Anti-counterfeit Paris 2016
- 1. 1 GE Title or job number 7/26/2016 Supplier anti-counterfeit requirements April 2016 Prepared by: Jo Vann IEC TC107 WG3 Counterfeit electronic parts; avoidance, detection, mitigation, and disposition in avionics applications convener , see http://www.iec.ch/dyn/www/f?p=103:14:0::::FSP_ORG_ID,FSP_LANG_ID:5736,25 Member of : SAE: G19A, G19AD, G19C, G19CI, AMPC, IAQG IEC TC107 WG3 IECQ WG6 UK CAWG
- 2. 2 GE Title or job number 7/26/2016 Counterfeit components Counterfeit wires (CALCE 2015): Counterfeit parts are on the rise, Paul Romano, Fusion Trade Figure 1: A counterfeit device that has been coated with a compound that will not be detected by normal permanency testing, but can be chipped off to reveal the remarked device. From Kozio blog Vertical launches online component market to defeat counterfeit chip fraud , Dean Takahasi
- 3. 3 GE Title or job number 7/26/2016 Recycling is increasing Uncontrolled processes
- 4. 4 GE Title or job number 7/26/2016 General Counterfeit statistics The Europol 2015 Situation Report on counterfeiting in the EU, see https://oami.europa.eu/ohimportal/documents/11370/80606/2015+Situation+Rep ort+on+Counterfeiting+in+the+EU: 87,000 cases of detentions in 2013, resulting in nearly 36 million articles compared with 7,553 in 2002 EU taxations and Customs union IPR statistics from 2014 , >95,000 cases were registered by Customs: large numbers of small packages detained containing cigarettes, toys, medicines, car spare parts and foodstuffs. International Anti-counterfeiting Coalition (IACC) estimates: 23,140 total number of IPR related seizures in 2014 from U.S. Department of Homeland Security, Intellectual Property Rights Seizures Statistics, Fiscal Year 2014 http://www.cbp.gov/sites/default/files/documents/2014%20IPR%20Stats.pdf $1.77 Trillion is the Projected Value of Global Trade in Counterfeit and Pirated Goods in 2015 from the International Chamber of Commerce / BASCAP, Estimating the Global Economic and Social Impacts of Counterfeiting and Piracy (2011).
- 5. 5 GE Title or job number 7/26/2016 What is the Avionics problem? In 2010/2011 the USA DoD identified upwards of a million counterfeit components in their Military supply chain. This resulted in the anti-counterfeit DFAR 252.247.7007 invoked in contracts of major Avionics OEMS. Researcher IHS analysed electronics industry data in 2013 concerning counterfeit parts that were reported from 2001 until early 2012: More than 12 million counterfeit parts have been reported over the last five years to 2013 57% of counterfeit part reports involved obsolete or end of life parts. Nearly 37% of counterfeit parts involve components still being produced by manufacturers. A single incident of a counterfeit part can cause up to 64 weeks of production line downtime and cost up to $2.1 million to resolve. Counterfeit parts are mostly sold on the open market.
