Transcript Document

FINDING AND COMBATING
COUNTERFEITERS
Polish Federation of Electrical
Wholesalers
9th MAY 2008
WARSAW
Dave Dossett
BEAMA - ACWG
FINDING AND COMBATING
COUNTERFEITERS
1 POLITICAL PROGRESS
2 ON THE GROUND
3 WHAT YOU CAN DO
POLITICAL PROGRESS
Organisation for Economic
Cooperation and Development
(OECD)
Has recently issued a report on the
Economic Impact of Counterfeiting
and Piracy with a special chapter on
the Electrical components sector
Scope of Global Counterfeiting
• The OECD concluded in a 2007 study that about 2% of
world trade, with a value of about 176 billion (USD), is
counterfeit
• This number exceeds the Gross National Product (GNP)
of entire economies such as Argentina (173 billion USD),
Ireland (167 billion USD), Israel (129 billion USD) and
Venezuela (128 billion USD)
• Some authorities argue that counterfeits make up much
more than 2% of world trade.
Market Shares
• Counterfeits share of electrical components market:
– Africa 25-75%
– Middle East 20-40%
– Eastern Europe 10-40%
• Lost sales worldwide €2- 4billion in 2005.
• Special mention of BEAMA and the Electric Dragon project.
Scope of Global Counterfeiting
• A very high percentage of counterfeit
goods originate in China
• Counterfeit products infiltrate legitimate
supply chains
• New technologies, including the internet,
have given counterfeiters access to new
channels of distribution
• Counterfeit products are bought and
sold in virtually all economies
Scope of Global Counterfeiting
• Counterfeiters constantly alter
their trafficking routes
• Customs authorities are
overwhelmed with the scale and
scope of counterfeiting
• Free trade zones are used to
‘sanitize’ manifests as to the
origin of counterfeit goods
• Free ports are transit points that
enable counterfeiters to conceal
distribution
• Which one is yours ?
Counterfeiting Today
• Dalmatian dogs.
• Electrical Products.
• Policemen.
• Automotive Spares.
• Water
• Hydraulic Parts
• Rice
• Aircraft Spares
• Tea / Coffee
• Pharmaceuticals
• Identities
• Cars
• Eggs
• Cosmetics
• Baby Milk
Why Counterfeit Electrical
Products ?
• High unit profitability and large market
• Low tech so easy and cheap to produce
• Small operations easy to conceal
• Enforcement poor – penalties low
BUT
• Risk of discovery increasing due to industry efforts
• Infiltrating established distribution chains can be difficult
• Consumer resistance if safety concerns highlighted
Effects on Supply Chain
• IP rights owners require
more protection to
safeguard their brands.
• Counterfeiting affects
distributors, retailers and
other suppliers throughout
the distribution chain.
• The cost of combating
counterfeiting is growing.
Effects on Consumers
• Consumers are cheated out of quality products and are exposed to
health and safety risks
• Safety issues are prevalent in many sectors, including:
 Food and beverages
 Pharmaceuticals
 Automotive and machinery
 Electrical components, including:
• Relays and contacts
• Timers, circuit breakers and fuses and
• Wiring accessories and batteries
• Substandard items can cause property damage, illness, injury and
death
Successes
• Government and business (rights owners) leaders are
engaged in expanding efforts to combat counterfeiting
– 90 countries were represented in the most recent global
Intellectual Property (I.P.) congress in Dubai.
• Governments have strengthened legal frameworks and
enforcement efforts
– Enforcement directive in the European Union
– The March 2006 ‘Stop Counterfeiting in Manufactured
Goods Act’ in the United States
– Trademark law revisions in China
– 60 countries identified to revise their I.P. laws.
European Commission
LVD Working Party in March 2007 –
Commission view:
“Counterfeit Products cannot comply
with European safety legislation”
ON THE GROUND
The BEAMA Anti-Counterfeiting WG
BEAMA Anti-Counterfeiting
Working Group - Members
BEAMA Anti-Counterfeiting
Working Group
Prime Objectives
• Raise awareness and create a political will in affected
countries
• Employ investigators to take group raid action at
source, mainly in China and in market countries
• Establish international communication network
between Europe, Far East, Middle East and Africa
TAKE ACTION!
BEAMA Anti-Counterfeiting
Working Group
Achieving the Objectives
• Good relationships established with Customs and
government officials in all areas
• Seminars and training exercises for Customs officers
• Investigations and raid action now extended from
China to numerous African countries, Kuwait, Jordan,
Saudi Arabia
• Efficient intelligence networks established within all
operational areas
BEAMA Anti-Counterfeiting
Working Group
Raising Awareness
Sequel to “Counterfeit Kills”
available on dvd and cd free
of charge. Arabic and
French versions now
available.
“Counterfeit Kills – Protect Yourself”
BEAMA Anti-Counterfeiting
Working Group
Raising Awareness
Typical poster used
in the Middle East
BEAMA Anti-Counterfeiting
Working Group
Projects
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Electric Dragon – China
Electric Lion – Kenya, Tanzania, Uganda
Electric Cheetah – Nigeria, Ghana
Electric Hyena – Saudi Arabia
Electric Falcon – Kuwait
Electric Ibex – Jordan
Electric Oryx – Sudan
Electric Jerboa – Qatar
Electric Dragon - 2008
• Permanent operation in China since 2000
• Chinese investigators exclusive to us
• Great co-operation from authorities
• Visits to Guangzhou Trade Fair
twice per year to raid stands and
gain intelligence
• Over 200 factories raided
• 10 Million products seized plus packaging & tooling.
