June 19, 2006

US, EU join forces to fight fake goods trade

By Doug Palmer

WASHINGTON (Reuters) - The United States and European Union
are launching a joint campaign to fight the huge global trade
in fake and pirated goods, beginning in Russia and China, EU
officials said on Monday.

"Stepping up the enforcement fight required a joint
strategy and it needed to have some teeth," EU Trade
Commissioner Peter Mandelson said in a statement.

The initiative coincides with the annual U.S.-EU summit
meeting in Vienna on Wednesday between President Bush, European
Commission President Jose Manuel Barroso and Austrian
Chancellor Wolfgang Schuessel.

The International Chamber of Commerce has estimated
worldwide sales of counterfeit goods at about $650 billion per
year -- a figure roughly equal to half the world's annual
energy trade or half the United States' annual export of goods
and services, the Progressive Policy Institute has noted.

"The issue of intellectual property protection goes to the
heart of the ability of the EU and the U.S. to compete in the
global economy because our high-value goods have strong
intellectual content," Mandelson said.

The global trade in fake goods ranges from medicines to
electrical appliances to toys and auto parts while piracy robs
producers of software, music, movies and books of potential

The International Intellectual Property Alliance, which
represents U.S. copyright holders, estimates piracy cost its
companies at least $15.8 billion in global sales in 2005.

While the United States and the EU will focus initial
efforts on reducing intellectual property theft in Russia and
China, they also have major concerns throughout Asia, Latin
America and the Middle East, the EU said in it statement.

The transatlantic trading partners will increase joint
efforts to stop counterfeit goods at borders and create teams
of U.S. and EU officials to work on reducing fake and pirated
goods in third countries, the EU said.

EU seizures of counterfeit goods at the border increased by
more than 1000 percent between 1998 and 2004, rising from 10
million in 1998 to over 103 million in 2004, the EU said.

The composition of the trade has changed from mostly luxury
items in the 1980s to commonplace goods like food and drinks
and almost every type of manufactured product, the EU said.

The only way the United States and European Union can
compete with low-cost suppliers is through "innovation,
invention and quality," EU Commission Vice President and
Industry Commissioner Gunter Verheugen said in statement.

"When ideas or brands and products are pirated, ripped off
and counterfeited, this strategy is doomed. This is why the EU
and the US have joined forces to combat the pirating of
products in a more effective way," Verheugen said.