- 6. 6 GE Title or job number 7/26/2016 ERAI reported non-conforming and suspect counterfeit parts in USA
- 7. 7 GE Title or job number 7/26/2016 International anti-counterfeit standards for supply chains SA E IE C IEC/TC 107 WG3 G-14 AAQS C IEC/TS 62668-2 risk assessm ent G19A IEC/TS 62668-1 for Avionic s OEMS G19A D G19C DRAFT AS6171 and 16 Test Methods AS6496 Franchise d distributor AS6301 ,AS646 2 audit checklist s G19CI AS5553 electronic component s G21 AS617 4 for materiels IEC Q AS9100 rev C changin g to rev D April 2016 Draft ISO9001 new traceability audit for any industry IECQ WG6 ISO900 0 risk assess ment AS6081 for non- franchise d buys G19CI IDEA STD 1010 visual inspection microcircuit sTrade Body inspection guidelines, e.g. BEAMA
- 8. 8 GE Title or job number 7/26/2016 IECQ anti-counterfeit audit roadmap IECQ WG6 has developed Third Party audit schemes for ( see http://www.iecq.org/publications/rules-procedures/ ) SAE AS5553A, OD 706-1 for any OEM in medium to high reliability industries SAE AS6081, OD706-2 for non-franchised distributors in medium to high reliability industries New IEC/TS 62668-1, OD706-3 for Avionics OEMs New draft ISO9001 Clause 6 risk mitigation - General Traceability audit for any industry- work in progress Benefit of IECQ audit schemes: On-line certificates viewable by any one Audits are available in your local language, please contact your IECQ CB, see http://www.iecq.org/members/bodies/mb-list.htm e.g. LCIE, DKE, DANSK, CNCA, JISC, BSI for BEC
- 9. 9 GE Title or job number 7/26/2016 Avionics Supply Chains and contract flow-down which includes AS9100 flow-down: USA Military UK Military DFARS in contracts DEF STAN 05-135 anti- counterfeit , electronics and materials DFAR 252.246.7007 electrical and SAE AS6171 OEM AS9100 SAE AS5553 flow- down to suppliers OEM suppliers AS9100 preferred SAE AS6496 Franchised distributors ARP 6178 non- franchised distributor SAE AS6174 Materials General Avionics Customer Anti-C flowdown AS5553 Avionics customer Anti-C flow- down IEC/TS62668- 1 and IEC/TS 62668-2 ARP 6328 or IEC/TS 62668-2 risk assessmen t or SAE AS6171 ARP 6328 or IEC/TS 62668-2 risk assessmen t and/or SAE AS6171 NEW DFAR Trusted supplier and Additional trusted supplier NATO Directive referring to external standards
- 10. 10 GE Title or job number 7/26/2016 Comparison between IEC/TS 62668-1:2016 edition 3 and SAE AS5553A for Avionics
- 11. 11 GE Title or job number 7/26/2016 Key steps for a business to avoid counterfeit and recycled components. Restrict PO to OCM or franchised distributor Minimise buys from non- franchised distributors Publish an anti- counterfeit policy or plan Establish standard PO anti-counterfeit notes for suppliers Request supply chain traceability back to the OCM for all POs Implement an anti-counterfeit training program Implement an obsolescence management plan Risk assess components from non- franchised sources Manage excess stock and scrap END Trade-body Policy or external anti- counterfeit standards START
- 12. 12 GE Title or job number 7/26/2016 Format of an anti-counterfeit plan Typically: Formatted in WORD as a traditional 6 part spec format under configuration control containing : Figures or an overall flowchart Clause 1. Scope, Clause 2. References Clause 3. Definitions and acronyms and abbreviations, Clause 4. Technical requirements directly addressing the mandatory requirements of the external standard or Trade- Body standard appropriate to your industry : IEC/TS 62668-1 for an Avionics OEM who manufactures and services repairs etc. SAE AS5553A section 4 for an OEM manufacturing electronic assemblies SAE AS6496 for a franchised distributor SAE AS6081 for a non-franchised distributor selling components into a high reliability customer. SAE AS6174 for an OEM manufacturing mechanical assemblies Clause 5. Plan administration Clause 6. Bibliography and annexes where the annex contains a cross reference matrix of the auditees procedures which comply with the external standard mandatory requirements that is most appropriate.
