The critical value of Intellectual Property Rights (“IPR”) to the global economy has been much discussed and analyzed in a series of published EU and national economic studies and reports, quantifying both the contribution of IPR-intensive industries to economic performance and trade and the significant economic impact of counterfeiting. Corporate and government budgets, allocation of human and other resources, integrity of public administration, investments, and criminal activities are all affected by the unauthorized use of IPR, which includes trademarks, patent, copyright, and designs.
Counterfeiting is a significant problem for the long-suffering Greek economy, which is now in its eighth year of recession. A 2015 EUIPO report on “The Economic Cost of IPR infringement in the Clothing, Footwear and Accessories Sector” reveals that legitimate industry loses approximately EUR 953 million of revenue annually, corresponding to 18.7% of the sector’s sales in Greece, while the EU average is only 9.7%. Counterfeit goods produced in the EU alone account for direct employment losses equal to 19,803 jobs. When adding in damages incurred due to indirect effects, general losses in the clothing, footwear, and accessories sector translate into approximately EUR 1.32 billion of lost sales in the EU and 24,375 job losses in Greece, a country with an unemployment rate of nearly 25%. The loss in government revenue due to counterfeiting is a painful injury to an already crippled Greek economy.
Such economic assessments indicate the need to reshape anti-counterfeiting strategies by re-prioritizing them. In this context, efficient IPR strategic planning should focus on the following four directions:
IPR Enforcement Coordination: Coordination of the five competent agencies in Greece remains the cornerstone of all operational aspects, as analysis of intelligence, dissemination of information, and operational coordination contribute not only to operational efficiency but also to creation of effective policy. The appointment of a coordinator at the highest possible level would give the political tone required to intensify anti-counterfeiting efforts and make use of both settled best practices and the existing adequate legal framework.
Police IP Department/ IP Public Prosecutor: National police service is in urgent need of a specialized IP department, well equipped to scrutinize and dive into the most important IP infringement cases. Under the supervision of a dedicated IP Public Prosecutor, valuable data could be mined from IP criminal cases, and infringers would be prosecuted to the full extent of the law, terminating the current “soft approach” of judicial practice.
Goods in Transit: Greece has been listed as one of the top provenance economies of counterfeit goods in the “Trade in Counterfeit and Pirated Goods: Mapping the Economic Impact” report (OECD and EUIPO, 2016). Greece has made its entry to the list not as one of the manufacturing countries, but due to its geographical position, serving as a gate to Europe. For Greece to remove itself from the listing, special attention should be paid to the immediate implementation of the much-awaited tool provided for in the recent EU trademark reform package: the permitting of inspection and seizure of goods in transit. In addition, Greek customs authorities should be financially supported and reinforced in playing their role in IP protection at the crossroads of three continents and significant maritime routes.
Anti-counterfeiting in Tourist Destinations: The proliferation of counterfeits in the Greek islands and other summer resorts requires urgent attention, as they address a wider group of consumers, including both Greek and foreign visitors. Often displayed in small batches per infringed brand, infringing products cannot be easily tackled by IP owners, and instead require a well-organized plan of action, implemented by the local enforcement agencies and local business communities and aimed at eliminating the disparaging phenomenon.
Final note: according to OECD statistics, Greece presents the lowest business investment activity in intangible assets and GDP per capital, far behind the US, Norway, and its EU peers. There is no doubt that IP could successfully work as an economic development tool for Greece, a country in urgent need of a spur of innovation. Thus, a strong stimulus of IPR-intensive companies, along with efficient anti-counterfeiting measures, are among the incentives that Greece should strive for.
By Michalis Kosmopoulos, Partner, Drakopoulos
