Anti-Counterfeiting

Company information

	Key points

• Counterfeiting costs the IT industry tens of billions of dollars per year directly in lost revenue, and many millions of dollars more indirectly in terms of damage to brand and reputation.
• HP actively engages in the fight against counterfeiting on a worldwide basis.
• HP proactively seeks to prosecute counterfeiters, as well as to work to toughen laws and enforcement against criminals by working with policy-makers and law enforcement.
• HP actively educates its sales force, channel partners, customers and the public on counterfeiting as a crime.

	The issue

Counterfeiting is becoming more sophisticated, more pervasive, and it remains one of HP’s largest global challenges.  HP Government Affairs is part of an integrated company team working on a worldwide HP anti-counterfeiting strategy to foster a regulatory and business climate that encourages entrepreneurship, investment, and growth.  HP is working with law enforcement worldwide to catch bad actors, helping remove illicit products from the market and prevent those products from impacting the market.

	HP’s position

Counterfeiting is becoming more sophisticated, more pervasive, and it remains one of HP’s largest global challenges.  HP Government Affairs is part of an integrated company team working on a worldwide HP anti-counterfeiting strategy to foster a regulatory and business climate that encourages entrepreneurship, investment, and growth.  HP is working with law enforcement worldwide to catch bad actors, helping remove illicit products from the market and prevent those products from impacting the market.

	Impact on HP

Unlike theft, counterfeit activity not only reduces revenue but also erodes consumer confidence in the HP brand.  HP and other technology companies are impacted worldwide by counterfeiting:

• It has been reported that worldwide counterfeiting is a $550 Billion problem.
• The IT industry suffers lost revenues of tens of billions of dollars annually from counterfeiting activities and governments lose billions of revenue in lost taxes.
• Counterfeiters, often tied to organized crime, are becoming increasingly sophisticated in their methods making it more difficult for consumers to recognize counterfeit IT products.
• Counterfeit supplies are of lower quality and reliability than HP’s original products, and may have detrimental effect on a customer’s printing equipment.
• When customers have difficulty distinguishing genuine product from counterfeit, consumer confidence and HP’s reputation are adversely affected.

The supplies counterfeiting problem is largely a packaging issue, and is separate from the refill/remanufactured issue.  If an HP cartridge is refilled and that fact is noted on the package, it is a legal product.  HP does not oppose the legal sale of refilled printing supplies.  The crime of counterfeiting occurs when the refilled supply is sold as an original HP product.

	HP Actions and Outlook:

HP Government Affairs is working to reduce threats to HP’s intellectual property and reduce costs associated with defending HP’s intellectual property. 

HP has made significant progress in its fight against counterfeiting in many countries in the last few years.  In 2008, HP will continue to push governments around the world for increased commitment to making counterfeiting a major priority for multilateral and bilateral trade agreements and to increase anti-counterfeiting enforcement.