- 13. 13 GE Title or job number 7/26/2016 SAE AS5553A section 4 clauses for clause 4 of the OEMs anti-counterfeit plan SAE AS5553A mandatory requirement s i.e. shall requirements Detailed requirements - keep clause 4 sub-clauses in the same sequence as SAE AS5553A section 4. OEM who owns the design IP where X means the requirement shall be achieved. OEMSs PCB subcontractor assembler 4.1 Requirement for an anti-counterfeit plan X X 4.1.1 Personnel training X X 4.1.2 Parts availability i.e. obsolescence management plan X The OEM manages this 4.1.3 Purchasing process addressing how suppliers are audited and controlled, that preference is given to buying from OCMs and franchised sources and buys from non-franchised sources are risk assessed to a stated method. X The OEM may: (1) provide their Approved Supplier List (ASL) and manage the auditing of suppliers on behalf of the subcontractor or (2) Only supply an Approved Manufacturer list (AML) and could allow the subcontractor the freedom to buy components themselves or (3) provide an AML and only allow the subcontractor to buy from the OCM or franchised sources. 4.1.4 Purchasing information for supply chain traceability back to the original source of supply. Flow down to subcontractors. Have X X
- 14. 14 GE Title or job number 7/26/2016 SAE AS5553A anti-counterfeit management plan section 4 SAE AS5553A requireme nt Requirements OEM who owns design IP OEMs PCB subcontr actor 4.1.5 Verification of purchased or returned product required depending on product risk to determine authenticity of product e.g. visual inspection to IDEA-STD-1010 etc. X X 4.1.6 In process investigation of failures which could be caused by counterfeit or recycled components X X 4.1.7 Failure analysis shall include the testing needed to verify component authenticity X The OEM may manage this 4.1.8 Material control of excess and non-conforming parts to prevent them from entering the supply chain under fraudulent circumstances, e.g. suspect components cannot be returned for a refund. X X 4.1.9 Reporting shall occur as appropriate to customers, local law enforcement etc. X X 4.1.10 Post delivery support shall be available for product returns and customer failures. X Manged by OEM
- 15. 15 GE Title or job number 7/26/2016 IECQ WG6 proposed Traceability audit i.e. a 3 way check of part numbers for ISO9001 supply chains complying to ISO9001 Clause 6 Part number ordered Traceability paperwork Part number received Vertical audit in Goods Inwards/Stockroom : Select 6 or 8 parts off a Bill of Material, Part number on Bill of Material Risk Mitigations: Sample verification tests for non- franchised buys and verification of special tracking schemes Part B optional capability enhancing activities to mitigate against counterfeits, see Table 1 Industry segment recommended Test methods e.g. from Trade Bodies or external standards bodies, see Annex A Franchised suppliers Approved communities The Part A traceability audit defined in the blue circles is a 3 way check to ensure: the manufacturers part number of the component required is the same as the manufacturers part number ordered and is the same as the manufacturers part number received with supply chain traceability back to the original manufacturer. The Part B optional capability enhancing activities are rated on a score of 2 to 12 to indicate the robustness of the organisation to mitigate against the use and supply of counterfeits
- 16. 16 GE Title or job number 7/26/2016 Anti-counterfeit standards summary Standard Market sector Description Comments AS/EN/JISQ9100 Avionics OEMS General Quality Management System All Avionics OEMs are expected to operate to this standard which is currently at rev C. Revision D (due out in 2016 includes anti-counterfeit requirements for material, mechanical and electrical components. This is a game changer for avionics industry SAE AS5553 General industry but mainly used by Avionics OEMs Set of 11 mandatory detailed requirements for how to buy, manage, and dispose of electronic components with reporting mechanisms when counterfeits are found Currently at revision A. Can be used to satisfy AS9100 rev D electrical component anti-counterfeit requirements. Next revision, rev B is in process to align it better with DFAR 252.246.7007. Mandated by most USA Prime Contractors. SAE AS6174 General industry but mainly used by Avionics OEMs Similar to SAE AS5553 for the procurement, management and disposal of electronic components but modified for material and mechanical components Can be used to satisfy AS9100 rev D anti- counterfeit requirements. Use rev A. Please join the committee if you have concerns contact Robert Tipton, robert.tipton@wyle.com USA DFAR 252.246.7007 Military US supply chain OEMs Set of 12 mandatory detailed requirements for how to buy, manage, and dispose of electronic components with reporting mechanisms when counterfeits are found Used in US Military contracts. Set of mandatory rules for covering how to buy and dispose of electronics components with reporting rules when counterfeits are suspected or found. Can use SAE AS5553 and or IEC/TS 62668-1 and IEC/TS 62668-2 to comply
