Like all major modern holidays, Halloween is big business. Consumer spending on Halloween in the US is around $9 billion annually, with participating individuals spending just under $90 each. Costumes and decorations form a big part of the holiday revenue, but chocolate and candy are also responsible for around $2.6 billion. With such high profits to be made for manufacturers and retailers, it’s unsurprising that fake confectionery is also available.
In 2017, eight Chinese people were sentenced to jail and forced to pay fines of nearly $1 million for producing and selling counterfeit chocolates in Jiangsu province. Similarly, in the same year, Chinese authorities seized 300,000 fake chocolate products including Mars and Ferrero Rocher from manufacturers who had made millions from the counterfeits. As with many food products, these cases are becoming increasingly common.
Although confectionery in general is now copied, chocolate particularly has been faked since the 13th and 14th centuries when cacao beans were used as a form of payment in Aztec culture. In modern times, however, there are two main ways in which chocolate is counterfeited. First, there is the adulteration or falsification of what manufacturers can advertise as “chocolate.” Due to the specific make-up of the product, the inclusion of certain artificial ingredients is prohibited. Each country has standards over what can be called chocolate, but generally what separates the genuine from the copy is what is called “chocolate liquor,” which is made from cocoa and cocoa butter. In the European Union, it was ruled that certain substitutions for cocoa butter can legally be considered chocolate. However, this allows only for the addition of up to 5% of a small number of oils that bear a chemical similarity to cocoa butter. These modifications depend on territory-specific legislation and on the legal organizations who regulate food and beverage standards. Manufacturers may be able to call their product “candy” or “chocolate-flavored,” but to call it chocolate can be an offense.
Secondly, there are also infringements of particular confectionery brands. In the case of the Mars and Ferrero Rocher seizures in China, this simply comes down to the production of packaging and designs which imitate registered brand IP with the intention of misrepresenting the product and capitalizing on the brand’s reputation.
Is the Fake Food Problem Limited to Counterfeit Chocolate?
While many confectionary brands have become the targets of counterfeiters, the problem also extends more widely. In 2018, one investigation based on over 41,000 checks off different establishments uncovered in excess of 3,620 tonnes and 9.7 million liters of illicit food and drink. Similarly, the 2019 OECD report into IP crime suggested, “Foodstuffs accounted for almost 25% of all goods detained by EU customs authorities in 2017, making this the number one category of articles. This was primarily the result of the detection of large shipments of counterfeit sweets and bubble gum.” The report also points to seizures of stock cubes, cheese, coffee, and much more.
These products are a real risk to public health. Frequently, such products are sold for such a low price because they do not match required health standards, or because they are plain imitations of existing products. At this time of year, when bulk purchases of chocolate and other sweets are common, it’s especially important to monitor the market for adulteration, falsification, and brand infringement. This helps to protect public health as well as safeguarding the reputations of brands.
Can Food Counterfeiting be Stopped?
We believe that the brand protection solutions offered by Pointer are best placed to assist food businesses in the removal of fake food and drink from the marketplace. The Market Protect service we offer monitors all the occurrences of fakes which are listed on marketplaces around the world. When combined with the Domain Protect module, which detects designated websites, this gives our team of brand protection analysts the fullest visibility over the market. Don’t let your customers get tricked this Halloween, and don’t let the counterfeiters get away with any treats.