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Food counterfeiting is spreading – also poses a threat to Finnish companies


September 21, 2018

Dyed pork, fake eggs and olive oil. The counterfeit market is growing and now expanding into food. This poses a threat to Finnish businesses and consumers, warns Kolster's Head of Asian Market.

Finnish brands are being counterfeited and copied around the world, particularly products by well-known companies such as Marimekko. Our food industry must also prepare for an increase in the counterfeiting of products and the related risks, especially the ones entering into Chinese market.

"Finnish food companies are trying to enter the world market, especially China. We are in dangerous waters in terms of the counterfeiting of foodstuffs. Products that are lower quality than the label indicates can be life-threatening,” says Kolster's Head of Asian Market.

Kolster has solid experience of the fight against counterfeiting, with the company's intellectual property team cooperating with experienced investigators to detect counterfeits entering the Finnish market.

Vigilant across the entire chain

Senior Customs Officer Riikka Pakkanen states that even fake eggs, and dyed pork passed off as beef, are being sold in China.

"If Finnish food companies go abroad, they must think carefully about their local practices and partners," says Pakkanen.

Pakkanen points out that companies in the sector must be vigilant across the entire production chain.

"Each stage involves its own risks. For example, in the case of plant-based products we also need to be sure that the farmer is not using counterfeit plant protection products."

Counterfeit oil circulating in Europe

There has been little food counterfeiting in Finland, but in the late spring we received three batches of spices with traces of banned substances. Customs stated that a total of three spice batches, one chili powder and two spice mixtures contained the prohibited auramine dye.

The Finnish Food Safety Authority (Evira) controls foodstuffs circulating in Finland.

"Food counterfeiting is more common in central Europe and Finnish tourists should be aware of this. The counterfeiting of olive oil is a current trend within the EU area. Counterfeit oil is straightforwardly inferior to Extra Virgin oils – even if it too is made from olives. It is impossible to say whether or not these are on shop shelves in Finland too. Wines and cheeses are also frequently counterfeited in Europe," says Pakkanen.

Kolster is fighting against product counterfeiting

Kolster has been actively fighting against the counterfeiting of products since the 1990s, when global trademark holders began to request customs supervision on Finland’s borders. Having already handled almost a thousand confiscations of counterfeit products by Customs, Kolster is the key Finnish IP company engaged in the battle against the phenomenon.

"We represent more than 220 international brand holders in Finland. In practice, this means that we are handling the elimination of counterfeit products from the Finnish market with regard to around a third of the world's 100 most valuable brands," says Kolster's expert.

In cooperation with experienced investigators, the Kolster Market Watch™ service (which specialises in intellectual property rights) checks for counterfeit products arriving on the Finnish market via auction and retail websites, and retail outlets and events.

Kolster's anti-counterfeiting team also deals with the majority of Finnish counterfeit goods stopped by Customs.

"In addition to our Market Watch service, clients can buy our ‘Customs action services, based on which we act as a Customs action agent. Customs contacts us as soon as it seizes products that potentially infringe copyright. If we have to go to court, we will handle the entire court process on behalf of the customer," says Kolster's expert.

Hundreds of millions in losses

According to fresh data from the Finnish Patent And Registration Office (PRH), EUR 380 million is lost annually in Finland due to counterfeit products. This is the equivalent of every Finnish person paying EUR 69 a year due to counterfeits.

The European Union Intellectual Property Office (EUIPO) has estimated that 1,469 jobs have already been lost in Finland due to product counterfeiting.

According to Finnish Customs, more than 80% of counterfeit goods come from China or Hong Kong and, in 2017, the range of counterfeited products included spare parts for cars and sports equipment, game consoles, and shoes and clothing.

Companies, protect your products!

Kolster's expert points out that many Finnish companies are beginners in terms of IP. Not all have an IP strategy and intellectual property rights are viewed as necessary expenses rather than investments. They are particularly hesitant about the value of registering IPRs for products headed for Asia – quite unnecessarily, says Kolster's expert.

“Many Finns have an outdated idea of the IP situation in China. There is a persistent illusion that it is pointless for companies to protect anything because trademark protection is not enforced, for example. In reality, IP legislation in China is good, and there are courts which specialise in IP cases.”

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