1.
Welcome

2.
Traceability labeling of products in the Eurasian
Economic Union (EAEU), EU and beyond

3.
Effects of globalization, international trade, e-commerce, free
trade zones
Disadvantage of these tools:
● Difficult to detect and less risky to traffic, smuggle and market counterfeit and pirated goods -
influx of ‘fakes’ resulting in:
● Complex Supply Chain
● Loss of revenue for governments and brands
● Potentially detrimental effect on a brand’s reputation, image and customer satisfaction
● Infringement of intellectual property rights
● Health and safety risks for end-users
● Impede innovation

4.
Good old days of easily identifiable knock-offs or ‘fakes’ are now
long gone

5.
Today, counterfeit products are almost identical to the real thing

6.
Today, counterfeit products are almost identical to the real thing

7.
Trade in counterfeit products in numbers
● 2016 study from the EUIPO and the OECD estimated the value of counterfeit
products to be 2.5% of world trade – up to EUR 338 billion
● In the European Union, the counterfeit products amount up to 5% of all EU imports,
worth up to EUR 85 billion
● Sectors that represent more than half the total estimated trade in fake goods
worldwide at a value of more than EUR 208 billion in 2013: fake foodstuffs,
pharmaceutical products, perfumery and cosmetics, leather articles and handbags,
clothing and fabrics, footwear, jewellery, electronics and electrical equipment,
optical, photographic and medical equipment, fake toys, games and sports
equipment.
● Total trade in fake clothes, footwear and accessories throughout the EU-28 amounts
to almost 10% of the total sales in these sectors, loss that translates into 363,000
lost jobs
● Knock-off effect loses to legitimate businesses in the EU = €43.3 billion of sales
revenue, over €8 billion of government revenue across the EU-28 is not collected

8.
Traceability Labeling of Products Panel Discussion – Description
Subject: Analysis of product traceability legislation in the Eurasian Economic Union,
EU, US, Turkey and beyond
Description: This presentation will examine the recent developments of traceability
legislation in EAEU, Turkey and analyse how it impacts consumers’ rights and the
obligations of manufacturers and importers to the regions.
Our contributions further aim to provide a comparison with the EU and US approach
to product traceability and look beyond the legislative measures to provide
information on existing technological brand protection solutions. Lastly, it aims to
look at trade in counterfeit products from the standpoint of a consumer and answer
the question of whether a traceability labelling may represent a break-point.

9.
Traceability Labeling of Products Panel Discussion - Goals,
Speakers and Contents
Speakers
Nesrin Gundogan Uzer - the head of the European Union Technical Harmonization Department at
the DG For Product Safety and Inspection of the Ministry of Trade in Turkey
Kymberli Stewart – SGS Global Brand Protection Services Manager
Martyn Allen – Technical Director at Electrical Safety First (ESF)
Livia Kecerova – Senior Regulatory Consultant with Compliance & Risks (C&R)
Anticipated Outcome
Gaining understanding of the impact of product traceability labelling on
manufacturers/importers, and consumers' rights, and also on the fight against illicit trading
activities and learning about traceability initiatives in EAEU, Turkey, EU, US and beyond

10.
Labelling of specific products with marks of
identification in the Eurasian Economic Union
(EAEU) and Russia

11.
Agreements on labeling of specified products with identification
marks and traceability labels
Background
Online commerce – 97% of goods come from non-food sector while clothes make up 23.9% and
footwear for 12%
58.7% of all goods bought online come from abroad, with large margin allocated to China, - the
main source of counterfeit products which present the safety risk as they lack quality and safety
approvals
Eurasian Economic Union’s Solution
● Launch of a successful Pilot Project on using chips/chipping for garments and apparel made
of fur has been launched to partially resolve this issue (2015/2016)
● Adoption of Agreement on Common Labelling System of Goods with Control (Identification)
Signs (2018)

12.
Agreements on labeling of specified products with identification
marks and traceability labels
Decision No. 70 of 2015
on the Implementation
of the Pilot Project for
Labelling of Clothing
and Garment of Natural
Fur establishing
labelling for products
made of natural mink,
nutria, fox, rabbit, hare,
raccoon, sheepskin, and
other types of fur
Agreement on
Identification
Labelling for
Clothing,
Accessories and
Other Products
Made of Natural
Fur, 2015
• Series of voluntary
pilot projects on
medicines, footwear
and tobacco
• Resolutions No. 791
and 792 of 2018
introducing mandatory
products labelling for
10 product groups and
forming a unified
digital labelling system
‘Honest Sign’
Agreement on
common labelling
system of goods
with control
(identification) signs,
2018
Implemented by
Success: growth in number of
legalized businesses, declared fur
products, revenue
Implemented in Russia
through:

13.
Deadlines for mandatory application of
‘Honest Sign’ for 10 product categories How?
Data Matrix Code
Unique marking code
consisting of:
• Product ID code:
• Verification code
(crypto-tail)
Russian Unified National System of Digital Marking and Product
Traceability System ‘Honest Sign’

