Dangerous Fakes

3. Trade in Potential Dangerous Counterfeit Products – Quantitative Analysis

This chapter presents the quantitative analysis of types of counterfeit goods with high probability of posing elevated health, safety and environmental risks. As discussed in Chapter 2, establishing the scope of counterfeits that such risks can take several approaches:

• A broad approach that looks at all products that on top of the general product safety obligation, need to meet specific safety standards, before entering the market.

• A focused approach that takes into account products categories that tend to dominate lists of safety alerts related with specific health, safety or environmental harms.

The broad scope

The domain of products captured by this approach is established by examining a sample of governance efforts aimed at providing quality norms and standards to products that are present on local markets. As discussed in Chapter 2, these include (i) the product specific safety norms in the European Union, (ii) the scope of the US Food and Drug Administration and (iii) discussion in the United States surrounding the SHOP SAFE Act.

Counterfeit products that have been seized in the product categories defined using the broad scope approach are then analysed, using the OECD/EUIPO database of global customs seizures of counterfeit goods. The product categories analyzed include:

• Foodstuffs (02-21)

• Beverages (22)

• Tobacco (24)

• Salt; sulphur; earths and stone; lime and cement (25)

• Pharmaceutical products (30)

• Fertilisers (31)

• Tanning or dyeing extracts (32)

• Perfumery and cosmetics (33)

• Soap; albuminoidal substances; glues; explosives (34-37)

• Miscellaneous chemical products (38)

• Plastic and articles thereof (39)

• Rubber and article thereof (40)

• Articles of leather; handbags (42)

• Wood and articles thereof (44)

• Printed articles (49)

• Silk; wool; and other vegetable textile fibres (50-53)

• Man-made filaments and staple fibres (54/55)

• Carpets and rugs (57)

• Other textiles not elsewhere classified (n.e.c). (59)

• Clothing, knitted or crocheted (61)

• Clothing and accessories, not knitted or crocheted (62/65)

• Other made-up textile articles (63)

• Footwear (64)

• Articles of stone, plaster and cement (68)

• Ceramic products (69)

• Glass and glassware (70)

• Jewellery (71)

• Iron and steel; and articles thereof (72/73)

• Copper; nickel; aluminium; lead; zinc; tin; and articles thereof (74-81)

• Tools and cutlery of base metal (82)

• Miscellaneous articles of base metal (83)

• Machinery and mechanical appliances (84)

• Electrical machinery and electronics (85)

• Railway (86)

• Vehicles’ parts (87)

• Aircraft (88)

• Ships (89)

• Optical; photographic; medical apparatus (90)

• Watches (91)

• Furnitures (94)

• Toys and games (95)

• Miscellaneous manufactured articles (66/67/96)

Seizure data indicate that there were over 400,000 seizures of products in potentially dangerous product categories worldwide between 2017 and 2019. The dangerous fakes seized were destined to almost 150 economies and originated from more than 190 different countries. The analysis of this broad scope is followed by the analysis of a more focused scope.

Products impacted

The scope of dangerous goods’ categories that are subject to infringement is broad. However, the intensity of counterfeiting and piracy differs significantly from one product category to another. This is illustrated in Figure 3.1 below, which indicates that between 2017 and 2019, interceptions were concentrated in a relatively limited number of HS chapters.

From 2017 to 2019, the highest number of seizures among the dangerous fakes intercepted corresponded to ready to wear items (footwear, clothing), luxury goods (leather goods, watches) and electronic appliances. Other items included spare parts, optical and medical apparatus as well as pharmaceuticals.

Figure 3.1. Main product categories of dangerous goods subject to counterfeiting, 2017-19

Source: OECD/EUIPO database.

Trade routes

From 2017 to 2019, the dangerous fakes seized mostly came from Asian countries, with eight of these countries accounting for around 84% of global seizures of dangerous fakes. As shown by Figure 3.2, these Asian countries were led by China (52%) and Hong Kong (China) (27%). They were followed by Turkey, which was the provenance economy for 8% of global seizures of dangerous fakes.

Figure 3.2. Main provenance economies of dangerous fakes, 2017-19

Source: OECD/EUIPO database.

The United Sates and the European Union countries were the main destination economies of counterfeit dangerous goods during 2017-19. Figure 3.3 indicates that 37% of global seizures of dangerous goods were destined to the United States. The European countries most targeted by counterfeiting of dangerous fakes were Germany (21%), Belgium (9%), Italy (6%) and Denmark (3%).