- 17. 17 GE Title or job number 7/26/2016 Anti-counterfeit standards summary Standard Market sector Description Comments UK Defence Standard 05- 135 UK Military supply chain OEMs General overall anti-counterfeit requirements Used in UK Military contracts. Part of the UK Counterfeit Avoidance Maturity model which is used to assess how counterfeit aware suppliers are. Can use SAE AS5553 and/or IEC/TS 62668-1 and IEC/TS 62668-2 to comply IEC/TS 62668-1 Avionics OEMs Anti-counterfeit requirements for the purchase and management of electrical components, management of the products IP and control of spares and repairs Allows the use of SAE AS5553 plans for components coming into a business. Considered to provide a more holistic approach to Avionics anti-counterfeit as covers spares and repairs operations. Preferred by European Prime contractors and suppliers. IEC/TS 62668-2 Avionics OEMs Risk assessment of electrical components purchased from non-franchised sources Complements SAE AS5553 and IEC/TS 62668-1 and advises on typical test methods without being overly prescriptive. ARP 6328 General industry but mainly used by Avionics OEMs Risk assessment to accompany SAE AS5553 when revision B is published. Contains updated SAE 5553A annexes in preparation for SAE AS5553B which will have no annexes AIR 6273 Terms, Definitions, and Acronyms- Counterfeit Materiel or Electrical, Electronic and Electromechanical Parts In ballot
- 18. 18 GE Title or job number 7/26/2016 Anti-counterfeit standards summary Standard Market sector Description Comments SAE AS6496 Franchised distributor for high reliability, Aerospace and Defence market Fraudulent/Counterfeit Electronics parts: Avoidance, Detection, Mitigation and Disposition- Authorised/Franchised Distribution Released 2014 SAE AS6171 Component Test Houses for any market Test Methods Standards; Counterfeit Electronic Parts Main spec and 16 test methods are being balloted. Contains extensive risk mitigation process. Overly prescriptive to mitigate against legal liabilities. Very complicated and will be expensive to implement. Excellent deterrent. Not known who will request this. AS6081 Non-franchised distributors Fraudulent/Counterfeit Electronics parts: Avoidance, Detection, Mitigation and Disposition- Distributors; Counterfeit Electronic Parts: Avoidance Protocol, Distributors Parts are offered by non-franchised distributors with some basic testing which Avionics OEMs need to review in their application risk assessment process. Considered an input into SAE AS5553 or IEC/TS 62668-2 risk assessment ARP 6178 Non-franchised distributors Fraudulent/Counterfeit Electronic Parts: Tool for Risk Assessment of Distributors Very useful Excel spread-sheet with macro to remotely audit non-franchised distributors. Considered an input into SAE AS5553 or IEC/TS 62668-2 risk assessment
- 19. 19 GE Title or job number 7/26/2016 Anti-counterfeit standards summary Standard Market sector Description Comments AS6462A Auditing bodies and OEMS AS5553A Counterfeit Electronic Parts: Avoidance, Detection, Mitigation and Disposition Verification Criteria Audit checklist for SAE AS5553A for use by OEMs and Third party auditing bodies. AS6301 Auditing bodies and OEMS AS6081 Fraudulent/Counterfeit Electronics parts: Avoidance, Detection, Mitigation and Disposition- Distributors Verification criteria Issued in 2014
- 20. 20 GE Title or job number 7/26/2016 UK Defence Standard 05-135 Avoidance of counterfeit material, published July 2014 High level language requiring a clear requirement to manage the risk in supply chains depending on the criticality of the material in relation to performance and safety where the supplier is aware of the final use of the materiel ( electronic components, material and mechanical components). The supplier shall be able to demonstrate the materiel meets the original qualification requirements and the safety and performance of the deliverable materiel and ensure it is not degraded. An anti-counterfeit policy Flow-down to suppliers Appointment of a management representative Training Purchasing controls Test and verification Control of non-conforming product Reporting On-line web-based training packages being developed. Information has been provided to NATO who may issue anti- counterfeit guidance soon to all members.
