THIS DOCUMENT IS NOT FOR SUBMISSION - EXCEL...

THIS DOCUMENT IS NOT FOR SUBMISSION - EXCEL ONLY!

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OMB Control Number: 0694-0119Expiration Date: 12/31/08

DEFENSE INDUSTRIAL BASE ASSESSMENT:Counterfeit Electronics - Distributors & Brokers

BURDEN ESTIMATE AND REQUEST FOR COMMENTPublic reporting burden for this collection of information is estimated to average -- hours per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Send comments regarding this burden estimate or any other aspect of this collection of information to BIS Information Collection Officer, Room 6883, Bureau of Industry and Security, U.S. Department of Commerce, Washington, D.C. 20230, and to the Office of Management and Budget, Paperwork Reduction Project (OMB Control No. 0694-0119), Washington, D.C. 20503.

BUSINESS CONFIDENTIAL - Per Section 705(d) of the Defense Production Act

SCOPE OF ASSESSMENTThe U.S. Department of Commerce, Bureau of Industry and Security (BIS), Office of Technology Evaluation, in coordination with the U.S. Department of the Navy, Naval Air Systems Command (NAVAIR), is conducting a defense industrial base assessment regarding the infiltration of counterfeit electronics into military and related industrial supply chains. The principal goal of this assessment will be to quantify reported counterfeits, document industry and government procurement and business practices that contribute to counterfeit product infiltration and, identify best practices employed to prevent counterfeit product from penetrating critical supply chains.

RESPONSE TO THIS SURVEY IS REQUIRED BY LAWA response to this survey is required by law (50 U.S.C. app. Sec. 2155). Failure to respond can result in a maximum fine of $10,000, imprisonment of up to one year, or both. Information furnished herewith is deemed confidential and will not be published or disclosed except in accordance with Section 705 of the Defense Production Act of 1950, as amended (50 U.S.C App. Sec. 2155). Section 705 prohibits the publication or disclosure of this information unless the President determines that its withholding is contrary to the national defense. Information will not be shared with any non-government entity, other than in aggregate form. The information will be protected pursuant to the appropriate exemptions from disclosure under the Freedom of Information Act (FOIA), should it be the subject of a FOIA request.

Not withstanding any other provision of law, no person is required to respond to nor shall a person be subject to a penalty for failure to comply with a collection of information subject to the requirements of the Paperwork Reduction Act unless that collection of information displays a currently valid OMB Control Number.

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Table of Contents Next Page

1.Discrete Electronic ComponentsIntegrated Circuit Products (Microcircuits)Bare Circuit BoardsAssembled Circuit Boards


Previous Page

Previous PageIf you selected "No" for questions 1 and 2, please call one of the contacts listed in the "General Instructions" section.


Briefly explain the products and/or services provided by your organization in the space below:

Section II Who Must RespondPlease select the description that most closely reflects your company's operations from 2005 - 2008.

3.

My company is an:

My company is engaged in buying and selling:2.

2


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IIIIIIIVVVI123

4.a4.c4.f4.g5678

Next Page

Previous Page

Previous Page

Table of ContentsWho Must Respond to this SurveyScope of Assessment

Section III Table of Contents

Inventory Control - Internal

Anti-Counterfeit Best Practices

Important InstructionsGeneral Instructions

DefinitionsCompany Information


Inventory Control - GeneralCounterfeit Parts IssuesOperations

Inventory Control - Counterfeit NotificationInventory Control - Counterfeit Handling

Certification

Costs of CounterfeitReasons for Counterfeit

3


A.

B.

C.

D.

E.


For letter correspondence to the Office of Technology Evaluation (OTE), please write to:

Brad Botwin, Director, Industrial StudiesOffice of Technology Evaluation, Room 1093U.S. Department of Commerce1401 Constitution Avenue, NWWashington, DC 20230

Please do not submit completed surveys to this address; all surveys must be submitted electronically.

Upon completion, review and certification of the survey, transmit the survey via e-mail to [email protected].

Questions related to this questionnaire should be directed to:

Teresa Telesco, Trade and Industry Analyst, (202) 482-4959Ryan Barnes, Trade and Industry Analyst, (202) 482-2397Christopher Nelson, Trade and Industry Analyst, (202) 482-4727Mark Crawford, Senior Trade and Industry Analyst, (202) [email protected]

For information on OTE’s defense industrial base surveys, please contact:

Brad Botwin, Director, Industrial Studies, at [email protected] or (202) 482-4060

Previous Page Table of Contents Next Page

Your company is required to complete this survey using an Excel template, which can be downloaded from the BIS website. At your request, BIS staff will e-mail the Excel survey template directly to your company. For your convenience, a PDF version of the survey is available on the BIS website to aid internal data collection. PLEASE DO NOT submit the PDF version of your company’s response to BIS.If information is not available from your records in the form requested, you may furnish estimates. Please indicate in the comment box on the page when you use an estimate.

