Distribution of counterfeit Korean product... > IT/과학기사 | it/science

The Organization for Economic Cooperation and Development OECD published a report titled “Illicit Trade and the Korean Economy ” on Wednesday, according to the Korean Intellectual Property Office KIPO the following day.

The report, commissioned by the KIPO, analyzed the economic damage caused to South Korean companies by the distribution of counterfeit products. This is the first time the OECD has analyzed the economic impact of counterfeit products on Korean companies.


The international trade of counterfeit products infringing Korean IPRs was valued at $9.7 billion in 2021, according to the report. Of this amount, counterfeit products related to home appliances, electronics, and telecommunications equipment accounted for the largest share of the total trade value at 62 percent, amounting to $6.1 billion.

The most commonly counterfeited Korean products included mobile phones, TVs, screens, batteries, headphones, cables, chargers, and related accessories.

The next largest category was counterfeit automotive and motorcycle products, with a trade value of approximately $2.5 billion. This was followed by watches and jewelry $320 million, and clothing, footwear, leather, and related products $250 million.

Electronics and electronic devices were the most commonly counterfeited items, accounting for 51 percent of the products seized by customs for IPR infringement. This was followed by textiles and apparel 20 percent, cosmetics 15 percent, miscellaneous goods 6 percent, and toys and games 5 percent.

The report noted that Hong Kong was the primary source of these counterfeit products, with 69 percent of the IPR-infringing items seized originating from or passing through the territory.

China was the next largest source, accounting for 17 percent.

The OECD explained that Hong Kong and China were the largest contributors to Korean IPR infringement by value of seized goods.

The revenue loss for Korean companies due to IPR infringement in international trade was estimated at $6.1 billion in 2021, equivalent to 0.6 percent of the total revenue of Korean companies that year.



By industry, home appliances, electronics, and telecommunications equipment lost the most at $3.6 billion, followed by automobiles at $1.8 billion.

The OECD also noted that 13,855 jobs were lost during the year due to IPR infringement, equivalent to 0.7 percent of the total number of workers in the Korean manufacturing sector. Without counterfeiting, these jobs could have been preserved.

The Korean government‘s tax revenue also decreased due to IPR infringement, according to the report.

The reduction in revenue and profit from IPR holders led to lower corporate tax payments, and fewer workers resulted in decreased personal income tax and social security contributions.

The OECD estimated that IPR infringement cost the Korean government $1.57 billion in lost tax revenue in 2021.

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