Counterfeiting is expensive for Danish companies

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Counterfeiting has become a huge “industry”, accounting for no less than 2.5% of the total world trade – or more specifically, around 407 billion EUR a year. The problem with counterfeiting and piracy is ongoing and influences all business sectors ranging from footwear and clothing to smartphones, cosmetics and medicine.    

New statistics from the European Union Intellectual Property Office (EUIPO) uncover that the trade in fake goods costs EU companies around 59 billion EUR and 435,000 workplaces every year, while it accounts for around 1,15 billion EUR and 5000 lost workplaces for Danish companies. Hence, last month, the previous Minister of Trade in Denmark, Brian Mikkelsen, urged all companies to protect their ideas with a patent, trademark, or design protection:

From my perspective, counterfeiting is theft and an assault of all talented, innovative companies in Denmark. We need to fight the trade in fake goods from all sides. It is thus crucial that Danish companies protect their ideas with for instance trademarks, design, or patents. Not until then, is it possible to enforce and sanction any violations of these rights.     

A piece of advice Plougmann Vingtoft can only agree with. Besides the lost profit, the company risks to loose goodwill and credibility of its goods and the established brand. Therefore, it is important to secure the ‘intellectual property’ (IP) rights, to create a basis for sanctions on violations of these rights.

“Made in China”

A report from EUIPO demonstrates how IP rights are foundation stones of the EU economy and society. The report outlines the value of IP rights and the growing threat of piracy, and especially one country stands out in this regard. China is one of the biggest threats when it comes to plagiarism and the counterfeit goods are estimated to account for approximately 12.5% of China’s total exports.

Even though China clamps down on counterfeit goods, the numbers prove that regardless of whether you plan to do business in China or not, it is crucial to protect your IP rights. If you own the IP rights in China, you are able to stop the counterfeit goods in China, whereas the Danish IP rights don’t allow you to do anything before the goods reach the Danish border.

In addition, the Chinese trademark legislation is significantly different from the Danish one. For example, they have a “first-to-file” rule, which is a very important and challenging aspect of the legislation in China. The first-to-file rule means that the first person to apply for an IP right, will usually own it, regardless of who used it first.

For that reason, you can have the best idea, product, or technology in the world, but you do not own it before it has been registered.

Get more information on trademark protection in China here or or read about the legislation and “first-to-file” rule here.

Remember the IP strategy

According to a study conducted by the World Intellectual Property Organization (WIPO), a UN agency, the “intangible capital” such as branding, design, and technology amounts to almost one third of the value of all goods manufactured around the world.

In other words, a well-founded IP strategy is important for the bottom line figures. ‘Strategy’ thus becomes a key word, because it all depends on what is relevant for the company in question: do you need to register your trademark, patent a technology, sell off inventions that do not align with your business strategy, or perhaps you need a combination of several possibilities to secure an optimal protection?

Although a patent or trademark registration does not safeguard your company against plagiarism, it protects the very foundation of your company, which is exactly why it serves as a tool against the trade in fake goods.

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