Industry alliances warn of the true cost of illicit alcohol

A 2023 report from the Transnational Alliance to Combat Illicit Trade (Tracit) revealed a staggering figure in the Philippines’ struggle with illicit alcohol: 31% of the country’s alcohol consumption was unrecorded, representing up to PHP 40 billion in lost annual tax revenue.

This amounts to a missed opportunity to build over 36,000 new public school classrooms, lay more than 1,300 kilometers of roads, or establish eight new public hospitals. Breaking down the loss further, PHP 1.6 billion is attributed to smuggling, while counterfeit alcohol drains PHP 22.5 billion from government coffers.

In 2024, the National Committee on Intellectual Property Rights (NCIPR) seized a new record value of counterfeit goods, including alcohol, worth PHP 41 billion, compared to PHP 26 billion in 2023. The growth in seized contraband underscores the pressing issue of counterfeit alcohol and its detrimental impact on the economy, legitimate businesses, and public safety.

A threat to the economy and society

Beyond lost tax revenue, the rise in illicit alcohol sales negatively impacts legitimate, tax-paying businesses, tarnishing the reputation of authentic brands and reducing their market share. Alcohol manufacturers are advocating for a "whole-of-society" approach to combat this problem.

“Addressing the spread of smuggled and counterfeit goods requires collaboration across the public and private sectors, as well as active participation from consumers. It’s a collective responsibility to protect legitimate businesses, safeguard tax revenues, and prevent counterfeit products from infiltrating the market,” said Nick Sonderup, Chair of The Alcoholic Beverages Alliance of the Philippines (ABAPI).

Illicit alcohol sales also divert resources to organized crime. David Francis, Managing Director of the Alliance Against Counterfeit Spirits (AACS), emphasizes that counterfeiting and smuggling are more than economic infractions.

“Counterfeiting and smuggling are crimes themselves and they can finance even more serious criminal activity. The new year marks a fresh start to address illegal activities that undermine the rule of law. When people buy counterfeit alcohol, they may be inadvertently supporting a network of criminal operations,” said Francis.

In addition to economic losses, the consumption of counterfeit alcohol poses severe health risks such as methanol poisoning. Unregulated and potentially hazardous, counterfeit alcoholic beverages impersonate well-known brand names, fuelling consumer confusion.

Choose authentic this 2025

Counterfeit goods remain a persistent threat, impacting consumers and businesses all-year round. The Intellectual Property Office of the Philippines (IPOPHL) is urging consumers to exercise caution and vigilance when making purchases.

“Be wary and cautious when buying products, not just online but also in physical markets. If a deal sounds too good to be true, it likely is. Counterfeit goods, including alcohol, are often marketed at a discount that seems hard to resist. If these ‘bargains’ put your health and life at risk, what you’re really getting is a gamble with a bigger price to pay,” said IPOPHL Director General Brigitte da Costa-Villaluz.

“We encourage consumers to be discerning and to only purchase from reputable retailers,” said Atty. Christine V. Pangilinan-Canlapan, Assistant Director of the Intellectual Property Office of the Philippines’ Bureau of Legal Affairs and Supervising Director of the IP Rights Enforcement Office (IEO). “It is best to purchase these products from legitimate stores to ensure that you are getting genuine items and to avoid the risks associated with counterfeit goods,” she added.

To address these challenges, industry organizations call on the government, businesses, and consumers to contribute to a unified response. ABAPI, AACS, and the Asia Pacific International Spirits & Wines Association (APISWA) have launched an awareness campaign to combat the spread of counterfeit and smuggled goods.

The  "Drink Authentic, Enjoy Responsibly” campaign aims to inform the public about the dangers and economic implications of illicit alcohol and underscores that drinking responsibly starts with buying authentically.

“Consumers can make safer choices by following a few simple steps,” Francis added. “This includes purchasing only from reputable sellers, carefully comparing prices with local supermarkets, diligently inspecting the product and packaging, and only paying through recognized payment channels.”

This initiative also raises awareness of counterfeit products as a scam, targeting unsuspecting buyers who believe they are purchasing legitimate products. Through the campaign, industry alliances seek to reinforce the message that buying counterfeit alcohol not only contributes to crime but also jeopardizes the safety and security of families and communities.

Consumers can learn more about the campaign through its social media pages on Facebook, Instagram, and TikTok.

Detailed guidelines on avoiding and reporting counterfeit alcohol are also available at https://aacs-global.com/how-to-stay-safe.