Illicit trade in counterfeit goods is a growing threat in our globalised innovation-driven economy, challenging the integrity of supply chains, while negatively affecting business profits, economic growth, and consumer health and safety. Its harmful impact on global markets and on innovation should not be underestimated.
To provide policy makers with robust evidence about this threat, the OECD carried out a series of analytical studies that deepen our understanding of the scale and magnitude of the problem. The results have been published in a set of reports starting with Trade in Counterfeit and Pirated Goods: Mapping the Economic Impact (2016). The OECD has also produced several country case studies similar to the present report, such as Counterfeiting and Piracy and the Swedish Economy (2019), Trade in Counterfeit Goods and the UK Economy (2019), Counterfeiting, Piracy and the Swiss Economy (2021), Trade in Counterfeit Goods and the Italian Economy (2021).
The Korean economy is largely based on innovation and intellectual property (IP) and it is one of the global leaders in this area. Its IP-intensive industries are well integrated in the global economy through their active participation in global value chains. Yet while innovation and integration to world trade support Korea's economic growth, it also exposes the country to the risks of counterfeiting and piracy.
In order to design effective policies to tackle the threat of counterfeit trade, such trade needs to be identified and assessed. This report provides a quantitative assessment of the scale and harmful effects of counterfeit trade on Korean IP rights (IPR) holders and the Korean government. The analysis is based on an objective and fact-based methodology that gauges the magnitude and scale of counterfeit trade and quantifies its direct economic impact on a given economy. This methodology relies primarily on a unique set of international customs seizures data, as well as on a series of interviews with customs and IP experts and Korean industry representatives. The findings of this report will help the Korean government design policies to combat counterfeiting and piracy, and to identify the main governance gaps in this area.
This report was prepared under the auspices of the OECD Working Party on Countering Illicit Trade, which focuses on evidence-based research and advanced analytics to assist policy makers to map and understand the vulnerabilities exploited and created by illicit trade.