PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

U.S. Counterfeit IP Seizures Support and Protect Small Businesses Across Industries

By at 10 April, 2015, 5:00 pm

Counterfeit goods are a direct threat to small businesses, and those seized at the border protect their competitiveness and survival and the livelihood of their employees.

Counterfeit goods are a direct and formidable threat to many small businesses. Counterfeits seized at the border protect small business competitiveness and survival, and the livelihood of their employees.

by Raymond J. Keating-

The importance of protecting intellectual property (IP) cuts across industries, and that is clear from the latest report regarding counterfeit seizures courtesy of the U.S. Customs and Border Protection (CBP) and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI).

In a statement, CBP Commissioner R. Gil Kerlikowske highlighted the scope of the seizures of counterfeit goods: “In 2014, strong partnerships with our federal enforcement counterparts, effective targeting of high risk shipments and frontline interceptions of cargo at America’s ports of entry produced more than 23,000 seizures of fake products worth an estimated $1.2 billion that could have cheated or threatened the health of American consumers.”

Meanwhile, ICE’s Director Sarah Saldaña accurately pointed to the broad economic ills of IP violations: “To be clear, intellectual property theft is not a victimless crime. The victims are American businesses, and the employees whose jobs are dependent on IP-intensive industries. Counterfeiting is a crime of global proportions, and when property rights are violated, American jobs are lost, business profits are stolen and ultimately, consumers are cheated.”

China and Hong Kong were identified as the top two offenders by far, with China being the primary source of 63 percent of all IPR seizures, and Hong Kong 25 percent.

The Top Ten counterfeit commodities seized by authorities during fiscal year 2014 in terms of number of seizures were:

  1. Wearing apparel/accessories
  2. Consumer electronics
  3. Pharmaceuticals/personal care
  4. Handbags/wallets
  5. Footwear
  6. Watches/jewelry
  7. Optical media
  8. Computers/accessories
  9. Labels/tags
  10. Toys

As ICE Director Saldaña noted, U.S. businesses and workers are among the victims here. And that very much includes small businesses and their employees.

Consider, for example, that, according to the latest Census Bureau data,

  • among U.S. apparel manufacturers, 83.7 percent have less than 20 workers;
  • among pharmaceutical and medicine manufacturers, 57.3 percent have less than 20 employees;
  • among footwear manufacturers, 68.3 percent have fewer than 20 workers;
  • among computer and electronic manufacturing, 65.3 percent have less than 20 employees;
  • and among doll, toy and game manufacturers, 85.5 percent have less than 20 workers as well.

 

A newly appointed Intellectual Property Enforcement Coordinator is now on the job at the White House. In his speech at the U.S. Chamber on April 9, hosted by the Global IP Center, Daniel Marti pledged to continue to support and help strengthen the work of CPB and HIS, as well as enhance outreach efforts that focus on education, and building a culture of respect for IP – both at home and abroad. (View Mr. Marti’s speech at the U.S. Chamber here. The speech begins at 15:30 on the video.)

It is a fundamental duty of government to protect private property, and that includes intellectual property. The benefits of enforcing IP rights and protections spread throughout the economy, including, as noted by the data above, among small businesses.

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Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council.

Keating’s latest book published by SBE Council is titled Unleashing Small Business Through IP: Protecting Intellectual Property, Driving Entrepreneurship and it is available free on SBE Council’s website here.

 

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