research since 2013, presents a comprehensive and updated picture of the scope and impact of IP rights (IPR) infringement in the EU. IPR-intensive industries contribute 42 per cent of total European GDP and 28 per cent of employment, an increase on 2013 estimates. Trademarks represented the highest share of total EU economic activity at over per cent.
IPR-owning firms perform better
EUIPO revealed IPR-owning firms generally performed better than companies not owning IPRs, with revenue per employee was on average 29 per cent higher for firms owning IPRs. This difference was most pronounced with designs (31 per cent), followed closely by trademarks (29 per cent). A 10 per cent increase in EU trademarks resulted in a rise of 2.8 per cent in revenue per employee, while a 10 per cent increase in national trademarks led to a rise of 5.2 per cent. The effect was especially noticeable for SMEs, yet while 40 per cent of large EU firms have registered IP rights the same is true for only 9 per cent of SMEs. The report says many SMEs lack deep understanding around IP and believe registration and enforcement processes are too lengthy and expensive.
Although originally centred around luxury and branded goods, counterfeiting has now spread to virtually every product with a brand that possesses value due to cheaper and more sophisticated production methods. Infringers make greater use of small packages over bulk transportation. The report warns that new transport links (such as the growing rail network between the EU and China) could lead to further diversification in their approach. The EUIPO attributes the mounting problem of fake goods principally to the potential returns on investment being higher than that of other crimes, with lower risks. Unsurprisingly, China was identified as the top producer of fakes while Hong Kong, the United Arab Emirates and Singapore were revealed to be key global transit points for onward distribution.