Figure 3.3. Main destination economies of dangerous fakes, 2017-19

Source: OECD/EUIPO database.

Transport methods

As shown by Figure 3.4, the postal service (59% of global customs seizures of dangerous fakes) was the preferred conveyance method for shipping the dangerous goods between 2017 and 2019. It was followed by air and express courier, which represented 16% of global customs seizures of dangerous goods.

In terms of global seized value, shipments by sea was prominent. They represented more than 60% of the global seized value of dangerous fakes.

Figure 3.4. Conveyance methods of dangerous goods subject to counterfeiting, 2017-19

Source: OECD/EUIPO database.

Dangerous counterfeit goods shipped by vessel

This section concerns the shipment of dangerous fakes that are transported in container ships.

Impacted products

Figure 3.5 indicates that the toys and games (28%) were the most frequently seized product category by customs among dangerous fakes shipped by vessel from 2017 to 2019. They were followed by clothing (14%) footwear (12%) and electronic appliances (9%).

In terms of seized value, vehicles’ parts were by far the most seized product category. This is partly due to one large seizure of more than 50 000 spare parts coming from China to Ukraine.

Figure 3.5. Main product categories of dangerous fakes shipped by vessel, 2017-19

Source: OECD/EUIPO.

Trade routes

China was by far the main provenance economy of dangerous goods shipped by vessel from 2017-19, representing more than 70% of global customs seizures of these goods. As can be shown in Figure 3.6, Morocco (6%) plays an important role in trade in dangerous fakes shipped by vessel as it is the second provenance economy, followed by Turkey (4%).

Figure 3.6. Main provenance economies of dangerous fakes shipped by vessel, 2017-19

Source: OECD/EUIPO database.

The counterfeit dangerous goods shipped by sea were destined to Gulf countries, led by Saudi Arabia - which was the first destination for these goods, followed by Qatar and Kuwait (see Figure 3.7). The European Union countries (Poland, Spain, France, Hungary, and Germany) and South American countries (Chile, Dominican Republic) were also important outlets for dangerous fakes shipped by vessel from 2017 to 2019.

Figure 3.7. Main destination economies of dangerous fakes shipped by vessel, 2017-19

Source: OECD/EUIPO database

Analysis of the most frequently counterfeited toys

As indicated by Figure 3.5 above, the toys and games were the most frequently seized products among dangerous fakes shipped by vessel. The customs seizures data indicate that building sets were the most frequently seized product by customs within this category.

Figure 3.8 which presents the main provenance-destination economies of the counterfeit building sets, indicates that China was the main provenance country while the Eastern European countries (Poland, Germany, Hungary and the Czech Republic) were the main destination economies.

Figure 3.8. Main provenance destination economies of the most frequently counterfeit dangerous goods (toys building set) shipped by vessel, 2017-19

Source: OECD/EUIPO database.

The data on customs seizures reveal that the shipment size of fake toys tended to be large as almost a third of global customs seizures of these goods contained more than 500 items (see Figure 3.9).

Figure 3.9. Shipment size of the most frequently faked product (building set) shipped by vessel, 2017-19

Source: OECD/EUIPO database.

Shipment size

Figure 3.10 presents the shipment size of global seizures of dangerous fakes from 2017 to 2019. It indicates that shipment size of these goods tended to be small as almost 60% of global seizures contained less than 6 items. Large shipments (i.e. more than 10 items) represented just over a third of the global seizures of dangerous fakes.

Figure 3.10. Shipment size of dangerous goods subject to counterfeiting, 2017-19

Source: OECD/EUIPO database.

Dangerous counterfeit goods transported by small parcels

This section concerns the shipment of dangerous fakes in small parcels (i.e. global seizures of dangerous fakes containing only one item).

Impacted products

Figure 3.11 indicates that among small parcels of dangerous fakes, footwear was the most frequently seized product from 2017 to 2019, equivalent to 35% of global customs seizures. It also included clothing (16%), leather goods (16%) and watches (9%).

Figure 3.11. Main product categories of small parcels of dangerous fakes, 2017-19

Source: OECD/EUIPO database.

Trade routes

The dangerous fakes shipped through small parcels mainly came from the main providers of counterfeit goods such as China (63% of global customs seizures), Hong Kong (China) (20%), Turkey (6%) and Singapore (2%).

Figure 3.12. Main provenance economies of small parcels of dangerous fakes, 2017-19

Source: OECD/EUIPO database.