Previous Page Next PageTable of ContentsSection IV General Instructions

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A.

B.

Section V IMPORTANT INSTRUCTIONS

BUSINESS CONFIDENTIAL - Per Section 705(d) of the Defense Production ActNext Page

Next PagePrevious Page Table of Contents

Previous Page Table of Contents

All questions must be answered for survey submissions to be accepted. Incomplete surveys will be returned to the sender for completion. All response boxes must be completed - for "Yes/No" questions. A blank response will not be counted as a "No." Please fillin all "No" responses as appropriate.

Exceptions include: 1) Responses to "Comments" fields if you have none related to that page. 2) Responses to explanation questions beginning with "If you answered 'Yes'..." if you answered "No."

Do not copy and paste responses within this survey. Responses should be made manually. Copy and paste can disrupt the data collection process. If your survey response is corrupted as a result of copying and pasting responses, a new survey will be sent to you for completion.

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After-Market Manufacturer

Arsenal

Assembled Board

Authorized Distributor

Bare Circuit Board

Brokers

Contract Manufacturer

Counterfeit

Distribution Depot

DMEA

Discrete Electronic Component

Electronic Testing

Excess Inventory

Federal Aviation Administration (FAA) Category 1



Generalized Emulation of Microcircuits (GEM)

Gray Market

Evaluating the functionality of a discrete component or IC part; and determining whether the electrical parametersof the part conform with the alternating current (AC) and direct current (DC) characteristics specified by its manufacturer. Measurements can be made at room temperature or over the recommended operating temperature range for the part.


An establishment for the manufacture and/or storage of military equipment, weapons, and related parts and materials.

A company engaged in the manufacture of electronic products initially produced by another company – and where the supply of such parts may or may not continue to be produced by the original manufacturer.

A secondary market outside of official OCM-OEM distribution chains where new electronic parts and systems, refurbished parts, and used parts owned by third parties are bought and sold. Not all product sold in this market is necessarily genuine, new, or working.

Section VI Definitions

Reengineered integrated circuit products whose manufacture has been authorized to meet the need for replacement parts for product that is obsolete. These replacement products are designed and tested to emulate all the functions of microcircuits that are no longer in production.

Legitimate, genuine new electronic part product held by OCMs, OEMs, authorized distributors, contract manufacturers, and U.S. government agencies.

Individual components such as capacitors, diodes, resistors, transistors that can be mounted on a circuit board toform a working electronic system.

An engineered circuit board populated with electronic components that forms a working system or subsystem.

Defense Microelectronics Activity, a Department of Defense facility located near Sacramento, CA, which manufactures integrated circuit products and electronic systems for U.S. Government national security applications.

Distribution depots store and distribute goods, materials and parts to the United States armed forces.

An electronic part that is not genuine because it 1) is an unauthorized copy; 2) does not conform to original OCM design, model, and/or performance standards; 3) is not produced by the OCM or is produced by unauthorized contractors; 4) is an off-specification, defective, or used OCM product sold as "new" or working; or 5) has incorrect or false markings and/or documentation.

A manufacturer that produces made-to-order custom electronic parts, including assembled electronic boards, for a private customer or government customer. These products may be manufactured on a build-to-print basis for an original equipment manufacturer; or may be designed by the contract manufacturer to conform to general specifications provided by the customer. Parts and board products manufactured by the contract manufacturer are not brand-name products marketed and sold by the contract manufacturer.

The part is one whose intended use indicates that the consequences of its failure, considered separately and in relation to other systems, would not cause a departure from normal operating procedures.

The part is one whose intended use indicates that the consequences of its failure, considered separately and in relation to other systems, could reduce safety margins, degrade performance, or cause a loss in the capability to conduct certain flight operations so as to prevent the continued safe flight and landing of the aircraft. Examples osuch conditions are those which may require the use of the “Emergency Procedures” portion of the flight manual, aircraft placards, or TC data sheets, as applicable.The part is one whose intended use indicates that the consequences of its failure, considered separately and in relation to other systems, would not prevent the continued safe flight and landing of the aircraft, but may reduce the capability of the aircraft or the ability of the crew, by increasing the workload, for example, to cope with adverse operating conditions or subsequent failures.

A company that is authorized by an Original Component Manufacturer (OCM) or Original Equipment Manufacturer (OEM) to market, store, and ship OCM/OEM products subject to legal conditions set by manufacturers.

