Business to G20: fake goods hurt economies

The International Chamber of Commerce pressing its point to the G20 Summit that counterfeiting and intellectual property theft damage national economies.

The International Chamber of Commerce pressing its point to the G20 Summit that counterfeiting and intellectual property theft damage national economies.

Flo, a DVD sniffer dog, waits for her reward after finding a box of pirate discs in Toronto. While the dogs have been lauded for their efforts in helping authorities crack down on counterfeit discs, the International Chamber of Commerce says governments and consumers must do more. ((Aaron Harris/Canadian Press) )
"Piracy and counterfeiting, it does take jobs away, and it doesn't make for a wholesome global economy," ICC director general Jean Rozwadowski said in an interview with CBC News.

A study prepared for the G20 by UK-based Frontier Economics suggests business loses $877 billion each year in intellectual property theft.

Within G20 countries, that amounts to a loss of $125 billion and puts 2.5 million legitimate jobs at risk.

While the study is European-based, Rozwadowski says Canada is far from immune from the effects of counterfeiting, pointing to the example of Waterloo, Ont.-based Research In Motion, maker of the BlackBerry.

"Apparently, there are counterfeit BlackBerrys all over the world which have batteries which are not functioning, [from] which information gets lost, et cetera, so from a consumer's perspective, you're less protected if you have counterfeit goods," he said.

The chamber has been coming to meetings of world leaders for more than 15 years, pressing the same point — governments need to take more action to crack down on counterfeit goods.

Rozwadowski concedes there's been a lack of progress in efforts to lobby governments, but he does applaud Canada for its recent legislation to change its Copyright Act.

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"Canada has been doing something very specific with copyright, which we welcome; its something which is important."

Technology has made intellectual property theft and counterfeiting much easier and profitable, according to the group Business Action to Stop Counterfeiting and Piracy.

A fake Ferrari car is displayed during an anti-counterfeit summit in Brussels. ((Yves Logghe/Associated Press) )
Its executive director, Jeff Hardy, told CBC News the organization is about to launch an international campaign aimed at consumers who purchase the counterfeit goods.

"Counterfeiting and piracy is like any other business, it's an illicit business. There's a supply side and a demand side, and for the most part governments have been tackling the supply side," he said.

A recent study by BASCAP showed a wide range of consumers willing to purchase fake goods or pirated media. The study found consumers find it easy to justify their purchases.

He said technology makes the practice easy. "High-speed internet, file sharing, low-cost mass storage makes piracy low hanging fruit and very difficult to resist the temptation."

Part of the BASCAP pitch will be to help consumers recognize the other costs of counterfeiting, such as its contribution to organized crime.

"It supports more of the bad things that organized crime does. It's more capital for them to invest in prostitution, illegal drugs and other activities."