Counterfeiting causes huge losses in key economic sectors in the EU, according to a study by EUIPO. Some sectors experience a worrying increase in losses, and German industry branches are facing an increase as well.

The European economy suffers annual sales losses amounting to many billions of euros due to counterfeiting and trademark infringements – an analysis of eleven selected sectors alone puts the total economic loss at around 83 billion euros, according to the latest EUIPO Status Report on Intellectual Property Rights Infringements. In addition, the EU member states lose an estimated 15 billion euros annually due to lower tax revenues, and around 671,000 jobs are lost.

The analysis by EUIPO focuses on eleven industry sectors that are heavily affected by IP rights and respective infringements. These include cosmetics and personal care, wines and spirits, pharmaceuticals, as well as toys and games. For the eleven sectors analyzed, the study estimates a loss in sales of around 50 billion euros per year; together with knock-on effects in other sectors, this results in an estimated total annual loss of around 83 billion euros.

The strongest increase in the current analysis is registered in the cosmetics and personal care industry: with an increase of more than 2.5 billion euros, the direct sales losses here amount to around 9.6 billion euros per year. This represents a loss in sales of around 14 percent. In Germany, sales losses of the cosmetics industry grew by 363 million euros last year and amount to around 1.4 billion euros annually. Overall, however, the analysis sees a slight decrease in direct sales losses in the sectors examined, compared to the estimate in the EUIPO status report of 2018. The most heavily affected sectors are clothing, footwear, and accessories (approx. 23.3 billion euros), cosmetics and personal care (approx. 9.6 billion euros), and pharmaceuticals (approx. 6 billion euros).

The current IP status report also analyses the reasons for consumers to purchase counterfeits. Here, the study e.g. emphasizes the importance of effective awareness campaigns to inform consumers about the dangers of counterfeits and to reduce the demand for counterfeit products.

Source: EUIPO