ENFORCEMENT

Office of the Intellectual Property Enforcement Coordinator
attendant harms and adverse social impacts that flow
from the unlawful exploitation and theft of IP assets.
Too often, the harm of unlawful exploitation and
theft of IP is mischaracterized as limited to a narrow
private interest, such as a loss of a potential sale,
loss of corporate goodwill, or loss of a technological
or competitive advantage. These harms are not the
full picture. The theft and unauthorized exploitation
of intellectual property rights by operators of illicit
businesses evokes a host of broader negative
impacts to the national economy and the general
public welfare. These attendant financial and
social harms must be a part of the analysis and
understanding of the harms tied to the unauthorized
exploitation and theft of IP.
When IP-based exploitative practices go unabated
in the aggregate, fair competition in world markets is
undermined, productivity is jeopardized, investment in
research and development is dis-incentivized, the job
market is threatened, and the creative and innovative
sectors are weakened. Trade in counterfeit and pirated
goods also compromises the integrity of domestic
and global supply chains; introduces significant public
health and safety risks; contributes to corruption of
government institutions; subverts human rights by
reliance on forced labor, child labor, and unsafe working
conditions; and generates environmental harms caused
by unregulated manufacturing practices or the use of
substandard products. The growth in IP crime is fueled
by sophisticated criminal syndicates exploiting new
technologies and lack of effective coordination among
governments. 9 The impact of these and other harms are
not limited to developed economies, rather they are
often disproportionately felt by developing countries
(for example, manufacturers of counterfeit medicines
and other goods target countries with less developed
regulatory structures), necessitating leadership and
collaboration from the international community—
both from the public and private sectors—to address
effectively these serious threats. 10
Raising public awareness and elevating a common
understanding of the issues through a detailed and
empirically-based message that provides a clear
understanding of the issues is a prerequisite to
constructing and implementing an effective solution to the
problem. Thus, the Strategic Plan begins with a detailed
account of the landscape of the problem so that the
policies and proposed responses detailed in the remaining
sections of the Plan can be read in proper context.
A. THE ECONOMIC SCOPE AND MAGNITUDE OF
COUNTERFEITING, COMMERCIAL PIRACY, AND
TRADE SECRET THEFT: A GLOBAL PERSPECTIVE.
Precise quantification and measurement of the global
reach and economic scale of counterfeiting and
commercial piracy, and the losses attributable to trade
secret theft, can prove elusive. Such assessments
have proven challenging because counterfeiting and
commercial-scale piracy are illicit activities, making
data on such activities and their impact inherently
difficult to obtain. Furthermore, the Government
Accountability Office (GAO) identified the inherent
difficulties in measuring the monetary value of nonpublic,
sensitive information in its report Intellectual
Property: Observations on Efforts to Quantify the
Economic Effects of Counterfeit and Pirated Goods. 11
Both the GAO and Congressional Research Service
found that victims of trade secret theft often do not
report the theft, thereby limiting the amount of available
information that might allow researchers to quantify the
impact of trade secret theft. 12
“[E]ven if precise assessments [of illicit activities]
are elusive, it is nonetheless important to
understand the orders of magnitude in order
to broadly assess impact and to improve the
effectiveness and targeting of policy.”
Source: World Economic Forum’s Global Agenda
State of the Illicit Economy (October 2015)
Over the years, industry, researchers, and
policymakers alike have made efforts to address these
challenges by assessing developments and trends across
various sectors and economies and by establishing
a more rigorous analytical framework to improve
economic modeling to measure the overall magnitude
of counterfeiting, piracy, and trade secret theft. Further
study, however, remains necessary and analysts have
not identified any single approach that quantifies these
activities fully; Section IV of this Joint Strategic Plan calls
for additional research into this and many other topics
SECTION 1
19