Türkiye's Counterfeit Crisis

Knock-off products have recently become a major issue in many countries. Its unethical nature is obvious from its definition: “a product bearing a trademarked name, logo, brand, or other identity that is not manufactured or sold by the company that owns the trademark.” Unsurprisingly, producing and selling knock-offs are illegal, as they infringe on trademark laws, but the law is not strictly enforced in many countries. Türkiye is a major example to such countries. In recent years, Türkiye has gained a reputation for the excessive amounts of cheap knock-offs sold to tourists near famous sights. A new report prepared by the Organization for Economic Cooperation and Development (OECD) estimates the value of counterfeit goods worldwide to be over 416 billion euros, making up approximately 2.3% of global imports. The same report revealed that Türkiye is the country that exports the second most counterfeit products to the EU.

Besides stealing designers’ ideas and overlooking intellectual property rights, knockoff products are typically made with inferior materials and insufficient manufacturing processes. This results in products that are not only of lower quality but also pose safety risks. For example, counterfeit clothing and accessories may contain harmful chemicals or be produced in unsanitary conditions.

While more than half of the counterfeit products sent to the European Union come from China, Türkiye follows with 22%, and Hong Kong with 12%. The report states that counterfeit trade creates a cycle that fuels corruption and organized crime, stifling innovation, undermining consumer confidence, and diverting resources from legitimate businesses to illegal activities. The most common shipping method is postal, at 58%. Express courier (17%), air freight (13%), and road transport (10%) are also commonly used in counterfeit product smuggling.

Cosmetics and toys are the biggest source of concern, according to the report, as they can be directly associated with skin cancer in some cases. These products ranked sixth and seventh in terms of volume seized in 2020-21, respectively. The presence of counterfeit automotive parts, ranked 10th on the list, and pharmaceutical products, ranked 12th, also stands out as a particular source of concern. Clothing and shoes are generally the most frequently seized counterfeit products. However, in terms of value, counterfeit watches account for approximately 30% of the total production, placing them at the top of the list. According to the OECD, recent global crises, including the COVID-19 pandemic and the war in Ukraine, have made intellectual property protection even more challenging. Disrupted supply chains and changing commercial regulatory enforcement priorities have added new layers of complexity to risk management.

The report fails to provide a reason for why the government doesn’t enforce stricter laws regarding the topic. The increase in the demand for counterfeit products in Türkiye in recent years is mainly a result of the rapid depreciation of the Turkish lira and the consequent rise in inflation, as well as the decline in purchasing power. The fastest and most effective solution against counterfeit products is search and seizure, but the Turkish police often encounter problems in carrying out these procedures due to inconsistent practices and the demand for evidence exceeding "reasonable suspicion.”

The counterfeit product and any receipt or invoice certifying where the product was purchased are the most important pieces of evidence sought to prove reasonable suspicion. However, these are almost impossible to obtain because of the years of experience tradesmen have in this business. These people consciously refrain from issuing receipts or invoices, and even when they do, the receipts don’t bear any information about the brand of the product.

In such cases, courts might demand a report to be prepared by an expert after examining the original product and the alleged counterfeit product. Still, some courts request law enforcement officials to determine the address where counterfeit products are sold before issuing a search and seizure decision, which causes further delay in the process. However, prosecutors' offices and judges approach requests for counterfeit products that threaten public health more favorably. Law enforcement agencies may even act against these products on their own initiative.

Another major point to mention while discussing this topic is the effect of culture. In most of Türkiye, there is a cultural acceptance of counterfeit goods as a norm. People do not associate goods and products with intellectual property; in their minds, there is nothing wrong with counterfeiting ethically, morally, or legally. Counterfeiters agree with this opinion too, and most even believe they are the ones keeping the Turkish economy alive by providing employment and bringing in foreign currency. The ingrained counterfeiter and small business lobby in the country also play a role in this situation, as Turkish small businesses, prevalently called “esnaf,” are known to rip off citizens and get away with it because there is often no other choice. A small business looks out for another, but they also get into fights between themselves and sometimes even get violent toward new entrepreneurs that affect their business negatively. They are also known for not letting police forces inside bazaars due to the abundance of counterfeit products, which provide income for hundreds of people.

Türkiye's prominent role as a major exporter of counterfeit goods, combined with culturally ingrained acceptance and weak enforcement of intellectual property laws, creates significant national and international challenges because of its geographical location between Europe and the Middle East, making it the perfect crossroads for licit and illicit commerce of all kinds.

Edited by: Melisa Altıntaş