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Stop illicit trade of tobacco
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Why is it a health concern?
Undermines price and tax measures making tobacco more affordable, affecting young people, the poor and other vulnerable groups
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First places in the WHO European Region
Tobacco kills 1,6 million people each year in the WHO European Region
Highest adult smoking prevalence (28%) in the world
Highest proportion of deaths (16%) attributed to tobacco
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Highest number of seized cigarettes
95% Huge potential gain in eliminating illicit trade
Source: World Customs Organization, The illicit trade report 2012, Brussels, 2013
of all seized cigarettes globally were seized in Europe (1.952 million cigarettes)
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Saving 38,000 lives per year Illicit trade in the European Region is 6-10% of the total market A 1.9% decline in consumption would save over 38,000 lives per year
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9 to 11 billion EURO to gain
Even when taking the fall in consumption into account due to increased prices, the WHO European Region stands to gain between 9 and 11 billion EURO in revenue
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Factors influencing illicit trade More smuggling takes place in countries with lower cigarette prices. Other factors include: Weak governance and lack of high-level
commitment Porous borders (ease of entry into country) Industry participation Well organized crime networks Existence of informal distribution channels Likelihood of being caught Corruption levels
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What has worked?
Different approaches to combat illicit trade include investing in tighter control, higher penalties, stamp-applied tracking etc. Examples from Italy, Spain, the UK and Turkey
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Italy and Spain reduced smuggling - how?
Scaled-up country cooperation (e.g. joint customs activity and intelligence gathering)
Introduced anti-smuggling legislation
Imposed higher penalties on smugglers
Result: Illicit market share was reduced from 15% to 2% in Italy and 6% in Spain
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Combating illicit trade in Spain: a good investment
4€ million
40€ million
2.3€ billion 5.2€ billion
16%
2% 0%
5%
10%
15%
20%
0€
10€
20€
30€
40€
50€
1993-1996 1996-2000
Investment combating cigarette smuggling (€ million)
Cigarette tax revenue (€ billion)
Market share smuggled cigarettes (%)
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How the UK decreased illicit trade Additional customs officers Specialist investigators and intelligence staff x-ray scanners Tougher sanctions and penalties Public awareness campaign Supply chain legislation Confiscation of proceeds International cooperation – overseas intelligence
officers
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Retail prices and illicit market share in Turkey
Turkey a stamp-applied tracking system: helped raise taxes without higher illicit trade
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Industry is part of the problem
Controlling information about illicit trade is useful for industry to undermine tobacco control policies
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Illicit Trade Protocol (ITP)
Supplementary treaty to
7 have ratified
(Austria, Spain and Turkmenistan in Europe)
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What should be done? Ratify the Illicit Trade Protocol
Protocol contains measures to: control the supply chain improve law enforcement enhance international
cooperation