European countries and the United States were the main destination economies of the small parcels containing dangerous goods. As indicated in Figure 3.13, Germany (30% of global seizures of small parcels of dangerous goods), the United States (26%), Belgium (15%) and Italy (7%) were the principal destinations of dangerous goods shipped through small parcels from 2017 to 2019.

Figure 3.13. Main destination economies of small parcels of dangerous fakes, 2017-19

Source: OECD/EUIPO database.

Analysis of the most frequently counterfeited footwear

As indicated in Figure 3.11, footwear was the most frequently seized product among dangerous fakes shipped through small parcels from 2017-2019. A detailed analysis of data on customs seizures reveals that sneakers from two major sport brands were the most frequently counterfeited items in this category.

As can be seen in Figure 3.14, the main trade routes of sneakers shipped through small parcels were from China and Hong Kong (China) to European countries (Belgium, Germany, Poland, Italy).

Figure 3.14. Main provenance-destination economies of the most frequently faked dangerous good (sports shoes) shipped through small parcel, 2017-19

Source: OECD/EUIPO database.

In terms of both global seized value (81%) and the number of customs seizures (73%), the postal service was by far the most used to ship fake sneakers via small parcels from 2017 to 2019 (see Figure 3.15). It was followed by express courrier, which was the transport mode used for 14% of seizures of counterfeit sneakers shipped via small parcels.

Figure 3.15. Conveyance methods of the most frequently faked dangerous good (sneaker) shipped through small parcel, 2017-19

Source: OECD/EUIPO database.

EU Case Study

This section focuses on trade of dangerous fakes destined for the EU 28 markets. The United Kingdom is included to the scope as the reference period (2017-19) is prior to the Brexit.

At the EU level, there were almost 230 000 seizures of dangerous goods from 2017 to 2019 which came from almost 170 different provenance economies.

Dangerous product categories subject to counterfeiting

From 2017 to 2019, footwear (31%) was the most frequently seized dangerous good destined for the EU (see Figure 3.16). It was followed by clothing (23%) and leather goods (9%). This top 3 is the same at the worldwide level. However, toys and games and cosmetics, which are the other most frequently seized products, seem to be more important at the EU level than at worldwide level.

As in the worldwide case, the dangerous product categories subject to counterfeiting are numerous and varied ranging from common goods to pharmaceuticals and machinery.

Figure 3.16. Main product categories of dangerous counterfeit goods imported into the EU, 2017-19

Source: OECD/EUIPO database.

Main trade routes of trade in dangerous fakes destined to the EU countries

Germany (35% of global customs seizures of dangerous products), Belgium (16%), Italy (9%), Denmark (5%) and Spain (5%) were the most targeted EU countries as they were the most frequently reported as destination economies for these products (see Figure 3.17).

Figure 3.17. Main destination economies of dangerous counterfeit goods imported into the EU, 2017-19

Source: OECD/EUIPO database.

At the EU level, China, Hong Kong (China) and Turkey, as at the worldwide level, were also the main provenance of dangerous fakes from 2017 to 2019 (see Figure 3.18). Turkey, however, played a greater role as a provenance economy for dangerous goods destined to the EU in terms of both the global seized value (+ 5 pp) and the number of global customs seizures (+ 4pp).

Figure 3.18. Main provenance economies of dangerous counterfeit goods imported into the EU, 2017-19

Source: OECD/EUIPO database.

Transport modes of dangerous goods destined to the EU countries

At the EU level, the postal service was also the preferred transport mode for shipping dangerous fakes during 2017-19, representing 61% of global customs seizures of dangerous products destined to the EU (see Figure 3.19). It was followed by express courrier (17%) and air (16%).

In terms of global seized value, the picture at the EU level differs from that at the international level. Sea represented 38% of global seized value of dangerous fakes destined to the EU while it represented 61% at the international level.

Figure 3.19. Conveyance methods of dangerous counterfeit goods imported into the EU, 2017-19

Source: OECD/EUIPO database.

At the EU level, the average shipment size of dangerous fakes is smaller than at the international level. The lesser role of transport by vessel in European countries may be an explanation. Small parcels largely dominated as they represented 62% of global customs seizures of dangerous products destined to the EU (compared to 47% at the international level). The large shipments (i.e. more than 10 items) represented only 15% of global seizures of dangerous goods (compared to 26% at the international level).

Figure 3.20. Shipment size of dangerous counterfeit goods imported into the EU, 2017-19

:Source: OECD/EUIPO database.