Companies/individuals engaged in the marketing of electronic parts, often scarce parts. Brokers frequently do noactually possess in inventory the parts being sought, but act as “middle men” to arrange the sale of the part from a third party.

An engineered circuit board with defined printed circuits on one or more layers of the board that serves as the foundation for integrating electronic components into a working system or subsystem.

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Hologram

Incident

Independent Distributor

ITAR

Legal Action

Microcircuit

Mined Die

Non-U.S.

NAVSEA Crane

OCM

OEM

Physical Evaluation

Prime Contractor

RFID

Scrap

"Seconds"

Subcontractor

U.S. Munitions List

United States

Visual Inspection

Previous Page

Non-destructive evaluation involving visual examination for correct labeling, shape, size and dimension, form, fit, color, security coatings, etc. Visual inspection can include use of other non-destructive evaluation such as X-ray, XRF (X-ray fluorescence), and scanning acoustic microscopy.

A process of confirming that materials used in a discrete component or IC part are genuine. It can involve destructive tests such as decapping the component’s package to validate its authenticity; evaluation of materials used in a device’s packaging materials (including connection leads and encapsulant); and examination of discreteand IC parts to verify it is genuine using various techniques including layer by layer destructive examination.

Occurrences, reports, or transactions pertaining to electronic parts suspected and/or confirmed to be counterfeit. For example, a report involving 10 copies of a single electronic part model equals one incident. Occurrences, reports, and transactions involving three separate electronic part models equal three separate incidents, regardless of the volume counterfeit parts for any given model.

Three-dimensional printing used to validate authenticity.


Foreign country where microcircuit production, purchase, or company incorporation is located.

An integrated circuit product that is removed from the original OCM package – and placed in a new package. Typically mined die are used parts being recycled. They are repackaged because the original package has been damaged or deteriorated in some way.

An integrated circuit product (Hybrids/Multi-Chip Modules should be counted as 'Microcircuits').

Radio Frequency Identification.

A lead contractor that directs and manages the delivery of large projects or products -- and which relies on subcontractors to provide part or all of the major components, designs, parts, or subsystems required to complete and deliver a working product.

Original Equipment Manufacturer.

Original Component Manufacturer.

BUSINESS CONFIDENTIAL - Per Section 705(d) of the Defense Production Ac

Filing of warning letters, civil complaints and lawsuits; filing criminal complaints; support of criminal investigations and prosecution by law enforcement agencies.

International Traffic in Arms Regulations – controlling the export and import of defense-related articles and services on the United States Munitions List.

An independent distributor company that markets and distributes electronic parts often acquired as excess inventory from OCMS, OEMs, contract manufacturers, U.S. Government organizations, and other entities. Independent distributors maintain inventories of parts and typically have controlled environments for part storage.

The “United States” or “U.S.” includes the 50 states, Puerto Rico, the District of Columbia, the island of Guam, theTrust Territories, and the U.S. Virgin Islands.

Articles and services designated by the President of the United States with concurrence from the Department of Defense as being specifically designed or configured for military applications; there are no equivalent civilian or commercial products.

A company that provides parts, subsystems, or systems required by a prime contractor for completion of a product or project.

Off specification, sub-standard product made by Original Component Manufacturers/Original Equipment Manufacturer that is normally destroyed by OCM/OEMs.

Defective, damaged, or used electronic parts, or systems from which electronic parts may be scavenged.

Naval Surface Warfare Center, Crane Division – circuit board analysis, testing, design, manufacturing and assembly capability.

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Company NameStreet AddressCityState Zip CodeWebsitePhone NumberFax Number

Name(s) Title Phone Number State E-mail Address

Name(s) Title Phone Number State E-mail Address

Comments:


Table of Contents

Table of ContentsBUSINESS CONFIDENTIAL - Per Section 705(d) of the Defense Production Act

Section 1 Company Information

Lead person(s) in your company responsible for dealing with counterfeit electronic issues, if any.

Primary point(s) of contact regarding this survey's completion.

8



A.

U.S. locationsNon-U.S. locations

200520062007

2008 (est.)


Previous Page

Previous Page

State the number of distribution facilities your company operates in:

Please state the number of years your company has been in business in the U.S.

Section 2.a Operations

B.

