EUIPO study reinforces role of small parcels in fakes trade

It has long been said that most counterfeit goods are shipped in small parcels directly to consumers, and a new quantitative study by the EUIPO reinforces that view.

The just-published study found that more than half (56 per cent) of all counterfeit goods seized at the EU borders stem from online commerce, and 91 per cent of those involved the postal service, compared to only 45 per cent of counterfeit seizures not linked to e-commerce.

The data also show that 82 per cent of detentions linked to e-commerce involved the post, compared to only 9 per cent for counterfeits.

That came against a backdrop of accelerated online sales to consumers., which rose 41 per cent between 2018 and 2020 – reflecting the increase in e-commerce during the pandemic – while total retail sales only climbed 1 per cent. The shift to online helped increase total business to consumer shipments to $440bn.

"The growing popularity of e-commerce has been used by counterfeiters, who are increasingly using e-commerce to sell fake items to consumers, some of whom purchase the items thinking they are genuine, while others actively seek out low-priced fakes," says the report.

The counterfeit product categories most associated with e-commerce were perfumery and cosmetics, pharmaceuticals and sunglass, with online purchases featuring in upwards of 71 per cent of seizures.

The study also showed that the value of the seizures related to counterfeit goods sold online is much lower than those which do not come via e-commerce and are instead shipped in containers using various transport modes (road, rail, air and sea).

Online sales seizures represent only 14 per cent of the total value of detentions compared to 86 per cent of detentions related to goods shipped by container.

However, some of these goods shipped by container are destined for distribution centres in the EU, from which they are in turn shipped to consumers who have purchased them online. This could indicate that the real role of e-commerce in trade in counterfeits is considerably more important, according to the study.

Considering the origin of fake goods traded online, China sits at the top with more than 75 per cent of seizures of counterfeit goods, followed by Hong Kong at 5.7 per cent, Turkey at 5.6 per cent and Singapore at 3.3 per cent.

China is also the dominant country when it comes to the value of counterfeit goods purchased online, with a share of 68 per cent.

"E-commerce has enhanced consumer choice, and offered businesses new, flexible ways of market access," said Christian Archambeau, executive director of the EUIPO.

"At the same time, there is ample evidence that the online environment has also attracted bad actors, who pollute e-commerce distribution channels with fakes."