Remarks delivered at the 24th Annual North American/Central Europe Airport Issues Conference
Director of the U.S. Patent and Trademark Office Andrei Iancu
October 29, 2019
As prepared for delivery
Good morning, everyone, and thank you for that kind introduction, Abigail (Rupp). Buna ziua, si salutary din Washington, D.C.! (“Good morning, and greetings from Washington, D.C.!”)
Let me start by thanking you, Deputy Rupp, and Ambassador Klemm, for everything you do here in Romania, and the amazing team you lead at the U.S. Embassy. The work you have all done over time has played a significant role in the close relationship between the United States and Romania.
Thank you also to both the American Association of Airport Executives and the International Association of Airport Executives for organizing this conference. Additionally, I’d like to express my appreciation to the Romanian Ministry of Transportation, the Romanian Civil Aeronautical Authority, and the National Company Bucharest Airports for hosting us today.
I also want to acknowledge David McNeill, the Regional Senior Commercial Officer from the U.S. International Trade Administration—the USPTO’s sister agency at the Department of Commerce. I thank you for your service in Romania. U.S. business has no better advocate here on the ground. You and the Foreign Commercial Service (FCS) are their voice, and you represent them so well.
As its name suggests, the United States Patent and Trademark Office (USPTO) issues patents and registers trademarks. Additionally, we advise the administration on all aspects of intellectual property policy, including patents, trademarks, copyrights, and trade secrets. And we participate in our government’s efforts to address the manufacture, shipment, and sale of counterfeit goods. My remarks to you this morning are focused on this international problem of counterfeits.
It’s a problem that I think has particular resonance for airport administrators. After all, airports, like all ports of entry, are at the forefront of the fight against it. Counterfeits, of course, pass through airports all the time, and there are plenty of dramatic examples from all over the world, including from the last few months.
For example, this past August, $3.4 million in fake luxury goods were seized at the Los Angeles International Airport. In June, authorities at the Edinburgh Airport seized £850,000 pounds worth of counterfeit designer products, including fake designer handbags and clothing. In April, at the Mexico City International Airport, customs agents seized 45 tons of counterfeit goods that ranged from fake Rolex watches to fake Bulgari and Nike products. And in January, at Washington/Dulles International Airport, authorities seized thousands of dollars’ worth of fake luxury goods, including Louis Vuitton purses and Gucci sneakers.
And as you know, it’s far from just luxury goods that are counterfeited. According to U.S. Customs and Border Patrol (CBP), the top three categories of counterfeit goods are personal care, pharmaceuticals, and consumer electronics.
Indeed, last year, CBP seized more items that pose health and safety risks than ever before.
An investigation by the U.S. Food and Drug Administration’s Forensic Chemistry Center, for example, found that 60% of suspected counterfeit contact lenses were contaminated with microbial bacteria that could lead to painful infections of the cornea and potentially loss of vision or blindness. In addition to counterfeit products that can endanger health and safety because they are ingested, used on the skin, or are given to children, there are also examples of exploding counterfeit lithium batteries that have led to intense fires, third-degree burns, and severe property damage.
There are also potential dangers involving high tech equipment, including, of course, aviation components. A 2015 study by the International Chamber of Commerce noted that in 1989, counterfeit airplane parts caused the fatal crash of Partner Flight 394 over Denmark, a tragedy that resulted in the death of all 50 passengers and five crewmembers. The International Chamber also noted that an audit the U.S. Federal Aviation Administration (FAA) conducted at the time found that 39% of spare parts in the FAA inventories were suspected of being counterfeits.
In the end, and unfortunately, the only thing counterfeiters care about is making a profit, and as these various statistics show, their actions can result in very tragic consequences. Clearly, counterfeiting is not a victimless crime.
Plus, counterfeiting can lead to further crimes. The United Nations Commission on Crime Prevention and Criminal Justice recently reported that counterfeiting is now the second largest source of income worldwide for all forms of criminal activities.
And counterfeiters are getting more sophisticated. In some cases, in fact, the very cargo screening equipment meant to combat counterfeiting has been the victim of IP theft. For example, we’ve had reports from U.S. and EU companies that Chinese-made cargo screening manufacturers are allegedly stealing trade secrets and are attempting to undermine enforcement actions at EU ports.
Please choose your partners wisely. Your citizens depend on it. They depend on you not just to protect them from illegal products, but also from the people who profit from these activities—the organized crime syndicates, human traffickers, and terrorist groups.
