Intellectual properties-trademarks, brand names, designs, manufacturing processes, formulas- are valuable company assets that U.S. officials estimate are knocked off to the tune of $300 billion a year due to counterfeiting and pirating. Some examples from China:
Design rip-offs. Estimates are that nearly 7 million of the 11 million motorcycles and scooters produced in China in one year were copies bearing the Yahama name. Some state-owned factories produce copies four months after a new model is launched.
Product rip-offs. Exact copies of products made by Procter & Gamble, Colgate-Palmolive, Reebok, and Nike are common throughout southern China. Exact copies of any Madonna album are available for as little as $1, as are CDs and movies. Bestfoods estimates that one-quarter of its Skippy Peanut Butter is pirated.
Brand name rip-offs. Bausch & Lomb’s Ray Ban sunglasses become Ran Bans. Colgate in the familiar bright red tube becomes Colgate. The familiar red rooster on Kellogg’s Corn Flakes appears on Kongalu Corn Strips packages that boast of “the trustworthy sign of quality that is famous around the world. “Bogus Budweiser is sold in 640-ml bottles. Yameha, Suzaki, and Hondea motorcycles appear on nearly identical models of Yamaha, Suzuki, and Honda.
Book rip-offs. Even the rich and powerful fall prey to pirating. Soon after My Father, Deng Xiaoping, a biography written by Deng Rong, daughter of Deng Xiaoping, was published, thousands of illegal copies flooded the market. The true owners also sell original versions of the products mentioned above in China.
In an attempt to control counterfeits, China passed a law that allows customers to demand a double refund for fake merchandise sold in department stores. This has led to bootleg “Vigilantes” who knowingly buy knockoffs and take them back demanding the double refund for violating the law. Wang Hai claimed to have made more than $10,000 buying bogus phones and fax machines and then getting a double refund “I couldn’t believe it, every major department store was selling rip-offs,” commented Wang, “If I had more money, I would have emptied out every store in Beijing. “The Wang Hai phenomenon, as it is called, is spreading throughout China.
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