Communication from the Commission to the Council, the European Parliament and the Economic and Social Committee - Follow-up to the Green Paper on combating counterfeiting and piracy in the single market
Date: 2000-11-30
Institutions: European Commission
Subjects: administrative cooperation, data collection, industrial counterfeiting, piracy, single market

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 30.11.2000
COM(2000) 789 final

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL, THE
EUROPEAN PARLIAMENT AND THE ECONOMIC AND SOCIAL COMMITTEE

Follow-up to the Green Paper on combating counterfeiting
and piracy in the single market

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL, THE
EUROPEAN PARLIAMENT AND THE ECONOMIC AND SOCIAL COMMITTEE

Follow-up to the Green Paper on combating counterfeiting
and piracy in the single market

Summary

the Commission consulted the interested parties, by means of the Green Paper on combating
In 1998,
counterfeiting and piracy in the single market, in order to determine the economic impact of this phenomenon on
the single market, to assess the effectiveness of the applicable legislation and to suggest approaches that could be
explored with a view to improving the situation.

This consultation confirmed that counterfeiting and piracy were major problems in most economic and industrial
sectors in the single market and that the Commission, and the European Union in general, should take steps to
strengthen and improve the fight against counterfeiting and piracy in the single market at EU level.

This Communication contains an action plan which sets out actions that should be carried out as a matter of
urgency, for which the Commission will submit proposals in the near future, medium-term actions and other
initiatives.

Actions to be carried out as a matter of urgency

(1)

(2)

(3)

(4)

(5)

The Commission will submit a proposal for a Directive aimed at strengthening the means for
enforcing intellectual property rights and defining a general framework for
the exchange of
information and administrative cooperation ;

On the basis of existing programmes, the Commission will develop training activities for officials of
law enforcement authorities, including those of the applicant countries, and public information and
awareness activities;

The Commission will continue to give priority to combating counterfeiting and piracy in the
enlargement negotiations;

The Commission will launch a study for defining a methodology for collecting, analysing and
comparing data on counterfeiting and piracy;

The Commission intends to identify a contact point at Commission level. This will provide an
interface between the various departments for work on combating counterfeiting and piracy and
promote transparency vis-à-vis the outside world;

Medium-term actions

(6)

(7)

The Commission will examine the appropriateness of setting up complementary administrative
cooperation mechanisms for combating counterfeiting and piracy, particularly between the competent
national authorities but also between these authorities and the Commission;

The Commission will examine the need to submit proposals for harmonising the minimum thresholds
for criminal sanctions, extending Europol's powers to include combating counterfeiting and piracy and
establishing a structure permitting access - via an Internet site, for example - to judgments by national
courts;

Other initiatives

(8)

In this Communication, the Commission sets out recommendations aimed in particular at making
better use of existing information systems and strengthening cooperation and exchange of information
between the private sector and public authorities.

2

INTRODUCTION

1.

2.

3.

4.

1

2

Counterfeiting and piracy in the single market cause deflections of trade and market
disturbances, particularly when national differences in the means of enforcing
intellectual property rights are exploited, since there are still major disparities in the
level of protection of intellectual property in the Member States of the European
Union, particularly as regards effectively exercising these rights. The arrangements
for applying provisional measures, which are used in particular for safeguarding
evidence and calculating damages, or the arrangements for applying the procedures
for stopping counterfeiting or piracy vary widely from one Member State to another.
In some Member States, measures and procedures such as the right to information
and the withdrawal of disputed goods from the market at the offender's expense do
not exist. These disparities hamper the smooth-running of the single market and
make it difficult to combat counterfeiting and piracy effectively. This leads to a loss
of confidence in the single market on the part of economic operators and a
from the economic and social
consequent
consequences, the phenomenon appears to be increasingly linked to organised crime
and is developing in new ways with the Internet. Combating this phenomenon is
therefore of vital importance for the European Union.

reduction in investment. Apart

The purpose of this Communication is to announce, in the form of an action plan, the
various measures and initiatives that the Commission intends to take in order to
improve and strengthen the fight against counterfeiting and piracy in the single
market. All the interested parties - above all, the holders of intellectual property
rights - must be involved in the implementation of this action plan. The aim of the
plan is to supplement, for the single market, existing measures for checking
counterfeit and pirated goods at the external borders of the EU (Regulation No
3295/94 amended) and the initiatives on combating counterfeiting and piracy in
connection with relations with non-member countries and multilateral agreements
(particularly the Agreement on trade-related aspects of intellectual property rights,
TRIPS, concluded under the aegis of the World Trade Organisation1).