• 18 brands now represented and growing
Electric Dragon - 2008
• A truly international project with European,
American and Australian companies
• Interest from Trade Bodies around the
World. i.e. NEMA, UL, CSA, Domergie.
• BEAMA Presentations in USA, Canada,
Italy, France, Belgium, Spain, Middle East,
Africa Malta, Germany, Hungary, Poland
• Customs Database - probably the best Database in
the World for our industry
• Recognition for the work that BEAMA is doing in
latest OECD report
Canton Fair, China - 2008
New Pazhou complex, Guangzhou, China
12,000 Stands over 500,000 sq m
Electric Dragon - 2008
Yiwu market
• Largest wholesale market in the world
• Estimated around 240 wholesalers selling counterfeit
electrical products
• Because of the action of BEAMA the Yiwu market has
removed its counterfeit displays
ANY ELECTRICAL PRODUCT CAN BE
COPIED
SWITCHES, SOCKETS and LIGHTING products.
ANY ELECTRICAL PRODUCT CAN BE
COPIED
CIRCUIT BREAKERS, FUSES and CABLE
ANY ELECTRICAL PRODUCT CAN BE
COPIED
EVEN CERTIFICATION MARKS CAN BE COPIED
COUNTERFEIT CATALOGUES
Typical catalogues found at the Canton Fair and in Yi Wu.
Designs and Part numbers can be copied
Labels and Holograms can be copied.
Chinese labels to be replaced with branded
Labels – both state “Made in USA”.
BEAMA Arriving at an illegal factory
Counterfeit products seized
Production continues during a raid
Moulding Area – Claimed to have ISO 9001 !
Using a hairdryer for temperature calibration!
C
Electric Dragon - 2008
BEAMA Warehouse Wenzhou
Electric Dragon - 2008
Destruction African Style - 2007
Destruction
Seizure
WHICH MARKETS ARE NOW
BEING AFFECTED?
EUROPE
WHY EUROPE?
• High prices
• Free to enter market
• Limited controls in some new
EU countries.
• UK, Ireland, Italy, Spain and
Portugal see increasing levels
• France, Germany, Netherlands
and Nordic countries next
EU Customs Seizures
• 2005: Customs seized 75 Million products
from 26,000 cases – 60% of all counterfeits
from China
• 2006: Customs seized 250 Million products
from 37,000 cases – 80% of all counterfeits
from China
The Danger for Poland
• The world is getting a smaller place.
• With Internet, trade is very easy.
• Free Trade Zones and Duty Free Areas
can hide illegal trading.
• Customs resource at the ports of entry
cannot control every consignment.
• All means Poland can be an easy target.
What could you lose?
• Loss of
BRAND REPUTATION
• Issues of WARRANTEES
• Issues of PUBLIC LIABILITY
• Issues of INSURANCE
• Issues of HEALTH & SAFETY
Example-Schneider
• Copies being imported into
UK
• Not Schneider branded,
but promoted as
interchangeable
• Many are dangerous but
this m.c.b. exploded on test
• Trading in such products is
illegal
• You should only buy from
authorised distributors
Example – Nintendo Charger
• British boy of 7 killed by counterfeit
Gameboy charger
• On holiday in Thailand found in hotel
room still holding wires
• Charger below safety standards – 1mm
gap between circuits
• Coroner stated that the “lead was
effectively live”
DON’T DESPAIR!
What you can do…
Message for Manufacturers
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Don’t become a victim of your own success
Consider your I.P. rights
Design in anti-counterfeiting measures
Stay ahead of the counterfeiters
Don’t wait till it’s too late
Take action NOW !
Join the BEAMA WG
Message for Installers and
Wholesalers
• Check packaging and labelling.
• Check certification marks
• Check CE marks
• Check the weight
• Obtain through authorised and
known distributors.
DON’T KILL YOUR CUSTOMERS!
Message for Installers and
Wholesalers
• Remember to suspect too good prices
• If in doubt check with brand owner
• Check with Certification body
• Know your supplier
• Be sure – you are responsible
• 3Ps – Place , Person, Price
DON’T KILL YOUR CUSTOMERS!
Supply Chain Co-operation
• In France Manufacturers and
Wholesalers have signed an agreement
not to trade in counterfeit or non
compliant products
• In the UK, BEAMA has signed a similar
Charter with Wholesalers and Installers
Associations
Message to Authorities
• It is your role to create legislation to fight this
illegal and dangerous trade
• Governments must ensure penalties do act as
deterrents and that Laws are effective
• Remember, in this industry, we are
talking about a matter of life and death
- this is not just about T shirts and CD’s !
• As well as economic damage
Message to all
Counterfeiters
If you manufacture, trade or install products that
infringe the I.P. rights of our members…
We are out to get you !
AND WE WILL !
WATCH OUT !
BEAMA’s ABOUT !
The difference between an Original and a Copy
Italian Ferrari
1st Press this Button
Copy
2nd Press this Button
COUNTERFEIT KILLS
Protect Yourself!