[Answer ALL Questions - Surveys With Blank Responses Will Be Returned For Completion]


Comments:

C.State your company's net sales revenue in thousands of dollars (i.e. inputs of $12 = $12,000.00) for the following years:

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Discrete Electronic

ComponentsMicrocircuits Bare Circuit

BoardsAssembled

Circuit Boards

Purchased from OCMsBought from OCM authorized distributors with OCM purchase documentsBought from OCM authorized distributors without OCM purchase documentsAcquired from independent distributors with OCM purchase documentsAcquired from independent distributors without OCM purchase documentsAcquired from parts brokersBought from other Original Electronic Manufacturers (OEMs) as "excess inventory" with OCM purchase documentsBought from other OEMs as "excess inventory" without OCM purchase documentsSupplied by Department of Defense (DOD) depotsSupplied by the Defense Logistics Agency (DLA)Supplied by DOD manufacturing centers (e.g. Sandia National Labs)"Mined DIE" placed in new packagesPulled from circuit boardsFrom DODFrom Contract Manufacturers

Parts obtained through other methods (specify)

Next Page



Section 2.b Operations (continued)[Answer ALL Questions - Surveys With Blank Responses Will Be Returned For Completion]


Used Parts

A.

Identify the sources of discrete electronic components, microcircuits, bare circuit boards and/or assembled boards that your organization buys/sells.

Factory refurbished parts purchased from OCMsDirect purchases from the internet

Surplus Parts

New Parts

Source of Parts

Comments:

10


U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S.OCMsOEMsContract ManufacturersAuthorized DistributorsIndependent DistributorsParts BrokersIndividual CustomersPrime and Sub ContractorsInternet-Exclusive SourcesU.S. DOD (DLA, depots, etc.)Other U.S. National Security AgenciesOther U.S. Federal AgenciesU.S. State & Local GovernmentsForeign National & Local Governments

B.



Section 2.c Operations (continued)

Comments:



Customer

Does your company act as an authorized aftermarket supplier and distributor of new electronic parts for which the manufacture of original product has been terminated by OCMs?

A.

Discrete Electronic Components Microcircuits Bare Circuit Boards Assembled Circuit

Boards

Identify the types of customers to which your company sells discrete electronic components, microcircuits, bare circuit boards, and/or assembled circuit boards directly in the United States and outside of the United States.

11


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DiodesMagneticsSmall Signal TransistorsRectifiersCrystals/OscillatorsElectromechanicalSensors & Actuators

Microprocessors/MicrocontrollersSpecial Purpose Logic (PLD, FPGA, etc.)Radio Frequency/Wireless Other (specify)

Single-SidedMulti-Layer RigidHigh Density Interconnect Other (specify)

Through-Hole (Predominantly)Mixed Technology (Balanced Through-Hole & Surface Mount) Other (specify)

Product Unit Value 2005 2006 2007 2008 (est.)< 1 cent1 - 10 cents11 cents to $1.00$1.01 - $10$11 - $100$101 - $500$501 - $1,000$1,001 - $10,000> $10,000

Total Number of Incidents 0 0 0 0

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Section 3.a Counterfeit Parts Issues

Capacitors

Select the types of electronic parts sold by your company in 2005 - 2008, where merchandise was determined to be counterfeit.

Microcircuits

Discrete Electronic Components

Circuit Protection (fuses)ThyristorsPower Transistors


All Other Discrete Electronic Components


For the years 2005 - 2008, estimate the number of counterfeit incidents your company encountered by product unit resale value.

B.

Surface Mount (Predominantly)

A.

Bare Circuit Boards

Resistors

Logic, Standard

Optoelectronics

Multilayer Flex/Rigid-Flex

Comments:

Assembled Boards

Memory

Double-Sided

12



200520062007

2008 (est.)

2005 2006 2007 2008 (est.)

FAA Category 1FAA Category 2FAA Category 3

C.

Table of Contents Next PagePrevious PageBUSINESS CONFIDENTIAL - Per Section 705(d) of the Defense Production Act

Industrial/Commercial

B.

Qualified Products List (QPL)

Critical Safety Items

Commercial Aviation

Generalized Emulation Microcircuits (GEM)High Reliability - Medical

Of the product models identified, how many were U.S. Munitions List/ITAR Controlled?

Comments:

Previous Page

High Reliability - IndustrialHigh Reliability - Automotive

Qualified Manufacturers List (QML)

Type of Counterfeit

Section 3.b Counterfeit Parts Issues (continued)

For the years 2005 - 2008, state the number of product models produced or acquired by your company for which suspected/confirmed counterfeit versions being marketed by other entities.

Consumer

For the years 2005 - 2008, state the percent of your company's discrete electronic component, microcircuit, bare circuit board, and assembled circuit board product models that were suspected/confirmed to be counterfeited.

Number of Incidents


A.

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Table of Contents

2005 2006 2007 2008

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20061.2.3.4.5.

