Chestny ZNAK - Product verification

Your primary tool for monitoring product quality and detecting counterfeits.

Chestny ZNAK is a no-cost application that enables you to scan labels, QR codes, and Data Matrix codes. Simply scan the digital code on the product label, and the app will validate the manufacturer's marking type and provide an instant result.

You can authenticate your purchases, safeguard yourself against counterfeits, and access comprehensive information including:

- Manufacturer details

- Production date, time, and location

- Expiration date

- Goods logistics from factory to store and more.

By scanning marked products, you'll ascertain if they are authentic or counterfeit.

If any irregularity is detected during verification, you have the option to report it. Depending on the violation type, complaints will be sent to relevant regulatory bodies and oversight services. They will assess the reports and take action against dishonest manufacturers.

The scanner verifies authenticity of marking codes for various products such as tobacco, shoes, medicines, fur coats, consumer goods, cameras, flashlights, perfumes, and tires. In 2020, the app will also cover milk products, bicycles, and wheelchairs for authentication.

For feedback or inquiries regarding the app, please contact support@crpt.ru.

How does this work

1#

The manufacturer applies a digital code to the product

2#

The entire path of the goods is recorded at each stage

3#

The store scans the product code and places it on the shelf.

4#

The product was sold at the checkout — in the system, the “code is no longer in circulation”

5#

The whole truth about the product in the mobile application

The Honest Sign application will help you check the legality and find out the whole truth about the product in order to buy only verified products

Features of the Honest Sign system

The main principle of the Honest Sign system follows from its name. It is honesty towards consumers, transparency of all processes (from production and logistics to sales tracking).

The system has several advantages:

    Combining two components - a digital labeling solution and a public control tool;

    Work with all goods, not individual groups. The list of goods subject to labeling since 2019 already includes: tobacco products, fur products, medicines, clothing and footwear, bed linen, cameras, perfumes and tires. In the future, the system will extend to most goods from milk to bicycles.

    Availability of online cash registers that synchronize data from the labeling system, preventing illegal goods from being sold.

    Consumer assistance. Anyone who has the Honest Sign app installed on their smartphone will be able to check the legality of the product.

    Easy to use. Simply scan the Data Matrix digital code in the app and the results will be available instantly.

    Reliability. Thanks to cryptographic technologies, the Data Matrix code is extremely difficult to counterfeit, and information about counterfeit goods will be stored in the system.

Public control will help the Russian market become transparent. You can get acquainted with the Honest Sign system, download the application for your smartphone and ask a question on the official website, honestznak.rf.

The official website of Honest Sign gives business owners a complete understanding of the modern labeling system.

Digital product labeling system Honest sign

Honest sign is a national system of product labeling and tracking. A special digital code guarantees the authenticity and quality of the product. The main objective of the system is to increase the level of safety of Russians, combat counterfeit and low-quality analogues.

Why is it important to label a product?

According to the Ministry of Industry and Trade, over 6 million units of counterfeit products have been identified on the Russian market since the beginning of 2018, which is a serious problem both for consumers themselves, who receive goods of dubious quality for their money, and for the owners of the products. This negatively affects the reputation of the latter and entails financial losses.

Applying digital marking allows you to obtain all the information about the product: the name of the manufacturer, place, date and time of production or sale, expiration date, article, standard number. The data is stored in the state information system. Marking reduces the spread of all types of illegal products: counterfeit, falsified, contraband, etc.

Fines 2022 - liability for lack of labeling of goods

Until 2020, while the marking was a test, manufacturers did not pay a fine for the absence of a DataMatrix code on packages. Today, for ignoring the need for marking, the manufacturer faces administrative liability, and in some cases even criminal liability.

According to Article 15.12 of the Code of Administrative Offenses, the sale, transportation and production of tobacco products, medicines and footwear without marking entails a fine of 5 to 10 thousand rubles for an entrepreneur. For a company, these amounts will be higher - from 50 to 300 thousand. In addition, all unmarked products will be confiscated.

Administrative liability may develop into criminal liability if the cost of footwear, tobacco products and medicines without labeling exceeds 1.5 million rubles. According to Article 171.1, Part 1 of the Criminal Code, the guilty party faces imprisonment for up to 3 years with a fine of 80 thousand rubles.

The official website of Honest Sign gives business owners a complete understanding of modern labeling and the responsibility for non-compliance.

FAQ

Why do we need the Honest SIGN marking system?

The future is digital technologies, data fusion systems that will be used to track and diagnose problems in healthcare, agriculture, light industry and the environment, as well as to perform everyday tasks. Technologies that operate on the basis of data analysis will be able to empower people and improve human well-being.

The problem of illegal products remains extremely acute for Russia: the share of illegal turnover in the light industry reaches 35%, in the perfume market 20%, in the pharmaceutical market up to 10%.

This year, mandatory labeling will affect six categories of goods: medicines, footwear, photographic goods, tires and covers, perfumes and tobacco. Labeling is designed to protect buyers from counterfeit products and help increase tax payments, since it will oust unscrupulous taxpayers from the market.