Focused scope

The focused approach takes into account the most dangerous types of counterfeit goods: foodstuffs, pharmaceutical products and those goods’ categories, that are most frequently subject to safety alerts. This is established using the databases on product safety problems and product recalls. In particular, as discussed in Chapter two, this section uses the main products subject to alert in the EU Safety Gate system. This scope includes the following product categories (HS code):

• Foodstuffs (02-21)

• Pharmaceutical products (30)

• Perfumery and cosmetics (33)

• Soap (34)

• Clothing, knitted or crocheted (61)

• Other made-up textile articles (63)

• Jewellery (71)

• Electrical machinery and electronics (85)

• Vehicles’ parts (87)

• Watches (91)

• Toys and games (95)

Specifically, pharmaceuticals, foodstuffs and cosmetics have been included in whole, at a two digit level, as structured interviews with enforcement officials underscored the wide presence of risky goods in these categories. For all other categories, only some subcategories of products at four-digit level were included, based on the specific indications in the Safety Gate database. These subcategories are listed below:

• Soap (34)

  • HS 3402: Organic surface-active agents (not soap); surface-active, washing (including auxiliary washing) and cleaning preparations, containing soap or not, excluding those of heading n°. 3401

• Clothing, knitted or crocheted (61)

  • HS 6101: Coats; men's or boys' overcoats, car-coats, capes, cloaks, anoraks, ski-jackets, wind-cheaters, wind-jackets and similar articles; knitted or crocheted, other than those of heading n°. 6103

  • HS 6102: Coats; women's or girls' overcoats, car-coats, capes, cloaks, anoraks, ski-jackets, wind-cheaters, wind-jackets and similar articles, knitted or crocheted, other than those of heading n°. 6104

  • HS 6104: Suits, ensembles, jackets, dresses, skirts, divided skirts, trousers, bib and brace overalls, breeches and shorts (not swimwear), women's or girls', knitted or crocheted

  • HS 6105: Shirts; men's or boys', knitted or crocheted

• Other made-up textile articles (63)

  • HS 6307: Textiles; made up articles not eslsewhere specified (n.e.s). in chapter 63, including dress patterns

• Jewellery (71)

  • HS 7116: Articles of natural or cultured pearls, precious or semi-precious stones (natural, synthetic or reconstructed)

• Electrical machinery and electronics (85)

  • HS 8504: Electric transformers, static converters (eg rectifiers) and inductors

  • HS 8516: Electric water, space, soil heaters; electro-thermic hair-dressing apparatus; hand dryers, irons; electro-thermic appliances for domestic purposes; electro heating resistors, not of heading n° 8545

  • HS 8539: Lamps; electric filament or discharge lamps, including sealed beam lamp units and ultra-violet or infra-red lamps, arc-lamps

• Vehicles’ parts (87)

  • HS 8703: Motor cars and other motor vehicles; principally designed for the transport of persons (other than those of heading n°. 8702), including station wagons and racing cars

  • HS 8711: Motorcycles (including mopeds) and cycles; fitted with an auxiliary motor, with or without side-cars; side-cars

• Watches (91)

  • HS 9113: Watch straps, watch bands, watch bracelets and parts thereof

• Toys and games (95)

  • HS 9503: Tricycles, scooters, pedal cars and similar wheeled toys; dolls' carriages; dolls; other toys; reduced-size (scale) models and similar recreational models, working or not; puzzles of all kinds

  • HS 9506: Gymnastics, athletics, other sports (including table tennis) or outdoor games equipment, n.e.s. in the chapter 95, swimming pools and paddling pools

While risks for consumers posed by foodstuffs, pharmaceuticals, cosmetics, electrical machinery and electronics, vehicles’ parts and toys and games are quite clear those associated with categories such as clothing, textiles, jewellery and watches are less obvious. The risks associated with these categories are discussed in Chapter 1 and notably illustrated in Table 1.6. However, it is important to highlight that cases of jewellery containing toxic substances as heavy metals like lead and cadmium, as well as PVC and other plastics have been reported. The main area of concern for watches are dangerous chemicals and toxic heavy metals used for production of strap and watch case. Clothing and textiles may contain toxic materials, or made in a ways that poses risks of chocking or fire. For example, a case of a cushion cover that was made out of extremely toxic textile material containing dyes releasing the aromatic amine benzidine has been reported. In direct and prolonged contact with the skin, this aromatic amine may be absorbed by the skin causing cancer, cell mutations and affect reproduction.

