Guidance

IP crime and enforcement report 2019 to 2020

Published 2 September 2020

1: The IP Crime Group

The UK IP Crime Group was formed in 2004 and its membership consists of representatives from the private sector, enforcement agencies and government departments who are committed to reducing IP crime and infringement in the UK.

Group members and other invited organisations provide contributions for the annual IP Crime and Enforcement Report, which is published in September by the Intellectual Property Office (IPO) and the Group.

The report draws together the experiences of key stakeholders in the IP crime prevention landscape and offers a unique insight into the nature of IP crime in the UK. In its 15th year of publication, the Report characterises the nature of IP crime today, the measures taken by stakeholders to respond to it and details of ongoing policy development and deployments.

2: The scale of IP crime

The IPO commissions research and works in partnership with many independent research institutions and international organisations to ensure the true scale of IP crime can be estimated.

Imports of counterfeit and pirated goods to the UK, according to Organisation for Economic Co-operation and Development research, accounted for as much as £13.6 billion in 2016 - the equivalent of 3% of UK imports in genuine goods. As compared to 2013, this value increased in absolute terms (GBP 9.3 billion in 2013) but decline in relative terms (4% of UK imports in genuine goods in 2013). ^{[footnote 1]}

More than the half of imported counterfeit and pirated goods into the UK in 2016 were sold to consumers who knew they were buying fake products. ^{[footnote 2]}

30% of UK consumers would knowingly buy a counterfeit item if they saw it for a fraction of the genuine price. ^{[footnote 3]}

3: Where IP crime happens

Nationally:

As a result of ongoing work by law enforcement and many industry supported organisations, year-on-year IP related convictions remain consistent. According to the Ministry of Justice, 401 people were found guilty of offences under the Trade Marks Act (TMA) and 23 under the Copyright, Designs and Patents Act 1988 (CDPA) during 2019, compared with 461 and 25 in the previous year.

TMA Found Guilty and CDPA Found Guilty

	2015	2016	2017	2018	2019
TMA Found Guilty	490	443	398	461	401
CDPA Found Guilty	69	47	47	25	23

Regionally:

The IP crime hot spot map, developed using IPO’s Intelligence Hub data, identifies the geographical spread of reported IP crime in the UK.

IPO Intelligence Hub IP crime hot spots

Collaboration work between law enforcement and IP stakeholders in regional hotspots, including Manchester and Birmingham, are highlighted in the report. An example of this work is Operation Beorma in the Midlands, where more than £4 million of counterfeit stock was seized during 37 raids, following a joint investigation by the National Markets Group and National Trading Standards.

Locally:

Trading Standards authorities throughout the UK prevent IP Crime through detection and prosecution work. In the Report we highlight many Trading Standards authorities’ ongoing cases that characterise the nature of IP crime in their areas.

Top ten counterfeit/pirate products investigated by Trading Standards

Top ten counterfeit/pirate products 2019/20
Cigarettes/Tobacco	86%
Clothing	81%
Alcohol	47%
Footwear	47%
Cosmetics/Makeup	44%
Perfume	43%
Watches, Jewellery	41%
Electrical Goods	37%
Fake Labels / Packaging	23%
Toiletries	20%

Top ten locations

Top 10 locations 2019/20
Ordinary Shops	75%
Social Media	67%
Private Residences	41%
Websites	39%
Auction sites	38%
On the street	29%
Outdoor Markets	28%
Pubs and Clubs	17%
Car Boot Sales	15%
Factories and Industrial Units	15%

Online:

Nominet administers the .UK domain and works with various Crime Group members including:

• Police Intelligence Intellectual Property Crime Unit (PIPCU),
• Medicines and Healthcare Products Regulation Agency (MHRA),
• National Fraud Intelligence Bureau (NFIB),
• Trading Standards,
• National Crime Agency (NCA),
• Fraud and Linked Crime Online (FALCON),
• Financial Conduct Authority (FCA),
• Counter Terrorism Internet Referral Unit (CTIRU),
• Veterinary Medicines Directorate (DEFRA) and
• Ministry of Defence Police,

4: Who commits IP crime?

IP crime involves many of us. From the willing suspension of normal law-abiding principles displayed by 25 percent of the general public who partake in copyright crime, to the organised criminals who engage innocent shoppers by duping consumers into buying dangerous products. ^{[footnote 4]}

This report explores the relationships and linkages in this environment. Exposing the breadth of IP crime, from counterfeit tobacco sales in corner shops, to illegal streaming at home, to the fabrication of complex counterfeit equipment and it’s routing across global supply chains by organised criminal networks.

5: Tackling IP Crime

The enforcement work detailed in this report highlights thousands of online suspensions, complex police, Trading Standards and Border Force operations, case work against individual criminals, prosecutions, engagement and educational work and international liaison with partners across the globe.

