Maltese businesses are losing up to €19 million a year in revenue to fake goods, according to a new EU report.
The European Intellectual Property Office calculates that the cosmetics and personal care industry in Malta is the hardest hit.
This industry loses €11 million a year to counterfeit products. Other losses are in the €5 million in the pharmaceutical industry, €2 million in toys and games and a further €2 million in fake wines and spirits.
Last November, Malta seized 36 containers of fake goods, including shoes, mobile phones and game controls in the largest single bust by customs.
Overall EU governments are losing an estimated €15 billion due to counterfeit goods on the market, the report said, mostly related to direct and indirect taxation that is owed, as well as unpaid social security contributions due to illegal manufacturing.
The report said that 97 per cent of counterfeit products on the market, like pharmaceuticals, electrical goods or children’s toys, posed a serious risk to consumers’ health and safety.
Fake toys - like these seized in Malta last year - account for 2 million a year in losses, a new EU report has calculated.'Risk to children'
These products are not put subject to the same rigorous testing that assures consumers that products are safe for use.
EUIPO said that many of the faulty counterfeit items related to children, with kids' toys, clothes and personal care items for children often coming under scrutiny.
Research from EUIPO and Europol also revealed a link between counterfeit products and other more serious criminal acts.
Since 2016 there have been 29 large-scale operations targeting counterfeits items and piracy which uncovered organized crime groups that were involved in criminal activity like drug trafficking and money laundering.
'Low stigma'
The EUIPO also looked into why there was such a demand for fake goods and pirated content. As well as being cheap, they were also easily accessed and the crime carried a very low social stigma with a belief that counterfeiting goods is a victimless crime.
Previous research indicates that teens in particular would be less likely to pirate digital content but see no issue with purchasing counterfeit objects.
However EUIPO executive president Christian Archambeau said counterfeiting was "not a victimless crime".
"Fake products take sales away from legitimate businesses and deprive governments of much-needed revenue. They carry clear health and safety risks for those who use them,” he said.