October 21, 2008
Counterfeit electronic components are entering the U.K. market in huge numbers
, costing the economy an estimated £1 billion ($1.73 billion) a year, according
to research conducted in July by the U.K. Electronics Alliance (UKEA). UKEA cited
estimates from the U.K. Intellectual Property Office that intellectual property (IP)
related crime (counterfeiting and piracy) costs the U.K. at least £9 billion
($15.57 billion) a year. In addition, the U.S. Patent & Trademark office notes
that 9% of all counterfeit goods seized are electronic in nature.
Electronic goods become counterfeit as a result of components within them. Taken
together, these figures indicate that the value of electronic counterfeit goods entering
the U.K. could be up to £1 billion ($1.73 billion).
The UKEA is calling on government to combat this problem by increasing the amount of
resources put into detection and prevention, introducing tougher penalties for those
caught with counterfeit goods, and by fostering cooperation between U.K. trading
partners and their customs services. The more counterfeits that appear on the
market, the greater the risk that a safety critical application, such as public
transport network, or even the National Grid, may suddenly fail. Such a failure
would have catastrophic consequences, UKEA said.
According to UKEA estimates, the U.K. has only two HM Revenue & Customs (HMRC)
officers directly responsible for intercepting counterfeit goods coming into the
U.K. The UKEA believes that Britain must follow the lead set by European
Parliament and the U.S. Customs Service. It states that more resources must be
allocated to HMRC so that it can enforce legislation already in place. UKEA said
a full review should be conducted of whether additional measures already enacted by the
U.S. can be applied in the U.K. Once in the country, counterfeit components have
a number of damaging consequences, UKEA said. Business relationships within the
electronics supply chain can be damaged by activities of counterfeiters, whose products
often instigate legal disputes between component distributor and manufacturer to recover
loss of revenue, profit, jobs and damage to reputation.
To offer meaningful discouragement, the UKEA is calling on government to ensure the
financial penalties for convicted counterfeiters reflect the significant profit to be
made. "Counterfeiting has hit U.K. electronics manufacturing hard," said Henry
Parker, electronics manager from UKEA member association Intellect. "We urgently
need to give our manufacturers more protection against the threat. We fully accept
that industry has a self-policing role to play and that combating counterfeiting is very
difficult. However, the government must also do all it can to help us," Parker
said.
For more information about the UKEA research, visit
http://www.ukelectronicsalliance.org.
Source: U.K. Electronics Alliance (UKEA).
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