Diesel recently announced that they have won a lawsuit against Cosmos World after a battle of 16 years spent fighting against the Spanish company that manufactured and sold counterfeited Diesel products in European and in Southern American countries.

The business of counterfeiting appears like a huge iceberg whose size is hard to imagine because final responsibilities are hidden and hard to punish. Especially during the summer season, for instance on Italian beaches, one might be persuaded into buying counterfeited products from non-European peddlers running back and forth carrying loads of merchandise under the sun. Some “bestsellers” may include Stella McCartney bags sold at €170, fake Louis Vuitton items at €80, Hogan bags at €40, Moncler jackets for €60 and Napapjjri sweatshirts for €15. Anyone might think that, while helping someone in difficulty, he or she could get a good bargain for a “branded” product. Despite this, the consumer is not always aware that the product is not genuine or produced employing the brand name dishonestly and in some cases manufactured with materials and under conditions that can even damage one’s health. And it is very likely that the person selling those products is also seriously exploited by dishonest people and organizations – as the whole business behind counterfeiting.

According to a recent study released by the European Office for Harmonization in the Internal Market, counterfeits of fashion and accessories make up a huge business. Yearly, they are worth over €26 billion euros, which is about 10 percent of all clothes, shoes and accessories sold in the 28 countries of the European Community. And considering the knock-off effect on connected companies the damage could be estimated to over €43 billion. Consequently such damage is also bringing a loss of 363,000 jobs directly and, indirectly, of 518,000. Among countries most involved in this phenomenon are Italy whose estimated direct impact is the highest in Europe with about €45 billion per year, affecting almost 50,000 jobs.

Cristina Calori, WP Lavori in Corso
Cristina Calori, WP Lavori in Corso
The problem is very common and involves always more fields of action, especially after the boom of e-commerce. “In addition to counterfeited products sold on the main market places, we are constantly discovering the proliferation of on-line fake domains selling, for instance, counterfeited Woolrich products,” comments Cristina Calori, owner WP Lavori in Corso, managing the brand’s master license for Europe and other markets.

The phenomenon is not easy to solve because organizations operating via web cannot always be tracked easily – especially outside of Europe - and once they are discovered they can shut down their old websites and start working through new addresses and servers. Plus such concurrency is not only involving small websites and organizations, but also bigger ones. For instance, Kering group, the luxury conglomerate owner of brands such as Gucci, Bottega Veneta and Saint Laurent, recently went to court launching a suit against Alibaba, a Chinese e-commerce giant. According to Kering Alibaba helps fakers sell goods on their websites.

In 2014 Diesel started a legal action at the Federal Court of New York against 83 illegal websites that sold counterfeited Diesel products. They also managed closing 3,346 websites and delisted 19,000 illegal websites from Google. They avoided 70,000 visits to illegal market places and had canceled 9,200 on-line auctions. Diesel shows how blocking counterfeiting is possible, but requires great commitment, costs and time. And there still remains a lot to do.

Mario Dell’Oglio, Dell’Oglio stores
Mario Dell’Oglio, Dell’Oglio stores
Among damaged parts there are not simply companies and owners of brands, but also retailers. Mario Dell’Oglio, owner of the Dell’Oglio luxury stores in Palermo, Italy, and president, Camera Moda Buyers, the association that groups together selected Italian fashion luxury stores, commented: “I was never contacted by producers of counterfeited goods because I am in touch with fashion houses directly. Though especially now that e-commerce has boomed the phenomenon is always harder to control. Most often luxury products are sold through unknown websites that are tied to phantom companies that give no assurance of who is behind them. Consumers can be cheated in two ways: they can either pay for as for instance, paying €250-€350 for a designer bag rather than the official €1200. Similarly other websites might offer small 10% discounts on the real price selling counterfeited products. In both cases it is fraud.”

And according to Dell’Oglio, designer brands should be very careful when signing agreements with manufacturing companies working for them. “When a manufacturing company stops working for a top luxury brand it can become its true enemy because it has earned some expertise and it can continue producing goods that are no longer approved and authentic ones. Since many luxury companies end up working with the same specialized laboratories they should sign common legacies in order to find agreements and guarantees that can help them facing such eventual situations.”

Stefano Colombo, Colmar
Stefano Colombo, Colmar
Branded products could also safeguard themselves thanks to special technology such as microchips, QR Codes and similar devices that can show each product’s own history and life by simply checking specific apps. Colmar, for instance, is acting in this direction. “In order to face counterfeiting and parallel distribution phenomena, we have started a collaboration with Italian Police and authorities and joined SIAC, an anti-counterfeiting information system,” explains Stefano Colombo, marketing manager, Colmar. “We also involved specialised Far Eastern investigation companies in order to discover and block counterfeited product sales activities. Moreover, we have internally structured ourselves and employ RFID systems that help us tracking items for controlling where our products are sold. This way we avoid parallel distribution. We also adopted the Certilogo system that permits consumer to check the authenticity of their purchase via app.”

New common laws could help solving our slow attitude towards counterfeits. Current laws, for instance, are too old because they don’t consider the present role of e-commerce and web, plus are too different from country to country. Also customs controls can help blocking this attack of fakes. In 2014 Diesel confiscated 75,000 fake Diesel items in China only and over 80,000 were blocked at the border of EC customs. If authorities did more thorough and regular custom controls, less counterfeits could reach and damage our economy. If noteworthy quantities of goods were crossing the borders of a country, for instance Europe, and not enough information or documentation could guarantee the authenticity of these products, they would be sent back to their country of origin.

Serious preventing and legal actions can help saving the fashion industry’s know-how, its authentic brand value and could heal some of the present economic problems.