Table of Contents

Other (specify to the right)

Next PagePrevious Page


[Answer ALL Questions - Surveys With Blank Responses Will Be Returned For Completion]For 2005 - 2008, estimate the number of suspected/confirmed counterfeit incidents involving microcircuits, discrete electronic components, bare circuit boards, and/or assembled circuit boards your company bought/soldby type of counterfeit.

2008 (est.)


Rank the top five countries suspected/confirmed by your company to be sources of counterfeit products/parts.

Comments:

2005

New product re-marked as similar, higher-grade part

2007

"Seconds" recovered from scrap piles

B.

A.

Used product re-marked as similar, higher-grade part

Unauthorized overrun of OCM productFake [non-working] OCM productUsed product sold as new (not remarked)

Jump to Year:

Invalid part markings - unknown functionality/performance

Unauthorized working part substitution packaged as new part

Section 3.c Counterfeit Issues (continued)

Working copies of original designs

Number of Incidents2008 (est.)200720062005

Type of Counterfeit

14


Y/N # of Incidents Y/N # of Incidents Y/N # of Incidents Y/N # of Incidents





WebsiteHotline

For 2005 - 2008, state the number of incidents of suspected/confirmed counterfeit versions of product models sold by your company per the ways your company learned of the problem.Note: Complete the Yes/No column for EACH category below. If "Yes," provide the number of incidents encountered per category.


Section 3.d Counterfeit Parts Issues (continued)

B. How do your authorized distributors and customers notify your company of suspected/confirmed counterfeit products?

Comments:


Discovered through self-initiated investigations

Discovery of unauthorized over-production by contract manufacturers

Notification by non-U.S. government agenciesNotification by other U.S. government agencies of seized partsNotification by U.S. Customs of seized parts

Notification issued by Government-Industry Data Exchange Program (GIDEP)

A.

Number of IncidentsWays Your Company is Uncovering Suspected/Confirmed Counterfeit Parts 2008 (est.)200720062005

Notification issued by DLANotification issued by OEM

Product returned to you as "Defective"

Counterfeit documentation/absence of original documentationCustomer suspected/confirmed part in product were counterfeitProduct returned to you as "Wrong Merchandise"Product returned to you as "Excess Inventory"

Notification issued by OCMTestingMarkings, appearance & condition of partsDiscovered "defective" parts/poor performance

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2005 2006 2007 2008 (est.)

Other (specify to the right) $ - $ - $ - $ -

If "Yes," please explain.

2005 2006 2007 2008 (est.)


Previous Page

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Comments:

C.

Out of ProductionIn Production

Does your company maintain a database on suspected/confirmed counterfeit activities?

Of the suspected/confirmed counterfeit discrete electronic components, microcircuits, bare circuit boards, and assembled circuit boards bought by or returned to your company, state the percent for which the products were both in and out of production at your company at the time the incidents were reported.

Suspected/confirmed counterfeit productsKnown/suspected companies and individuals


Lost Sales

Total Financial Product Losses

B.

A.

Has your company experienced negative effects on its company image or reputation due to counterfeit activities?

Refunds

Customer Shifts to Competitor/Lost Contracts


D.

For 2005 - 2008, quantify the costs, in thousands of dollars (i.e. inputs of $12 = $12,000), attributable to suspected/confirmed counterfeit versions of electronic products your company unknowingly purchased or acquired through product returns from customers.

If "Yes," identify the variables tracked by your database: Source of Reporting

Countries of origin

Warranty Claims

Deferred or Delayed Contracts

Section 3.e Counterfeit Parts Issues (continued)

Type of Cost Costs Attributable to Counterfeit Products


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A.B.C.D.

G.

H.

Next PagePrevious Page Table of Contents

Comments:

Does your company restock/recirculate returns and products it buys back from its customers?

DLA

OEMsOCMs


Does your company accept returns from its customers?

Section 4.a Inventory Control - General


Does your company buy back component parts from its customers?

Indicate if your company has documented cases of suspected/confirmed counterfeit component parts being sold by of the following entities:

Other (specify to the right)U.S. State & Local GovernmentsOther U.S. Federal AgenciesOther U.S. National Security Agencies

IndividualsInternet-Exclusive Sources

Has your company detected contract manufacturers producing significant OCM part overruns and offering to sell that excess product to your company?


Contract ManufacturersBrokers

DLA

Independent Distributors

DOD Depots

Authorized Distributors

E.

F.

Has your company documented cases of its individual customers returning counterfeit products?

Does your company have written procedures in place to prevent acquisition of unauthorized product overruns?

Prime and Sub ContractorsContract Manufacturers

Other (specify to the right)Other government agencies

OEMsOCMs

Indicate if your company buys excess inventory from any of the following entities:

U.S. DOD DepotsPrime and Sub Contractors

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E.

