The AuthorBob Groome Bob Groome holds a B.A in French, Sociology and Political Science and a Masters degree in Natural Resource Governance and Economic Policy, both from National University of Ireland, Galway. He speaks English and French and has a good command of Irish. Cristian-Silviu Busoi, a Romanian MEP and trained physician who has served in the chamber since 2007, will be hosting a seminar at the Parliament on January 29th to take on two questions that have vexed European policymakers for two decades: “Where does the parallel trade of tobacco come from? How to end it?” Busoi’s description of the event puts the urgency underpinning the discussion from both public health and fiscal grounds in no uncertain terms. The parallel tobacco trade serves as a primary vehicle for young people in Europe to pick up the habit of smoking, all while robbing EU governments of €10-20 billion every year. Unfortunately, the European Commission has yet to respond with a robust approach to the underground tobacco trade. Over the past fifteen years, a central tenant of the Commission’s strategy has in fact been to rely on the very industry accused of driving it. From 2004-2016, the EU and Philip Morris International (PMI) implemented an “anti-contraband and anti-counterfeit agreement” that saw PMI cooperate with the European anti-fraud office (Olaf) and contribute to EU and member state budgets to counteract illicit trade in its own products. The EU-PMI accord led to copycat agreements with the other tobacco majors: British American Tobacco (BAT), Imperial Tobacco, and Japan Tobacco International. The central irony of these agreements is that the tobacco companies, who present themselves as victims of “parallel trade”, have been continuously implicated in trafficking their own cigarettes to dodge taxes. The most prevalent cases see tobacco companies oversupply smaller markets with cigarettes which are then redirected to larger ones. More salacious examples include BAT’s alleged willingness to threaten African governments and profiteer in conflict zones. These underhanded tactics cost national and local governments lose substantial amounts of revenue. In 2012, 22 Colombian departments sued Philip Morris in a New York court for over $3 billion, alleging the company had been involved in smuggling and money laundering in the South American country over the span of ten years. The 2004 European Union-PMI agreement was primarily a vehicle for the company to pay the EU up to $1.25 billion in restitution for its involvement with contraband tobacco, although even that amount pales in comparison to the customs duties, excise taxes and VAT revenue lost as a result of industry wrongdoing over the preceding decades. Will smoking in movies be banned soon? Frederik Cyrus Roeder 30/09/2018 The Opinion Those who have watched to movie Thank You For Smoking might remember its very entertaining way of telling the story of tobacco control activists fighting for more regulation, as well as tobacco lobbyists … Be More Curious… — This inherent conflict between the public interest in fighting the underground tobacco trade, and the industry’s interest in profiting off it, is precisely why the World Health Organisation (WHO) demands signatories to its Framework Convention on Tobacco Control (FCTC) and Protocol to eliminate illicit trade in tobacco products keep measures to stymie illicit tobacco separate and independent from tobacco companies. While the protocol officially came into force this past September, the EU signed it in 2013 and ratified it in 2016. Despite internal lobbying by bodies such as OLAF in favour of renewal, the European Parliament’s resolution rejecting the partnership and emphasizing the need to abide by the protocol’s rules and principles shifted the debate within the European institutions. The Commission specifically pointed to the FCTC to justify its decision not to renew its agreement with PMI. At the time, commissioner Kristalina Georgieva finally acknowledged the FCTC’s provisions as “the best instruments to fight illicit trade by regulatory means”. When the Parliament forces the Commission to close a door, however, the Commission oftentimes mollifies lobbyists by opening a window. Not long after abandoning the strategy of working directly with the tobacco industry, the Commission moved to implement the FCTC’s requirement for a “track and trace” system in a way that anti-tobacco campaigners claim opens a back door for industry interference. Busoi himself indicates the Commission’s approach allows the manufacturers to choose the entities responsible for data storage and handle the implementation of security codes on their products. According to the Tobacco Control Research Group at the University of Bath in the UK, the tobacco companies are also reportedly pushing for a PMI-developed marking system known as Codentify to serve as the track and trace tool of choice for the EU. The researchers point out that PMI sold the Codentify system to Inexto, a company led by a number of former PMI employees, for the sum of one Swiss franc. The Commission’s moves have not gone unchallenged. The International Tax Stamp Association (ITSA) is currently suing it before the European Court of Justice (ECJ), arguing the Commission’s openness to delegating data storage to the industry under the 2014 Tobacco Products Directive does not conform with the WHO’s Protocol to Eliminate Illicit Trade in Tobacco Products. As the association told members of the French Senate in November, the Commission’s approach to track and trace assumed the WHO’s protocol would not come into force for years to come. That short-sighted assumption was upended when the protocol went live this past September. From its tobacco industry agreements to its haphazard application of the FCTC, the Commission has demonstrated it is unable or unwilling to take a hard line with an industry responsible for the deaths of 700,000 people in the EU every year. That failure extends not only to the current EU member states, but also to some of the strongest candidates for future membership. As a series of investigative reports from the Balkan Investigative Reporting Network (BIRN) revealed this December, both Montenegro and Albania are home to factories producing contraband cigarettes that are smuggled to other parts of Europe but also to North Africa. Montenegro’s ruling party has a long and sordid history of links to black market tobacco and organized crime, and the BIRN revelations undermine the country’s claims it has turned a corner in governance. Even so, the country remains the top candidate for EU membership and has been commended by the Commission for its “progress” in terms of the rule of law. Where the Commission fails to act, it is often up to the European Parliament to act as the EU’s conscience and represent the interests of the public. The Parliament’s 2016 resolution against the anti-trafficking agreement with PMI pushed the Commission to abandon it. As such, the debate being organized by Busoi fits into a parliamentary tradition of enforcing accountability when the Commission proves unwilling. Just a few months ahead of pivotal European Parliament elections, this initiative represents the type of important parliamentary work that all too often flies under the populist radar. print Leave a Reply Cancel Reply Your email address will not be published.CommentName* Email* Website This site uses Akismet to reduce spam. Learn how your comment data is processed.