Product Authenticity and Anti-Counterfeiting FAQ

It is estimated that counterfeiting is a $600 billion a year worldwide problem. Product counterfeiting has grown over 10,000% in the past two decades and continues to grow. It is estimated that counterfeit goods currently account for 5-7% of world trade. Costs to US businesses are estimated to be between $200- $250 billion annually. The trade in counterfeit goods has been described as much larger and more profitable than the drug trade.

The OECD report found that counterfeit products are being produced in virtually all economies with Asia as the largest producing region, accounting for 69.7% of all seizures. According to US Customs, China is overwhelming the chief source followed by Hong Kong, Taiwan, Pakistan and Egypt.

The range of counterfeited goods touches almost all industries. Among seizures made by US Customs, footwear accounted for 40% of the goods, followed by wearing apparel (13%), consumer electronics (principally batteries) (8%), watches, handbags, pharmaceuticals, network hardware and sunglasses. Other counterfeited goods include: automotive parts and products; chemicals; electrical components; food, drink and agricultural products; tobacco; toiletries; toys and games; sporting goods; fabrics; belt buckles; decals; flags; qualification certificates; tableware; and plumbing products.

The auto industry has found enough counterfeit parts to build a whole car, including brakes made of compressed grass and wood sold in American stores. Investigators also found counterfeit toothpaste in Panama that contained antifreeze.

A recent FDA/U.S. Customs investigation revealed that 88% of the imported pharmaceuticals examined contain unapproved drugs, many of which could be harmful.

In the United States, the Customs Agency is limited in its effectiveness in preventing counterfeit goods. According to a Customs spokesperson, the agency is primarily concerned with preventing terrorist attacks and with ensuring that there is a free flow of trade. A modest number of Customs agents limits the agency?s ability to inspect and seize counterfeit goods. For instance, there are 300 inspectors at the Port of Los Angeles which has over 9 million containers arriving annually.

If a company can identify counterfeit goods, US Customs will help enforce the laws. However, Customs has limited reach in collecting fines or making assessments against those who have been found importing counterfeit goods. Collection rates have never been greater than 1% of the assessed penalties.

It is much more effective for companies to interdict the flow of counterfeit goods either at the points of origin or within the channels of distribution. For this, companies need strategies that include various layers of security. Counterfeiters have learned to duplicate various types of security measures, so it is important to use a combination of overt and covert techniques simultaneously.

The anti smuggling and counterfeit cell will have the following key objectives:

Generate awareness about the smuggled, contraband and counterfeit products that is rampant in the country

Understanding the best practices afollowed globally for countering this menace of contraband, smuggled and counterfeit product

Provide knowledge support to the industry members in understanding and tackling counterfeit, contraband and smuggled products.

Conducting programs and workshops to educate industry members on various action routes that could be taken to counter counterfeiting and smuggling

Conducting programs and workshops to educate consumers on various contraband, counterfeit and smuggled products help them make a better buying decision.

Conducting programs and workshops to build capacity of the enforcement agencies to prevent countering and smuggling

Kashmir is said to be one of the best location that is blessed with quality saffron and is the only place after Spain and Iran, where saffron is produced. But today even the Kashmiri saffron is counterfeited and what we buy is not the original pure Kashmiri saffron but fake and replica of the original saffron produced in the valley.

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