Illicit Market Continues to Grow in the EU, Largely Driven by Counterfeits in France, According to New Study by KPMG
In 2021, an estimated 1.3 billion more illicit cigarettes were consumed in the European Union, reaching 8.1% of total consumption in the region.
LAUSANNE,
Based on the report, the increase of illicit consumption in the EU was largely driven by an estimated 33% increase in counterfeit consumption in
“The findings of the KPMG Report should be a real wake-up call. It’s alarming that in countries that maintain high excise taxes on cigarettes, such as
The annual KPMG report focuses on the consumption and flows of illicit cigarettes in 30 European countries—the 27 EU member states, as well as the
“Tax revenue losses will limit governments’ ability to invest in areas such as public safety, public services, or infrastructure, at a time when people across
The KPMG report also shows that roughly half—16 out of 27—of the member states experienced declining or stable consumption of illicit cigarettes in 2021. Among these countries,
“The decreasing consumption of illicit cigarettes in countries like
Counterfeit consumption was the main driver of illicit trade in the EU; consumption of fake cigarettes reached an estimated total of 12.3 billion—accounting for 34.6% of total illicit consumption. The study indicates that due to continued travel and border restrictions related to the COVID-19 pandemic, organized criminal groups shifted their focus toward manufacturing counterfeit cigarettes directly within EU borders. Interviews conducted by KPMG with seven different law enforcement agencies found that illegal manufacturing sites are increasingly moving west in
The continued growth of a black market where fake and unregulated cigarettes are easily available seriously undercuts legitimate efforts to reduce and eventually eliminate cigarette smoking.
“We are convinced that consumers need to be incentivized so that they don’t have to turn to illicit cigarettes. This means focusing on education and awareness, and ensuring the availability of better alternatives, such as scientifically substantiated smoke-free products,” added Verdeaux. “Making them accessible as a better option for millions of adult smokers in
A detailed overview of the results and methodology of the KPMG report is available here. For more information about PMI’s illicit trade prevention efforts, visit PMI.com.
Note to editors
In
For PMI, eliminating the illicit tobacco trade has been a long-standing priority. The company collaborates with law enforcement agencies and other organizations all over the world to root out and shut down illegal activities, including counterfeiting and smuggling operations. PMI IMPACT is just one example of PMI’s commitment in this sector—it supports third-party projects aimed at reducing or preventing illegal trade. Ultimately, through PMI IMPACT (now in its third round of funding), PMI is growing and fostering an ecosystem of public and private actors to tackle illegal trade in all its forms.
PMI’s efforts to fight illicit trade are embedded in its day-to-day operations. The company implements preventive and protective measures as a means of supply chain control, uses cutting-edge track-and-trace technology, and holds all customers and suppliers to strict due-diligence standards and protocols. PMI continues to support relevant regulations like the FCTC Protocol to Eliminate Illicit Trade in Tobacco Products and the EU Tobacco Products Directives’ tracking-and-tracing provisions.
Philip Morris International (PM): Delivering a Smoke-Free Future
Philip Morris International (PM) is a leading international tobacco company working to deliver a smoke-free future and evolving its portfolio for the long term to include products outside of the tobacco and nicotine sector. The company’s current product portfolio primarily consists of cigarettes and smoke-free products, including heat-not-burn, vapor, and oral nicotine products, which are sold in markets outside the U.S. Since 2008, PMI has invested more than
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Source: Philip Morris International (PM)