By Zoe Naylor
Counterfeit products are being widely used in the GCC construction industry. As Construction Week launches a campaign to ‘crush the counterfeiters’, Zoe Naylor charts the growth of a worrying trend.
new CW campaign looks to lift the lid on the growth of unregulated products entering the building market|~|96counter200.gif|~|From Damascus to Dubai: Fake products are on the construction market.|~|Counterfeit products are an increasing problem within the Gulf construction industry. Fake tools and machine parts, along with cheap copies of branded materials and design software, are a growing concern within the market.
“There are cases of branded building materials where the original has been changed,” says Siddarth Balachandran, MD of Dubai-based Bumga Builders. One example he cites is Korindo, a group which manufactures plywood from Indonesia. “We have seen people importing this brand under the name ‘Corindo’ — it is deliberately misspelt and the products are hugely discounted in price.”
Balachandran says in the trade metal, the issue is more of low quality products instead of counterfeit goods: “Since there is a lack of registered brands for us to compare against, there is less of an impact.” But he says low-quality metals still pose a threat to the construction industry.
“You get different quality products from different places and at different prices. Indian aluminium, for example, is supposed to be good quality. But there are cases of local producers or people from the Far East who try to supply aluminium with impurities, which in turn compromises the long-term performance of the metal.
“Counterfeit products used to be more of a issue for us in the past, now there are certificates of origin for all imports. But the enterprising people can always find a loophole,” he adds.
Software piracy is also affecting the region’s construction industry, according to a software design company. Manish Bhardwaj, a consultant at Dubai-based Autodesk, estimates approximately 50 to 60% of contracting companies in Dubai are thought to be using pirated software.
Purchasers of counterfeit or copied software face a number of risks including viruses, corrupt disks and defective software, as well as a lack of technical product support.
“We spend hundreds of millions of dollars on research and development every year, and to see open violation of our intellectual property is a really grave concern,” he says.
The hand-held tools market is another potential area for counterfeit products, according to Harry Wright, MD, Eurolink Safety in Dubai.
“There are many counterfeits around — one example is tools such as spanners,” he says. “You do find copies of these here, especially with German-made and branded tools. Many of these copies come from the Asian countries.”
Fake tools pose a major safety hazard: “If someone is working with a tool and it breaks, there may be hand and head injuries,” says Wright. “Hand-held drills or grinding machines in particular pose real safety issues — if the disc itself breaks it can cause severe physical harm.”
Site safety equipment has also fallen foul of Dubai’s counterfeiters. Paul Grundy, MD of S&B Fencing, says his company’s fencing systems are often copied using inferior workmanship and cheap materials. “Even though we’ve registered our designs and have a GCC patent, people still copy our products.”
S&B Fencing is currently taking legal action against a contractor on a site in Mirdif, Dubai, over the perimeter hoardings being used. According to Grundy, the contractor has copied S&B Fencing’s designs by using thinner and cheaper products and lower grade materials — which poses a serious safety risk.
“The way they’ve erected the steel hoardings and barricades on the Mirdif site is really dangerous because they’ve not been put up properly,” explains Grundy.
“Once a big wind blows it’ll blow them over because there aren’t enough blocks on it. Also, the sheet they’ve used is so thin that in a strong wind it could easily blow out and take someone’s head off.”
While S&B carries out safety tests on its products, the rip-off merchants have no such interest: “All our products are tested in wind tunnels and we have calculations for wind loading that are a big issue when you’re dealing with a 3 m-high steel fence. If it blows over and falls onto someone, it will kill them,” says Grundy.
The frenetic pace of construction activity in the Gulf means the region’s plant market is booming, which offers ripe pickings for fraudsters manufacturing fake machine components. “Counterfeiting is definitely a problem when it comes to parts such as filters,” says Pete Walters, industry manager at Caterpillar in Dubai.
He says some competitors or counterfeiters will put fake parts in a Caterpillar-marked box and try to hoodwink customers. “But some customers will go out and buy them with full knowledge simply because they’re cheaper. If it’s 50% cheaper, most people are going to realise it’s not a genuine product.”
Chad Slee, parts and service sales manager at Caterpillar,
says half the problem is trying to track down where the fake parts have come from: “Some products come from China, some from Pakistan. But it’s usually products that are easy to copy, for example oil and air filters — anything that can be masked on the inside. The outer shell is then painted so it looks the same as a Caterpillar part.”
According to UK-based bearing manufacturer, INA FAG, counterfeit bearings are being made in the Middle East and Asia and exported into the UK marketplace.
“Rolling bearings are safety-critical products,” says Kate Hartigan, MD at INA FAG. “Cheap counterfeits are often made of inferior materials instead of high-grade steel and lubricants.
“When it comes to precision and service life, cheap bearings often fail shortly after the running-in stage. At best, the user does not enjoy the anticipated bearing performance; however the consequences can be much worse, including total machine failure and safety risks,” she adds.
Even the Middle East’s air conditioning industry is facing rip-off products. Korean-based LG Electronics is calling for a ban on imports of counterfeit air conditioning units after fake LG products started to appear in Iraq and the UAE. “We are stepping up efforts to track down importers, distributors, and manufacturers of counterfeit products,” said K H Kim, president, LG Electronics Middle East and Africa Operations.
The counterfeit LG units being distributed illegally in the region feature a crudely manufactured sticker of the LG logo on its packaging. Many of the fake products also bear stickers listing two different countries of origin (both Korea and China) and differing ranges of operational capacity.
The fakes can be identified by closer inspection of the packaging and the logo on the units. According to a company spokesperson, most of the fake units in circulation do not have the LCD temperature displays which feature on the LG units.
In an industry where quality and safety are often overlooked in favour of speed and cost, counterfeit building materials and products are continuing to make their presence felt within the region.
Quality assurance does exist in the form of the Kitemark, for example, but a growing number of contractors seem to be eschewing these safety standards in order to cut corners.
“It’s an issue which has been identified because of the implications for the construction industry,” says John Glackin, business client manager at the British Standards Institution (BSI) in Dubai.
“The BSI works very closely with industry to provide a professional service, but there are still products which go into the market that may cause long-term problems to the end-user,” he adds.
With the pace of construction across the GCC, the policing of counterfeit goods is becoming harder, posing greater risks to the end-user.||**||