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Physical evaluation of partsElectronic testing of parts

Independent distributorsAuthorized distributors


Indicate if your company requires parts suppliers to provide verification from their internal or independent testing facilities that the parts they are shipping to you are genuine and meet OCM performance specifications.

Other (specify to the right)What is your company's procedure for stocking inventory after it has processed incoming parts?


[Answer ALL Questions - Surveys With Blank Responses Will Be Returned For Completion]Section 4.b Inventory Control - Pre-Stocking Procedures

A.

OCM

Authorized distributorsOEM

For your company's parts suppliers, indicate what percent of your purchases are tested by your facilities prior to placing them in inventory.

Internet-exclusive sources

Independent distributors


Brokers


For the incoming parts your company decides to test prior to placing in inventory, indicate the percent of testing performed per the kind of testing.


Internet-exclusive sourcesBrokers

Visual inspection of partsInspection of OCM shipping packagesConfirmation of genuine OCM pedigree paperworkVisual inspection of packages and paperwork

B.

Comments:

C.

Do you co-mingle identical parts from multiple suppliers in the same bin?

D.

OEMOCM

18



C.


Are your company's auditing practices and processes for counterfeit products reviewed by independent authorities?

Independent AuditorsCompany Staff

Physical EvaluationElectronic TestingVisual Inspection

Which forms of inventory auditing does your company perform to check for the presence of counterfeit product?


[Answer ALL Questions - Surveys With Blank Responses Will Be Returned For Completion]Section 4.c Inventory Control - Internal

Comments:


D.


B.

A. Does your company perform audits of its inventory to check for the presence of counterfeit products/parts?If "Yes," how often?

Who conducts your company's inventory audits for counterfeit products?

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Visual InspectionElectronic TestingPhysical Evaluation



2005Identify the number of part models for which your organization ordered the following inspection and/or testing procedures.

Section 4.d Inventory Control - Internal (continued)

A.


Identify the level of testing your company performs on individual part models to check for counterfeit products - by sampling rate.Visual Inspection

Comments:

B.

Physical Testing


Examination Method

2008 (est.)20072006

Electronic Testing

Assembled Circuit BoardsBare Circuit BoardsMicrocircuitsDiscretes

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Other (specify to the right)U.S. Non-U.S.

Company Operated

Contractor Operated

U.S. Non-U.S.

Next Page



Comments:

[Answer ALL Questions - Surveys With Blank Responses Will Be Returned For Completion]Section 4.e Inventory Control - Internal (continued)

Has your company experienced any problems with contractor-operated testing facilities?

State the number of testing facilities your company operates and the number of contractor-operated testing facilities it uses to detect counterfeit products at U.S. and Non-U.S. locations.


Trademarks

Marking TechniquesDate of ManufacturePlace of ManufactureBar Coding

C.

B.

If "Yes," please describe these problems.

A.

Embedded Authenticity Data in Product Circuitry/Encrypted Code

RFIDCovert Markings

What does your company look for when it performs package-level visual inspection and non-invasive screening to check for the presence of counterfeit products/parts?

HologramSurface TextureSerial NumberPart Number

21




Other (specify)

Other (specify)

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Other (specify)

Quarantine parts away from regular inventory; awaits direction from law enforcement agents

Identify the databases your company checks for counterfeit related information for discrete electronic components, microcircuits, bare circuit boards, and assembled circuit boards.

C.ERAI

FAA AVS-20 Website - Unapproved Parts

GIDEP

Comments:


Locate select inventory

Enter incident into industry and/or USG databasesCheck industry and/or USG databases for similar problems

Leave disposal of the counterfeit part to the party filing the complaint

Section 4.f Inventory Control - Counterfeit Handling

Pull back inventory for checkPerform random testingTrace part supply chain path

Inform authorized distributorsInform OCM

Wait for additional complaints

A.

No steps are takenNotify industry associations

Notify internal company authorities


Conduct random testing of parts in inventoryTest part/send the part to a testing facility for evaluation

Issue credit to distributor or manufacturing end-user upon receipt of suspect counterfeit parts

Once your company has physical possession of suspected/confirmed counterfeit parts, what steps does it take?

Identify the steps your company takes once it is notified it has shipped counterfeit parts.

Turn counterfeit parts over to law enforcement authorities after performing an analysis of samples

B.

Notify federal authorities

Turn counterfeit parts over to law enforcement authorities for analysis

Retain samples of counterfeit parts for future reference

Enter incident into company databaseDispose of parts almost immediately after customer ships them back to the company

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A.

Other (specify)200520062007

2008 (est.)

D.