In December 2017, Russian President Vladimir Putin approved the government's decision to create a national system of digital labeling of goods by 2024 on the basis of the Center for the Development of Advanced Technologies (CRPT).

Digital labeling will allow businesses to increase productivity, improve logistics schemes, increase market share and ultimately increase revenue:

    1. By reducing the share of contraband and counterfeit goods, legal producers will increase the share and volume of production by 5-50% depending on the product group.

    2. Business will be able to transfer production to Industry 4.0, to work on the Just-in-Time principle. Receiving online data on product movement, it will optimally plan production, reduce stocks and increase product turnover.

    3. Connection to the electronic document management operator (if you have not worked with EDI before).

    4. Business will be able to save significantly on logistics: when implementing full tracking, the manufacturer or logistics company will receive up-to-date statistical data on the geography, intensity, and seasonality of sales, which will allow them to restructure logistics schemes and optimize deliveries and warehouse stocks.

    5. Business will improve accounting. Currently, many entrepreneurs do not have their own data on the balances and codes of goods in warehouses and stores. Without proper accounting, it is impossible to calculate profits or plan purchases, so automation will help entrepreneurs to put their business in order in the future.

    6. Business will switch to electronic document management. EDI radically reduces the volume of paper documents that Russian companies still actively exchange with each other, will reduce business costs and increase labor productivity.

Who needs the Honest SIGN marking system?

The introduction of a national product labeling system is beneficial to consumers, businesses and the state:

The consumer can be sure of the legality of the purchased products, their safety for life and health. Through the application, any citizen will be able to report any illegal products found, and this information will be transferred to the appropriate control body.

Legal manufacturers and importers, participating in  the national product labeling system , receive revenue growth and increased competitiveness, thanks to a decrease in the share of counterfeit and contraband on the market. Business will be able to track the movement of products and save on logistics, optimizing supplies and warehouse stocks based on up-to-date statistical material on seasonality, intensity and geography of sales. As a result, costs will be reduced and labor productivity will increase.

At the state level, product labeling will reduce the “shadow” market, increase tax payments and customs duties, and reduce the costs of organizing control over product markets.

How does Honest SIGN work and what does the marking process consist of?

The process consists of the following stages:

    1. A participant in the turnover of goods is registered in the State Commodity Monitoring System (GIS MT).

    2. The manufacturer or importer orders a digital code in the GIS MT and applies a unique code to the product.

    3. The digital code - the marking code - records the entire logistics chain along which the marking item moves - from the plant to the consumer, from the introduction into circulation to the withdrawal of the goods from circulation.

    4. The code is scanned at the checkout during the sale. Information about the withdrawal of products from circulation is transmitted to the system.

    5. Using a mobile application for digital product labeling , the consumer can check its legality.

Launch of mandatory product labeling:

    July 1, 2020

 — All medicines , Tobacco products , Footwear (a ban on unmarked products comes into effect)

    October 1, 2020

 — Perfumes and eau de toilette

    October 1, 2020

 — Cameras and flash lamps (a ban on unmarked products comes into force)

    November 1, 2020

 — Tires and covers

    January 1, 2021

 - some goods of the Light Industry (a ban on unmarked products comes into force)

The following are currently in the labeling experiment: Wheelchairs , Bicycles , Dairy products , Drinking water

By 2024, virtually all consumer goods sold, manufactured, and imported must be labeled. Therefore, every business owner should prepare for the implementation of the system today and apply for registration in it.

What should I do if I find a fake?

The application will provide the ability to report detected counterfeit goods. Depending on the type of violation, the information will be transferred to the relevant regulatory authorities, who in turn will analyze the results and conduct inspections of unscrupulous manufacturers.

Thousands of mobile checks will be carried out every minute across Russia, and thanks to public control, the market will become truly transparent.

Who applies the digital code to the product?

The Center for the Development of Advanced Technologies creates a unique digital code Data Matrix and sends it to bona fide manufacturers and importers. They apply the code to each package of their goods. The digital code can be used to track the entire path of the goods - from the conveyor to the online cash register, which removes them from circulation. The system records the transfer of goods from owner to owner at each stage of the logistics chain, which makes it impossible to introduce counterfeit goods.

Why can't the code be forged?

A digital code, unlike a regular paper stamp, is difficult to counterfeit. Product data cannot be deleted from the system or adjusted thanks to domestic crypto technologies. The marking code is divided into two parts: an identification code that determines the position of the product in the system and the unified product catalog, and a verification code or crypto-tail that is generated by the CRPT.

When a product is withdrawn from circulation, its legality is confirmed at the online cash register using a fiscal storage device. It synchronizes the data of the labeling system and the unified catalog and does not allow the seller to sell counterfeit goods.

The series of unique codes cannot be predicted, and the digital code itself is not repeated within 5 years from the date of issue of the product item.

Who is responsible for the operation of the product labeling and traceability system?

Global experience shows that to launch labeling projects, states most often involve a private operator. In China, this is Alihealth, a company owned by Alibaba, in Brazil, the Swiss company SICPA. Such an operator, investing its own funds, does not create an additional burden on the state budget. In Russia, the Unified System of Labeling and Traceability of Goods operates in the format of a public-private partnership. The Center for the Development of Advanced Technologies is a private and single operator of the system.

