Russia starts voluntary labelling of beer products

Russia has extended its wide-ranging track-and-trace scheme – Chestny ZNAK – to include beer and related products, although initially it will only be on a voluntary basis.

Eventually all beer producers wanting to sell into the Russian market will have to include Chestny ZNAK codes on their products that can be used to tack and trace products through the supply chain, and offer protection against counterfeit goods.

In the meantime, around 100 companies – small to large – have opted to participate in the voluntary, pilot phase of the programme that is due to end on August 31, 2022., according to the Center for Research in Perspective Technologies (CRPT), a public-private partnership tasked with managing the system.

So far they have ordered more than 5,000 free codes to use on products.

Russia's plan is eventually to make every single consumer good traded in the domestic market – including imported goods – digitally traceable at the unit level. Specific requirements vary by industry, but key elements include 2D datamatrix codes, serialisation and aggregation, crypto codes, and electronic reporting.

It wants goods to be trackable and verifiable as they make their way down the supply chain from the point of manufacture to the consumer, who can verify purchases using their smartphone.

First rolled out for medicines in 2019, the intention is to expand Chestny ZNAK to a broad range of products by 2024, and so far it also covers bicycles, dairy, footwear, fur products, perfumes, photography equipment, tires, tobacco and light industrial goods.

It is thought that somewhere between 5 and 12 per cent of beer in the Russian market is illegal, and the hope is that introducing the track-and-trace system will drive bad actors out of the market, secure the profits of legal producers and also increase tax revenues.

CRPT estimates that the labelling will increase the profit of beer producers by 2.5-3 billion roubles ($34m-$41m), will create up to 1,700 jobs and increase annual tax revenues by 20 billion roubles a year. It also says that it should not lead to increased prices to the consumer.