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National Aeronautics & Space Administration (NASA)Government-Industry Data Exchange Program (GIDEP)Federal Trade Commission (FTC)B.

Department of Justice (DOJ)

Department of Homeland Security (DHS) - Customs & Border Protection (CBP)

Department of Energy (DOE)

Nuclear Regulatory Commission (NRC)

Defense Logistics Agency (DLA)

Federal Communications Commission (FCC)Federal Bureau of Investigation (FBI)Federal Aviation Administration (FAA)Department of Transportation (DOT)

Comments:


None at All

Section 4.g Inventory Control - Counterfeit Notification

State how long it typically takes your company to report suspected/confirmed counterfeit products to government authorities.

State the number of incidents of suspected/confirmed counterfeit products for which your company notified government authorities.

Once your company identifies a suspected/confirmed counterfeit product, what authorities do your personnel notify?

When your company encounters a counterfeit product in its inventory, do your personnel know what authorities to contact?

Defense Microelectronics Activity (DMEA)

C.

National Security Agency (NSA)

State & Local Authorities

Defense-Related Investigative Services (e.g. DCIS, NSIC, etc.)

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Other (specify)


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[Answer ALL Questions - Surveys With Blank Responses Will Be Returned For Completion]Section 4.h Inventory Control - Counterfeit Notification (continued)

Defense Logistics Agency (DLA)

Government-Industry Data Exchange Program (GIDEP)

Department of Energy (DOE)Department of Homeland Security (DHS) - Customs & Border Protection (CBP)Department of Justice (DOJ)


Comments:

B.

A.

What authorities does your company instruct its authorized distributors and/or end-users to contact when they encounter suspected/confirmed counterfeit products?

My Company

Indicate your company's level of reporting of suspected/confirmed counterfeit products to the Government-Industry Data Exchange Program (GIDEP)If your company does not report suspected/confirmed counterfeit products to GIDEP, explain why in the space below:

Defense Microelectronics Activity (DMEA)

Department of Transportation (DOT)

National Aeronautics & Space Administration (NASA)

Federal Aviation Administration (FAA)Federal Bureau of Investigation (FBI)Federal Communications Commission (FCC)Federal Trade Commission (FTC)

None at All

National Security Agency (NSA)Nuclear Regulatory Commission (NRC)Defense-Related Investigative Services (e.g. DCIS, NSIC, etc.)State & Local Authorities

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A.

B.

C.

D.

Other (specify)


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Comments:

Is your company aware of any written instructions or guidance from federal authorities on reporting suspected/confirmed counterfeit products?

Is your company aware of any legal requirements for the management and/or disposal of suspected/confirmed counterfeit products that your company must adhere to?

If your company reported to any of the organizations listed above, what actions did these organizations take?My company does not notify any industry organizations.

Section 4.i Inventory Control - Counterfeit Notification (continued)

E.

Indicate whether your company reports counterfeit products to any of the following industry organizations.

Does your company need guidance from federal authorities with regards to civil and criminal liability, and penalties pertaining to the distribution, storage, and disposal of suspected counterfeit products?

Alliance for Gray Market & Counterfeit Electronic IndustriesAerospace Industries Association

Association of Connecting Electronic Industries (IPC)

Semiconductor Industry AssociationQuality Brands Protection Committee (Chinese government)

Is your company aware its liabilities related to the distribution, storage, and disposal of suspected/confirmed counterfeit products?


ERAIElectronic Industries AssociationElectronic Components, Assemblies & Materials Association (ECA)

National Electronic Distributors AssociationNational Association of ManufacturersIndependent Distributors Electronics Association (IDEA)Government Electronic Industries Association

U.S. Chamber of CommerceSociety of Automotive Engineers

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U.S. Non-U.S.Production design centersManufacturing centersWarehousesTesting facilities

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[Answer ALL Questions - Surveys With Blank Responses Will Be Returned For Completion]Section 5.a Reasons for Counterfeit

Comments:

In the last five years, indicate if your company discovered counterfeit products as a result of unauthorized activities in the following locations:

Explain your answer.

Is your company better able to control the infiltration of counterfeits today than it was five years ago?


A.

B.

C.

Explain your answer.

Does your company find it difficult to identify counterfeit parts?

If you answered "Yes," explain the unauthorized activities in the space below.

