Counterfeit cosmetics challenge market

- Last updated on GMT

Related tags: European union, Eu

With five million contaminated and unregistered cosmetics being
seized in stores across Thailand this week, counterfeit cosmetics
and perfumes are becoming a serious global issue. As increasing
numbers of fraudsters turn their activities from luxury to consumer
goods it is not only personal safety that is at risk but whole
economies.

Custom seizures of counterfeit cosmetics and perfumes across the 15 European Union countries are reported to have risen by a staggering 300 per cent between 2001 and 2002. Things however are expected to gradually worsen as the EU prepares to enlarge next year.

"Consumer products are now potential targets for counterfeiting and pirating, these products are dangerous because there is no guarantee that they meet safety standards,"​ said EU customs commissioner Frits Bolkestein.

The problem is not only a European one. With 66 per cent of seized goods being traced back to Asia, other markets are also being affected. The number of falsified goods in Russia for example, has dramatically risen in recent years with around 30 to 50 per cent of consumer goods believed to be fake.

Speaking at a conference earlier this year, Russian deputy minister for economic development and trade, Maksim Medvedkov, stated that up to 50 per cent of perfume and cosmetics in the country are believed to be falsified. This spread of counterfeit goods has had a huge impact on Russia's economy, suffering annual losses of €2.5 billion.

The Ukraine, which is set to join the EU parameters next year is also thought to have suffered over €1 billion in annual losses. If this trend continues cosmetic profit margins across Europe and the globe could be seriously damaged.

Related topics: Market Trends, Fragrance

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