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It’s a problem that costs the retail industry vast amounts of money, although given the lack of data surrounding the problem, no one really knows exactly how much counterfeit markets are costing their genuine counterparts.

It’s an affliction that touches every sector, from luxury fashion items (cue the ‘genuine fake’ Rolex watches and Louis Vuitton handbags), through to FMCG goods such as pharmaceuticals and food and drink. It’s in these latter areas that the risk level goes up a notch.

In September this year, 26 people died as a result of drinking counterfeit vodka and rum laced with methanol in the Czech Republic, with more hospitalised and blinded by the alcohol which was sold in both the on- and off-trade across the country.

In total, some 5,000 litres of counterfeit alcohol were thought to have been produced by only 10 people who were responsible in this particular case.

As well as loss of life, the impact of these counterfeit products has been crippling for the Czech Republic, as the government responded to the crisis by  banning the sale of alcohol above 20% abv on 14 September, throwing the country into partial prohibition.

It lasted for almost two weeks before the government partially repealed the ban on spirits above 20% abv produced before 1 January 2012. A ban on the export of Czech spirits to other countries in the EU remains in place. Although it undoubtedly prevented the death toll from rising further, the decision to implement a widespread prohibition of its kind has been condemned as damaging by some.

Brand damage

Paul Skehan, director general of the European Spirits Organisation (CEPS), wrote a letter to the Czech Prime Minister Petr Necas, explaining that the ban risked forcing the production and sale of bootleg alcohol even further underground making it harder to combat, and also that the ban was discriminative against international brands.

“We consider the ban on all spirits to be a counter-productive measure as we fear it will drive consumers into precisely the illegal sales channels your government is working to remove,” he said. “Rather than banning legitimately produced, taxed, packaged, stamped, and distributed spirits brands from the market, we urge you to recognize that such brands actually provide an assurance of quality and safety to consumers.”

However when illegitimate spirits are being sold in packaging almost identical to established – and trusted – brands, it can be hard to tell the difference between a safe, legitimate product and a fake.

Are bottle closures the answer?

New anti-counterfeiting strip stamps have been introduced by the Czech government, but like everything, these can also be imitated and faked.

David Thomson, innovation manager for Guala Closures, anti-counterfeit closures specialist, said the only way to ensure a bottle is genuine and not mimicked or refilled with an imitation liquid, is to install effective closures on every bottle.

“The Czech market to my knowledge is not generally an anti-counterfeit market, and as far as I know the brands [involved] do not use any form of anti-counterfeit packaging. The use of a non-refillable closure would certainly make life much more difficult for anyone involved in refilling bottles with fake liquid and definitely makes a brand a less attractive target for counterfeiters.

“Additionally, if consumers recognise a genuine bottle because it has a certain style of closure, then the market starts to police itself to an extent. There are many unscrupulous ‘standard’ closure manufacturers or agents who would supply anyone who asked. With Brand Protection closures, by nature, the manufacturers generally ask questions regarding the authenticity of the company who have requested them.”