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Other (specify)

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Less stringent inventory management by parts brokers

Greater reliance by OEMs on gray market parts

Inadequate parts purchase planning by OEMs with regard to market demand; part requirements

Authorized distributors buying gray market products

Greater reliance by authorized distributors on gray market parts

Inadequate parts purchase planning by contract manufacturers with regard to customer demand; part requirements

Return of OCM product from authorized distributors that co-mingle genuine inventory with gray market product

Just-in-time delivery systemsDelays in production by after-market manufacturers

Greater reliance by contract manufacturers on gray market parts

Inadequate production of parts by OCMs

Section 5.b Reasons for Counterfeit (continued)

Comments:

Less stringent inventory management by independent distributorsLess stringent inventory management by authorized distributorsLess stringent inventory management by OCMs

Greater reliance on contract manufacturers for procurement

Please identify the prime reasons for counterfeit products entering supply chains in the United States. Provide written comments in the box below.

Purchase of excess inventory on open markets


Insufficient testing of parts

Greater reliance by brokers on gray market parts

Greater reliance by independent distributors on gray market parts


Insufficient chain of accountabilityInsufficient inventory controlInsufficient buying procedures

A.

Premium prices charged by after-market manufacturersInsufficient notice to customers of part production termination

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Table of Contents

2005 2006 2007 2008 (est.)Number of personnel assigned to counterfeit product issues.

Total company employment (including personnel assigned to counterfeits)

2005 2006 2007 2008 (est.)Total costs for counterfeit-related legal actionsCounterfeit-related legal costs as a percent of total company legal costs:

Other (specify2005 2006 2007 2008 (est.)

Table of Contents

State the legal costs in thousands of dollars (i.e. inputs of $12 = $12,000.00) your company incurred related to addressing counterfeit product issues. Also state those legal costs as a percent of total company legal costs.




Section 6 Costs of Counterfeit

A.

B.

C.

Did not want to make the problem publicLegal costs and time requirements excessive


State the number of full-time equivalent personnel assigned specifically to matters related to addressing counterfeit issues and your company's total employment.

If "Yes," identify the reasons why your company did not pursue additional counterfeit-related legal actions.

Extent of problem was not large enough to botherInsufficient support from U.S. Federal authoritiesChance of success was lowPerpetrator(s) could not be found

Could your company have filed more legal actions to address counterfeit product issues than it did during the years 2005 - 2008?

Comments:

D. State the other costs in thousands of dollars (i.e. inputs of $12 = $12,000.00) your company incurred in addressing counterfeit product issues.

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Other (specify)

Other (specify)

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Revising company procedures for disposal of "seconds," defective parts, and production overruns

Referring customers to authorized after-market manufacturers for parts discontinued by my company

Performing screening and testing on inventory

Educating customers about risks associated with gray market productsEducating customers on the negative economic and safety impacts of counterfeit products

Embedding new security measures in product lines

Adding security markings to existing inventory

Revising procurement to more carefully screen/audit/evaluate authorized returns from customers

Prohibiting authorized distributors from buying back excess inventory on the gray market

Prohibiting authorized distributors from buying back excess inventory from their customers

Tightening contractual obligations of contract manufacturers with regard to disposal of "seconds," defective parts, and preventing production overruns

Referring customers to companies that could identify suitable substitute product or re-engineer system components

Section 7.a Anti-Counterfeit Best Practices


Training staff on the negative economic and safety impacts of counterfeit products

B.

A.

Comments:

Embedding new security measures in existing product lines

What is your company doing externally to combat counterfeit electronics from getting into its inventory and customers' supply chains?

What is your company doing internally to prevent infiltration of counterfeit electronics into its inventory?

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1.2.3.4.5.


Has your company encountered any other incidents involving counterfeits that have not been covered by this survey?

What are the five most important best practices distributors and brokers should adopt to limit counterfeit product from entering the supply chain?

Previous PageSection 7.b Anti-Counterfeit Best Practices (continued)

A.

B.

Beyond current efforts, what should the federal government do to help prevent counterfeit products from entering the supply chain? Explain your answer.

If "Yes," please list the organizations and consultants below.Does your company use outside organizations to help determine best practices for handling counterfeit products?



C.

Comments:

D.If "Yes," please explain in detail below.

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Company NameCompany's Internet AddressName of Authorizing OfficialTitle of Authorizing OfficialE-mail AddressPhone Number and ExtensionDate Certified

Point of Contact NameTitle of Point of ContactE-mail AddressPhone Number and ExtensionWould you like a free copy of the final report?

How many hours did it take to complete this survey?Previous Page Table of Contents

The undersigned certifies that the information herein supplied in response to this questionnaire is complete and correct to the best of his/her knowledge. It is a criminal offense to willfully make a false statement or representation to any department or agency of the United States Government as to any matter within its jurisdiction (18 U.S.C.A. 1001 (1984 & SUPP. 1197))

Section 8 Certification


In the box below, please provide any additional comments or any other information you wish to include regarding your experience with counterfeit products or other related issues.

If POC is different from the above named, include below:


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