Tobacco Product Directive 2 (TPD2) Challenges for Manufacturing

Transcription

1 Tobacco Product Directive 2 (TPD2) Challenges for Manufacturing Article 15 Traceability Article 16 Security Features Brian W. Lee

2 - Japan Tobacco International In numbers 8 Global Flagship Brands: Winston, Mevius, Camel, Benson & Hedges, Silk Cut, Sobranie, Glamour and LD 26,000 employees worldwide 398 billion cigarettes or cigarette equivalents sold by JTI in billion cigarettes under track and trace regime in Factories, 220+ production lines equipped with track and trace 500+ warehouses scanning for tracking and tracing 2

3 Article Member States shall ensure that all unit packets of tobacco products are marked with a unique identifier. In order to ensure the integrity of the unique identifier, it shall be irremovably printed or affixed, indelible and not hidden or interrupted in any form, including through tax stamps or price marks, or by the opening of the unit packet. In the case of tobacco products that are manufactured outside of the Union, the obligations laid down in this Article apply only to those that are destined for, or placed on, the Union market. 2. The unique identifier shall allow the following to be determined (a) the date and place of manufacturing, (b) the manufacturing facility; (c) the machine used to manufacture the tobacco products; (d) the production shift or time of manufacture; (e) the product description; (f) the intended market of retail sale; (g) the intended route (meaning 1st destination ) (h) where applicable, the importer into the Union; (i) the actual shipment route from manufacturing to the first retail outlet, including all warehouses used as well as the shipment date, shipment destination, point of departure and consignee; (j) the identity of all purchasers from manufacturing to the first retail outlet; k) the invoice, order number and payment records of all purchasers from manufacturing to the first retail outlet.. 3. Member States shall ensure that the information mentioned in points (i), (j) and (k) of paragraph 2 is electronically accessible by means of a link to the unique identifier. 4. Member States shall ensure that all economic operators involved in the trade of tobacco products, from the manufacturer to the last economic operator before the first retail outlet, record the entry of all unit packets into their possession, as well as all intermediate movements and the final exit of the unit packets from their possession. This obligation may be complied with by the marking and recording of aggregated packaging such as cartons, mastercases or pallets, provided that the tracking and tracing of all unit packets remains possible 3

4 Track & Trace The Process Pack Outer/Bundle A single production line standard cigarette box Shipping Case Pallet Warehouse SAP sends customer data and picking information UI code printed on pack Code applied to end label of Outer Print and apply Master Case label Print and Apply Pallet Label Using L/U Track products are scanned to customer Customer Unique Identifier printed directly on pack Pack code is linked to another unique code printed on each outer FractureCode system links outers to master cases Data sent to a Factory server Production Information together with outers linked to shipping case sent to itrack Factory Server (MCG) Scanned data from the warehouses sent to itrack itrack Global Track & Trace database 4

5 Pack/Pouch Coding, Secure Unique Identifier A unique identifier generated by the serialization software is printed on the pack/pouch as a 12 digit alpha-numeric human readable code and, for machine readability, in a Dotcode format The code is created as close to the time of production as possible so it contains many of the elements that are required for TPD2, such as place of manufacture, the date and time, production line, etc. The Dotcode was selected as it is the only machine readable code which can be applied at ultra high speed that also allows for the additional human readable elements such as price The specification is available from the AIM 2 website; 2 Association of Identification and Mobility 5

6 Track & Trace Outer end label design GS1 GS1- Serialized Global Trade Identification Number (SGTIN) 2D matrix The 2D bar code contains the following information UPC Universal Product Code Serialization A unique number SKU Stock Keeping Unit These numbers are also printed in human readable format XXXXX UPC code Serialization Code SKU number JTI Date Code 6

7 Track & Trace Pallet Label GS1- Serialized Shipping Container Code (SSCC) 7

8 Industry perspective - Open Standards 8

9 Digital Coding and Tracking Association Formal Association, registered in Zurich Produce 75% of the world s tobacco products (ex China) Raise over US$150 billion in taxes annually Digital Tax Verification Track & Trace Product Authentication Drive for the adoption of standards (and approved solutions) to fight illicit trade in excisable products.

10 Open Standards What are open standards? Definition: Non-proprietary protocols or specifications governed by an organization open to all who wish to join, free from legal or technical clauses that limit its utilization by any party or in any business model Quote: EU Commissioner Erkki Liikanen: "Open standards are important to help create interoperable and affordable solutions for everybody. They also promote competition by setting up a technical playing field that is level to all market players. This means lower costs for enterprises and, ultimately, the consumer." (World Standards Day, 14 October 2003) It is important that all actors within a supply chain agree on the open standards to be used. The major Tobacco Manufacturers are advocating that GS1 should be the predominant standard for the tobacco industry as this is the most widely used in supply chains GS1 is an international not-for-profit association with Member Organizations in over 100 countries. 10

11 Data Communication standard GS1 EPCIS (Electronic Product Code Information Service ) 11

12 Article 16 -Security features 12

13 Security Pyramid This pyramid demonstrates the increasing level of security Level 4 - Scientific Instrument Restricted Awareness Level 3 - Sophisticated Tool Selected Awareness Level 2 - Simple Tool Controlled Awareness Level 1 - No Tool Common Awareness Forensic Covert Semi-Covert Overt 13

14 TPD2 Challenges for Manufacturing Article 16 Security Features 1. In addition to the unique identifier referred to in Article 15, Member States shall require that all unit packets of tobacco products, which are placed on the market, carry a tamper proof security feature, composed of visible and invisible elements. The security feature shall be irremovably printed or affixed, indelible and not hidden or interrupted in any form, including through tax stamps and price marks, or other elements imposed by legislation. Around 23 out of the 28 countries already use Tax stamps or banderoles it is quite like that they will keep these and upgrade them to the standards detailed in the Implementing acts Security Feature Visible element From our point of view a secure serialization like Codentify with the Dotcode where consumers can validate the product easily using smart phone and or sms technology Security Feature Invisible element We believe that the invisible element should be an integral part of the packaging using unique chemical taggants or finger printing technology 14

15 Selecting a security feature Important considerations Prior to selection, what is the main purpose of the security feature? Is it to protect the brand owner from infringement of their copyrights? The type of feature required is something which the brand owner can take to court to prove that the product is or is not counterfeit. Typically this would have a forensic attribute Is it to protect the consumer from buying something which he believes to be genuine? This is the most difficult category to cover, typically anything which is visible can be copied or mimicked. With digital connectivity, particularly with smart phones, more and more brand owners are using secure unique identifiers which can be used to validate a product Is it for the authorities to be able to quickly identify counterfeit product? Generally for this you would need a simple tool which can validate that the product is genuine Is it to deter counterfeiters? One of the ways of deterring counterfeiters is to have complex packaging which would need high capital investment By selecting the main purpose it will better determine the type of security feature required 15

16 Security features Comments regarding security features It must be noted that security labels/stamps placed onto packaging do not necessarily provide assurance that the content is authentic Security devices do not reduce counterfeits only potentially make them easier to detect Brand Owners are the only ones who can give evidential* proof of products being counterfeited Overt features; the more widely used the more attractive it is for the counterfeiter to defeat it, even the most complex can be mimicked Covert features should be for the brand owners to identify counterfeited product; a covert product should not be easily copied and details must be on a need-to-know basis only Seemingly randomized unique product identifiers (SUPI) can give a high level of security and are easily used to validate the products *evidential proof - Brand owner s expert providing evidence in court 16

17 Enterprising Open Challenging