On 15 October 1998,
the Commission issued a Green Paper on combating
counterfeiting and piracy in the single market2 in order to launch a debate with all the
interested parties. The approaches suggested in the Green Paper were monitoring by
the private sector, effective use of technical security and authentication devices,
sanctions
and
administrative cooperation between the competent authorities.

and other means of enforcing intellectual property rights,

The Commission received several responses (145) and, on 2 and 3 March 1999, it
organised, together with the German Presidency of the EU Council, a hearing open to
all interested parties in Munich and, on 3 November 1999, an experts' meeting with
the Member States. The Economic and Social Committee issued its Opinion on the

Council Decision 94/800/EC, of 22 December 1994, concerning the conclusion on behalf of the
European Community, as regards matters within its competence, of the agreements reached in the
Uruguay Round multilateral negotiations (1986-1994), OJ No L 336 of 23/12/1994, p. 213.
COM(98)569 final.

3

Green Paper on 24 February 19993 and the European Parliament adopted a
Resolution on 4 May 20004.

5
RESPONSES TO THE GREEN PAPER

5.

6.

3

4

5

6

The consultation process confirmed the harmful effects of counterfeiting and piracy
to the smooth operation of the Internal Market. The scale on which the phenomenon
takes place in the Single Market is considerable and generally increasing, even if it is
difficult to quantify because of the clandestine nature of these activities. It is a major
problem for all sectors of the economy since it discourages investment and
innovation, causes job losses and represents a danger for consumers. The global
figures from the Counterfeiting Intelligence Bureau set up by the International
Chamber of Commerce6 according to which the trade of counterfeiting and piracy
would represent from 5 to 7 % of world trade with a cost from
200 to 300 billion a
year and with global losses of 200 000 jobs a year are frequently quoted by the
that European Union companies having
interested parties. They consider
international activities would lose between
400 and 800 million in the Internal
Market and
2 000 million outside the Union. The share of counterfeiting and
piracy, in percentage in relation to legitimate trade in the Internal Market, would be
as follows according to the information provided by certain concerned sectors:

€

€

€

Share of counterfeiting/piracy in % of legitimate trade in the Internal Market

Sectors concerned
Software
Audio-visual
Textile
Music
Car spare parts
Sport and leisure

Counterfeiting/piracy rate
39
16
10 to 16
10
5 to 10
5 to 7

The interested parties complained about the lack of uniformity in the systems of
sanctions, which had implications for trade between Member States and a direct
impact on competition in the single market. The disparities meant that counterfeiting
and piracy were concentrated in particular areas of the European Union because
counterfeit and pirated products tended to be manufactured and sold in the countries
where the repression of counterfeiting and piracy was less effective than in others.
This led to deflections of trade, distortion of competition and market disturbances.
For this reason, the interested parties, including the Member States, hoped that the
problem would be dealt with vigorously and that ambitious initiatives would be taken
at European Union level.

The Commission generally shares the concerns voiced by the interested parties,
whose wishes also correspond to the objectives of the Commission policy aimed at
innovative and creative activity in Europe,
facilitating the development of
particularly through systematic and effective protection of intellectual property rights
in the single market.

OJ C 116 of 28 April 1999, p. 35.
Not yet published.
The report on the responses to the European Commission Green Paper on Counterfeiting and Piracy can
be consulted at: http://europa.eu.int/comm/internal_market/fr/intprop/indprop.
Countering Counterfeiting. A guide to protecting & enforcing intellectual property rights,
Counterfeiting Intelligence Bureau, International Chamber of Commerce, 1997.

4

7.

8.

