Counterfeit watches and jewellery are costing EU businesses 13.5% of their sales each year.
New figures from the Office for Harmonization in the Internal Market (OHIM), the EU’s largest intellectual property agency, show that fake jewellery, watches, handbags and luggage cost EU businesses €3.5 billion (£2.6bn) every year.
Fake watches and jewellery have more of an impact on reputable businesses than even the booming market for fake handbags and luggage, which result in 12.7% lost sales.
In the UK, counterfeit watches and jewellery result in ₤138 million (£108.6m) of lost sales each year.
OHIM has calculated that those lost sales result in 27,000 jobs ‘directly lost’ across the combined sectors with manufacturers employing fewer people than they would in the absence of counterfeiting.
The report also states that these counterfeit products result in lost revenues to EU governments of €1.1 billion (£865.9m) in household income taxes, social security contributions, corporate income taxes and VAT.
António Campinos, president of OHIM, said: “The jewellery and watches sector and the handbags and luggage sector in the EU are overwhelmingly made up of micro-enterprises, which employ fewer than ten people. The average number of employees per enterprise in the jewellery and watches sector is just three people. Such businesses are particularly vulnerable to the economic effects of counterfeiting.”