Counterfeits Remain a Lucrative Illegal Trade with Broad Impact
Despite ongoing awareness campaigns and enforcement efforts, counterfeit goods persist as one of the planet’s most lucrative illegal trades. They endanger consumer health and cause substantial losses for manufacturers, weaving a web of negative consequences across supply chains and local economies.
Data from EUIPO highlights the economic and social toll of counterfeit activity in industries such as toys, fashion, and cosmetics. Piracy diverts 1.5 billion euros away from legitimate markets in Spain alone, a figure reported in the most recent EU Intellectual Property Office assessment. The study emphasizes not only lost revenue but also broader social costs, noting that tens of thousands of jobs and significant annual sales would be added to these sectors if counterfeit products were entirely eliminated from the market.
When the analysis focuses on 2018 to 2021, EUIPO identifies fashion as the sector most affected in Spain by counterfeit goods, with losses surpassing one billion euros. This figure represents about 3.7 percent of sector turnover and translates into roughly 11,200 lost jobs nationwide for that period.
Cosmetics also bear the burden, with brand sales in the sector dipping as a result of piracy. Perfume and makeup counterfeits contributed to an estimated 3,600 job losses annually and an impact approaching 398 million euros.
In the realm of toys, the impact is particularly pronounced. A report from Alicante-based Euroagency shows that counterfeit toys constitute about 11.1 percent of the market, meaning that roughly one in ten toys sold in Spain could be fake. This translates to an economic impact of around 113 million euros and approximately 235 lost jobs in that subset of the market.
EUIPO’s director general stresses the real costs of forgeries for consumers, brands, and the broader economy. The organization works closely with Europol, OLAF, and the European Commission to detect and curb fraud within the EU, underscoring the collaborative effort required to address this crime family.
Consumer awareness also plays a key role in shaping the counterfeit problem. An EUIPO survey published in the previous year found that a sizable portion of Europeans consider it acceptable to purchase fake goods when original products are priced too high, with the acceptance rate rising among younger consumers. This attitudinal factor helps explain why counterfeit goods continue to circulate despite enforcement actions.
EUIPO underscores that awareness and perception among consumers are critical variables in combating counterfeits. The organization highlights that public understanding of the risks and consequences of buying fakes can influence purchasing behavior and reduce demand for counterfeit products.
EUIPO Field Report: Impact in the Valencian Community
In addition, a recent study by EUIPO and Europol points to the broader pattern of crime linked to intellectual property violations. The data suggest that crimes against intellectual property are often connected with other serious offenses, reinforcing the need for cross-agency collaboration in enforcement and prevention strategies.
European Trends in Intellectual Property Crime
Across Europe, counterfeit activity in the examined sectors amounts to about 16 billion euros annually and is linked to roughly 200,000 job losses. Spain again records some of the highest shares of counterfeit turnover in the toy category, with piracy affecting nearly 9 percent of sales in that sector. Several countries exhibit double-digit piracy rates, underscoring the regional variability of the problem. Malta, Croatia, Cyprus, Hungary, and Slovenia stand out with notably high piracy percentages in their toy and related industries.
In clothing and footwear, the largest sector by sales, various European nations also report measurable losses. Countries such as Cyprus, Ireland, Luxembourg, Lithuania, and Estonia show notable percentages of imitation products affecting their markets, reflecting the broad reach of counterfeiting across fashion categories.
Within cosmetics, the rate of loss from counterfeits tends to be lower relative to other sectors. Nevertheless, the EUIPO report identifies the French cosmetics industry as experiencing significant absolute losses, while Bulgaria, Cyprus, Romania, Portugal, and Hungary show comparatively high piracy percentages among the EU members.
Beyond economic implications, the health and safety risks posed by counterfeit cosmetics and toys are a central concern. EUIPO notes that a meaningful share of counterfeit goods seized at the EU’s external borders in 2022 were potentially hazardous, underscoring the potential danger to consumers who unknowingly purchase these products.
Overall, the EUIPO investigation emphasizes that counterfeit goods disrupt legitimate trade, erode consumer trust, and fuel organized crime networks. The findings advocate for stronger consumer education, more rigorous border controls, and sustained cross-border cooperation to reduce demand for fakes and protect public health and safety.