Luxury Items Account for Bulk of Fake Goods Seized in the U.S.

As the world celebrates World Intellectual Property Day on April 26 to “highlight the role that IP rights (patents, trademarks, industrial designs and copyrights) play in encouraging innovation and creativity,” we’re taking a look at the other side of intellectual property, namely the illegitimate trade in counterfeit goods. Global trade with fake products amounts to hundreds of billions of dollars each year, as only a fraction of trademark-infringing merchandise is detected and subsequently seized by customs.

In the United States, U.S. Customs and Border Protection seizes thousands of shipments of goods that violate intellectual property rights each year, with the value of the seized merchandise usually exceeding $1 billion. In 2020, the retail value of the 26,503 seizures made by CBP amounted to $1.3 billion, meaning that the seized goods would retail for that much if they were legitimate.

As our chart shows, luxury items such as watches, jewelry, handbags and wallets accounted for more than 50 percent of the seized merchandise’s retail value, despite accounting for only 30 percent of all seizures. Unsurprisingly, much of the pirated goods seized by U.S. customs come from China, where $660 million worth of goods originated in 2020. With a retail value of $429 million, counterfeit goods from Hong Kong make up the second largest chunk, while all other trade partners accounted for no more than low single-digit percentages of seized goods.