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Have some windscreen wash with your wood pulp

08. december 2016

Counterfeit products are no longer just fake fashion items. Counterfeit products are found wherever there is a possibility of making money, including food and wine.

Most are familiar with the fact, that there are massive problems with counterfeit products within the clothing industry. But the problem is not limited to this industry. Counterfeit products are no longer “only” fake Louis Vuitton bags and Gucci sunglasses. Counterfeit products are found wherever there is a possibility of making lots of money in combination with a low risk of being caught.

Organized crime networks use popular trademarks to sell counterfeit products within more and more industries. In July 2016, the European Union Intellectual Property Office (EUIPO) published a report on the economic costs of IPR infringement in spirit and wine, and it concluded that counterfeit spirit and wine are responsible for the loss of approx. EUR 1.3 billion of revenue annually in the EU which is equal to approx. 4,800 jobs.

Joint operation and first conviction
Based on the assumption that organized crime networks are behind trading with counterfeit food, INTERPOL and Europol have started a joint operation that now covers more than 50 countries with focus on fake and substandard food and drink. During the operations, seizures related to alcoholic drinks have included three illegal factories producing counterfeit alcohol in Greece, the closure of an illegal factory making ‘vodka’ from windscreen wash in the UK, and the seizure of nearly 10,000 litres of fake or adulterated alcohol including wine, whisky and vodka in the UK.

Whilst consumers are learning to follow common-sense rules when shopping for fashion goods such as clothing and shoes, they do not necessarily apply the same rules when shopping for other goods. Partly because the same rules probably do not apply when shopping food and drink, and partly because consumers may not be aware that counterfeit food and drink exist – but they do.

In 2014, the first person to be convicted of wine fraud in the US was sentenced to 10 years in prison. The case began when French wine makers became suspicious about vintage bottles of Clos St Denis from Domaine Ponsot from between 1945 and 1971, since the Ponsot family only started making the wine in 1982. The fraudster, Rudy Kurniawan, was convicted of mixing newer, cheaper wines together and pouring them into old bottles with forged labels. During the search of his house in 2012, FBI agents found winemaking materials everywhere and fake labels dating back to 1899.

Fake cheese containing wood pulp
A product that goes well with wine is cheese, and cheeses are also subject to skulduggery. In the beginning of October 2016, a former executive was sentenced to three years on probation and to pay a USD 5,000 fine in the US for mislabelling and fraudulently representing cheeses as Parmesan and Romana cheese, though they only contained grated Swiss and mozzarella cheeses and possibly also cellulose which is a filler made from wood pulp.

The case was an eye-opener to many people in the US regarding problems with mislabelled cheeses. According to Arthur Schuman Inc., the biggest seller of hard Italian cheeses in the U.S., an estimated 20 percent of U.S. production is mislabelled.

While the counterfeited cheeses in the US case were safe to eat, counterfeit products can be outright dangerous. In 2012, 50 people died in the Czech Republic because of methanol-contaminated vodka and 8 survivors were blinded.

Brands endangered by poor quality
Buying counterfeit products is no longer a question about how much money one is willing to pay for e.g. designer sunglasses, and whether one cares about designers losing money to a lone street-vendor or not. More than ever, it is a question of actual quality.

The most important function of trademarks is to serve as a guarantee for customers that a given product originates from a specific commercial enterprise. If customers cannot trust this, trademarks will lose value and eventually meaning and purpose.

To counter this, trademark owners must monitor the markets and enforce trademark rights strictly to ensure the ability of their trademarks to function as such. The customers must be able to trust products that are said to originate from the brand owners and not run the risk of unintentionally ending up with dangerous counterfeit products.