Controls on sales of perfumes and cosmetics are a by-product of tax authority plans to track alcohol from its place of manufacture all the way to the consumer.
Officials said they had to monitor product movements to stop people drinking cheap perfume instead of alcohol. The deadline for registering products in the Unified State Automated Information System, EGAIS, has been extended to January 2007 but this is only for distributors and for certain products. Manufacturers must comply now. Disruption caused by EGAIS has already begun to damage the industry. Cosmetics companies report a fall in sales of up to 20 per cent. The Perfumery and Cosmetics Association warns that sales may decline by up to 60 per cent and that prices of cosmetics may surge as much as 40 per cent. It has taken its concerns to the economic development and trade ministry but with no response so far. As well as cosmetics, medicines face their own challenge. The Federal Health and Social Development Inspection Service may introduce its own tracking system, to stop counterfeit medicines. These are thought to represent up to eight per cent of an $8 billion industry, though the Association of International Pharmaceutical Manufacturers says the figure is hard to verify.