There were just over 70 000 customs seizures of potential dangerous goods from 2017 to 2019 in the HS categories covered. The seizures originated in 170 economies, and were shipped to 115 economies.

Trade volumes

According to the GTRIC methodology, the total volume of potential dangerous fakes traded amounted to almost USD 75 billion in 2019. As can be seen in Figure 3.21, the value of global trade in dangerous fakes were slightly higher in 2017 and 2018, and amounted to USD 88.4 billion.

The trade in dangerous fakes represented a third of global trade in counterfeit goods within the focused scope in 2019. When considering the global value of trade in fakes (i.e. all goods categories) which has been estimated to USD 464 billion in a previous OECD/EUIPO report (Global Trade in Fakes : A Worrying Threat), the trade of potential dangerous fakes accounted for 16% of global trade in counterfeit goods overall the same year.

Figure 3.21. Estimates of global trade in dangerous fakes, 2017-19

Note: The share was based on the value of fakes of all counterfeit goods in categories within the focused scope (foodstuffs, pharmaceuticals, cosmetics, soap, clothing, textiles, jewellery, electronic appliances, vehicles’ parts watches as well as toys and games).

Source: OECD/EUIPO database.

Trade routes

Figure 3.22 indicates that the main provenance of dangerous fakes indicates that dangerous fakes are the same as those for global counterfeit goods overall.

The list of dangerous counterfeit goods is broad and many Asian countries are included, led by China (55% of global customs seizures) and Hong Kong (China) (19%). In addition to Asian countries, Turkey (9%) was also an important provider of dangerous fake products.

Figure 3.22. Main provenance economies of dangerous fakes, 2017-19

Source: OECD/EUIPO database.

As indicated in Figure 3.23, from 2017 to 2019, the dangerous counterfeit products were mainly destined to Germany (34% of global customs seizures of dangerous fakes) and the United States (23%). Many European Union countries are included in the top destinations of dangerous fakes; Belgium accounted for 7% of seizures, followed by, Denmark (4%), Italy (3%) and Spain (2.6%).

Figure 3.23. Main destination economies of dangerous fakes, 2017-19

Source: OECD/EUIPO database.

Products impacted

Among dangerous goods, perfumery and cosmetics (32% of global customs seizures), clothing (25%) and toys and games (22%) were the most frequently counterfeited product categories during 2017-19 (see Figure 3.24). They were followed by automotive spare parts (7%) and pharmaceuticals (5%).

Figure 3.24. Main dangerous product categories subject to counterfeiting, 2017-19

Source: OECD/EUIPO database.

Transport methods of dangerous fakes

Data on customs seizures indicate that, during 2017-19, the postal service was the preferred shipping mode for dangerous fakes as 60% of dangerous goods seized were shipped by mail (see Figure 3.25). It was followed by express courier (14%) and air (12%).

Sea was the leading transport mode of dangerous fakes in terms of seized value. It was equivalent to 64% of the global seized value of dangerous goods, a higher share than for all counterfeit goods (53%) during the same time period.

Figure 3.25. Conveyance methods of dangerous goods subject to counterfeiting, 2017-19

Source: OECD/EUIPO database.

Dangerous counterfeit goods shipped by vessel

The following section focuses on seizures of dangerous fakes shipped in containers.

Impacted products

Among the seized dangerous fakes shipped by vessel, toys and games were the most frequently counterfeited products, equivalent to 53% of the global customs seizures of containerized dangerous goods (see Figure 3.26). It was followed by cosmetics (20%), clothing (9%) and automotive spare parts (8%).

Figure 3.26. Main product categories of dangerous fake goods shipped by vessel, 2017-19

Source: OECD/EUIPO database.

Trade routes

As indicated in Figure 3.27, the containerized counterfeit dangerous goods came mainly from China (77% of global customs seizures of dangerous fakes), the United Arab Emirates (3%), Turkey (3%) and Morocco (2%).

Figure 3.27. Main provenance economies of dangerous fake goods shipped by vessel, 2017-19

Source: OECD/EUIPO database.

Data on customs seizures also reveal that the list of destination economies of containerized dangerous fakes is very broad (see Figure 3.28). During 2017-19, European countries (particularly Eastern European countries) were an important destination for containerized dangerous fakes, led by Poland (12% of global seizures of containerized dangerous fakes), Hungary (6%), Romania (4%) and Germany (4%). The Gulf countries were also an important outlet for dangerous counterfeit containerized goods as Saudi Arabia (7%), Qatar (4%) and Kuwait (3.6%) were also main destination economies. Dangerous counterfeit containerized goods were, moreover, also destined to South American countries, notably Chile (5%) and the Dominican Republic (almost 1%).

