19 October 2009

Roger Rogowski, executive, UK Electronics Alliance

Last week's Anti Counterfeiting Forum saw electronics industry leaders convene to discuss the severity of the problem. Chris Shaw spoke to UK Electronics Alliance executive Roger Rogowski.

CS: With the Anti Counterfeiting Forum website encouraging users to join forces against the problem, how has the issue been previously addressed? What have been the most – and least successful strategies and why do you think they worked – or failed?
RR: Responding to what is a growing worldwide problem, many organisations started their own initiatives. When we were researching material for the Anti Counterfeiting Forum site, we found a huge amount of material on the problem, some overlapping, some contradicting and competing, even if unintentionally.

Unfortunately, many of these initiatives are not as coordinated as they might be and this appears to be leading to confusion over which ones to follow and, as a consequence, might be acting as a barrier to adoption - in particular, with regard to which suppliers are safe to deal with and what best practice to adopt.
On the other hand, a huge amount is already being achieved and, as well as raising awareness of the problem, the website signposts to all of the various organisations and initiatives that can provide support.

CS: What kind of directives or legislation would you like to see enforced to stop counterfeit components arriving from regions such as Asia and Eastern Europe? And would stringent legislation really have any effect on global supply networks?
RR: While we feel there is certainly more that can be done by both UK government and the EU, there are some operational issues to be addressed. The EU is currently as secure as its weakest border and to make matters worse, of course counterfeit electronic components are extremely difficult to detect. Our own Revenue and Customs have been quite receptive to our offer of training for selected border inspectors but more needs to be done.

I also think more component manufacturers need to work more closely with the Intellectual Property Office to make their component marking more enforceable in law and more distributors and OEMs need to share intelligence on known counterfeits. Distributors and OEMs also need to be more aware of their obligations under law when they identify counterfeits.

CS: Do you have any examples of counterfeit components slipping the system with devastating effects? If possible, how do you think this could have been avoided?
RR: Organisations are very reluctant to disclose instances where counterfeits have slipped through the net. It exposes their procurement and materials handling systems and impacts their reputations, especially in the eyes of their customers.

However, organisations are often prepared to share information on counterfeit parts they have detected, which is the basis on which the counterfeit components database works on the Anti Counterfeiting Forum website. The website was launched in July and there are currently over 350 different parts on file but we do need more companies to get involved in sharing intelligence on counterfeits they have found.

CS: Are there certain components that are more difficult to trace than others? Why is this and what do you feel is the best way to address this?
RR: Small packages with limited marking are obviously very difficult to detect through visual inspection although attempting to detect counterfeits by visual inspection alone is becoming increasing unreliable. Until recently, many counterfeits were quite amateurishly marked. For example 'Philippines' or 'Philips' might be spelt incorrectly.

However, marking on counterfeits has improved, if that's the right word. Many counterfeits are black topped and re-marked with a different part number, batch code and logo. Until recently, the application of a solvent such as acetone would reveal re-marking. However, we have heard of instances where semiconductor manufacturers themselves are re-marking their own parts for legitimate reasons, which makes this test more unreliable.

CS: How important is it that the electronics industry joins forces on sites such as the Anti-Counterfeiting Forum?
RR: It is hugely important that as many levels of the supply chain in as many geographic areas as possible collaborate, as difficult as that might be. By the way, the UKEA didn't initially set out to launch and run the Anti Counterfeiting Forum website but we found that there was nothing quite like it either already in existence or in prospect so, in response to a wide call for a single online resource, we started our own.

While we shouldn't wait until we have a single movement before taking action, it is vital that organisations working on similar initiatives join forces. To take an example, there are already several codes of practice, standards or certification systems to address counterfeit components, which we would like to see coordinated into a single standard recognised by the electronics industry worldwide.

CS: What effect does counterfeiting in the electronics sector have on the overall UK economy?
RR: The Intellectual Property Office estimates that intellectual property related crime costs the UK at least £9billion a year. In addition, The U.S. Patent & Trademark Office has stated that 9% of all counterfeit goods seized are electronic in nature. Electronic goods become counterfeit as a result of components within them so, taken together, these figures suggest that the cost to the UK economy could be about £800m.

However, more concerning is the potential for a counterfeit component to find its way into a safety critical piece of equipment, in avionics or ground transport systems for example – and to fail. Many of these systems are very robust and often contain double or triple redundancy on critical functions so we have to put the risk in context but it is there.

CS: Is counterfeiting an issue of ignorance or greed?
RR: It's certainly greed, if you like, on the part of the counterfeiters. However our main concern, and one that the UKEA and other organisations are trying to address, is that there is still a great deal of ignorance of not only the problem but more importantly, of how companies should be managing the problem within their supply chains and materials management systems. I would probably liken this lack of knowledge to that of obsolete components fifteen years ago before the Component Obsolescence Group was formed.

There is still a great deal to make our supply chain more secure and there is a lot we can learn from other sectors who have been dealing with the problem for some time, the pharmaceutical sector for example.

Chris Shaw

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