Trade of Made in Italy Counterfeit Goods Said to Be Worth 5.2B Euros

MILAN — As Italy faces a new wave of COVID-19 cases, potentially undermining the country’s economy, Confindustria Moda, the association that groups more than 67,000 companies in the fashion, textile and accessories sectors, has partnered with the Ministry of Economic Development on the fifth edition of Anti-Counterfeiting Week, which is running through Oct. 25.

“Counterfeit goods are a real plague for our sector and a damage for the whole economy of our country,” noted Cirillo Marcolin, the newly appointed president of Confindustria Moda.

According to data compiled by the Organization for Economic Co-operation and Development, the trade of counterfeit goods from the textile, fashion and accessories sectors amounts to 5.2 billion euros, causing a 1.3 billion euro loss for manufacturing companies and a 1.4 billion euro loss for consumers who are misled in buying fake products.

“In the last few years, several steps were made toward the fight against this phenomenon, but still there’s a lot that needs to be done. The damage connected with the infringement of intellectual property is too often not perceived as a crime: It’s important to sensitize the public opinion about this topic,” said Marcolin.

Over the last few years, Italy’s authorities have been able to increase the seizure of fake goods, which were valued at 26 million euros and 52 million euros in 2016 and 2018, respectively.

Confindustria Moda has also launched a dedicated campaign that reads: “The fight against counterfeiting starts from you!,” urging consumers to only buy original products.

According to Marino Vago, president of SMI Sistema Moda Italia, 20 percent of counterfeit goods seized in Europe pertain to the fashion and textile sectors. In 2018, 31 million euros’ worth of counterfeit fashion items were seized in Italy, Vago said. He added that trade happens largely online.

“Our association has done a lot to this end, thanks to selected deals with international players, but a severe legislation shared on a European and international level is needed,” Vago said. He offered that the blockchain project that is under the scrutiny of the Ministry of Economic Development could provide an effective safeguard of consumers’ interests.

The second most affected sector behind fashion is accessories, whose products represented 34.2 percent of the seized goods in 2018. Franco Gabbrielli, president of Assopellettieri, the leather goods association, praised the institutions for showing interest in fighting counterfeiting but urged the country to do better, especially “warding off the phenomenon before it spreads. It would be useful to increment the informative campaigns dedicated to consumers, highlighting the importance of purchasing products through the official channels and remarking that ‘shortcuts’ often encompass a high cost for everybody.”

In addition to damaging the reputation of Made in Italy products and companies’ sales, Confindustria Moda pointed to a number of side effects of counterfeiting, such as money laundering, tax evasion, illegal labor and even sustainability, in that producers of fake goods do not comply with environmental regulations.

“In terms of labor there’s a serious implication, because in addition to job losses we need to take into account the tax evasion coming from the business-to-business and business-to-consumer trade of fake products and the missed payment of duties to entitled companies for [their] intellectual property and patents,” said Siro Badon, president of Assocalzaturifici, Italy’s shoemakers association. “Victims span from companies deprived from legit sales, to governments bereft of taxes.”

According to figures provided by the country’s jewelers association Federorafi, counterfeit goods amount to 7 percent of the sector’s annual revenues of 7.5 billion euros. President Ivana Ciabatti noted that very often fake jewels are marketed with a lower tier of precious metals, thus damaging the sector’s credibility.

Voicing concern for consumers’ health, Gianni Russo, president of tannery organization Unic, expressed concern over the use of toxic and inadequate materials and compounds in the production of fake leather hides and accessories. To this end, last May the Italian government, pressured by Unic, passed a law regulating the use of the term “leather.”

Similarly, Giovanni Vitaloni, president of eyewear association Anfao, noted that “counterfeiting in our sector…is particularly harmful because glasses are not a regular accessory: They are a medical device and of self-protection. Counterfeiting entails the risk that all the required technical specs are not respected, thus potentially provoking severe diseases for users.”

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