Cheap fakes come at a very high price for the UAE

A surge in counterfeit goods being seized in Dubai reflects higher scrutiny of a sector of the economy which threatens legitimate businesses.

One of the idiosyncracies of the UAE is its global reputation not only as an excellent place to purchase the very best designer goods but also for the profusion of counterfeit products available here. As The National recounted yesterday, the number of fake products being seized has soared, with an Intellectual Property Forum in Dubai being told that 11 million items were confiscated in the first nine months of this year – more than double the figure for the whole of last year.

Counterfeiting runs the gamut of seriousness. At its worst, involving items like aviation or automotive parts or pharmaceuticals, the results can easily be fatal, and few would take issue with harsh penalties being imposed on those who trade in such items. But at the other end of the scale, there is often a curious degree of tolerance towards the sale of fake versions of designer handbags and DVDs. As Dr Sheikh Omar Abdel Kafi, director of the Quranic Studies Centre in Egypt, explained to delegates at the forum in Dubai: “A thief is a thief under Islam and it does not matter what type of thing is stolen.”

The UAE faces a unique susceptibility to counterfeiting because it threatens to negate the nation’s advantage as a place to buy high-end designer goods. Many tourists from east Asia, for example, visit Dubai purely to buy designer goods without the swingeing luxury taxes levied on the same products at home. Establishing Dubai and Abu Dhabi as hubs for the sale of such designer goods is part of the UAE’s strategy to broaden the economy away from a reliance on oil and, for obvious reasons, the profusion of counterfeit designer goods weaken those efforts.

For small to medium sized businesses starting up in the UAE – another sector of the economy the nation seeks to foster – a different kind of threat is posed by those who seek to turn a quick profit through the theft of intellectual property. If a company’s goods – be they tangible or intangible – are copied and then put up for sale at a cheaper price, it acts as a powerful disincentive for going into business here.

In this, the authorities have a clear role to play. Many consumers will use a price point when selecting an item, without the ability to test its veracity. This is where enforcement comes in, and a gratifying aspect of the surge in confiscations of counterfeit goods is that it reflects a corresponding increase in the number of inspections being done.