Many of the most productive interventions developed and highlighted in this report are collaborations between interest groups with overlapping agendas, but all with a common purpose - tackle IP crime.

6: Policy

The fundamental purpose of this report is to characterise and highlight a form of crime that threatens the economic health of the UK, compromising consumer safety and undermining public confidence in goods and services. This annual insight helps the UK develop policies that reduces and prevents IP crime.

If the UK is to succeed as an independent trading nation it requires two things: further development of the role of IP in the economy, so that valuing, exchange and use of IP as collateral expand; and a reduction in the attacks on IP rights through counterfeiting online, in local markets and through vulnerable supply chains.

A ground-breaking series of a large-scale consumer tracking surveys covering consumer behaviours and attitudes to online digital content has now entered its 10th wave. It confirms that 25% of all digital consumption (i.e. downloading or streaming/accessing content online) used an illegal source of copyright protected material.

The success of this information-gathering initiative informs the IPO’s 2020-21 research agenda. A priority is the need to build our understanding of the role of IP in the UK economy and to link IP data to business data, to better understand incentives and impacts. The first wave of a counterfeit goods tracker, focussing on 6 key sectors: Beauty and Hygiene; Clothing, footwear and accessories; Sports; Toys; Electricals; and Alcohol, has been published to complement the online copyright infringement tracker.

As well as strengthening law enforcement authorities’ capacity to mount operations against IP criminals in the field, increasing attention is turning to the role of educating consumers. We must not only promote IP as a good thing for everyone by protecting rights that are relied on by consumers and businesses, we must explain why undermining those principles is damaging for everyone.

In other words, we must change the attitudes and behaviour of consumers and traders towards IP crime. The Online Copyright Infringement (OCI) 2019 Communications Report, Behaviour Change Opportunities, produced by the IPO, highlights the importance of this aim and how it can be achieved.^{[footnote 5]}

7: Consumer behaviour

One of the challenges for 2020 and beyond is to better understand and tackle consumer behaviour towards counterfeit goods. There is no doubt changing behaviour is a significant challenge. According to the OECD/IPO report: Trade in Counterfeit Products and the UK Economy 2019 Update: more than the half of the counterfeit and pirated goods imported into the UK in 2016, were sold to consumers who were aware they were buying fake products.^{[footnote 6]}

This figure is supported by other data in the report, where, for example, a survey conducted by Electrical Safety First revealed almost 30% of UK consumers would knowingly buy a counterfeit item if they saw it for a fraction of the true price.

So, changing the attitudes of consumers and traders towards IP crime is essential. The IPO has committed to work towards a time when infringement is socially unacceptable to all. Using the results of the Counterfeit Goods Tracker, the IPO are now developing a consumer awareness campaign that will focus on the beauty and hygiene sector.

8: Contributors to this year’s report

• Anti Copying in Design (ACID)
• Anti-Counterfeit Forum (ACF)
• Anti-Counterfeiting Group (ACG)
• Crown Prosecution Services (CPS)
• FACT
• Independent Automotive Aftermarket Federation (IAAF)
• Industry Trust
• Intellectual Property Office (IPO)
• Intellectual Property Online Prosecutors Group (IPOP)
• National Markets Group for IP Protection
• National Trading Standards (NTS)
• Nominet
• Police Intellectual Property Crime Unit (PIPCU)
• Premier League
• PRS for Music
• Real Deal
• SCOTTS IP Crime Group
• Snapdragon IP
• TM Eye
• Trading Standards Local Authorities
• Trading Standards Scotland (TSS)
• UK Interactive Entertainment (Ukie)
• Vistal Works
• WRi Group

9: Further information

Information about the IP Crime Group including useful IP enforcement contacts is available:

Research:

• IPO Research Priorities 2020/21(PDF, 19.5KB)
• Trade in Counterfeit Products and the UK Economy 2019 Update
• Online Copyright Infringement Tracker 9th Wave

Disclaimer:

The findings, facts and opinions in the IP Crime and Enforcement Report are those of the IP Crime Group members and not necessarily the views of the IPO or the government.

The data in the Report has not been substantiated by the IPO.

Footers

1. Trade in Counterfeit Products and the UK Economy 2019 Update, (2019) OECD and the UK IPO, Paris and Newport pg. 4. ↩

2. ibid. ↩

3. Electricity Safety First - IP Crime Report 2020 pg 25. ↩

4. 25% of copyright infringement in the UK is intentional Online Copyright Infringement Tracker 9th Wave Newport, Intellectual Property Office 2020. ↩

5. Online Copyright Infringement Tracker 9th Wave. ↩

6. Trade in Counterfeit Products and the UK Economy 2019 Update, (2019) OECD and the UK IPO, Paris and Newport pg 4. ↩