- 21. 21 GE Title or job number 7/26/2016 IEC committee TC107 WG3 Counterfeit electronic parts see http://www.iec.ch/dyn/www/f?p=103:14:0::::FSP_ORG_ID,FSP_LANG_ID:5736,25 IEC/TS 62668-1, PROCESS MANAGEMENT FOR AVIONICS COUNTERFEIT PREVENTION Part 1: Avoiding the use of counterfeit, fraudulent and recycled electronic components Published a revision in 2014, with a revision due out soon to explain the DFAR Allows the use of SAE AS5553A plans for components coming into the business. Enables OEMs to have one overall plan for SAE AS5553A and IEC/TS 62668-1 Discusses when recycled components become fraudulent components and why the Avionics industry cannot use them. Also manages spares and repairs Refers to the now published IEC/TS 62668-2 PROCESS MANAGEMENT FOR AVIONICS COUNTERFEIT PREVENTION Part 2: Managing electronic components from non- franchised sources. Used as the IEC/TS 62668-1 non franchised distributor risk assessment process. Revision in process to refer to SAE AS6171 test methods and other risk assessments Can also be used as a risk assessment process for the following: SAE AS5553A, DFAR rule 252.246.7007 DEF STANDARD 05-135
- 22. 22 GE Title or job number 7/26/2016 SAE International Anti-counterfeit Specifications SAE AS5553A for Electronic components See http://www.sae.org/ G-19 committee has active membership mainly from the USA and UK SAE AS5553A was published in January 2013 superseding SAE AS5553 which has misleading definitions. Manages components coming into a business only. Targeted at general industry and AS9100 requirement is not mandatory. Revision B was started to incorporate DFAR 252.246.7007 to the extent that general industry will allow. Meetings still on-going. The SAE has no Third Party auditing activities but is working with PRI http://p-r-i.org/ to establish an audit process which Boeing may endorse. The audit checklist for SAE AS5553A is published as SAE AS6462A. IECQ WG06 has the documents for SAE AS5553 auditing if your customer endorses an IECQ audit. The APMC committee will host an anti-counterfeit update April 19th, contact John Clatworthy of the SAE if you wish to attend.
- 23. 23 GE Title or job number 7/26/2016 How one anti-counterfeit plan can address: DEF STD 05-135 DFAR 252.246.7007 SAE AS5553A IEC/TS 62668-1 using the non- franchised risk assessment process from: IEC/TS 62668-2
- 24. 24 GE Title or job number 7/26/2016 2016 Avionics anti-counterfeit supply chain
- 25. 25 GE Title or job number 7/26/2016 25 The Avionics Supply Chain 1. Parts & Materials Suppliers 2. Board Assemblers 3. Avionics OEMs, Logistics, Maintenance and Repair 4. Platform Integrators 5. Operators & Regulators Parts Boards Contract Mfg. Suppliers CustomersSolder etc. Suppliers Customers 15 - 40 yr Lifecycle 3 - 6 yr Lifecycle IEC/TS 62668-1/SAE AS5553A Anti- counterfeit and IEC/TS 62239-1 ECMP Most life cycle costs are incurred here and managed by ECMP Global Supply Chain SAE AS5553A counterfeit avoidance Requirements flow-down vs. products flow-up process is disrupted here Aerospace Captive To build products that must meet mil-aero requirements (what we must control) Using COTS components targeted for other markets (what we cannot control) Aerospace Electronics Depends on materials and components developed for other industries Vastly different lifecycle applications
- 26. 26 GE Title or job number 7/26/2016 Overview
- 27. 27 GE Title or job number 7/26/2016 Anti-counterfeit summary 2016 Contact information: Jo Vann, TC107 WG3 Anti-counterfeit convenor, CEO- Component Technology , GE Aviation Systems Ltd., T +44 (0)1242 632927 F +44 (0)1242 661151 E jo.vann@ge.com www.ge.com/aviation