Prohibition on the Trafficing of Goods and Services

PROHOBITION ON THE TRAFFICKING OF GOODS AND SERVICES -- (Senate - November 10, 2005)

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Mr. CORNYN. Mr. President, I rise today to thank my colleagues for joining me in the fight against global counterfeiting--a plague on our economy, on the safety of our citizens, and on our national security.

S. 1095, the Protecting American Goods and Services Act, or PAGS, is important legislation designed to combat the trafficking of illegitimate goods throughout the world--and I look forward to working with our colleagues in the House of Representatives to send it to the President.

I am particularly pleased to work with Senator LEAHY in our continued bipartisan effort to protect intellectual property rights as well as to work on other important issues. Recently, we have worked together on a matter near and dear to my heart--good government legislation related to the Freedom of Information Act, and it indeed has been a pleasure to work with the ranking member of the Judiciary Committee and his staff again.

Mr. President, the rampant distribution of illegitimate goods--be it counterfeited products, illegal copies of copyrighted works or any other form of piracy--undermines property rights, threatens American jobs, decreases consumer safety and, often times, supports organized crime and terrorist activity.

Amazingly, it is estimated that between and 5 percent and 7 percent of worldwide trade is conducted with counterfeit goods and services. According to FBI estimates, counterfeiting costs U.S. businesses as much as $200-$250 billion annually--and that costs Americans their jobs--more than 750,000 jobs according to U.S. Customs.

In recent years, this plague on global trade has grown significantly. According to the World Customs Organization and Interpol, the global trade in illegitimate goods has increased from $5.5 billion in 1992 to more than $600 billion per year today; that is, $600 billion per year illegally extracted from the global economy.

But perhaps most troubling, the counterfeit trade threatens our safety and our security. Counterfeit goods undermine our confidence in the reliability of our goods and service. For example, the Federal Aviation Administration estimates that 2 percent of the 26 million airline parts installed each year are counterfeit. And the Federal Drug Administration estimates that as much as 10 percent of pharmaceuticals are counterfeit. Worse yet--evidence indicates that the counterfeit trade supports terrorist activities. Indeed, alQaeda training manuals recommended the sale of fake goods to raise revenue.

And the reach of counterfeiting runs deep in my own home State of Texas. Data is difficult to collect, but a 1997 piece detailing Microsoft's efforts to combat counterfeiting and piracy--while dated--pointed out that this type of activity costs Texas over 10,000 jobs and almost $1 billion. Today, we know those numbers are much higher.

Mr. President, we must act to stop this illegal activity.

The legislation that we are sending over to the House today, the Protecting American Goods and Services Act, is not complicated, it is not long--but its global impact will be significant. The legislation is designed to provide law enforcement with additional tools to curb the flow of these illegitimate goods and it is perhaps even more critical for businesses, large and small, throughout America and for ensuring the safety of consumers around the globe.

Those who traffic in counterfeit goods put Americans in danger, support terrorism and undermine the health of our Nation's economy. The PAGS Act fills certain important gaps in current counterfeiting law by clarifying the term ``trafficking'' to ensure that it is illegal to: Possess counterfeit goods with the intention of selling them; give away counterfeit goods in exchange for some future benefit--in effect, the ``bartering'' of counterfeit goods in such a way that avoids criminality and import or export counterfeit goods or unauthorized copies of copyrighted works.

This bill will protect property rights, protect consumer safety, preserve American jobs and bolster the American economy by cracking down on the trade of illegal counterfeit goods and services.

Each of these items was highlighted by the Department of Justice in its October, 2004 report on its Task Force on Intellectual Property. In it, the Department describes the significant limitation law enforcement often times faces in pursuing counterfeiters and offers, among others, the principles embraced in the Protecting American Goods and Services Act, as possible solutions to these obstacles.

This legislation, and other reforms, will help turn the tide of the growing counterfeit trade. The legislation is critically important to law enforcement--but it is even more critical for businesses, large and small, throughout America--including in my home state of Texas--as well as for ensuringthe safety of consumers around the globe. Those who traffic in counterfeit goods put Americans in danger, support terrorism and undermine the health of our Nation's economy. It is time to put an end to this scourge on society.

I look forward to working with my colleagues to move this legislation forward, and in so doing, protect property rights, protect consumer safety, preserve American jobs and bolster the American economy.

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