Monday, August 27, 2012

Fake bottled water in Indonesia

The Indonesian Food and Drug Monitoring Agency (BPOM) has authority to conduct inspections into fake goods provided they are subject to regulatory control. They received complaints recently about fake OXXYWELL carbonated water in several cities in Java, Bali and Kalimantan. OXXYWELL is a brand owned by CV Tirta Bali Garden but the labeling bore the BPOM regulatory approval number from another of their products HYDRO 2, thus the packs were presumed to be fake.

BPOM then conducted inspections in several cities according to media reports. In theory BPOM can prosecute infringements of the health laws, such as falsifying the BPOM numbers on labels.

The case is illustrative of the classic problem in many of South East Asia's weaker legal systems. Few fake product cases tend to make it through the prosecution system in Indonesia. In this case BPOM will need to trace the source to prosecute the true actors behind the product. That can be difficult since retailers rarely disclose real sources for fear of reprisal. Instead they typically claim to have purchased from passing salesmen, leaving authorities with no way to investigate further. That leaves the investigating authorities in the difficult position of having to prosecute the retailers to send a message that true source information must be disclosed. But this is not high priority for low retail levels of stock. As a result retailers have little to fear and in future will not disclose sources. So the circle remains unbroken and distributor level purveyors of fake goods escape being caught.

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