Fears for FMCG exporters

A flourishing trade in counterfeit goods from Jebel Ali Free Zone could be damaging to local companies that are trying to tap lucrative export markets.

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By  Roger Field Published  December 12, 2006

|~|JAFZA200.jpg|~|Jebel Ali Free Zone is gaining a reputation internationally as a hub for the trans-shipment of counterfeit products, including FMCG items. (photo: Getty Images)|~|Many local FMCG producers have made big strides in recent years by increasing exports and even starting to make their brands recognisable internationally. And these companies have certainly benefited from the UAE’s location, which makes it an ideal hub for exporting, and for the tran-shipment of products and raw materials from other countries. But news from the World Customs Organisation that many economic free zones, including Jebel Ali Free Zone, are being exploited by counterfeiters is bad news for everyone. And if the situation continues, it appears that FMCG producers in the region that export products from Jebel Ali could find that their products fail to reach their intended foreign markets as quickly as they intended. Indeed, Christophe Zimmermann, an intellectual property rights expert at the WCO, points out that JAFZA is gaining a reputation among some European customs authorities as a major hub for the transhipment of counterfeit goods - many of them FMCG products - usually originating in China. Already, many shipments entering European ports from the UAE come under scrutiny from customs authorities, according to Zimmermann. While local producers could see their foreign exports hampered by delays, the situation is perhaps more of an eye opener for multinational companies such as Unilever and Procter & Gamble, which both face problems with some of their brands being counterfeited. But the news is not all grim. According to Zimmermann, the WCO is planning to make life much more difficult for counterfeiters that attempt to hide the true origin of their illegal wares by trans-shipping them through free zones. The organisation will work with customs organisations around the globe to help them pinpoint the shipments that are most likely to contain counterfeits. This move, combined with the efforts of the Brand Owners Protection Group, which includes representatives from FMCG producers including Unilever, Kraft and GlaxoSmithKline, will hopefully help bring the problem into some kind of check. Roger Field, Editor. E-mail: roger.field@itp.com ||**||

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