According to the responses to the Green Paper, monitoring by the private sector
could be stepped up, particularly in terms of cooperation with public authorities.
Most of the responses stressed the need for better coordination between databases
and increased cross-border information flows, involving national authorities and
professional bodies. The responses were generally in favour of public information
and awareness campaigns on the negative implications and dangers of counterfeiting
and piracy. The right of professional bodies to take legal action was generally
accepted. As for the use of technical security and authentication devices,
the
interested parties called for legislation prohibiting the manufacture and distribution
of illegal technical devices, and providing channels for recourse against tampering
with legitimate devices. In the case of multimedia products (CD, CD-ROM, DVD),
rightholders hoped that the use of identification codes would be made obligatory.

Sanctions and other ways of enforcing intellectual property rights should, according
to the interested parties, be equally effective in all the Member States. Some parties
advocated the harmonisation of sanctions and criminal proceedings. The majority of
responses called for harmonised rules on the closure of establishments and shops and
the confiscation of equipment used for illicit purposes. The interested parties also
complained about
the diversity and inadequacy of the national measures for
collecting evidence and taking action. They called for uniform search and seizure
procedures and more effective cross-border injunctions. They also hoped that
flat-rate or punitive damages would be provided for in all the Member States. Most
of the comments were in favour of introducing the right to information7 and the
publication of judgments in all Member States. The responses to the Green Paper
revealed a broad consensus on the need for
improvements in administrative
cooperation between the competent national authorities in the fight against
counterfeiting and piracy in the single market, including training aspects and the
exchange of officials. The responses stressed that the Commission should play a
major role.

ACTIVITIES ENVISAGED BY THE COMMISSION

9.

10.

11.

7

The Commission stresses that, while the public authorities certainly have an
important part to play in combating counterfeiting and piracy, responsibility lies
primarily with the holders of intellectual property rights, who must be on their guard
- especially in the policy they adopt on granting licences and monitoring the quality
of products and services.

The Commission proposes to follow up the Green Paper with this action plan, which
sets out activities that should be carried out as a matter of urgency and for which the
Commission will submit proposals in the near future, medium-term activities, and
recommendations for the private sector and the public authorities that have been
incorporated into the action plan itself.

Given that counterfeiting and piracy on the Internet are a growing cause for concern,
the Commission intends to keep a close eye on developments and will, if necessary,
take appropriate initiatives as part of the implementation of this action plan.

Obligation for the counterfeiter or the pirate to provide information on the origin of suspected goods,
the channels of distribution and the identity of third persons involved in the production and distribution
of goods.

5

12.

The activities provided for in this action plan will obviously have to be integrated
with the horizontal initiatives in the field of justice and internal affairs - particularly
the European Union's strategy on the prevention and control of organised crime, in
accordance with the provisions of the Amsterdam Treaty, the conclusions of the
Tampere European Council of 15 and 16 October 19998 and the guidelines proposed
by the Commission in its Communication on the prevention of organised crime and
the work of the European Forum for the prevention of organised and economic
crime9.

ACTIVITIES TO BE CARRIED OUT AS A MATTER OF URGENCY

Directive on means of enforcing intellectual property rights

13.

14.

The Commission will submit a proposal for a Directive aimed at guaranteeing the
smooth-running of the single market in this respect. However, given that the TRIPS
Agreement provides for a minimalist approach to the means of enforcing intellectual
property rights that are applied in all the Member States, the activities envisaged by
the Commission in this field will only concern complementary improvements to this
Agreement.

The aim of this Directive will be to harmonise the legislative, regulatory and
administrative provisions of the Member States on means of enforcing intellectual
property rights and ensuring that the available intellectual property rights enjoy an
the
equivalent
implementation of such means remains subject to the competition rules of the treaty.
It will particularly provide for:

level of protection in the single market. It

is understood that

–

–

–

the right of professional bodies to take legal action to defend the collective
interests for which they are responsible10;

the legal protection of technical devices in the field of industrial property11; the
legislation envisaged should prohibit the manufacture and distribution of non
legitimate technical devices and provide channels for
recourse against
tampering with legitimate devices;

in appropriates cases, and without prejudice to the criminal sanctions referred
to in Section 21, the possibility of closing down establishments and shops in
which acts of counterfeiting or piracy have been committed, and confiscating
equipment used for illicit purposes and the assets and profits of counterfeiters
and pirates;

8

9

10

11

OJ C 124 of 3 May 2000, p. 1.
The European Forum for the prevention of organised and economic crime is a Commission initiative
aimed at structuring work on crime prevention at European level. It is a framework for networking
experts and launching initiatives.
Provisions of this type which create this specific right already exist in the legislation of several Member
States.
On the question of copyright and related rights, the Council's common position on the Directive on the
harmonisation of certain aspects of copyright and related rights in the information society contains
detailed provisions on the legal protection of technological measures. See also Article 7(1)(c) of
Council Directive 91/250/EEC of 14 May 1991 on the legal protection of computer programs.

