November 22 2023  |  Industry News

Eradicating illusion: the duty free sector's crusade against illicit trade

By Wendy Morley

Stores like this one do nothing to help correct the impression that our industry is rife with illicit trade

Our industry is facing a grave threat from the underbelly of illicit trade. This shadowy world of counterfeiting and fraud not only undermines the financial foundations of the industry, but also erodes the trust of consumers worldwide, which damages our reputation.

Despite the duty free and travel retail sector's stringent regulations and transparent operations, counterfeit products persistently appear. As these insidious activities often operate under the guise of “duty free,” they make us an easy target. And the global repercussions go beyond inflicting a reputational damage that transcends international borders, though they do that;­ as we are perceived to carry on reprehensible activities, our voice becomes less legitimate in all areas of potential influence.

Leading the charge

Sarah Branquinho, a name that has become synonymous with integrity in the duty free industry, leads the Duty Free World Council (DFWC) in its tireless campaign against these illicit operations. Together with its partners around the globe including TFWA, ETRC, ASUTIL, FDFA, IAADFS, APTR and MEADFA, the DFWC has embarked on a mission to shield the industry's reputation from the tarnish of illegality.

DFWC President Sarah Branquinho is clear that we must declare our full support to the global fight against all forms of illegal and illicit trade and commit to assist the appropriate authorities in all relevant markets in their ongoing efforts against this heinous form of criminality

“Counterfeit products and illicit trade hurt us, hurt our businesses,” she stated at a workshop earlier this year. “We fight against poor working conditions and fight for CSR and a better working and social environment where the brands we sell manufacture and transport goods. Meanwhile illicit goods and stores selling them are labeled duty free. Criminals claim to work in the travel retail channel. Government and journalists outside our industry believe these tales, thus sullying our reputation. Consumers are hurt by this. We in our industry lose sales but also, and more important, we lose reputation. We are not a source of the problem but instead we are ready to help combat it. We need to publicly declare our stance against illicit trade.”

Qatar Duty Free Senior Vice President Thabet Musleh could not have been clearer about his position and about the industry’s need to take this threat seriously. “Everyone here is talking about margins and space and no one is discussing this important topic,” he said. “The importance of this matter is why we make sure we can trace every product through every step of its journey from production to our store. That’s why we can sell tobacco in arrivals. Everyone in this industry needs to be proactive and work together before it’s too late.”

QDF Senior Vice President Thabet Musleh is adamant that if we in our industry do not take control, including ensuring we trace every product every step of the way, we will all suffer in the long term

Lucio Rosetto, Chief Business Officer at Lagardère Travel Retail, echoed Musleh's sentiments, urging the industry to invest in traceability. He warned of the domino effect that illicit trade could trigger: “As soon as duty free is impacted, cost of travel goes up,” he stated.

Everyone suffers

The implications of illicit trade extend far beyond the direct stakeholders. When the duty free sector is compromised, it's not just the retailers that suffer — the entire travel economy feels the repercussions, potentially leading to increased costs and a diminished travel experience for all.

Our industry is not standing idly by. Leaders within duty free/travel retail are advocating for advanced tracking systems and stricter enforcement of regulations to ensure the integrity of their products and services. The industry's struggle against illicit trade is often unseen by the public eye, yet it remains a stark reality for those within it.

There is a growing consensus that a unified stance against illicit trade is imperative. From public declarations to tangible actions, the industry is rallying to establish standards and agreements akin to those agreed upon against child labor, this time focusing on the blight of illicit trade.

News abounds focusing on our industry's connection to illicit trade, and governments listen

Beyond the bottom line

The call to arms extends to ensuring corporate social responsibility and the creation of a working environment that is not just profitable but ethical and sustainable. The duty free and travel retail industry recognizes that its fight against illicit trade is not just about protecting sales, but also about its acceptance as a legitimate and valuable industry, its negotiating strength with governments, its legacy and trust with consumers and, indeed, its future.

Find DFWC's anti-illicit-trade declaration here.

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