Figure 3.28. Main destination economies of dangerous fake goods shipped by vessel, 2017-19

Source: OECD/EUIPO database.

Shipment size of dangerous fakes

Figure 3.29 indicates that the shipment size of all dangerous fakes within the focused scope seized tended to be small during 2017-19; shipments containing less than 10 items represented 64% of global seizures of dangerous goods while it represented 61% of seizures of all counterfeit goods.

Figure 3.29. Shipment size of dangerous goods seized, 2017-19

Source:OECD/EUIPO.

Dangerous counterfeit goods shipped by parcels

The following paragraph focuses on analysing the seizures of dangerous goods sent by small parcels.

Impacted products

As indicated above by Figure 3.29, 41% of customs seizures of dangerous goods contained only one item. Among these seizures, there were mostly fake cosmetics which accounted for 42% of the global seizures of small parcels of dangerous fakes (see Figure 3.30). It also included fake clothing (24%), toys and games (24%).

Figure 3.30. Main product categories of small parcels of dangerous fakes, 2017-19

Source: OECD/EUIPO database.

Trade routes

Figure 3.31 shows that dangerous fakes shipped through small parcels came from China (75%), Hong Kong (China) (10%) Turkey (5%) and Singapore (2%), which are the leading sources of all counterfeit goods. Altogether, these four countries accounted for 92% of global customs seizures of dangerous fakes shipped via small parcels.

Figure 3.31. Main provenance economies of small parcels of dangerous fakes, 2017-19

Source: OECD/EUIPO database.

The customs seizures data show that small parcels of dangerous fakes were mainly destined to developed countries (European countries and the United States) with Germany (54%), Belgium (13%), the United States (9%), and Denmark (7%) being the most frequent destination economies (see Figure 3.32).

The United States played a key role in terms of global seized value, representing more than half of seized value of dangerous goods sent through small parcels.

Figure 3.32. Main destination economies of small parcels of dangerous fakes, 2017-19

Source: OECD/EUIPO database.

Transport mode

As indicated in Figure 3.33, the postal service was the preferred transport mode of dangerous fakes shipped through small parcels. This conveyance method represented more than three quarters of the seizures of small parcels of dangerous fakes. It was followed by express courrier (15%) and air (8%).

Figure 3.33. Transport mode of small parcels of dangerous fakes, 2017-19

Source: OECD/EUIPO database.

Analysis of the most frequently counterfeited cosmetics

Cosmetics were the most frequently seized products among the small parcels of dangerous fakes. The data indicate that within this category, perfumes from a leading luxury brand were the most frequently counterfeited products sent by small parcels.

As indicated in Figure 3.34, the main trade routes of perfumes, in terms of global seized value, were from China to European countries (United Kingdom, Hungary, Germany), from China to Tunisia and from Turkey to European countries.

Figure 3.34. Main provenance-destination economies of the most frequently faked product (perfumes) sent via small parcels, 2017-19

Source: OECD/EUIPO.

Figure 3.35 indicates that perfumes sent through small parcels were mostly sent via postal service as it represented almost 80% of global customs seizures of these products.

Figure 3.35. Transport modes of the most frequently faked product (perfumes) sent via small parcels, 2017-19

Source: OECD/EUIPO database.

EU Case Study

This section focuses on the trade of dangerous goods in European Union countries. It aims to provide information on the providers of dangerous fakes, and the most targeted countries in Europe, the most commonly counterfeited items, and the manner in which they are shipped to the European Union.

The scope of the analysis is the EU 28 countries, including the United Kingdom as the analyzed period refers to the pre-Brexit period.

Among dangerous fakes imported to the EU, cosmetics were the most frequently seized products (35% of global seizures), followed by clothing (24%), toys and games (24%) and vehicles’ parts (7%).

Figure 3.36. Main product categories of dangerous fakes seized destined to the EU, 2017-19

Source: OECD/EUIPO database.

Figure 3.37 shows that China, Hong Kong (China) and Turkey were the main source of dangerous fakes imported into the EU during 2017-19. Due to its geographical location, Turkey is a more important supplier of dangerous counterfeit goods in Europe than in the world as a whole.

