#Team
TRACK & TRACE
I
n addition to her main work tasks, Yuliya Volkova coordinates Imperial Tobacco’s work
group in the industrial experiment on mandatory marking of tobacco products. Please,
find more information about the project in the July edition of The Империалист.
In the course of the experiment, a machine-readable code will be applied onto
each block of cigarettes: it will contain encoded information on the product, its
manufacture and movement along the market chain. The objective of the marking
is to confirm the authenticity of products: buyers will be able to scan the barcode
and get full information about the date, time and place of manufacture of a package
using a mobile app. The experiment will also help us optimize the internal product
management processes.
Georgy Soustin, Director of Corporate & Legal Affairs:
“Now, development and testing of track &trace mechanisms for
tobacco products is underway as part of an experiment being
conducted by the government of the Russian Federation. Despite
the deadlines have already been established for the introduction
of mandatory track & trace requirements, there is no regulatory
framework that prescribes the technical requirements. Along with the
logistics department, we are participating in an experiment to minimize the potential
risks to our business from the mandatory track & trace system. We are working
towards an agreement with the Center for the Development of Promising Technologies
(the operator of the experiment) and the government of the Russian Federation on a
phased plan for the introduction of track & trace system that will allow us to prepare
for the new requirements of the regulator.”
The most important for us at this stage is to launch and test the
product marking and tracking process, from code printing on a pack
to communication of all information into the information system for
tobacco products tracking and tracing (IS TPTT) through electronic
document flow (EDF).
Yuliya Volkova: “Organizing the manufacturers turned out to be the simplest task. We
entered the experiment in June, and our first pilot batch of marked products will be
manufactured already in October. Yet, the hardest thing is to prepare the commodity
distribution chain: installation of necessary equipment enabling accounting of marked
products and connection to the electronic document flow system. We planned that
by October there would be a sufficient number of retail chains participating in the
experiment and that it would be possible to increase the product turnover in terms of
volume. But in reality, the process is being delayed.”
The liability of Imperial Tobacco as a manufacturer and wholesale supplier terminates
after application of the code on a pack and sale of the marked goods to a distributor,
which is recorded in the electronic document flow. As for wholesale distributors,
everything is much more complicated: they have a large number of clients who must
work through EDF, while they never had it before. The need to track the marked
goods by exchanging sales data from IS TPTT requires large-scale modification in the
operation processes of all market participants, and these results in additional capital
and temporary investments.
Vladimir Zarudnev, Coordinator of the Work Group on the side of our manufacturer –
Imperial Tobacco Factory in Volgograd: “The factory is preparing for the launch
of 200 pilot boxes with the new marking that is scheduled for October. One of the
production lines was fitted with additional equipment to aggregate codes and marking.
The introduction of the mandatory marking for all manufactured tobacco products will
require substantial investments for re-equipment of the entire production.”
Manufacturers of tobacco products are the best-organized component in the marking-
related experiment: the project operator can influence them very easily and they
are the main responsible parties. For the period of the experiment, the operator of
the information system of the marking project provides the manufacturers with the
equipment for generating and printing codes on a pack free of charge. However, after
completion of the experiment period, the production lines will be reequipped at the
expense of the manufacturers.
In Russia the experiment will continue until December 31, 2018. Of course, it is too
early to speak about its results, but already before its completion the President of the
Russian Federation approved the amendments to the law on protection of citizens’
health against second hand tobacco smoke. According to those amendments, each pack
of tobacco products must be marked with means of identification since March 1, 2019.
Lyubomir Panov, Regulatory and government affairs specialist:
“The mandatory labeling system will not be unique to the tobacco
market. New track & trace experiments are already being
launched in the footwear, perfume, automobile tire and clothing
industries. The government is trying to create a unified digital
tracking system that will track the movement of every product in
legal circulation. The difficulty of our position lies in the fact that we are the first
product category on the list.”
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