ECPA Anti-counterfeit Project

1
ECPA Anti-counterfeit Project
Counterfeiting and other Problems in Plant
Protection Markets 2nd International Conference
State Plant Health and Seed Inspection
Service And Polish Crop Protection Service
13th November 2008 Warsaw Rocky Rowe
www.ecpa.be

2
Industry Network of Associations across 90
Countries
26 national associations
13 national associations
3
European Crop Protection Association

• .

28 National Associations (Poland PSOR Michal
Fogg) 17 Companies Brussels based with DG and
Secretariat plus 37 Working Groups Several
special projects including Anti-counterfeiting
4
European Crop Protection Association

• .

• Anti-counterfeiting Project Team
• Established late 2005 in recognition of
  industry's concerns of
• a growing issue.
• A special fund established by the member
  companies to
• combat the Issue through-
• Awareness raising
• Communications
• Advocacy
• Engagement of stakeholders
• Special national projects

5
ECPA Anti-counterfeit Project

• Counterfeit and Fake Pesticides in Europe
• A growing problem
• Almost all countries affected.
• Regional and national hot spots.
• A wide range of products, not just new
  proprietary ones.
• Growth in far East chemical manufacturing
  capability
• Inconsistent legislation/rules on export and
  import
• Uncoordinated national enforcement strategies
• To few resources spread across too many sectors
• Political rhetoric and but little action.

6
ECPA Anti-counterfeit Project

• A Growing Problem
• Across all sectors of industry, more and more
  counterfeits are being reported. 17 increase in
  seizures over 2006
• 60 from China
• Cosmetics/personal care 264, Toys 98,
  Foodstuffs 62Pesticides none.
• Almost all Countries Affected
• Few exceptions across Europe
• Global as well as regional Africa, Latin America
  and Asia
• Regional and National Hot Spots
• Spain, Poland, Ukraine, Baltics

7
ECPA Anti-counterfeit Project

• A wide range of products affected
• Proprietary products
• Generic products
• Growth in Far East Chemical Manufacturing
• China by far the biggest growth area.
• Production 20.8 up in 1st half on 2007 figures
• Exports 288K tonnes in 1st half, 16.4 up on
  2007, value 1.2 Billion USD
• What regulatory checks are made on Chinese
  manufactures. Do they exist ?Inconsistent Rules
  on Export and Import
• Chinese (ICAMA) export rules and EU import rules
  not connected.
• Customs focus only on IPR.
• Non IPR chemicals rarely stopped offer
  opportunities to hide other illicit materials.

8
ECPA Anti-counterfeit Project

• Uncoordinated National Enforcement Strategies
• Too many agencies involved
• No inter communication between national
  governments
• Does IPR have to be violated to trigger a seizure
  or can you seized on other criteria. Substances
  likely to damage human health and the
  environment.Too few resources
• With every industry affected, how can
  enforcement agencies cope ? CDs, luxury goods,
  cigarettes, motor parts, medicines etc.
• Political Rhetoric but little action
• Five Commissioners calling for action as is the
  EU Council
• Action - what action?
• Where is the Commission today ?

9
ECPA Anti-counterfeit Campaign

• What types of Products are we dealing with ?
• Sophisticated illegal copies of branded
  proprietary products, packaged and labelled to
  look exactly alike. IPR infringements Trade
  mark.
• Generic illegal copies that have not been
  approved for sale, packed but with rudimentary
  labels giving the active substance name and
  concentration only.
• Fakes and copies containing anything from talc,
  water or solvents, outdated/obsolete stocks often
  based on banned or severely restricted products ,
  recycled packaging with diluted original
  materials.

10
ECPA Anti-counterfeit Project
Formulated and labelled counterfeit products
seized in Poland
11
ECPA Anti-counterfeit Project
Illegal copies of products found in Spain
12
ECPA Anti-counterfeit Project
Illegal herbicide contained in a food oil bottle.
13
ECPA Anti-counterfeit Project

• Why Europe ?
• Easy to import a chemical/pesticide into Europe
• Many, many ports
• Millions of containers per day
• Customs under resourced and focused on IPR
• Only a pesticide once placed on the market.
• Imports usually of two types
• Small 1-5 tonnes of formulated product ready to
  sell i.e. labelled
• Larger consignments 5 100 tonnes, bulk packed
  ready for repackaging and labelling once inside
  Europe.

