Turning off the tap: An update on cigarette smuggling in the UK and Sweden, with recommendations to control smuggling

Turning off the tap: An update on cigarette smuggling in the UK and Sweden, with recommendations to control smuggling by Luk Joosens and Martin Raw, Ph.D., for Cancer Research UK and The National Institute of Public Health in Sweden. 33 pp. June, 2002.

Summary of published paper:

The tobacco industry has along argued that tobacco smuggling is caused by market forces and by price differences between countries, which create an incentive to smuggle cigarettes from "cheaper" to "more expensive" countries. They have urged governments to solve the problem by reducing taxes which will also, they say, restore revenue. Internal tobacco company documents reveal that the facts contradict all these assertions, and that smuggling is more prevalent in "cheaper" countries, and places where taxes have been reduced, like in Canada and Sweden for example, where consumption has risen and revenue has fallen. However there are countries that have solved the problem by better control, without lowering taxes. Spain is the most impressive example to date, and the new WHO Framework Convention may at last promote control of tobacco smuggling at the level at which it must be tackled -- globally.

Tobacco industry documents housed in the Guildford depository in England show that cigarette makers use smuggling as a strategy for increasing market share, and that they exercise almost total control on the markets in which they sell their cigarettes, not only over legal sales but also over the contraband market. Documents also show that members of the tobacco industry regard the health warning on packs as a useful marketing tool in many markets, because it helps persuade purchases of the "authenticity" of the manufacturer.

Recommendations for reducing smuggling include:

and retailers to be licenced: conditions would be attached to the licenses which would reinforce anti-smuggling programs; tobacco products a unique serial number which would identify manufacturer and date and location of manufacture, and another identifier which would show the chain of custody -– wholesaler, exporter, distributor, end market; prove that the cigarettes that leave the factory arrive in their intended end market; including quantities, sub-brand, brand, manufacturer, language of health warning, counterfeit or legitimate; every pack seized, fine the original manufacturer or their agent at least three times the lost duty (in line with United States’ racketeering legislation); and trading standards officers, so that small scale ‘retail’ distribution is disrupted; is to be tackled successfully it will require international collaboration and the likeliest mechanism for achieving this is the WHO Framework Convention curently being negotiated; the current text on tobacco smuggling pr oposes end market pack markings, warnings in national languages of the end market, a ban on duty free sales and mandatory licensing; all relevant government departments are urged to give this convention its whole -hearted support.
 * require manufacturers, exporters and importers, wholesalers, transporters, warehouses
 * chain of custody marking: require manufacturers to print legibly on all packages of
 * place the onus on the manufacturer (through record keeping and tracking systems) to
 * customs and excise should ensure that all seizures of cigarettes are properly recorded,
 * increase penalties: at the moment the benefits are greater than the risks; for example for
 * the anti-smuggling strategy within countries should be extended to engage the police
 * support the World Health Organization's Framework Convention on Tobacco Control: if tobacco smuggling

Related SourceWatch resources

 * Report on Smuggling Control in Spain (Published paper)
 * Tobacco smuggling
 * Organizing or participating in tobacco smuggling

External resources

 * International Union Against Cancer (UICC) Fact Sheet on Tobacco Smuggling
 * Merriman D, Yurekli A, Chaloupka F, How big is the worldwide cigarette-smuggling problem?, Tobacco Control in Developing Countries, background paper, The World Bank Group.
 * Schapiro, M. Big Tobacco, The Nation. May 6, 2002.
 * Joosens, L. How can cigarette smuggling be reduced?, BMJ 2000;321:947-950 (14 October)
 * Chronology of R.J. Reynolds Northern Brands cigarette smuggling in Canada, Physicians for Smoke-free Canada & Nonsmokers Rights Association of Canada, 2001.
 * Tobacco companies linked to criminal organizations in cigarette smuggling: what's next?, Center for Public Integrity/International Consortium of Investigative Journalists. March 3, 2001
 * Alamar B, Mahmoud L, Glantz S. Cigarette Smuggling in California: Fact and Fiction, July 30, 2003. University of California San Francisco, Center for Tobacco Control Research and Education. Tobacco Control Policy Making: United States.
 * Legresley E, Muggli M. Tobacco Overlords: Systematic Smuggling of Cigarettes throughout Africa July 13, 2006, Presentation at the 13th World Conference on Tobacco OR Health, Washington, DC.