6

–

–

–

–

civil measures and procedures, particularly as regards searching, seizure and
proof, enabling holders to ensure that their intellectual property rights are
respected in the single market;

a procedure for withdrawing disputed goods from the market at the offender's
expense; harmonised criteria for calculating damages; establishing a right to
information and the possibility of publishing judgments on counterfeiting and
piracy in the Member States, while respecting the data protection rules and
especially personal data12;

the designation of one or more administrative correspondents in each of the
Member States responsible for dealing with operators and supervisory
authorities on questions of combating counterfeiting and piracy in the single
market, as already exist for matters concerning checks at the external border of
the EU, and the establishment of an EU-level contact committee, made up of
the national correspondents and chaired by the Commission, with the task of
developing cooperation, promoting the exchange of information and examining
all the various aspects of combating counterfeiting and piracy in the single
market, except for penal matters13;

drawing up a periodic evaluation report on the operation of the Directive,
including the effectiveness of the measures taken by the various competent
bodies

Moreover, the Commission will examine the opportunity of introducing an obligation
to use identification codes on optical discs, as well as measures for the control of
plants and manufacture.

Training and exchange of officials

15.

The Commission will ensure that optimum use is made of existing and future training
programmes in the training of the agents of law enforcement authorities, including
the exchange of officials, so that better account is taken of the aspects relating to the
fight against counterfeiting and piracy. Experience acquired by the customs
administrations through Community programmes such as "Customs 2002" will also
be taken into account.

Stepping up training and technical assistance for the applicant countries

16.

12

13

As regards the applicant countries, the Commission will continue to give priority to
combating counterfeiting and piracy in the enlargement negotiations and will see to it
that training and technical assistance in this field are stepped up under the existing
It will urge these countries to introduce the instruments and
programmes.
infrastructures needed for enforcing intellectual property rights without delay.

The establishment of a register of judgments is currently being examined in connection with the
implementation of the principle of Mutual recognition of Final Decisions in criminal matters, as
provided for in the conclusions of the European Council of Tampere.
The administrative correspondents and the contact committee would take account of the work of the
European Forum for the prevention of organised and economic crime.

7

Public awareness and information

17.

The Commission organised,
in collaboration with the French Presidency of the
European Union, and in particular with the active support of the French customs
authorities, a European Forum on combating counterfeiting, in Paris on 20 and 21
November 2000. It will also, as far as available resources permit, support national
initiatives,
in cooperation with the private sector, on public awareness of and
information on the negative consequences of counterfeiting and piracy, particularly
as regards the protection of consumers and public health and safety. The
Commission's information programmes will be used for this purpose.

Defining a methodology for collecting, analysing and comparing data

18.

The Commission intends to have a study carried out for the purpose of defining a
methodology for collecting, analysing and comparing data in the single market. The
methodology will particularly take account of the approach to collecting customs
statistical data developed under Regulations Nos 3295/94 and 1367/95. It should be a
simple, reliable and efficient evaluation tool that is easy to use and that will enable
the interested parties, the Member States and the Commission to define and apply the
appropriate measures for combating counterfeiting and piracy. The data collected
using this methodology could be used when drawing up the evaluation report
provided for by the Directive.

Commission-level contact point

19.

At the level of the Commission itself, a contact point could be identified to permit
greater transparency vis-à-vis businesses and the Member States on all questions
relating to counterfeiting and piracy in the single market, and particularly those
deriving from the implementation of the Directive referred to in Section 14. This
Commission-level contact point would not have any specific competency as such but
would provide the appropriate interface between the different Commission
departments. Its role would be complementary to both that of the administrative
correspondents and the contact committee referred to in the fifth indent of Section 14
and that of the contact point for the implementation of Regulation No 3295/94, as
amended.

