Europe intercepts 617 million worth of fake products

09 November 2015

Last year European customs dealt with 95,000 cases of intercepted articles violating the EU’s Intellectual Property Rights rules. The total number of articles intercepted stood at 36 million, and had a total value of €617 million. The largest number of articles (69% of total) were stopped at Europe’s ports, even while making up only 3% of total cases. China remains the source of the largest number of goods by volume and value, while the greatest number of interceptions occurred in Germany.

The Intellectual Property Rights (IPR) legislation in Europe is part of the regions’ move to create a genuine Single Market in Europe. The EU wide IPR places restrictions on the freedom of movement and anti-competitive practices, while creating an environment not only favourable to creativity, innovation and investment, but also for developing employment and improving fair competition.

Enforcement by customs is a key aspect of the IPR, with the Commission and Member States engaging in the practice of detaining goods that violate the IPR and in many cases, destroying them. An analysis by on data released by the European Commission reveals that annually companies are losing millions in foregone revenues as a result of the import of counterfeit, or fake products.

Total number of interceptions by customs

Customs cases
The total number of cases (each case represents a single interception by customs) rose in 2014 to an all-time high of more than 95,000 interceptions, an increase of 10% compared to 2013 when there were almost 87,000, and up 118% on 2007 when there were around 43,000 interceptions. The number of articles intercepted per case, which can vary from 1 to thousands, stayed stable compared to 2013, both at 36 million; however, the number of articles has come down considerably in recent years, from a high in 2008 when there was a total of more than 179 million articles.

Total number of interceptions by channel

Landed interceptions
The total value of intercepted goods hit €617 million last year*, with sea routes, while generating a relatively small 3% of intercepts (although more than 69% individual articles), accounting for the highest total value at €315 million. Air routes follow at 14% of all interceptions, carrying 17% of the value of goods illegally imported into the EU.

The growing number of intercepts can be explained by the high number of cases in postal and courier traffic resulting from internet sales, as well as a new procedure on small consignments. The new procedure allows intercepted goods to be destroyed when the right-holder has asked customs authorities to apply this procedure, and appears to have led to an increase in cases in 2014. As such, postal intercepts represented 77% of cases by volume last year, although given the limitations on size, the number of articles is low at 2% of the total. The value of items intercepted through the post too remains low at only 8% of the total.

Total value of intercepted goods by EU customs

Interception by value
In terms of the products imported in violation of the IPR, watches represent the category of highest value at €92 million, followed by clothing and accessories at €85 million. Shoes and body care imports were valued at €63 million and €60 million respectively. In terms of volume, Tobacco is by far and away the largest category at 34% of all intercepts, with a value of €52 million. Toys come in second at around 10% and a value of €28 million, while medicines come in third at also just under 10%, with a value of only €4 million.

The report highlights that the kinds of goods being intercepted has changed in recent years, with a significant decrease in body care items, clothing, ink cartridges and toners, CD/DVDs, vehicles accessories and office stationery, while the most important increase (>50% increase compared to 2013) occurred in the categories of foodstuffs, alcoholic and non-alcoholic beverages, computer equipment and electrical household articles, cigarettes and other tobacco products, machines and tools, lighters and textiles.

The main source of counterfeits: China
China leads the pack in terms of origin of intercepted IPR infringing goods in term of the value of the goods, at 66%. Hong Kong comes in second at 16%, although the country’s port is too used intensively by Chinese organisations exporting to Europe and beyond. Panama comes on third place with 4%, with the top 3 position explained by several interceptions of large volumes of expensive watches routed through Panama.

Total number of interceptions by country

Countries of entry
Germany was by far and away the location in Europe with the most interceptions in 2014, with almost 43,000, an increase of 107% on the previous year. The UK on the other hand saw interceptions drop 43% to a total of almost 12,000, roughly 31,000 lower than Germany, partly explained by Germany’s logistical hub location in mainland Europe. Belgium and Ireland, both with relatively low populations relative to the UK and Germany had high levels of interception, at around 9,000 and 8,000 respectively. Interestingly the Netherlands, harbour of Europe’s most strategic port (Rotterdam), had only 465 interceptions, while Portugal saw the largest year on year decrease in interceptions, dropping -79%.

Fake clothing
Recently featured an analysis on the cost of imitation clothing to the European retail industry, finding that across the European Union as much as €26 billion is lost in foregone revenues.

* It is important to keep in mind that the true scale and value of goods imported in violation of the IPR may be considerably higher as the information released by the European Commission only pertains to what has actually been detected.


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