Ilegal trade in Costa Rica

By IDeas trademarks & patents

On August 21, 2019, the Chamber of Commerce of Costa Rica reported that the total volume of illegal trade in Costa Rica reached in the last year USD12.238.317, equivalent to 6.8 percent of total household consumption. The findings of the report were published by QCOSTARICA.COM, an independent news media portal.

According to the Chamber of Commerce, the most demanded illegal products by Costa Rican households were cigarettes (between 22 percent and 25 percent of the total consumed were counterfeited or smuggled), alcoholic beverages (15 percent), auto parts (10 percent), appliances (9 percent), clothing (8 percent) and medicines (8 percent). Between 6 percent and 7 percent of other products were also of illegal origin, such as diesel, soaps, detergents and perfumes.

According to a February 2019 report from the World Bank, illicit trade impacts a government at several levels. Specifically about tobacco illegal trade, the World Bank states that it can increase disparity in tobacco use since the illegal products are disproportionally consumed by low-income populations; it enhances the access to tobacco products, particularly for youth, as the illegal products are often distributed via unregulated channels; it undermines health warning and ingredients disclosure policies; and additionally, tax evasion associated with the illegal tobacco market reduces government tax revenue.

Costa Rican authorities, law makers and IP specialists have long agreed that part of the problem to fight counterfeiting is that it’s a public offense only prosecutable by a private party. Therefore, although authorities carry out investigations to decrease the illegal trade of counterfeited products throughout the country, further steps such as seizures and criminal prosecutions depend on legal actions from those companies whose brands are being infringed.