One in five cigarettes in some EU countries smuggled, report says

Date: 03/03/05

Smuggled cigarettes may account for more than one-fifth of the tobacco market in some EU states, a Council of Ministers' probe has revealed.

A report by the Council's working party on customs co-operation cites "the stranglehold of criminal organisations on tobacco smuggling". This finding, it says, has been endorsed by most of the 16 national authorities that took part in its investigation.

The smuggling phenomenon appears to be growing in some of the Union's newer entrants. The Czech Republic, for example, referred to "the sophistication and professionalism of crime rings, which regularly tried to bribe officials" from law enforcement agencies.

The report finds that the market share of contraband cigarettes varies widely across the EU. In Hungary and Slovakia it could be higher than 20%, as was the case in Britain before 2002. At an estimated 15%, Poland also has a large illicit cigarette market, though the situation is less serious in France and the Netherlands and is "insignificant" in Italy, Spain and Portugal despite their use as transit countries by smugglers.

Developing a co-ordinated EU response to smuggling has been hampered by poor sharing of intelligence between national authorities, the report adds. Finland, Sweden and Slovenia found that "co-operation in its present form does not allow smuggling routes to be accurately identified, thus constituting a recurring obstacle to the dismantling of smuggling rings".

The lack of co-operation has been exacerbated by divergences in the powers which different national customs authorities have. While some have extensive enforcement powers, smuggling is considered a purely financial offence in Italy, despite "the virtually unanimous recognition of the role of organised crime in such trafficking".

Britain, which seized over 7 billion illicit cigarettes in 2000-04, remains the "priority destination" for contraband tobacco entering the EU, often from the far east and the former Soviet Union states. About 95% of all cigarettes seized in Ireland and half of those seized in Germany are en route to Britain, the report says, citing both the size of the UK market and its high tobacco taxes as the principal reasons.

A report by the Council's Working Party on Customs Co-operation says that smuggled cigarettes may account for more than one-fifth of the tobacco market in some EU Member States.

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