Applying Smart-Contracts to fight Food Fraud in PGI Lika Potatoes

In Croatia, the fraud problem deals with the import of much cheaper potatoes from third countries, which can be unhealthy due to the overuse of pesticides that although being banned in the EU, are still allowed elsewhere. According to producers, controls on imported potatoes are not as strict as those for domestic produce. In the grey market, imported potatoes can be mislabelled as potatoes of domestic origin, under the name Lika potatoes (Lički krumpir), which undoubtedly misleads consumers. Most of the misuse of the names of protected products was found in restaurants, where it is very easy to mix higher quality products with lower quality products. In order to reduce fraud in the potatoes’ food chain, it is necessary to ensure traceability controls involving all actors across the supply chain in the fight against fraud. Improved traceability will enable quicker identification and verification of PGI Lika Potatoes / Lički krumpir, distinguishing these high-value products from similar varieties.

Verification of PDO/PGI compliance in Croatia is carried out by private certification bodies registered with the Ministry of Agriculture. Biotechnicon poduzetnički centar d.o.o. is the certification body responsible for the process of PDO/PGI product certification in Croatia. Product certification refers to the implementation of all control and certification activities so that PDO/PGI products that convey a certain added value on the market meet all the prescribed requirements for such products and are credible in communication with the customer. Biotechnicon's inspection activities relate to the monitoring of the production, processing and preparation of organic food and PDO/PGI products. Specifically, these activities involve field inspections, documentation checks, and verification of laboratory reports for compliance with production and other parameters required by regulations, registered specifications, and other normative documents. The aim of these procedures is to establish conformity and issue a document confirming the controlled quality and status.

ALLIANCE will enhance the traceability of the PGI Lika potatoes that is currently controlled through an opaque traceability documentation system (production site codes, storage site codes) that relies only on an unsafe QR coding system. The new FSC will provide encrypted product information that will be stored on a blockchain. What will be stored on a blockchain database using the ALLIANCE solution will be a trusted set of sensor-derived information that can be audited by authorized entities, accessed by the authorized actors across the FSCs (e.g. farmers, retailers) and by the end consumers to get proof of authenticity and full product traceability. In addition, the improved method would serve to more quickly identify and comply with Lički krumpir compared to other similar potatoes from other regions. Possibility of using it at the wholesale place as well as for the activities of the control body to increase the control activity and increase the sales volume.