The jewellery and watch sector in the UK loses £138m every year as a result of counterfeit products in the marketplace, according to new figures.
The two new reports from the Office for Harmonization in the Internal Market (OHIM) – the EU’s largest intellectual property agency – said the jewellery and watch market was just behind the UK handbag and luggage sector which loses the most to counterfeiting (£149m).
Across the EU, The manufacture of counterfeit jewellery, watches, handbags and luggage costs EU businesses €3.5bn (£2.7bn) each year. Some 13.5% of sales of jewellery and watches in the EU are lost due to counterfeiting.
The report added that the lost sales translate into 27,000 jobs directly lost across the two sectors, as legitimate manufacturers employ fewer people than they would have done in the absence of counterfeiting.
Meanwhile, the total yearly loss of government revenue as a result of counterfeit products in these sectors across the EU, in terms of household income taxes, social security contributions, corporate income taxes and VAT, is estimated at €1.1bn (£853m).
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.”