France is clearing out flea markets and collecting counterfeit goods ahead of the Olympics taking place at the end of July, to avoid being called the “capital of counterfeit goods” instead of the “capital of fashion” and to protect sponsors.
In the early morning of April 3, more than three months before the Olympics, police stormed the Saint-Ouen flea market in the Seine-Saint-Denis suburb of Paris. They seized 63,000 items of clothing, shoes and imitation leather goods from famous brands and put them into garbage trucks on the spot. Eleven stores were closed and 10 people were arrested.
Seine-Saint-Denis will host the swimming and athletics events of the 2024 Paris Summer Olympics. Seine-Saint-Denis police chief Michel Lavaud said the operation was part of a pre-Olympic crackdown on counterfeit goods. “We have been talking about counterfeiting for the past two years,” Lavaud said, adding that police were working to crack down on the problem.
Axel Wilmort, an urban researcher at the French National Center for Scientific Research (CNRS), said police have increased their presence at informal markets in the Paris suburbs over the past three months. They patrol regularly, set up checkpoints and stop street vendors.
According to the French Interior Ministry, 70 tons of counterfeit goods were destroyed in March. In the area near the hillside of Montmartre, police have doubled their operations since February. In just the first four days of June, 10 operations were carried out to destroy a street market with 1,000 vendors.
The raid on counterfeit fashion in the world’s fashion capital is not an isolated incident. Host countries have carried out similar campaigns in the run-up to previous Olympic Games, including Beijing in 2008, London in 2012 and Rio in 2016, with mixed results.
An official fashion display of the Paris 2024 Olympics on June 27. Photo: Reuters
Counterfeit fashion is big business. According to the European Union Intellectual Property Office, counterfeit branded clothing cost French companies an average of €1.7 billion ($1.83 billion) in lost revenue each year between 2018 and 2021.
Some 15 million visitors are expected to attend the Paris 2024 Olympics from July 26 to August 11. This is an opportunity for the retail industry, but also an attractive target for counterfeiters. Recognizing the threat to luxury goods, the Paris 2024 Games organizers and the International Olympic Committee both joined the French Association for the Protection of Intellectual Property (UNIFAB) last year. The organization works with brands to raise awareness of the risks associated with counterfeit products. “We did a lot of work before the Olympics,” said Delphine Sarfati-Sobreira, CEO of UNIFAB.
LVMH, the world’s largest luxury goods group, is a sponsor of the 2024 Paris Olympics. The company has refused to disclose how much it is contributing to the Olympic budget. A source familiar with the matter said AFP The company is estimated to have contributed around 150 million euros ($160 million), or 1 percent of the group’s record 15.2 billion euros in net profits last year. Along with its investment, LVMH is also working closely with authorities and customs to enforce intellectual property rights and protect consumers from counterfeit goods.
In 2023, French customs seized 20.5 million counterfeit products, up 78% from the 11.5 million seized in 2022. Earlier this year, UNIFAB helped train 1,200 customs officers on how to identify genuine Olympic merchandise. Among them, event mascots and apparel are likely to be the most counterfeited. France also has 70 online anti-counterfeiting focal points, responsible for dismantling local and international criminal networks.
John Coldham, an intellectual property lawyer at Gowling WLG (London), one of the experts who worked with brands on the “Fake Free London” campaign, commented that France’s move was to declare that “Paris does not want to be seen as the counterfeit capital of Europe”.
However, the bigger concern for French fashion houses may come from foreign shoppers’ reluctance to visit Paris during the Olympics, rather than lost sales due to counterfeit goods.
Last week, Air France-KLM warned it could lose up to 180 million euros this summer as some foreign tourists avoid Paris. LVMH and other luxury brands have also admitted they do not expect any revenue growth from the sporting event and may instead focus on attracting customers to other locations.
“Luxury companies are showing that they are ready to welcome shoppers in places beyond Paris, from the Cote d’Azur to Milan and beyond,” said Luca Solca, luxury goods analyst at research and brokerage firm Bernstein.