- The Washington Times - Sunday, February 4, 2007

Washington Times special correspondent John Zarocostas interviewed Guy Sebban, secretary-general of the International Chamber of Commerce, in Geneva last week about the counterfeiting of manufactured goods and the threat it poses to the health and safety of consumers worldwide.

The Third Global Congress on Combating Counterfeiting and Piracy, held in Geneva last week by the World Intellectual Property Organization, the Interpol and the World Customs Organization, with the support of business groups such as the ICC, concluded that the problem is endemic in every sector of the world economy.

Fake goods replace 5 percent to 10 percent of total sales by legitimate companies, participants said. The Paris-based ICC is an umbrella group for national chambers in more than 140 countries.

Question:How big, Mr. Sebban, is the counterfeiting and piracy problem?

Answer: The problem is huge, not only in size, but it’s a fact that it is growing and growing, despite all the efforts of stakeholders to reduce the importance of this problem.

We started to fight the problem of counterfeiting and piracy two years ago by putting together representatives of different sectors from different parts of the world, and we now have the feeling that we will have to work against it for many years to make progress in this area.

Q: The ICC estimated a few years ago that the amount of counterfeit and pirated goods was equivalent to 5 percent to 7 percent of world trade. Do you stick by that assessment, or do you think it may have gotten higher?

A: I think it is even more now, but it’s very difficult to give a precise figure, as what we see is only the tip of the iceberg: We see what is seized at the borders. That concerns only tangible goods, and it concerns only the counterfeited goods that have been seized. It’s not 100 percent of them.

On top of that, you have all the intangible goods, which are now transferred from one country to another via the Internet and modern communications means, and these are not included in some figures. So I think now we are probably above this percentage, and it’s certainly more than several hundreds of billions each year that are at stake here.

Q: Some recent surveys and findings by trade associations and international bodies indicate that counterfeiting and piracy are now a problem across all sectors of the world economy. Is this a new phenomenon?

A: Yes, it is a new phenomenon because in the beginning it was a question that was affecting mainly luxury goods — famous handbags and watches, and so on. But the problem now is also affecting the health of consumers because we have more and more fake drugs. And we also see more car parts being copied — not following the normal way of producing them.

Q: And aircraft parts?

A: Aircraft parts as well. It has been said that the Concorde jetliner crash of July 25, 2000, shortly after takeoff from Paris for New York that killed all 109 people aboard was linked to the use of a fake part. I don’t know if that has been proved, but I have heard stories linking the crash to … fake parts.

So, now it’s not only a question of price and economic impact, it’s much more a problem which is affecting the health, safety and security of consumers. And we would like to make consumers aware of the danger they face when they think they make a good deal by purchasing something at a lower price. In fact, they are putting their health and security in danger.

Q: But sometimes consumers are not aware they are purchasing a fake product.

A: That’s right, that’s also another big problem. Now, we have fake parts that are very similar to the real ones, and we have to clearly identify the products that are genuine and make them very different from the ones that are fakes.

Some new technologies are developing now, and by using holograms or other sophisticated means, we will be able in the future — at least for some kinds of goods — to have more assurance that they are genuine products and not copies.

Q: Your report noted that one of the world’s most dynamic economies, China, is also a major source for many counterfeit products, as are Russia and other emerging countries.

A: Yes. About China, what I can say is I often make the comparison with Japan roughly 30 years ago. At that time, Japan was a country in which counterfeiting of manufacturing parts was very much developed, and people were copying genuine products.

But after some years, when they discovered that they had their own innovations and growing creativity to make new products, they wanted to avoid having them copied [and] were more inclined to enact the right legislative framework and enforce it.

What I hope is that this process will take place in China, probably more quickly than happened in Japan. So I am rather optimistic because even if most of the fake goods are coming now from China, this country has started to sign international agreements and treaties, and they seem ready to enforce these.

I think that in coming months and years, we will see a drastic improvement in the situation.

Q: Another trend seems to be that now, a lot of counterfeited goods are also consumed not in developing countries but in highly industrialized economies with tough intellectual property laws?

A: Yes, but even in developed countries in the Western world, you still have some people who are not conscious enough about what they are doing when they purchase a fake, and most of them are not aware of the link … It’s probably by combining actions on the supply side-counterfeiters and educating the public and governments that we will win this fight.

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