Fighting the fake!

You were in hurry. You wanted to wash your hair today since the conference is tomorrow. But the shampoo bottle is empty and you are time pressed, so you rushed to the neighborhood shop and didn’t find the brand you usually use. You ultimately bought a sachet of Clinic Plus. The next day the conference was okay but you didn’t feel good for the lack-lustre, lousy hair. You were not in your usual confidence. You doubted the brand and in the evening at home you found the sachet you brought is a pass off with a brand name Climic Plus, not the original Clinic Plus.

Pass-offs and counterfeits are the two serious problems that have to be handled cautiously. The problem is causing approximately Rs 900 crore per annum in unpaid excise tax, sales tax and other taxes. According to AC Nielsen, an internationally-reputed marketing research firm, 10-30 per cent of cosmetics, toiletries and packaged food are counterfeits that costs the consumer goods industry Rs 2500 crore annually. It is also shocking that the nation’s capital acts as the distribution centre for approximately 70 per cent of counterfeits nationally. According to Mr Bharat Patel, ex-chairman of Procter & Gamble, Rs 113000-crore FMCG market in India is infested by counterfeits and pass-offs which incur a revenue loss of  Rs 5000 crore for the sector.

What is counterfeit and pass-off?

There is a distinct difference between pass-offs and counterfeits. A little bit of alertness can make you identify the fake and distinguish it from the original. A look-alike product with the same kind of packaging and subtle change of the brand name can easily dupe a not-so-alert customer. This kind of a product is called pass-off. Examples are several,  such as “Surf Exel” without the “c” in the original “Surf Excel”, “Sunslik” instead of “Sunsilk”, “Clemic Plus” or “Climic Plus” or “Cosmic Plus” instead of “Clinic Plus”, “Collegiate” for “Colgate”, “Vips Rub” or “Vives Rub” for “Vicks Vaporub”. On the other hand, counterfeits are the fake products illegally using the trademark owned by another company and breaching the copyright.

A recent raid

Recently a raid was conducted to unveil a racket involved in manufacturing counterfeits. The action has unearthed how expensive machinery and packaging materials being used for this purpose. Their value amounts to Rs 5 crore.

With this seizure one thing is clear that those law-breakers are equipped with the latest technology to fool the consumers wherein fake packaging is too close to the original making the identification very tough. Also, it is shocking to find that holograms have lost their authenticity which can now be easily emulated.

The measures

The question now rises how much the industry is doing to counteract the menace? “Why are we not investing money for anti-counterfeit policies as we are doing for the sales growth? Laws are there but we are not strict enough in action”, that’s how Ashok Gupta, Executive Director-Legal, Hindustan Unilever Limited, explains the system that is reluctant to work aggressively to counter the problem. “The retailers should be rated by the parameter of whether it is selling duplicate products. This can be done by an empanelled body. If yes, their trade licence has to be cancelled. Name them and shame them. Also, local consumer body should be empowered to fight the problem of duplication, and in this task, NGOs can be involved. Lastly on the Government’s part, the laws have to be enforced more stringently. It should seek damages from the persons involved in such malpractices in terms of revenue loss, not just putting the culprit behind  bars for a couple of days” - were his advices.