COUNTERFEIT FOOD AND DRINK

Criminal networks involved in IP crime continue to counterfeit food and drink. In 2020, foodstuffs (in particular cookies, pasta, crisps and sweets) were the second most commonly seized category of products at the EU’s external border. In contrast, they were among the less commonly seized products on the EU’s internal market in 2020. China and Turkey were among the most frequently reported non-EU countries of origin for counterfeit food and drink seized at the EU’s external border in 2019 and 2020. Other common non-EU countries of provenance were Albania and Ukraine in 2019, and Jordan, Moldova and Panama in 2020 . Investigations by EU law enforcement authorities have detected IPR-infringing goods at illegal warehouses, and in laboratories , stores, supermarkets, restaurants and transportation companies .

Criminal networks involved in this activity attempt to infiltrate the legal supply chain at various points, including during production, transportation and distribution. In some cases, criminals control the entire production and distribution chain, presenting themselves as legitimate suppliers to consumers and business partners. Criminals develop marketing and distribution strategies, including online sales, and also attempt to infiltrate legal supply chains. In some cases, criminals trafficking in IP-infringing food and drink set up complex trade-based money laundering schemes . Criminals counterfeit or manipulate food products or mislead consumers by altering labels, manufacturing processes , geographical origins, or by replacing products.

All types of counterfeit food can contain adulterations. For instance, some counterfeiters add cheap corn syrup and sugarcane to genuine honey, producing large amounts of counterfeit product at a much lower price than the genuine one. Honey adulteration has been on the rise since high fructose corn syrup became widely available . Corn syrup and sugarcane are cheaper than honey. They present an easy way to increase the volume of honey and thereby increase the profits illegally. Food fraud in the EU increasingly involves seafood by falsely applying the designation of origin. In many cases this relates to illegal fishing . IPR infringements related to geographical indications are reported in significant numbers and target a wide range of products, such as oil and other condiments, chocolate , spices , alcoholic products , meat products , cheese and dairy products , vegetables and fruit . Trade mark and copyright infringements are also detected regularly. Food fraud typically entails the falsification of origin, transit and administrative documents. All types of illicit food products are increasingly marketed and sold online.

The counterfeiting of alcoholic beverages remains a significant public health concern and has a substantial impact on both the legitimate sector and state revenue. Wine, spirits, distilled beverages, liqueurs and beer are all targets for counterfeiters. Indeed, counterfeit alcoholic beverages remain the most frequently seized item of fake food and drink . Enterprising criminals are able to adapt to meet emerging demand. In some cases, criminals involved in counterfeiting alcohol target recreational occasions and locations, such as festivals and public celebrations . With a sustained and constant demand for alcoholic products and a high level of market competition, the beverage industry is especially reliant on supply chain technology . Alcohol counterfeiters need to rely on a functional and consolidated supply chain as well. This can include the use of legitimate delivery networks, such as, delivery vans and other legitimate traders. Counterfeit alcohol is often adulterated with artificial colours to make it look like the genuine product. The refilling of empty bottles is another frequently encountered modus operandi. Authentic bottles are usually refilled with cheap alcohol purchased online or at discount stores. Counterfeit capsules, corks, packaging films and false masking are all used to seal the bottles containing the counterfeit drinks. Counterfeiters obtain genuine product bottles by collecting empty authentic bottles or through the complicity of workers in the food industry. Fake bottles, imported with fake labels, are also misused and refilled, suggesting the presence of production facilities for counterfeit goods in the EU. Remarkably, packaging materials for juices were one of the most-seized fake goods at the EU’s external border in 2020

As with counterfeit food, the organised crime groups involved in producing counterfeit drinks have shown increasing sophistication in their production methods. Traditionally, they would primarily refill original bottles with counterfeit produce. Law enforcement authorities regularly detect other types of counterfeit goods smuggled alongside counterfeit food and drinks, which highlights the involvement of criminal networks in the production of a range of different counterfeit goods. Consumer demand for products bearing specific brands or protected designations of origin at lower prices drives the supply of counterfeit food. IPR infringements result in financial losses and reputational damage to legal producers, as well as the loss of tax revenue. Counterfeit food and drink is particularly dangerous for human health, because the quality is frequently substandard and production processes take place in unhygienic conditions. Some IP-infringing food products include dangerous ingredients such as methanol, mercury, fipronil, insecticides or pesticides.

Products

1. alcohol
2. alcoholic products
3. beer
4. bottles
5. capsules
6. cheese
7. chocolate
8. corks
9. dairy products
10. distilled beverages
11. foodstuffs (in particular cookies, pasta, crisps, sweets)
12. fruit
13. juices
14. Labels
15. liqueurs
16. masking
17. meat products
18. oil and other condiments
19. packaging films
20. packaging materials
21. seafood
22. spices
23. spirits
24. vegetables
25. wine