The Ontario Chamber of Commerce is out today with a new report on intellectual property which recycles many of the demands of the copyright lobby – WIPO ratification, tougher penalties, and a handful of task forces. What makes the report unique, however, is its claims about the size and scope of the counterfeiting issue in Canada. The report includes the RCMP's discredited $30 billion claim and even though the RCMP has backed away from it, the report states that it is a "widely accepted" estimate.
The Chamber's press release trumpets $22.5 billion in counterfeiting losses for Canada of which it says $9 billion comes from Ontario. How did it arrive at this figure?
The U.S. Chamber of Commerce claims that counterfeiting costs the U.S. economy $250 billion per year (actually it claims the number is between $200 – 250 billion). Since the Canadian economy is nine percent of the U.S. economy, the Ontario Chamber says that Canadian counterfeiting must cost $22.5 billion.
This approach is completely lacking in any statistical rigour which totally undermines the conclusions. Indeed, using the same approach, we can conclude that Canadian counterfeiting trade accounts for $4 billion dollars or only 18% of the Chamber estimate. How? The same report notes that the OECD has concluded that the total global trade in counterfeiting is $200 billion. Since Canada accounts for about 2 percent of global GDP, it stands to reason to reason that the Canadian global trade in counterfeiting is 2 percent of the total global trade or $4 billion. Of course, the OECD also found that Canada had one of the lowest rankings in the OECD's General Trade Related Index of Counterfeiting, so even that number should be revised downward considerably.
The reality is that none of these figures may be accurate. When pressed, authorities admit that they don't much about the scope of the problem. Before we introduce new laws, surely we need some reliable data. With today's report, the Ontario Chamber of Commerce has done little more than embarrass itself and its members.