Figure 3.37. Main provenance economies of dangerous fakes seized destined to the EU, 2017-19

Source: OECD/EUIPO database.

Figure 3.38 which presents the main EU countries targeted by trade in dangerous fakes, indicates that Germany (47% of global customs seizures of dangerous fakes destined to EU) was by far the leading destination of these counterfeit goods during 2017-19. It was followed by Belgium, Denmark, Italy, Spain and Austria

The United Kingdom was the first European country targeted by trade in dangerous fakes in terms of seized value, receiving 26% of global seized value of dangerous fakes destined to the EU.

Figure 3.38. Main destination economies of dangerous fakes seized destined to the EU, 2017-19

Source: OECD/EUIPO.

Around 63% of global seizures of dangerous fakes destined for the EU were shipped by mail from 2017 to 2019 (see Figure 3.39). Express courrier (15%) and air (12%) were the other most frequently used transport modes for the dangerous fakes.

Sea (57%) was the leading conveyance method used to ship dangerous fakes into the EU in terms of global seized value. At the worldwide level, this share is quite higher, at 64%.

Figure 3.39.Conveyance methods of dangerous fakes subject to counterfeiting imported into the EU, 2017-19

Source: OECD/EUIPO database.

Figure 3.40 indicates that the size of shipments of dangerous fakes seized destined to the EU tends to be small as 56% of seizures contained only one item from 2017 to 2019. Large shipments (i.e. more than 10 items) only concerned 22% of global seizures of dangerous fakes destined to the EU, while this share was higher at the worldwide level (36%).This trend is partly linked to the limited role of containerized shipments in EU trade of the dangerous fakes.

Figure 3.40. Shipment size of dangerous goods seized imported into the EU, 2017-19

Source: OECD/EUIPO database

The role of e-commerce

Some seizures recorded by custom offices of the EU Member States contain information that they were related to online sales of goods. The link with online sale of goods is determined by custom officers on a case–by-case basis, taking documentation accompanying the shipped goods into account. In practice the collection and provision of online sales data is uneven among EU Member States. Whereas in some countries the majority of the detentions are associated with online sales, in other countries no single seizure has been associated with online sales of goods in the entire 2017-2019 period. To reduce the impact of this unevenness on the analysis, data from countries which do not report any detentions related to online sales or where the share of detentions related to online sales is lower than 5% have been eliminated from further analysis.

Among dangerous fakes destined to the EU, the majority of purchase were made online (see Figure 3.41). From 2017 to 2019, online sales represented 60% of global seizures of dangerous products destined to the EU. In terms of seized value, they only represented a small share (11% of global seized value).

Figure 3.41. Distribution of online and offline sales among dangerous fakes destined to the EU, 2017-19

Source: OECD/EUIPO database

From 2017 to 2019, cosmetics were the most frequently seized products among dangerous fakes purchased online (see Figure 3.42). 46% of the purchase of dangerous fakes made online were cosmetics items, followed by clothing (18%), toys and games (17%) and automotive spare parts (8%).

Figure 3.42. Product categories of dangerous fakes purchased online, 2017-19

Source: OECD/EUIPO database.

China was by far the main provenance economy of dangerous fakes purchased online, representing 75% of global seizures (Figure 3.43). The dangerous fakes purchased offline came also mainly from China but it represented less than 60% of global seizures. It was followed by Hong Kong (China), Singapore and Turkey in both cases (online and offline sales) as can be seen in Figure 3.43 and Figure 3.44. However, Hong Kong (China) and Turkey play a greater role as provenance economy of dangerous fakes purchased offline.

Figure 3.43. Provenance economies of dangerous fakes purchased online, 2017-19

Source: OECD/EUIPO database.

Figure 3.44. Provenance economies of dangerous fakes purchased on site, 2017-19

Source: OECD/EUIPO database.

The postal service dominates in terms of number of seizures, whether the sale of counterfeit goods has been performed online, or not. In the case of online sales however, mail is associated with 92% of seizures (compared to 42% of seizures of offline sales). All other modes of transport play a far lesser role in the online sale of counterfeit goods than in case of shipment of counterfeit goods not related to online sale. Air transport is the second most important transport mode associated with online sale of dangerous fakes (around 7% of seizures).

