The Department of Homeland Security released its Fiscal Year 2013 Intellectual Property Rights Seizures Statistics, and the findings are bleak. Counterfeit and pirated goods are on the rise. In FY 2013, there were 24,361 IPR seizures, up 7 percent from FY 2012. If these goods were genuine, their total MSRP value would have been over $1.7 billion, up 38 percent from FY 2012.
Where are all these illegitimate goods coming from? The two largest source economies are China (68%) and Hong Kong (25%). Last year, China Customs worked with the United States to enforce intellectual property rights, and in just one month seized 1,735 shipments containing counterfeit and pirated goods.
Among the most popular goods are apparel, electronics, and handbags. And these aren’t just going to New York City’s Canal Street. Knock-offs are everywhere, particularly on internet black markets. Over 1,400 domain names were seized last year for distributing counterfeit merchandise.
Counterfeiting, piracy and other forms of intellectual property theft are incredibly dangerous for American industry and the international economy at large. IPR violations steal revenue from legitimate businesses, and discourage innovation. The International Anti-Counterfeiting Coalition estimates that counterfeit and pirated goods make up a $600 billion economy. That’s $600 billion in theft from legitimate businesses, which could force them to lay off workers or close entirely.
Not only is counterfeiting and piracy economically dangerous, it poses serious threats to health and safety. Pharmaceuticals made up the fourth largest category of IPR seizures last year. The World Health Organization estimates that between one and 10 percent of drugs sold worldwide are counterfeits, and in some countries, it’s as many as 50 percent. Worse yet, groups like al Qaeda and Columbian drug cartels are producing, trafficking and making profit off of counterfeited pharmaceuticals.
Clearly, intellectual property rights are crucial for businesses, innovation, health and safety, and national defense. The yearly IPR Seizure Statistics continue to shed light on the magnitude of IPR violations, and why we cannot take them lightly.