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August 29, 2011

Fake pesticides are a growing danger

by Caroline Henshaw

The illegal trade in counterfeit pesticides has grown into a multimillion-euro industry in Europe, putting consumers' lives and farmers' livelihoods at risk as unregulated and often toxic chemicals enter the food chain.

These untested and frequently substandard products can be hazardous to anyone handling them or to consumers buying contaminated food. Last year, for example, 28 metric tons of counterfeit pesticides destined for Lithuania were seized in Hamburg. Although they were packed alongside labels and measuring cups purporting to be made by three of the world's largest agrochemical makers, Bayer AG, Syngenta AG and E. I. du Pont de Nemours and Co., they actually contained more than 30% of a solvent called Dimethylformamide, which is banned in Europe because it is suspected to cause serious harm to pregnant women.

...even though it is illegal to import non-EU-approved chemicals into the European Union, a loophole in the bloc's legislation means many pesticide imports don't come under counterfeiting laws and therefore customs can't seize them. And although industry representatives are pushing for revisions to legislation due to be debated in the European Parliament in the coming months, they say little is likely to change anytime soon.

Under current EU law, the company whose goods have been imitated is expected to bear the costs of storage and destruction of any counterfeit goods seized by customs—bills that can often run into thousands of euros. Although these companies are technically able to claim back such costs from the counterfeiters, practically this can prove complicated and even impossible, as many of these companies are beyond EU jurisdiction or completely bogus. Other national bodies can act but rarely do, meaning customs officials are often forced to release the pesticides back to the importers.

Lobbyists are now pushing to create a system similar to the one that operates in the U.S., where if there is intent to counterfeit, all component parts can be seized, even if they are transported separately. Some are also pushing to make the shipping agents more legally accountable for moving counterfeit goods...

David Boubil, press officer for the EU's Trade and Customs Commission, says the EU is "streamlining" its laws to simplify the destruction of goods to make it faster and less expensive, and new regulations should come into force next year...

For farmers, the effects of using such chemicals can be devastating. In 2006, produce grown with unapproved chemicals made their way from farms in Andalucia, southern Spain, into the rest of Europe, costing the region's agricultural sector an estimated €20 million.

"The whole image of the sector and the price that consumers wanted to pay for the product dropped." says Carlos Palomar, director-general of the Asociación Empresarial para la Protección de la Plantas, a national plant-protection agency...

What makes combating the trade even harder is that there are no reliable statistics on the scale of the problem; in the EU's report on the counterfeit trade for 2010, pesticides were not included in their own category. But According to data from the European Crop Association, which represents the region's pest-control industry, estimates peg sales of illegal pesticides in Europe at anything from €400 million to €1.2 billion, or between 5% and 15% of the total EU pesticides market.

In some parts of Eastern Europe, particularly heavily agricultural Ukraine, illegal pesticides could make up as much as 50% of the total market, industry participants say. In 10%-20% of cases, farmers said they lost their entire crop because of the chemicals.

The EU official said the majority of the trade in illegal pesticides is now dominated by criminal gangs who are seeking to tap into the lucrative industry. Regulators say the pesticides are normally sold in Europe for between three and eight times the price the gangs buy them for in Asia.

Lithuanian customs acknowledge that the inflow of counterfeit pesticides has "worsened" in recent years as smugglers seek to exploit the more permeable borders of Eastern Europe. "Since the movement of goods is free in the EU, it is not difficult to import goods into the country where legal norms are more liberal and then transport the consignment to other countries where the norms are stricter," they said in a statement.

Yet regulators and lobby groups say the laws are still not an effective deterrent to the lucrative trade. Mr. Palomar, of the Spanish plant-protection agency, says his group has managed to raise awareness of the illegal trade with both police and farmers since, but the counterfeiters have found new ways to escape notice.

"They have started mixing real products with the Chinese" goods, he says. The people selling the fake products "move from one province [of Spain] to another using the same behavior--first they sell the good products at a good price, then put in the fake one."

full article...Wall Street Journal

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