Figure 3.45. Modes of transport of dangerous fakes purchased on site (left) and online (right), 2017-19, in terms of number of global customs seizures

Source: OECD/EUIPO database

Industry focuses

This section focuses on two industries where products can present elevated health risks, including foodstuffs and cosmetics. Pharmaceuticals are also of high interest in the framework of this study, however a previous (OECD/EUIPO, 2020[26])report dedicated to the trade in counterfeit pharmaceuticals (Trade in counterfeit pharmaceuticals products) has already been carried out.

Foodstuffs

The data on customs seizures indicate that a wide range of food products were counterfeited. Within this category the most frequently seized products were candies. Most of counterfeit candies were destined to children as it refers to candies with toys or figurines. Fruits and notably frozen strawberries, oranges, apricots or dates were also frequently seized. There were also seizures related to common food products such as tea, coffee, chocolate, honey, cooking oil. Customs have also reported seizure of counterfeit milk powder for baby.

As can be seen in Figure 3.46, the leading provenance economies for counterfeit foodstuffs were China, Hong Kong (China) and Turkey. However, the Middle East countries played a greater role in trade in counterfeit foodstuffs than in global trade in fakes. Several Middle East countries were reported as provenance for fake foodstuffs, including United Arab Emirates, Egypt, Oman, Pakistan, Kuwait, Jordan, Syrian Arab Republic, Saudi Arabia and Bahrain.

Figure 3.46. Main provenance economies of counterfeit foodstuffs, 2017-19

Source: OECD/EUIPO database.

From 2017 to 2019, counterfeit foodstuffs were mainly destined to the US, Gulf countries (led by Saudi Arabia, Qatar and Kuwait) and EU countries (led by Lithuania, Germany and Belgium) as can be seen in Figure 3.47. This indicates that within the Gulf region there were trade flows of counterfeit foodstuffs during 2017-19 period as these countries appeared both as provenance and destination.

Figure 3.47. Main destination economies of counterfeit foodstuffs, 2017-19

Source: OECD/EUIPO database.

While mail was usually the leading transport mode of counterfeit goods overall, sea was the preferred transport mode to ship counterfeit foodstuffs in terms of both the number of seizures and the global seized value from 2017 to 2019 (see Figure 3.48).

Figure 3.48. Transport modes used to ship counterfeit foodstuffs, 2017-19

Source: OECD/EUIPO database.

Consequently, the average shipments size of counterfeit foodstuffs tended to be big. As can be seen in Figure 3.49, one third of seizures of counterfeit food products contained more than 1000 items.

Figure 3.49. Shipments size of counterfeit food products, 2017-19

Source: OECD/EUIPO database.

Cosmetics

Within this category the most frequently intercepted products were perfumes from several brands. Make-up products (i.e. lipstick, bb cream, eyeshadow pallet, skin powder, etc) were also frequently seized by customs. There were around 23000 seizures of counterfeit cosmetics from 2017 to 2019.

Figure 3.50 shows that counterfeit cosmetics seized during 2017-19 originated from China (68%), Hong Kong (China) (15%), Turkey (8%) and United Arab Emirates (1%).

In terms of value, China (78% of global seized value) and India (11%) were the leading provenance economies of counterfeit perfumes and cosmetics.

Figure 3.50. Top provenance economies for counterfeit perfumery and cosmetics, 2017-19

Source: OECD/EUIPO database

European countries and the US were the main destination economies for counterfeit perfumery and cosmetics from 2017 to 2019 (see Figure 3.51). Apart from these countries, Saudi Arabia was also included in the top destinations of counterfeit cosmetics, and accounted for 3% of global seized value of these products.

Figure 3.51. Top destination economies for counterfeit perfumery and cosmetics, 2017-19

Source: OECD/EUIPO database.

Counterfeit perfumes and cosmetics were mostly shipped by mail which represented 77% of global seizures (see Figure 3.52). Road was the second transport mode for shipping counterfeit perfumery and cosmetics (equivalent to 10% of global seizures), followed by air (6%) and sea (4%).

In terms of global seized value, sea was by far the leading transport mode used to ship counterfeit cosmetics as it accounted for 81% of global seized value of these goods.

Figure 3.52. Conveyance methods used to ship counterfeit perfumery and cosmetics, 2017-19

Source: OECD/EUIPO database.

As postal service dominates in terms of shipping mode for counterfeit perfumery and cosmetics, the average size of shipment of these goods is small. Seizures of counterfeit perfumery and cosmetics containing only one item accounted for more than a half of total seizures (see Figure 3.53).

Figure 3.53. Shipment size of counterfeit perfumery and cosmetics, 2017-19

Source: OECD/EUIPO database.