From R&D to consumption, counterfeits affect everyone

Recently heard: "Wow, this stuff is really cheap. Must be the economy."

Aug 1st, 2003

Recently heard: "Wow, this stuff is really cheap. Must be the economy."

If you have gotten a really good deal on some cable or connectors lately, the downturn in the economy may not be the reason.

The International Anti-Counterfeiting Coalition (IACC) estimates that trademark counterfeiting of U.S. products exceeds $200 billion annually, with the majority of counterfeit products coming from Asia—primarily China—and Eastern Europe. The IACC is a watchdog in this area; see www.iacc.org for additional details.

Why should you care?

A manufacturer makes parts and stamps-on its "good name." A nationally recognized testing laboratory (NRTL) performs checks to ensure quality and allow use of its mark. Distributors sell parts to installers. Installers install and test, then the manufacturer and installer guarantee performance to the consumer. The consumer assumes liability for code compliance—that the installed parts are not going to harm or kill anyone.

So yes, wherever you are in the process, you are being affected.

Generally speaking, there are four versions of product counterfeiting:

  • Exact copies of product, including trademark and safety marks;
  • Copied packaging or similar packaging to confuse consumers;
  • Counterfeit safety labels, such as UL and CSA;
  • Counterfeit trademarks.

A counterfeit trademark is a bogus mark that is identical to, or largely indistinguishable from, a registered trademark.

The U.S. Customs Service estimates at least 5% of products entering the U.S. are counterfeit. (See www.customs.ustreas.gov for additional details.) Section 3, Trademarks and Trade Names, of the U.S. Customs Services publication Importing Into the United States warns importers that, "Articles bearing counterfeit trademarks are subject to seizure and forfeiture." But of course, that assumes that they are seized before they reach our regular distribution channels. That is a lot of shipping containers to open and inspect.

In an attempt to explain the consequences of the situation, let's bring the discussion to a more personal level. Counterfeiting is a form of stealing. If someone steals your personal information and runs up big credit card bills and writes bad checks, all in your name, then "your" creditors will report "your" bad management practices to the credit bureaus. Any future credit checks will indicate that you are a bad risk or that you do not pay your bills. It can take between two to five years to clear your credit report even though you have done nothing wrong.

Counterfeiting and cabling

Counterfeiting products is a similar problem at the corporate level on a global scale, but there are no credit bureaus to negotiate with regarding the use of bad cabling products. So, those affected will always be working toward clearing their names, even though they also have done nothing wrong.

Counterfeiting of cabling products has been a problem for years, but we are currently seeing a dramatic increase. Why is this happening? M-O-N-E-Y. Sellers want to make it and buyers want to save it. Cabling products are being cloned (some clones are obvious fakes, while others are very convincing) and sold through distribution channels.

Importing, selling, installing, and using counterfeit products are not victimless crimes. Anyone can unsuspectingly purchase a counterfeit product or a product bearing counterfeit approval marks. These are the real victims of counterfeiting, because they believe they are specifying and purchasing a genuine product, and are paying for the value they associate with the product.

While these people may be dissatisfied in the performance, reliability, and robustness of the product, the real threat is in safety. If the product has not been tested and certified to meet applicable standards and does not bear legitimate approval marks, it could pose a serious hazard to the user and a liability risk to whoever may have supplied the product.

While imitation is the sincerest form of flattery (Shakespeare), counterfeiting is usually not flattering (NEMA), and is illegal (U.S. Customs Service). Regardless, some people actually choose to purchase counterfeit products assuming that they are paying less for products that are equal to the products they imitate.

People who deliberately choose to buy counterfeit products are supporting the criminally deceptive practices of counterfeiters by creating a built-in market for their products. Counterfeiting would not likely disappear if there were no willing customers for counterfeit products. But counterfeiting would be more risky and less profitable without these easy deals.

Who's paying attention?

Counterfeit items are not submitted to safety testing laboratories and may be unsafe, or they may be exact copies that were just less expensive to produce because their labor is cheaper and the makers do not have to recuperate research-and-development costs or pay the NRTLs for compliance testing. But how can you tell?

  • Abnormally low pricing. If it is "too good to be true," then most likely it is not true.
  • The quality of the packaging. Is the box or reel unusual? Are all the words spelled correctly? Are the markings logical?
  • Does the cable "feel" right? Are the conductor-insulation colors as expected, or slightly off?

Are you really getting what you are paying for? If you suspect that you have a counterfeit cable, do not install it. Save all packings. If the cable is from a U.S. manufacturer, then contact that manufacturer directly. If the cable is not from a U.S. manufacturer, then contact the indicated listing laboratory. For UL, contact either Brian Monks or Steve Galan at (631) 271-6200 or Brian.H.Monks@us.ul.com. For ETL, contact Jim Anastasi at (607) 758-6411 or JAnastasi@etlsemko.com. To follow NEMA's progress in pursuing counterfeiters, see www.nema.org.

Remember, while Zenith Electronics owns the famous slogan, "The quality goes in before the name goes on," its relevance is not limited to Zenith alone. It applies to us all.

Donna Ballast is BICSI's standards representative, and a BICSI registered communications distribution designer (RCDD). Send your questions to Donna at: dballast@swbell.net

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