October, 2010

International trade of Goods and services including technology transfer is broadly regulated under the legal frame work of World Trade Organization (WTO), World Custom Organization (WCO) and World Intellectual Property Organization (WIPO). Trade and investments constitute the core of economic globalization where knowledge and technology play very crucial role. Intellectual Property Rights is broadly covered under the TRIPS agreement of WTO for minimizing the risk of infringement through a harmonised and unified code of IP laws around the world. However the counterfeiting and piracy still remains a menace and a challenge with increasing volume of international trade in today's era of globalization.

The Agreement on Trade-Related Aspects on Intellectual Property Rights (the TRIPs Agreement) defines the term counterfeiting and piracy. Article 69 of the TRIPS agreement provide for a minimum level of obligation on the member countries of WTO to provide for custom enforcement and check the international trade of counterfeited and pirated goods for the protection of Trademarks and copyrights.

The Indian government has issued Custom Enforcement Rules in July 2007 which covers not only Trademark and copyright but also patent and designs. Any person who is the right holder of the aforesaid IPRs has to register the product by filing the supporting information as annexure with the custom authorities which will in turn ensure seizure of the counterfeited goods or technology at the port as per the prescribed rules. It is therefore advisable to the victims of infringements from counterfeited goods to register their names and related IPRs with Customs Authorities.

In some cases there is an overlapping of IPR infringements. For example, in case of music piracy there is infringement of copyright as well as trademark. In case of fake toys, there is infringement of Trademark and design.

The overview of industries affected by counterfeiting is highlighted in the table showing the share of counterfeit products in total sales of the different sectors.



The Organization for Economic Co-operation and Development (OECD) has reported in it's recent study on the economic impact of counterfeiting and piracy, 2008, that the share of the counterfeited and pirated goods in the world trade has been gradually increasing. The report says that the International trade for counterfeited and pirated goods accounted for USD 200 Billion in 2005 and has gone upto USD 250 Billion in 2007 with a increase in percentage of total volume of world trade from 1.85% in 2000 to 1.95% in 2007 as shown in the below graph.

The study has taken into consideration the infringements with relation to Trademark, copyright, patent and design rights only to the extent of physical cross border movement of goods and do not include domestically produced and consumed products or intangible pirated digital products. In other words if some counterfeited goods have been produced and consumed within the national boundary of a country and the cross border movement of knowledge resources such as music and software they do not form part of the OECD study.

Therefore, if a comprehensive account is taken for all types of tangible and intangible goods within and out side the countries, the volume of the counterfeited goods and services could be as high as USD 1 trillion.

ITAG belives that there is a growing need for IPR awareness amongst the people so that the adverse economic impact on consumers and IPR holders can reduce and a healthy atmosphere is created for International trade and investments.

- Dr. D. R. Agarwal