What products are already labeled by CRPT?

In March 2019, a project for mandatory labeling of tobacco was launched, and in July 2019, a project for labeling footwear was launched. Since January 1, 2020, projects have been launched for labeling perfumes and eau de toilette, certain types of clothing, bed linen, table linen, toilet and kitchen linen, cameras and flash lamps, tires and pneumatic tires. Product groups continue to be actively added, of which beer and low-alcohol products can be singled out.

Launch of mandatory product labeling:

    August 12, 2016

 —  Fur coats

    July 1, 2020

 — All medicines , Tobacco products , Footwear (a ban on unmarked products comes into effect)

    October 1, 2020

 — Perfumes and eau de toilette

    October 1, 2020

 — Cameras and flash lamps (a ban on unmarked products comes into force)

    November 1, 2020

 — Tires and covers

    January 1, 2021

 - some goods of the Light Industry (a ban on unmarked products comes into force)

    June 1, 2021

 —  Dairy products , for cheeses and ice cream, from September 1, 2021 for dairy products with a shelf life of more than 40 days. And from December 1, 2021 for a shelf life of 40 days or less

    December 1, 2021

 —  Packaged mineral water , and from March 1, 2022 for other categories of drinking water

    April 1, 2023

 —  Beer and low-alcohol products packaged in kegs, from October 1, 2023 — in glass and polymer packaging. And from January 15, 2024 — in other types of packaging

The center starts labeling new groups of goods in a short time, thanks to the scalability of the Honest SIGN system. For a comfortable transition to labeling, the company is working out all solutions and technologies with businesses during pilot projects.

Will prices rise due to labeling?

After the introduction of labeling, the cost of goods from legal manufacturers will decrease over time.

The consumer will not bear the costs of purchasing equipment for labeling, they will be borne by the business. At the same time, the economic effect of labeling will cover these costs. Thanks to the system, the manufacturer will clearly know how much goods it sells and how the logistics chains work. This will optimize business processes and reduce costs.

In the most conservative scenario, after the introduction of labeling, prices for goods may decrease by 10% due to a decrease in the share of counterfeit goods on the market and other positive effects.

Is the labeling system effective?

For a number of product categories, labeling has shown the effect of whitening the market.

For example, before the labeling appeared, Discovery Research Group estimated the volume of the Russian shoe market at 329 million pairs. The labeling system showed that the figures were significantly underestimated. Thus, now the Honest Sign system has issued more than 2 billion codes for labeling shoes and growth continues.

Labeling of tobacco over the past period has made it possible to identify 30% more tobacco manufacturers on the market. In late 2018 - early 2019, these factories began to transfer information on the maximum retail price (MRP) to the Federal Tax Service. Companies that were registered several years ago, but did not submit information on the MRP, also resumed submitting data to the Federal Tax Service. This suggests that they were most likely producing products without excise taxes, which became impossible due to the appearance of labeling.

The labeling experiment led to a decrease in counterfeit goods in the category where it is literally life-threatening. According to Roszdravnadzor, the turnover of substandard drugs has decreased by 2.5 times during this time. According to BIOCAD calculations, the illegal market for expensive oncology drugs has decreased by 10 times. At the same time, in 2018, 568 new drug names priced at up to 20 rubles appeared on the market, and the price of 440 such drugs decreased even more, according to DSM Group data. This may be due to the fact that drugs cheaper than 20 rubles are labeled due to the CRPT.

In the light industry, the share of illegal turnover has decreased from 31% to 18% over three years, the Ministry of Industry and Trade reported. This means that about 375 billion rubles in sales of textiles, clothing, etc. have come out of the shadows. Taking into account the entire size of the Russian clothing, footwear and accessories market (2.3 trillion rubles, according to Fashion Consulting Group estimates), more than 400 billion rubles remain in the gray zone.

The experience of other countries also demonstrates the positive effects of the introduction of labeling. For example, in Brazil, tax collection increased by 20% in the beer and soft drinks segment and by 40% in the tobacco segment in the first two years. In Turkey, illegal cigarette sales decreased by 11% in the first three years. In the EU, a digital traceability system reduced the turnover of contraband products by 30% in 5 years. Most of this revenue went to legal producers.

What do the statuses mean when scanning the marking code (DataMatrix) applied to the product?

    "Product checked"

This status means that the code has the status "In circulation". The marking code is OK, the product can be sold.

    "Questionable product", "Medicine prohibited for sale"

These statuses mean that the marking code is NOT OK. The product is not in circulation.

    "Code not found"

This status means that the scanned marking code is incorrect or the code is missing from the system.

    "The product was produced before mandatory labeling began"

This status is displayed if the product was released during the experiment period.

    "Item sold", "Item sold on August 1, 2021"

This status is displayed if the product has been sold.

    "The product has expired"

This status is displayed if the product has expired.

    "Medicine not for sale", "Medicine dispensed by prescription on August 1, 2021"

These statuses are specific Pharma statuses and are associated with drugs that are dispensed/issued on prescription in pharmacies/medical institutions.