Manufacturers fight trade in counterfeits

Press, 9 February 1983, Page 14

Manufacturers fight trade in counterfeits

NZPA-Reuter Davos, Switzerland

Alain Thrierr’s wallet is engraved with the name "Dupont, Paris,” one of France’s renowned manufacturers of luxury goods. But it is a fake, made in Japan. So too is his leather credit card holder bearing the "Cartier" insignia. The smart English pen with which today’s businessman signs his contracts may be a fraud made in Italy. The French perfume he gives his wife could be an imitation from Taiwan, as indeed might be the pacemaker he wears on his heart or the spareparts of the airliner carrying him to his business appointments. If he is really unlucky, he may buy a watch with an expensive Swiss brand name but no quality movement inside.

Mr Thrierr heads the Manufacturer's Union for International Protection of Industrial and Artistic Property, a Paris-based organisation set up to combat the counterfeiting which, he says, has grown to a worldwide

business, practised on a huge scale.

The examples he took to a discussion on the subject at a European management symposium at Davos were detected by his organisation’s office in Tokyo.

The worst offender is Taiwan, which exports fakes ranging from kitchen implements to pharmaceuticals and automobile parts in shipments of 20.000 or 30,000 at a time, savs Mr Thrierr.

Tran van Thinh. the European Commission’s representative for the General Agreement on Tariffs and Trade, estimates that counterfeits represent 2 per cent of total world trade. “It is another obstacle to free trade, since it harms both the owner of the genuine trade mark and the consumer,” he says. United States industry calculations put the value of worldwide counterfeiting at around $7O billion annually. French perfume manufacturers believe it loses them the equivalent of 10 per cent of their total exports. But Mr Thrierr says the

damage. which loss of confidence in authenticity does to the free flow of goods, is incalculable. Other offenders named in a report drawn up by the Davos meeting were South Korea. Brazil, Mexico. Morocco, Italy, and the United States.

Malaysia and Hong Kong have set up special customs squads to deal with the flood of fakes both made and sold in their territories. Enforcement officers in the British colony admit that the over SNZ4 million worth of counterfeit goods seized there in 1981 was just the tip of the iceberg. A decade ago, 50 pirated music tapes were estimated to change hands in Hong Kong for every one legitimately sold. When the Customs Department stopped that trade, counterfeiters moved to video tapes,' and even personal computers cleverly assembled from cheap components and selling for a quarter of the price of the brand names they copy. The International Pub-

Ushers’ Association estimated three years ago that pirated books were a $1 billion international trade, stemming largely from Latin America, Taiwan, and South Korea. Mr Thrierr. whose manufacturers' union is financed by industry in France and other countries, says political pressure against the pirates is often more effective than court action, which may be too long and costly for companies. For instance, the French Government has begun cracking down on counterfeiters after representations by the union that they would harm the country’s’ image when it staged the Olympic Games in 1988. Member states of G.A.T.T. have for the last four years been debating a code for Customs to intercept and destroy counterfeits on arrival before they are distributed for sale. But even this has run into opposition from developing countries which believe the world trade system already works too much to their disadvantage. Mr Thrierr says the United States. Canada, the European Community countries, and Japan are all ready to sign a code banning the practice.

Rather than wait for a worldwide consensus, these governments should go ahead and sign, he says. “We need tougher sanctions. There is too much money being made in counterfeiting at present. Ten years ago it was just an artisans' occupation, but now it is being done on a truly industrial scale aimed at world markets,” Mr Thrierr says.