14.
Russian Unified National System of Digital Marking and Product
Traceability System ‘Honest Sign’- Process
1. The Centre for the
development of
promising technologies
(CRPT) assigns each
product a Data Matrix
Code to be placed on a
product by a
manufacturer or
importer
2. Digital code is a
product’s passport that
travels along the entire
path and can be traced
every step of the way
3. The store scan the
products and puts it on
the shelf – the labelling
system detects and
records the transfer of
goods through the
logistics chain
4. When being sold, a
product is scanned
again at the check-out
counter and recorded as
‘out of circulation’. The
system will not allow
the sale of counterfeits
5. The mobile phone
app ‘Honest Sign’ will
soon become available,
helping consumers
easily check the legality
and full information
plate of a product,
simply by scanning the
Code. App will show
either a ‘Correct Code’,
or ‘Error’ message

15.
Manufacturers & Importers Guide to ‘Honest Sign’
1. Data Matrix Code – a
unique tracking and
verification code
generated by CRPT is
send to bona fide
manufacturers and
importers
2. Manufacturer or
importer places the
issued digital code on a
product’s package. The
system records the
product as it advances
in the supply chain
4. To participate on a
pilot project, a
manufacturer/importer
needs to submit an
online application form
CRPT – system’s
single operator, can
issue a code for new
products in a short
time thanks to the
scalability of the
‘Honest Sign’. The
company will work out
all the niches during
ongoing pilot projects
Optimization of
business
processes,
transparency in
supply chain =
cost reduction
in a long run
5. Applicant obtains an
enhanced qualified
electronic signature and
can register on the pilot
project website
Participants get advice
on ‘Honest Sign’
implementation, further
works in the system,
necessary hardware and
software
3. The responsibility
for the cost of
implementing the
system will not fall
on consumers. They
will be born by
manufacturers but
once the system is
set up within the
company, cost will
go down

16.
‘Honest Sign’- First of its kind
Ground breaking system – unified information platform for controlling the authenticity of goods and increasing
transparency
Applicable to all types of product groups; facilitate tracking a supply chain and distribution route of a
product on a smartphone via app
Data Matrix Code on the product packaging tackles the issue of counterfeit products and smuggling,
protects legal interests of enterprises, governments, as well as consumer rights. Identification part of the
code determines the position of a product in a distribution channel. Verification crypto-tail is generated by
domestic cryptography technologies to avoid code interception and hacking
Element of public/social control – violations and ‘fakes’ can be instantly reported via mobile app and
transferred to relevant regulatory authorities
All product information will be accumulated in a single information platform accessible by
manufacturers and consumers through the mobile app

17.
Thank You
Presented by:
Livia Kecerova
Regulatory Consultant
l.kecerova@complianceandrisks.com

18.
1
DG Product Safety and Inspection
RECENT DEVELOPMENTS IN TURKEY
CONCERNING PRODUCT SAFETY AND
TRACEABILITY
Brussels, November 2018

19.
 Turkey and the EU established a Customs Union (CU) in 1995 (Decision 1/95 of the EU-Turkey
Association Council, 96/142/EC).
 The CU covers trade in manufactured products between Turkey and the EU.
 The CU covers both harmonised and non-harmonised area.
 Entails alignment by Turkey with all EU product legislation. The Agreement aims to ensure the free
movement of industrial products between the EU and Turkey, by eliminating import controls at the EU-
Turkey border on such products.
 Articles 5-7: elimination of measures having an effect equivalent to quantitative restrictions
(mirroring Articles 34-36 TFEU)
 Article 8: incorporation of Community instruments into legal order
 Article 9: trade between the Parties takes place in accordance with the conditions laid down by
those instruments
1
DG Product Safety and Inspection
2
1/95 ASSOCIATION COUNCIL DECISION

20.
 Turkey transposes EU’s harmonization legislation on products and quality infrastructure.
 Up to now, Turkey has transposed into its legal order the rules of the EU on the CE
marking, notified bodies, market surveillance and mutual recognition in the non-
harmonized area as well as many EU sectoral legislation, including the acquis requiring
the CE marking on products.
 80% of EU’s product legislation are already transposed. This work continues since it is a
dynamic structure and revisions are taking place time to time in EU and thus Turkey.
 Already published legislation includes 21 Turkish Regulations transposing the
corresponding new approach directives of the EU such as toys, personal protective
equipment, pressure equipment, lifts, etc. These have been confirmed by the Joint
Statements signed by Turkey and the EU.
 48 NBs under 14 legislation
1
DG Product Safety and Inspection 3
HARMONIZATION

21.
 The objective of this Law is to lay down the principles and the procedures for the placing
on the market of the products, conformity assessment, market surveillance and inspection
and the notifications relating to these arrangements.
 Covers;
- the conditions of placing on the market of the products,
- the obligations of the producers and the distributors,
- conformity assessment bodies and notified bodies,
- market surveillance and inspection,
- prohibition of the placing on the market of the products, withdrawal and destruction of
the marketed products,
- the notifications relating to these arrangements.
1
DG Product Safety and Inspection
4
LAW NO 4703

