Retailers try to iron out problems for duty-free cosmetic sales

ETRC president Frank O'Connell met earlier this week with the president of the European Commisson Jose Manuel Barroso at the European parliament in an attempt to draw attention to the effects increased security measures have had on duty free retail sales that provide an important source of revenue for many premium and luxury cosmetic suppliers. This problem is being further exacerbated by new security measures being introduced in both the Middle East and the Asia Pacific regions, matters which O'Connell says merit an urgent European Commission meeting before the summer season begins. Indeed, only last month Australian airport authorities introduced new security measures limiting the amount of cosmetic products passengers can carry on flights, falling in line with both their European and North American counterparts. Although airport retailers, together with cosmetic and fragrance producers, are not arguing against the increased airport security measures, what they have expressed concern over is the fact that liquids-in-hand baggage regulations vary from country to country, leading to significant confusion amongst passengers. Indeed the ETRC claims that new figures showing how much liquids have been confiscated from European airport passengers reflect this confusion. These include over 2,500 litres each day at Frankfurt airport, 1,200 litres at Amsterdam Schiphol, and over 900 litres per day at Zurich airport. Putting this into perspective, the ETRC estimates that confiscations at Zurich airport are now totalling €22,000 worth of goods per day. Such figures are expected to be even higher in the run up to the summer months, when travel in Europe is hit by the holiday rush - a problem the ETRC says could lead to travel chaos and even more confiscations. However, O'Connell said that he was pleased by the outcome of the meeting with Barosso, stating "We are extremely encouraged by today's meeting. President Barroso showed a very clear understanding of the scale of the problem and has given us a cast-iron guarantee that the European Commission will work towards a swift solution of the problem. "We now need to use the short period of time available to us before the summer season to ensure a workable solution is put in place before millions of people take to the skies for their annual holiday," he added. The organisation says that it is now working closely with the EU authorities to help forge a solution to the problem of 'incompatible security regulations that aim to safeguard the global duty-free trade'. Many premium cosmetic and fragrance makers, including names such Estee Lauder, LVMH and Inter Parfums, derive a significant proportion of their sales - sometimes as high as 10 per cent - from duty-free sales. Although increased security measures have failed to have a significant impact on such companies' results to date, the international widening of security measures and the resulting passenger transfer blockages, siding with the ETRC's opinion that if no action takes place, the current security situation could spell bad news for trade this summer.