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December, 2017

Chengdu authorities seize RMB 20 million in counterfeit candy

Original article: Sina (Chinese)

Chengdu authorities have broken up a major candy counterfeiting ring, confiscating over one million bags containing 10 tons of fake candy and arresting 27 suspects. The counterfeiting operation is valued at RMB 20 million, authorities say. 


The candy counterfeiting ring was in operation since 2011, according to Chengdu police. The counterfeiters had a widespread distribution network and sales channels spanning Sichuan, Xinjiang, Gansu, Shaanxi, Hubei and Jiangsu provinces. 

Analysis:

The China confectionary market is large and steadily growing, offering plenty of opportunity for counterfeiters. The chocolate market alone has increased 2% to 124,838 tons and RMB 20.2 billion ($3.08 billion) in 2017, according to research firm Euromonitor. Euromonitor expects the chocolate market will reach 149,715 tons and RMB 26.1 billion by 2022.  


The Sina report does not mention which marks were infringed - only stating that the gang had violated the intellectual property of "well-known" brands. One of the most counterfeited global candy brands in China is Mars, maker of Dove, M&M and Snickers. Mars has long been the leader in the Chinese confectionary market, currently holding a 36.7% share, according to Euromonitor. 


Candy counterfeiting in China is linked to the burgeoning wedding industry: Premium chocolates are often part of Chinese wedding ceremonies. China's wedding industry earned $23 billion in 2015, according to Daxue Consulting. Between 2010 and 2015, the wedding sector's revenue expanded at a 5.3% annual rate, a research report published in 2016 by ACMR-IBS World found. 


Earlier in the year, Confectionary News reported that Chinese authorities seized 300,000 counterfeit chocolate pieces during the 2017 Lunar New Year period valued at RMB 700 per box. Marks infringed included Ferrero and Mars' Dove. Police acted following complaints from local consumers to a wedding candy store owner about substandard products. Many Chinese people choose the Lunar New Year period to hold wedding ceremonies. 

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