WikiLeaks busts major fake wine racket in Asia

Okay you guessed it right, nothing as dramatic has happened (as yet)…the headline is just a figment of my imagination, in fact a blatant attention-grabbing stunt! But just imagine waking up one fine morning to a similar breaking news :-). Would you be surprised? Read on…

Although this is an apolitical blog dedicated to wine (and only wine), I could not think of any other appropriate title to discuss the growing menace of fakery in the wine world. This, admittedly tongue-in-cheek approach with an intended pun, is also keeping in line with the latest buzz surrounding WikiLeaks, the online whistle-blower and the current undisputed star in investigative journalism.

Fraudulent practices in the wine industry is not a new phenomenon. In fact they are going on for centuries in some form or the other but thanks to the ever-vigilant media (aided by a collection of hyper-viral social media), these incidents have become increasingly overt in present times.There have been numerous revelations in the recent past including the infamous Red Bycyclette incident, the unearthing of a major Italian fake wine syndicate and the high-profile case involving the American billionaire William Koch and the auction house Christie’s, to name a few.

With the rapid globalization of wine and the corresponding popularity of the beverage in new and emerging markets, the risks involving possible malpractices have also increased significantly. The interesting point to consider is that fakery in the industry is not only limited to fine wines anymore and that is what makes this issue more complex and widespread. But nowhere the menace of new-age counterfeit wines is more striking than in China. According to one report quoting a Chinese government agency survey a few years back, more than 70% of imported wine sold in restaurants and hotels in the country’s major cities is fake. It also claims that the process may simply involve filling up bottles with cheap local wines and labeling them as though they are imported! More recently, this trend has also been substantiated by a slew of exposés across the world wine media. There are too many to list in this post – here is one, for example.

Now this brings us to the crux of the matter; what if this burgeoning wine market becomes a real victim of the multi-billion dollar organized Chinese fake goods industry? One does not need a great deal of imagination to understand the possible repercussions. According to Vinexpo, the country will become the seventh largest wine consumer by 2013, a staggering  32% increase compared to 2009. This equates to roughly 1.25 billion bottles. As the demand for imported wines keep on growing, a large chunk of this number will undoubtedly be the well-known names from conventional markets as well as the New World countries. If the present scale of counterfeiting goes unchecked it will surely prove to be a huge setback for the industry as it looks east in its quest to explore alternatives to the more or less stagnant western markets. Instead of being the driving force, as it has come to be known as, the Chinese may end up setting a bad precedent for other emerging wine economies too in addition to causing a big dent in the overall market sentiments.

Here’s a quick snapshot of everything discussed above (see the image on the left). Mind you there is nothing clandestine about this example which raises the question that if such (funny?) counterfeiting is taking place in the open, what might be transpiring ‘behind the scenes’?

Note the brand name: ‘Bordux Carstel‘ which sounds like a corruption of ‘Bordeaux Castle’ (Castle happens to be the english translation of Chateau!). A quick search of this name on Google only brings up Chinese results…..surprised?

The image of the Chateau itself resembles one of the Classed Growths.

Note the grape variety: ‘Syrah’. In Bordeaux? Unless the AOC rules have made special provision keeping in mind the Chinese market!

Note the appellation: ‘Grand Vin de Bordeaux’. Very prominent.

Note the real appellation at the bottom: A VDP from Southern France. In small fonts.

Apart from such apparent labeling manipulations, a recent trend of using translated names of well-known brands has also come in light. The phonetic translation for Lafite becomes ‘Luxurious’, for example! An ingenious approach indeed, to add extra value to an already iconic name.

China, with Hong Kong as its flag-bearer, provides an enormous opportunity to the world wine business and will continue to be a lucrative destination in the future, although the country’s notoriety in faking everything commercially popular may prove to be its biggest stumbling block in the long run. A collective effort involving consumer awareness and education may ultimately prove to be the most potent weapon to fight this menace. Needless to say, there are also lessons to be learnt for other up-and-coming markets like India.

Cheers

Niladri

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