[A2k] FT: Piracy Numbers not what industry claims

[Robin Gross]

http://www.ft.com/cms/s/acbd064c-fcb9-11db-9971-000b5df10621.html


    Forgery trade losses =91under $200bn=92

By Hugh Williamson in Berlin
Financial Times

Published: May 7 2007 18:27 | Last updated: May 7 2007 18:27

International trade losses due to product counterfeiting and piracy are
much lower than estimated by business lobby groups, according to the
most detailed global study to date.

Trade losses in 2005 were =93up to $200bn=94, according to the executive
summary of a report by the Organisation for Economic Co-operation and
Development, obtained by the Financial Times.

This compares with the business estimates for international trade
losses, ranging upwards from $600bn.

The report, due for endorsement by the OECD board later this month,
could prove embarrassing for international business lobbies, which have
used the higher estimates to lift intellectual property rights up the
global political agenda and to demand crackdowns in China and elsewhere.

The German chancellor Angela Merkel and trade union representatives from
the G8 industrial nations discussed these issues on Monday in Berlin.
Germany has put the battle against counterfeiting on the agenda for next
month=92s G8 summit on the Baltic coast.

The OECD report, based in part on reported customs seizures in various
countries, stresses the $200bn figure did not cover all aspects of
counterfeiting, which it says is growing at an =93alarming=94 rate. It note=
s
that =93counterfeit and pirated products are being produced and consumed
in virtually all economies, with Asia emerging as the single largest
producing region=94.

Business groups such as the Paris-based International Chamber of
Commerce fear the report=92s publication could undermine momentum on
tackling IPR abuses. Guy Sebban, ICC secretary general, said =93up to
$1,000bn in international trade was lost annually=94 to piracy and
counterfeiting. The OECD figure was =93an under=ADestimate=94, he added.

Jeff Hardy, co-ordinator of Business Action to Stop Counterfeiting and
Piracy, an alliance of multinational companies including Microsoft and
Nike, said: =93Business is definitely not exaggerating the scale of the
problem.=94 The OECD report did not cover domestic or internet-based losses=
.

OECD officials have acknowledged the report is =93politically sensitive=94,
according to people familiar with the draft. Mr Hardy said his group had
called for changes, which were subsequently made.

John Evans, head of the OECD=92s trade union advis=ADory committee , said
IPR abuses were a serious problem but companies should not put all their
=93political capital=94 into stronger legal penalties and campaigns against
China and other countries. Im=ADproved labour conditions and corporate
governance standards in developing countries would help, he said.

The unions=92 position paper prepared for the G8 summit, obtained by the
FT, states: =93both the absence of decent work and a lack of corporate
accountability facilitate the manufacture of counterfeits=94.

The OECD study says law enforcement needs to be improved, but closer
co-operation between industry, governments and other stakeholders is
also needed.

Copyright <http://www.ft.com/servicestools/help/copyright> The Financial
Times Limited 2007