By Veneranda Sumila, The Citizen Reporter, *Dar es Salaam:*
15th June 2012 President Jakaya Kikwete signed into a law Business laws
(Miscellaneous Amendment) Act. Among the many laws amended by the act ,
also was the Merchandise Act (CAP.85). The new law describes “counterfeit
goods” as “goods that are a result of counterfeiting and includes any goods
generally known as pirated goods and any other means used for
counterfeiting;”
It explicitly criminalizes exportation of counterfeit goods and indicates
that owners/ and or any one in control of such goods. For many years
Confederation of Tanzanian Industries (CTI) has been lamenting how local
industries are adversely affected by counterfeits.
When the new law is implemented, it’s hoped it will greatly reduce the
problem of counterfeits. Currently, counterfeit products continue to
affect the competitiveness of industries in the country.
The Fair Competition Commission (FCC) is entrusted with the duty to combat
counterfeit goods in Tanzania by enforcing the Merchandise Act.
Unfortunately, the commission’s website competition.or.tz by 30th July 2013
had not updated its site about the Business laws (Miscellaneous Amendment)
Act, which could be a pointer to low awareness about the new realities that
must be applied in the fight against counterfeits.
Only recently FCC seized a stock of 728 counterfeit pipes worth of 8.7m/-
from four out of seven shops inspected at Kariakoo Business District area
in Dar es Salaam Region. Will all the culprits be prosecuted according to
the new law? Time will tell.
The new law came into being after CTI and other stakeholders lobbied for
years to the Merchandise Act amended to define sub-standards and
counterfeits. But its goes short of what CTI have been looking for – a new
agency to exclusively counter counterfeit.
In the past factories have been constructed mainly to manufacture fake
goods for certain countries, including Tanzania, greatly harming the
legitimate manufacturers.
Yet despite several initiatives taken over the years to tame the rogue
trade, it continues to be of great magnitude adversely affecting producers
and dealers in genuine products.
The Fair Competition Commission (FCC) as well as Tanzania Bureau of
Standards (TBS) has been seizing such goods every year.
Speaking to BusinessWeek over a phone interview CTI chair Felix Mosha said
that the government efforts to curb counterfeit products have to a small
extent helped to reduce the problem.
“I am not saying that counterfeit products have been eliminated but my view
is that they have been reduced to a certain extent,” he said.
He said, however, he said that he cannot comment on the extent of the
reduction because CTI is yet to conduct a survey.
“We have not done any survey to examine if these products have been
decreased and to what extent,” said Mr Mosha.
Tanzania Private Sector Foundation (TPSF) Executive Director Godfrey
Simbeye said counterfeit products must be fought because they badly impact
on genuine businesses and investments. Genuine businesses are not able to
compete effectively with counterfeit products.
In 2009 CTI published a report which revealed among the things the impact
of counterfeit products to industries.
Titled ‘Effects of Counterfeit and Substandard Goods on the Tanzanian
Economy, the report asserted that the impact of counterfeit products was
highly on the rise resulting in loss of revenue collection and worsening
business environment.
The report estimates that Tanzania could be losing between 15 to 25 per
cent of the total domestic revenue due to counterfeit products.
This means if estimated total government domestic revenue was Sh6.7
trillion in 2011/2012 subsequent loss in government revenue due to
counterfeit products stood well over Sh1 trillion.
Financed by Best-AC, the study reveals that business people dealing with
counterfeit products are able to sell more products at less cost thus
reaping huge profits compared to those dealing in genuine products.
According to the report, counterfeit and sub-standard goods not only
cripple legitimate local industry by unfair competition but, local services
firms and channel players also lose revenue while businesses waste time and
money working with faulty and unsupported products.
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The Tanzania Solar Energy Association (TASEA) recently lamented that
substandard and counterfeit solar panels are being sold in various shops
dealing with electrical appliances in the country.
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Early in the year Tanzania Food and Drugs Authority (TFDA) banned the
anti-malaria drug Metakelfin and ordered all vendors and health centres to
return the remaining stocks to their wholesale suppliers.
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According to Fair Competition Commission (FCC) Senior Communications and
Public Relations Officer, Mr Frank Mdimi the existence of informal routes
(panya routes) that unscrupulous business people were using to bring in
substandard goods were hard to contain for the practice involved a number
of players in almost all sectors. “Buying a counterfeit product further
escalates the prevalence of that good in the market, these products are
cheaper but made of poor and substandard technology,” he said.
End