MEDIUM-TERM ACTIVITIES

Administrative cooperation

20.

The Commission will examine the appropriateness of setting up, possibly in the form
of a Regulation, specific mechanisms, complementary to those referred to in the fifth
indent of Section 14, for administrative cooperation between the competent national
authorities and with the Commission in the fight against counterfeiting and piracy in
the single market. The proposals envisaged could be based on the existing
mechanisms for administrative cooperation in other fields - particularly customs and
agriculture, as well as Community own resources. This could involve establishing
mutual assistance between the competent national authorities for exchanging
information on matters including specific cases of counterfeiting and piracy, while
respecting the rules of confidentiality and data protection, and possibly carrying out
joint surveys and checks and, if the interests of the Community were at stake,
establishing Community-level cooperation between these national authorities and
Commission.

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Harmonisation of minimum thresholds for criminal sanctions

21.

The Commission will examine the need to submit proposals for measures to establish
minimum rules on the elements constituting criminal
infringements and the
applicable sanctions (on the basis of Article 34 of Title VI of the Treaty establishing
the European Union). It will also examine the possibilities for developing customs
legislation in this field. The initiative could involve the approximation of the
minimum threshold for national criminal sanctions applicable to offences against a
given intellectual property right and the convergence of the level of sanctions
applicable to the different intellectual property rights.

Extension of the powers of Europol

22.

For aspects of counterfeiting and piracy going beyond First Pillar matters, Europol's
powers should be extended to combating counterfeiting and piracy, in accordance
with the provisions of the Europol Convention14

Improving access to information

23.

In order to improve access to information for businesses and associations,
the
Commission intends to set up a structure, such as a website, through which legal
decisions published in the Member States would be accessible, in accordance with
personal data protection, to operators and the law-enforcement authorities. This
website could be based in particular on the information component in the European
Judicial Network in civil and commercial matters. Via hyperlinks, it would provide
access to national sites dealing with these matters.

OTHER INITIATIVES

Improving cooperation between the private sector and public authorities

24.

The Commission recommends that public authorities and the private sector make
better use of the databases and public and private information systems for combating
counterfeiting and piracy, while respecting the rules of confidentiality and data
protection. The compatibility between existing systems and any gateways that would
need to be created between them should be investigated. The Commission
encourages national and private initiatives aimed at concluding protocols of
agreement for cooperation and exchange of information.

European judicial cooperation

25.

The Commission will take account of any needs in connection with the existing
instruments or work in progress on civil and criminal judicial cooperation, such as
the work of the implementation of the European Judicial Network in civil and
commercial matters, for the coordination of legal proceedings through EUROJUST,
the mutual recognition of final decisions in criminal matters15 or the mutual
recognition of judgments on civil and commercial matters. On 1 March 2000, the
Commission submitted an additional contribution to the IGC on the reform of the

14

15

Cf. Art. 2(2), indent 3, of the Europol Convention, OJ C 316 of 27/11/1995, p. 1.
Cf. Commission communication of 26 July 2000 (COM(2000)495).

9

Community courts16,
in which it expressed the view that regarding intellectual
the
property rights under Community law, particularly with the prospect of
Community patent, consideration should be given to establishing a specialised
tribunal with jurisdiction particularly in cases concerning the validity and
counterfeiting of such rights.

Possibilities afforded by the specific programmes under
Programme

the fifth R&D Framework

26.

The Commission encourages interested parties to make use of the possibilities
afforded by the specific programmes under the fifth R&D Framework Programme
for developing new technologies and new technical devices - particularly the specific
programmes of research, technological development and demonstration in the fields
of "Competitive and Sustainable Growth"17 and "Information Society Technologies".
It also encourages the interested parties to contribute to the preparation of the sixth
Framework Programme by giving information about R&D objectives likely to be
supported in the future.

16

17

COM(2000)109 final.
For example, in October 1999, the Commission launched a call for proposals covering, inter alia,
reference databases and, in particular, a global information system for the fight against counterfeiting
(OJ C 295 15 October 1999, p. 8).

10