The worst fears are confirmed. The overriding impression left by the press conference of European Commissioners Laszlo Kovacs and Siim Kallas on the clamp-down operation against commercial piracy (see our bulletin 9064), was not the number of counterfeit articles, almost all of which originate from China, which were seized in the space of 10 days, but two statements which were made: a) among the containers which were checked, one out of every four contained counterfeit articles. If you think how many containers are unloaded every day in the ports of the EU, this gives you some idea of the actual scale of counterfeiting; b) the figures for the year 2004 show that luxury products represented less than 2% of articles seized by the customs authorities.
This means that the EU's worst fears are confirmed, in terms both of the scale of the phenomenon and its wicked and dangerous nature. Although popular imagery continues to see counterfeit products in the form of perfumes, watches and ladies' handbags, or even CD records or DVDs, the reality is radically different: the two Commissioners spoke of medicines, food products, false spare parts for cars and even for aircraft, with obvious risks for the health and safety of the citizens. Mr Kovacs spoke of imitation batteries for mobile telephones, which are extremely likely to explode. I shudder to think about the results of recent investigations into certain aviation accidents which killed an awful lot of people. These investigations pointed to a suspicion that these accidents were caused by counterfeit spare parts (but I must stress that China has no implication in these cases).
This problem is not a new one, and this column has already looked at it several times. Fairly recently, the European Parliament produced a report and a resolution, both of which were firm and clear. Last July, the European Commission made a proposal that piracy and counterfeiting should be considered criminal acts: any intentional attack upon intellectual property rights would lead to prison sentences, of over four years if the infringement is committed by a criminal organisation or if it carries with it a risk for people's health or safety. Provisions of this type already exist in some of the Member States (but with less stringent penalties), but not in others. The Council and the Parliament are to take position on this initiative as quickly as possible, because criminal organisations are increasingly active in this field, due to the fact that commercial piracy is less of a risk than their traditional activities (trafficking in drugs, the white slave trade, etc), but returns similar profits. The counterfeiting industry and the involvement of criminal organisations do not, furthermore, concern only third countries, but also some of the Member States, the old and the new alike. It is clear that the requirement for stringent action concerns these countries just as much.
China, a special case. Various third countries have made considerable efforts to improve the situation, Brazil being a notable example. Elsewhere, in Latin America and Asia in particular, the situation remains serious, and is even getting worse. The case of China is a particular one, due to the size of the country and the explosion in its production capacity, as well as its cultural makeup. According to the report by the delegation to the EU of the French Assemblée Nationale (which was chaired by Pierre Lequiller, and whose rapporteur was Marc Laffineur), which is, as far as I'm aware, the most detailed and revealing investigation that has been carried out to date in this field (1), (our translation) "copyright had been understood in China as meaning the right to copy". It is true that in its time, Europe has copied Chinese techniques for producing porcelain or treating silk, but it has never claimed that it was selling its own porcelain and its own silk fabrics as those produced in China. What is unacceptable is to pirate brands and models and to export products which were made in China as though they were of European origin, even though no comparison is possible in terms of value or quality. Marc Laffineur visited China and what he discovered about the scale of the phenomenon, its implications and its legal complications is all quite breathtaking. At the same time, the French parliamentarian noted the reality of efforts being made by the central Chinese authorities to fight piracy, because these authorities are looking ahead: China is becoming the world's number one deponent of patents and models, which means that in the long term, it is very much in China's interests to ensure that rules in these areas are applied and adhered to. In my view, this development proves just how artless and littered with shortcomings the EU's trade policy towards China is at this moment in time. This is an enormous subject to think about tomorrow. (F.R.)
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(1) Marc Laffineur: “L'Europe et la contrefaçon: halte au pillage!” (Europe and counterfeiting: stop the pillage!). Available in French at http://www.assembl ée-nationale.fr