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Counterfeiting is Increasing – How can you Defend Yourself? 

by Kristian Fredrikson, Senior Associate / Advokat and Angelica Lundqvist, Associate

Published: June, 2015

Submission: June, 2015

 



Is your business affected by counterfeiting? If so, you are not alone. A newly released study shows that almost all intellectual property dependent companies listed on the NASDAQ OMX Stockholm 30 Index have been affected. Moreover, most expect that the problem will continue to grow. Better political support is required to stem this development, but companies already have several weapons available to use against the counterfeiters. 


For a long time, counterfeiting has comprised more than just luxury goods such as watches, handbags and clothing. Ordinary consumer products and food products are also copied to a large and growing extent. The profit margins can be great even for everyday products if the costs for consumer safety, environmental considerations and working environment can be avoided. This applies to an even greater extent to products such as pharmaceuticals and spare parts for aircrafts and automobiles for which the profit margins are very high, but at  the expense of not only the original producers’ loss of profits but also the risk to life and health of the public.


In 2009, the OECD estimated that the value of counterfeit goods in international trade was USD 250 billion per year. In 2012 the Swedish Trade Federation anticipated that the value of trade in counterfeited consumer products in Sweden was SEK 20 billion, of which SEK 15 billion was in consumer sales. Thus, the original manufacturers and retailers are being deprived of significant amounts, as is the government in the form of foregone tax revenues. 


These and similar calculations indicate that trade in counterfeit goods has a turnover exceeding the illicit drug trade on a worldwide basis. There are strong suspicions that counterfeiting contributes to the financing of terrorism and organised crime in several areas. This means that product counterfeiting is a threat to health, life and and security in a variety of ways in addition of being a major commercial problem.

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