14
ECPA Anti-counterfeit Project
15
ECPA Anti-counterfeit Project
16
ECPA Anti-counterfeit Project

• Why Europe?
• Minimal enforcement
• Easy abuse of parallel trade rules accommodated
  by ability to repack.
• Origin of product confidential Have you checked
  out if the factory exists ?
• Poor judicial knowledge of issues
• Low penalties
• Farmers under increasing pressure to provide low
  cost food
• Commission focused on increasing regulations on
  what can be used, but with little attention to
  monitoring of products in the market place.
• Minimal political inertia.

17
ECPA Anti-counterfeit Project

• Why Europe ?
• More and more companies from China offering
  products
• www.Alibaba.com around 1500 companies offering
  products ready for use.
• Increased Chinese presence at trade fairs and
  conference.
• Increase in organised crime
• Probably now world and national economics.
• More and more opportunities for organised crime
  and illegal traders to operate.

18
ECPA Anti-counterfeit Project

• Why should we all be concerned about Pesticides
  ?
• Counterfeits/fakes are untested and unregulated
  products.
• Can contain high levels of manufacturing
  by-products and impurities.
• Are usually formulated with cheap solvents and
  surfactants, many already banned across Europe.
• Often packed in inferior packaging, liable to
  leak and thus posing environmental/disposal
  issues.

19
ECPA Anti-counterfeit Project

• Why are we so concerned ?
• Counterfeits pose severe health risks to farmers
  who are applying them.
• Can potentially damage/destroy the crop treated
  and thus ruin the farmers livelihood.
• Leave unknown residues in food crops that place
  consumers at risk.
• Create environmental risks to wildlife, water and
  soil.
• Pose environmental waste problems in terms of
  disposal.
• Devalues IPR and brand integrity

20
ECPA Anti-counterfeit Project

• Impact on the Food Chain and Risks to Consumers
• Spanish Pepper Example
• In 2006 Spanish peppers treated with illegal
  isofenphos insecticide.
• Picked up in National food monitoring programmes
• Rapid food alerts filed by 15 countries.
• EFAS adjudged residue levels posed minimal risk
• Pepper market in Spain almost collapsed as buyers
  sough other sources. Only just recovering.
• Could have easily have resulted in a major food
  crisis
• How long do we have to wait before another
  example occurs?

21
ECPA Anti-counterfeit Project
22
ECPA Anti-counterfeit Project

• What has Industry been doing ?
• Awareness raising Brussels, Countries
• Communicating conferences, publications
• Advocacy talking to policy makers and
  politicians about how to make the supply of
  counterfeits and fakes more difficult. DG Trade,
  Internal Market, Enterprise, SanCo.
• Engagement working at the national level
  through our associations to co-operate and
  support national enforcement agencies.
• Working with other industry sectors and using
  best practises.

23
ECPA Anti-counterfeit Project
24
ECPA Anti-counterfeit Project

• Next Steps
• The Crop Protection Industry is committed to
  fighting counterfeiting of its products.
• Global, regional and national projects.
• Ongoing dialogue with EU customs and Chinese
  officials imperative to linking legislation and
  enforcement activity against the counterfeit
  supply chain.
• Regulatory authorities need to apply robust
  checks on sources of products How many are
  real?
• Coordinated operations between industry and
  internal enforcement agencies is critical.
• Gaining political priority and resources to meet
  the challenges.

25
ECPA Anti-counterfeit Project

• Conclusion
• The manufacture, distribution and supply of
  counterfeit and illegal chemicals/pesticides is
  far too easy.
• Use of existing legislation must be exploited
  fully
• The concept of just using IPR as a trigger for
  imports into Europe needs to be widened.
  Dangerous products
• A strong political message needs to be given from
  Europe to the rest of the world.
• Political priorities need to be focused on
  counterfeits and fakes that may serious harm the
  consumer and agriculture.

26
ECPA Anti-counterfeit Project

• Thank You