By the way, a 2019 report by the Organization for Economic Cooperation and Development (OECD) found that “while counterfeit and pirated goods originate from virtually all economies in all continents, China and Hong Kong continue to be by far the biggest origin.”
The OECD report also found that illicit trade follows complex routes with many intermediary transit points, and that this practice, together with falsified documents, is used to hide the origin of the shipments.
Another noted trend is for fake goods to arrive in large quantities in containers, which are then broken down into smaller parcels for further distribution. The OECD has highlighted the growing role of mail and express courier shipments as vehicles for illicit trade. According to its findings, nearly 63% of customs seizures of counterfeit and pirated goods involved small parcels. Small international parcels of this sort, of course, pass through airports, so the work done at airports to interdict counterfeits is clearly vital.
The bottom line is unmistakable: counterfeiting is a scourge on the world economy.
To help address this problem, the USPTO has taken a leading role in advancing the enforcement of IP rights in the United States and throughout the world, including through training and technical assistance. Many of our training programs are designed to promote effective enforcement of civil, criminal, and border provisions to combat trafficking in counterfeit goods, for customs and other officials from all over the world.
I’m pleased to tell you that that over the past five years, more than 150 of these officials have been from Romania, Croatia, Bosnia and Herzegovina, Bulgaria, the Czech Republic, Greece, Greece, Hungary, and Serbia.
What are some of the things we focus on at these programs? For example: techniques for identifying counterfeits; the importance of cooperation between the various government agencies that have responsibilities for enforcing IP rights; and the importance of handling investigations and seizures using procedures that are fair, equitable, and transparent.
An example of a training program we conducted—together with U.S. Customs and the U.S. Postal Inspection Service, and in coordination with law enforcement officials from other countries—we worked with colleagues at mail-sorting facilities at various local and international airports to support the inspection and interdiction of shipments that may include illicit and counterfeit goods.
There are other examples like this where we work to reduce the supply of fakes. But we must also work to educate the public to reduce the demand for fakes.
A recent study by the International Trademark Association (INTA) revealed that 93% of Generation Z “have a lot of respect for people’s ideas and creations,” and that 87% believe that intellectual property rights are at least as important as physical property rights. And yet, the same study reveals that 79% of Gen Zers have purchased counterfeit products in the past year.
This gap must be bridged. This can be done by highlighting the importance of IP enforcement generally and by furthering public awareness.
Educating the public and fostering respect for IP is key to lowering demand for counterfeit and pirated goods. Government, industry and academia need to work together to educate and raise public awareness.
Let me offer just a few examples of the public awareness efforts we’ve already undertaken.
In collaboration with colleagues in the Thai government, we launched a campaign to help educate people about the deadly risks posed by counterfeit medicines. In particular, the campaign was aimed at tourists and was conducted through a combination of signage and digital screens in high-density tourist locations, including, notably, Bangkok International Airport. According to one survey, each sign was viewed more than an estimated 60,000 per day.
Additionally, and in collaboration with the U.S. National Crime Prevention Council (NCPC), we launched a multi-year nationwide public awareness campaign to educate the general public throughout the United States about the dangers of counterfeit goods.
Meanwhile, other airports around the world are also spreading the message about the dangers of counterfeiting and piracy. For example, in the United Kingdom (UK), the UK IP Office worked with police and airport staff to develop the “Holiday with Real Style” campaign targeted at holiday travelers. In the United States, a program entitled “Fake Goods, Real Dangers” is in place at some of our busiest airports, including: Baltimore Washington International Thurgood Marshall Airport; Chicago O’Hare International Airport; Dallas/Fort Worth International Airport; Los Angeles International Airport; New York John F. Kennedy International Airport; and Washington Dulles International Airport.
But a lot more needs to be done. Conferences such as these are a big help, because they educate and raise awareness.
Education and raising awareness are so timely and important. Because today, while we see rapid investment and development in new transit routes that will facilitate trade, at the same time this increase brings with it a glaring certainty that criminals will attempt to exploit these new avenues as passageways for the trafficking of their illicit goods.
Safeguarding against these harms will require increased awareness, increased vigilance, and increased cooperation. Through such coordinated efforts, we can protects our societies from illicit goods, as we uphold the pioneering spirit of creators and innovators from around the world.
By preventing the entry and distribution of these goods, as well as enhancing the protection of intellectual property, each of our respective countries will be better protected from the scourge of counterfeit and pirated goods. We stand ready to help as you all consider these issues.
Multumesc, si va urez o zi buna si o conferinta productiva! (“Thank you, and I wish you a good day and a productive conference!”). Thank you again for the opportunity to be with you today.