Luxury brands will benefit from a crackdown on counterfeit luxury goods in the US this Christmas.

The crackdown has begun in Manhattan’s Chinatown, with raids by a special crime unit making undercover purchases of counterfeit goods. The operation has seized USD$1 million in fake bags and watches.

Were just not going to have any tolerance for people selling knock-offs. Its not fair to companies that invest in their brand. said, Michael Bloomgberg, mayor of New York.

Earlier in the year, a lawsuit brought by IntellecPro (a Beijing law firm specialising in intellectual property and representing five foreign luxury brands) against Beijing’s Silk Street Market closed down 29 vendors for selling counterfeits. The vendors protested, staging a sit in at IntellecPro’s offices and vandalising them with the message: “We want to eat!”

US music, software and film companies estimated pirated Chinese goods cost them over USD$2 billion in sales annually.

Despite shortcomings and safety issues, ‘shanzai’ (black market) goods such as mobile phones are very popular – more than 20% of mobile sales in China are counterfeits.