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Nov 16, 2012, 10.50 PM IST | Source: CNBC-TV18

Foreign brands get together to fight against fake goods

Frustrated by the rise in import of fake goods, global brands in India have realised, at this point, the need for preventive action is more urgent than curative. So several brands like L'Oreal and Lacoste have now joined hands with the Indian customs authorities to work together and prevent counterfeits from seeping into the country.

Frustrated by the rise in import of fake goods, global brands in India have realised, at this point, the need for preventive action is more urgent than curative. So several brands like L'Oreal and Lacoste have now joined hands with the Indian customs authorities to work together and prevent counterfeits from seeping into the country. CNBC-TV18's Farah Bookwala reports.

The counterfeit market in India is worth Rs 45,000 crore, 10-30% of cosmetics, toiletries and packaged foods in India are said to be counterfeit and consumer companies lose nearly 25% of their products' market share due to this.

Rajesh Jain, director & CEO of Lacoste India said, "With China and Brazil, India is in the top three countries where Lacoste is facing the most serious counterfeit issues. Two million fake Lacoste have been seized in 2011 in India."

Realising the need to nip the problem in the bud, global brands such as Lacoste, L'Oreal, FCUK and Calvin Klein have joined hands with the Indian custom authorities.

So what are they doing?

These brands have begun conducting periodic workshops where custom authorities are trained to help them in identifying counterfeit products.

Through this, custom authorities can immediately detect counterfeit goods at airports or seaports and seize them under the Intellectual Property Rights (Imported Goods) Enforcement Rules 2007.

Thereafter, customs can destroy these goods or dispose them before they get into the regular commerce channels thereby eliminating the need for raiding factories and warehouses, a method which is expensive, time-consuming and restricted to a few areas within the company's reach.

Dinesh Dayal, COO of L'Oreal India said, "We don't have to do small multiple actions in the market and this is a much more effective way."

But will this be this enough to tackle the widespread problem of counterfeiting? Experts say that companies must constantly review their supply chains to plug leakages, undertake regular investigations, invest in better packaging and educate retailers and customers to help identify counterfeits if they want to effectively tackle this growing problem.

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