22.
 A new draft “Law on Product Safety and Technical Regulations” has been
prepared in the context of the revision of “Law No. 4703 on Preparation and
Implementation of Technical Legislation for Products”
 Planned to be submitted to the Turkish Parliament
 The New Legislative Framework (NLF) Package, the General Product
Safety Directive of the EU taken into consideration
 The purpose is to ensure that the products are safe and in compliance with
the related technical regulations (whether produced in or imported to
Turkey)
1
DG Product Safety and Inspection 5
DRAFT LAW

23.
MAIN IMPROVEMENTS:
 Economic operators defined in accordance with the EU legislation
 Responsibilities of the economic operators clarified
 Recall
 E-commerce/E-Market Surveillance
 Product Liability
 Notification of Risks and Measures
 Administrative Fines in accordance with the gravity of the non compliance
 Traceability
1
DG Product Safety and Inspection
6
DRAFT LAW

24.
TRACEABILITY
 Name, title, brand and address of the manufacturer/importer should be placed on
the product/package (Decision No 768/2008/EU)
 Economic operator:
 responsible for keeping the record (name, title, brand and address) of the
previous and the next economic operator for 10 years
 Provides the information to the competent authority when asked
 Distributor: if does not provide the information of the manufacturer/importer, will
be acknowleged as the manufacturer
 Covers E-commerce (intermediary service providers, TVs and radios)
1
DG Product Safety and Inspection
7
DRAFT LAW

25.
TARGET
to find the manufacturer of the unsafe/ non-comliant product
to reach the primary responsible party
1
DG Product Safety and Inspection
8
DRAFT LAW

26.
THANK YOU
Nesrin GÜNDOĞAN ÜZER
Head of Department
DG for Product Safety and Inspection
E-mail: gundogann@ticaret.gov.tr Tel: +90 312 212 89 01
1
DG Product Safety and Inspection
9

27.
SGS
BRAND
PROTECTION
BEYOND LEGAL
How to Craft a Secure Supply Chain
& Distribution Strategy

28.
28
WHY IS BRAND PROTECTION NEEDED?
Worldwide counterfeiting
grows at 15.6% every year
Inability to effectively enforce intellectual
property laws abroad means there is a
need for stricter self-regulation
OECD puts the annual cost of
counterfeiting at half a trillion
USD, others see it as high as
1.8 trillion USD
Fake products destroy 10% of
the top line revenue, but they
also erode the credibility of the
retailers selling the products
Increasing loss of visibility
over more and more complex
supply chains
2

29.
29
WANG HUI
3

30.
30
US Const. Art I, Section 8, Clause 8 The Congress shall have power to
promote the Progress of Science and useful Arts, by securing for limited
Times to Authors and Inventors the exclusive Right to their respective
Writings and Discoveries;
4

31.
31
WHY IS BRAND PROTECTION NEEDED?
RENOVATION
RESTRUCTUREREARRANGE
REORGANIZE
INNOVATE
ALTER
REMODEL
TRANSFORM
CHANGE
5

32.
32
WHERE DO THE VULNERABILITIES LIE?
*Counterfeiting, diversion, substitutions, recalls, destructions of goods
6

33.
33
MAP OUT YOUR
SUPPLY CHAIN
1
7

34.
34
 Are your factories and warehouses secure?
 Can you source your suppliers’ suppliers?
 Are your distributors vetted?
 Do you sell at trusted retailers?
 Are you able to effectively locate and recall product?
 Is recalled product destroyed?
 Are your consumers engaged?
 Are your consumers confident in the products you provide?
 Is your reputation secure?
2
IDENTIFY PLACES WHERE YOU LACK
VISIBILITY
8

35.
35
 Clear diagnostic of the problem that exists
 Create an exhaustive audit of the situation
 A brand protection task force
• Include many departments (Marketing, Finance, Legal,
Operations)
 Look at the problem not only as brand security but also
fiscally to gain allies internally
 Implement solutions that combat piracy
 Track & trace
 Unscheduled inspections
 Regular auditing
 Covert tagging
 Focus on incentives that not only engage consumers but
also distributors/retailers to increase sell-through
3
IMPLEMENT A STRATEGY
9

36.
36
OVERVIEW
 Brand Protection should be part of every brand
strategy, regardless of industry
 Brand Protection is a mixture of due diligence
and technical aides to visualize your supply
chain
 Do not assume that the work of brand
protection is limited to legal teams and legal
infringements
 Brand protection goes beyond black market
counterfeiting and is needed to secure brand
reputation
 The ultimate goal of brand protection is
securing growth & protecting consumers
10

37.
37
QUESTIONS
Can you name the
three steps needed to
construct a successful
brand protection
strategy?
11

38.
38
QUESTIONS
THANK YOU
12

39.
39
BRAND PROTECTION CONTACT
SGS Global Brand Protection
+33 6 08 46 71 45
kymberli.stewart@sgs.com
Kymberli Stewart
13

40.
WWW.SGS.COM
©
SGS
Group
Management
SA
–
2018
–
All
rights
reserved
-
SGS
is
a
registered
trademark
of
SGS
Group
Management
SA