By Daniel Hunter

The highest level of seizures of counterfeit goods by HM Revenue and Customs (HMRC) and the UK Border Force for three years, worth an estimated £70 million spearheaded the UK’s response to the growing and complex issue of intellectual property (IP) crime, according to the annual IP Crime Report, published today (Monday).

Assessing the impact of IP crime is difficult, but figures from Business Action to Stop Counterfeiting and Piracy (BASCAP) estimate that it costs the UK around €500 million in lost tax revenue and welfare payments and results in around 15,000 jobs losses a year in the short term.

The production of fake goods remains the key activity of IP crime, with clothing, cigarettes, DVDs, alcohol and footwear being the most common counterfeit items. But with the growth in digital content and services, and the borderless nature of the internet, there has been a corresponding rise in digital crime.

The report also highlights the threat to consumers posed by potentially harmful fake products such as toys, batteries, cosmetics and electrical goods.

A more strategic approach to enforcement, through an updated IP crime strategy published last year, and more effective coordination of key bodies including local trading standards, HMRC and the UK Border Force, is yielding results.

The report reveals the success of coordinated action being taken by Government, industry and enforcement agencies to tackle IP crime, for example:

- HMRC and Customs and Border Force together detained counterfeit goods arriving into the UK with a value of £70 million.

- In one operation, trading standards seized fake branded golf equipment and computer accessories worth over £1.5 million. This prevented criminals from making a £7 million profit and led to the conviction of six people for money laundering and fraud.

- An online trader of counterfeit and unlicensed medicines was convicted and ordered by the Crown Court to repay £14.4 million from the proceeds of his crime. Led by the Medicines and Healthcare products Regulatory Agency (MHRA) and assisted by the North West Regional Asset Recovery Team, this is the largest confiscation order for counterfeit medicines.

With the internet and social media networks increasingly being used by criminals as a route to sell their counterfeit products, the industry has responded with:

- The Publishers Association issuing over 200,000 takedown notices of infringing copyright content on website
- The British Recorded Music Industry (BPI) identifying and removing over four million illegally hosted digital music files.

“I am encouraged to see so much activity being undertaken to tackle IP crime. This report demonstrates that the most effective model of enforcement is where government, industry and enforcement agencies work together to act as a powerful force against organised criminals," The Minister for Intellectual property, Baroness Wilcox said.

"I saw this type of coordinated work in action in the market in Manchester where I was witness to the seizure of pirated DVDs and CDs. I also recently visited Coventry Postal Hub where potentially dangerous counterfeit goods are intercepted before they reach the consumer.

“Raising public awareness is vital — and the IP Crime Group and its members are providing guidance for business and consumers. It is very encouraging to see such a coordinated approach, which I will continue to champion.”

The Intellectual Property Office has launched a ‘Best Practice’ web page, bringing together advice for businesses, consumers and enforcement agencies on protecting and enforcing IP rights; including the IP Crime Group’s ’Preventing IP Right Infringement in the Workplace’ e-guide to aid the prevention of infringing others’ IP rights.

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