Cameroonian president, Paul Biya, in his recent preparations for the 2024 State Budget, has issued instructions for the effective implementation of a beer-marking system in Cameroon to combat fraud.
This reform, which had been proposed several years ago but faced resistance from brewing companies, is now set to become a reality.
In 2019, these companies even appealed to the government to abandon the reform, citing several concerns.
Sources familiar with the matter revealed that the marking system will initially focus on beers but will eventually extend to include cigarettes and other medicines, as these are among the most susceptible to smuggling.
Similar to the wine and spirits industry since June 1, 2012, this system involves affixing an identification sticker to the products.
The government stated that the primary objective of this reform is to bolster tax revenues by ensuring traceability and production control for products most vulnerable to illicit trade.
Simultaneously, this marking will provide manufacturers with solutions to protect and authenticate their production, creating a win-win situation.
“Cameroonian brewery companies have already committed to food safety quality standards, necessitating the acquisition of an advanced traceability system in recent years,” an executive from one of the brewery companies stated.
Introducing a tax marking system, managed by a government-contracted service provider, implied that brewers would need to abandon their existing marking and traceability system, involving significant financial investments.
Furthermore, implementing the system will require modifying production lines to align with the supplier’s equipment specifications, incurring costs during installation, testing phases, and staff training.
These additional expenses could lead to further increases in beer prices in Cameroon, causing concern among consumers.
Meanwhile, the Cameroonian government has reportedly enlisted the Swiss company Sicpa, known for its involvement in similar contracts in Kenya and Morocco.
Brewers, backed by certain media outlets, also expressed their reservations about Sicpa’s track record in these African nations.
In Morocco, Sicpa faced criticism from brewers, cigarette manufacturers, and soft drink producers for its pricing.
In 2014, before renewing its 2010 contract, Sicpa was supplying cigarette stickers at a cost 15 times higher than what it offered in Canada and Turkey.
Moreover, Moroccan tax authorities imposed hefty annual fees on producers operating in sectors subject to the marking system.
A tax expert suggested that these operational challenges could be overcome with collective effort.
He argued that brewing companies should also consider that the marking system protects their market by combating fraudulent, contraband, and counterfeit products sold at unbeatable prices.
According to the expert, only dishonest taxpayers need to fear the sticker, as it enables tax authorities to monitor the quantities of goods produced or imported by every economic agent.
