The black market of cigarettes increased in July to 18.2 percent of total consumption (by 2.1 pp more than in May 2018). This is the highest level of smuggling this year, surpassing the average of 2017, of 16 percent.

“The northeast region continues to be the most affected by the black market, with a share of 39.5 percent, although illicit cigarette trade seems to have assaulted the western side of the country. The most significant increase is in the northwest, 14.7 pp, to 29.4 percent, the region thus reaching a record level in the last three years! In addition, illegal trade increases by 6.2 pp. up to 26.9 percent in the Southwest region. From the point of view of origin, “cheap white” continues to be the main source, with 63.9 percent. The share of illegally produced tobacco products from Moldova, Ukraine and Serbia is relatively constant,” said Marian Marcu, general manager at Novel Research.

“The smuggling rate reached 18.2 percent in July 2018, the highest ever recorded in the summer since 2010. According to information on illicit cigarette catches provided by the Border Police and centralized on www.stopcontrabanda.ro, smugglers are increasingly using unconventional routes for introducing illegal cigarettes into the country, the “green stripe” representing the opportunity of fraudulent border crossing with minimal risks, despite the constant efforts of the Border Police. That is why we consider that the Ministry of Public Finance’s very good initiative to strengthen control at customs points needs to be matched by “green stripe” measures as well as strengthening bilateral relations with Ukraine and Moldova in order to prevent illicit trafficking from these countries . Otherwise, there is a risk that the investment at the customs points will not produce the desired smuggling reduction, from the current level of 18.2 percent to the one closer to the European average, of only 9 percent in 2017,” said Ileana Dumitru, director Legal and Public Relations, British American Tobacco.

“We read daily in the press about network destruction, searches or seizures, and cigarette smuggling has once again become the subject of discussion in the Supreme Council of Defense. Efforts of law enforcement authorities are visible. Everything is done but is for nothing. From one Novel study to another, the phenomenon is amplified and the degree of sophistication of networks increases. A convincing example: the recent accidental discovery of a Romanian truck with a Bulgarian driver, officially transporting clothes from Turkey to Ukraine, and unofficially 165 cigarette packs of Moldovan stamps most likely manufactured in China. Lately, smuggling packages are sold not only in markets, but also in shops, under the counter. The black market affects both our budget revenues and our legitimate businesses. That is why we support the authorities’ efforts through concrete programs. JTI has donated to the Romanian Customs since 2010 over 50 dogs trained to detect tobacco and some others with double or triple specialization: tobacco, drugs or cash. I also contributed to the formation of Moldovan and Serbian canine teams. Over the past nine years, we have been partners of the authorities in organizing annual public awareness campaigns on the profoundly negative effects of smuggling. There are concrete actions and programs that we will continue to pursue,” said Gilda Lazar, Corporate Affairs & Communications director of JTI Romania, Moldova and Bulgaria.

“This increase in smuggling by over 2 pp. it is all the more worrying that law enforcement authorities are fighting alone on the front of smuggling without clear coordination and in the absence of a coherent national strategy. We are in the process of implementing the European Regulation on the Traceability Tracking System (Track & Trace) adopted by the European Commission with the objective of reducing smuggling. However, the system will only monitor EU manufactured products, but most cigarettes in the black market come from outside the EU, as seen in Novel studies. Apart from the fact that the Regulation itself is useless in the fight against smuggling with cigarettes, the system is complicated and costly, there are also a number of delays in binding regulations, such as the designation of a single code emitter, “said Valentin Canura, sales development manager at Imperial Tobacco Romania.

According to www.politiadefrontiera.ro, at the beginning of August, the Romanian and Bulgarian border guards discovered over 82,300 cigarette packs hidden in a truck with clothes. During the same period, ITPF police officers in Sighetu Marmatiei conducted 51 searches at the homes of people in a criminal group focused on smuggling cigarettes. They also captured 21,000 packets of cigarettes in July and 54,950 packages in June. In July, STPF Mehedinti police officers devastated an important smuggling network with excisable products, and in June police officers from the Border Police Section of Iaşi discovered 7,000 cigarettes that were crossed over the border with the drones.

Cigarette manufacturers consider that, in order to reduce illicit trafficking, it is necessary to adopt a National Strategy to Combat Illicit Trade in Cigarettes on the model developed in 2011, as well as several legislative changes that, together with law enforcement authorities, demands for years. In addition to the unitary regulation of smuggled cigarette smuggling, it is necessary to step up operations at internal border crossing points, with Hungary and Bulgaria, as well as to establish specific attributions for local police and gendarmerie, since illegal trade with cigarettes unfolding almost unhindered in their area of ​​competence – markets, galleries, metro stations.

The tobacco sector is the second largest contributor to Romania’s state budget, after the oil industry.

The post Cigarettes smuggling at year-high; the black market increased in July to 18.2 pct of total consumption appeared first on Business Review.