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Cigarette Smuggling

FRCA signs agreement with British American Tobacco Fiji

8 July 2011

To address the growing issue of illicit trade of tobacco products, the Fiji Revenue Customs Authority has signed and launched an operations agreement with British American Tobacco Fiji.

FRCA Chief Executive Officer Jitoko Tikolevu said the sale and use of illegal tobacco which is smuggled, counterfeit or tax evaded continues to rise and presents a large problem for customs and border control authorities.

Tikolevu said it also presents a challenge to government in respect of the loss to government revenue and the threat to the local legitimate tobacco industry.

He said FRCA will be working closely with British American Tobacco Fiji to further strengthen border management and internal control capabilities and procedures.

Story by: Sofaia Koroitanoa

http://www.fijivillage.com/?mod=story&id=080711e59e694a26bbcd63ad21fe5b#

Tobacco lawsuit could impact enforcement

http://timestranscript.canadaeast.com/newstoday/article/1419383

29 June 2011

A newly launched $1.5-billion lawsuit against contraband tobacco manufacturers across Canada could change the way the RCMP attempts to snuff out the trade of illegal cigarettes.

Cpl. Robert Fullerton of New Brunswick’s RCMP customs and excise unit says a lawsuit by Canada’s largest tobacco company Imperial Tobacco Canada Ltd. may shift greater police focus to eliminating illegal smokes at the source.

“It might change the way we do enforcement,” Fullerton said. “Right now we seem to be more concentrated on the end users than the manufactures.

“Maybe this is going to see the government force us to target the manufacturing more.”

Imperial Tobacco launched the lawsuit this month against what it labeled as contraband tobacco manufacturers and retailers on First Nations reserves.

Imperial also wants to bring smaller producers – whether operating legally or not – in as third parties to lawsuits it faces from the New Brunswick, Ontario and British Columbia governments.

The provinces are suing tobacco giants, including Imperial Tobacco, for health-care costs from tobacco-related illnesses.

The result of the lawsuits could focus the public eye on the large existence of illegal tobacco in the country, which big tobacco maintains is illegal competition to a regulated industry.

The RCMP has special units to deal with contraband tobacco and organized crime surrounding the trade. In 2010, the RCMP seized approximately 782,000 cartons and bags of illegal cigarettes nationwide.”It’s going to be very interesting to see how the government reacts,” Fullerton said.

Imperial was also critical of New Brunswick’s move in March to increase the tobacco tax in the province, saying the government had “set out the province’s welcome mat for organized crime to expand its thriving contraband business in the east.”

The Alward government’s first provincial budget, released in March, increased the tobacco tax by 45 per cent – a move that exceeds the request of the Canadian Cancer Society. The jump equates to an increase of 5.25 cents per cigarette, $1.31 per pack, $10.50 per carton and an extra $25 million in new government revenue.

Fullerton, who is based in Edmundston, said that there has yet to be an influx in illegal cigarette seizures since the tax increase, despite expectations that there in fact could be. New Brunswick RCMP spokesman Cpl. Yann Audoux said the amount of illegal tobacco seized in the last three months was not available yesterday.

More than 350,000 illegal cigarettes were seized at two traffic stops on the Trans Canada Highway in the Edmundston area on the same day last month.

In both cases, the cigarettes and the vehicles used to transport them were seized and will be forfeited.

In April, police also seized 124 cartons of illegal cigarettes at a home in Tracadie-Sheila.

Last week, the RCMP customs and excise section executed a search warrant at a residence near Sussex.

During the search, officers seized approximately 9,800 illegal cigarettes.

It also executed a search warrant at a residence in Albert Mines where more than 100 cartons of illegal cigarettes were seized.

Dodgy data enlisted in the propaganda war against plain packaging of cigarettes

http://blogs.crikey.com.au/croakey/2011/06/28/dodgy-data-enlisted-in-the-propaganda-war-against-plain-packaging-of-cigarettes/

This week British American Tobacco Australia (BATA) launched its latest salvo in its propaganda war against plain packs.

A new website allows visitors to click on any federal electorate (“Find your electorate”).

Once inside a selected electorate we read the estimate of illegal tobacco sales, with tax foregone derived from data compiled by Deloitte in 2011.

When you estimate illegal sales, you have to base it on survey data of what smokers tell you.

BATA are thoughtful enough to link to the report itself and on page 20, we read that Deloitte sourced Roy Morgan data gathered for BATA and that at  3.1.2.1 “Key requirements of sample:  Adult participants who qualified for the survey satisfied the following criteria: Aged between 18-64 years.  Resided in Sydney, Melbourne, Brisbane, Perth or Adelaide.”

On page 39, we can see that just 949 smokers completed the survey in these cities about whether they ever used illicit tobacco.

So BATA have taken city data and applied it to every electorate around Australia.

Apparently, smuggled tobacco is as easy to buy in Oodnadatta as it is in Redfern, Toorak or Vaucluse. It’s just the same with all consumer goods, right?

Deloitte seemed prescient when it handed over the report to the tobacco industry. A caveat reads “ No one else, apart from British American Tobacco Australia Limited, Philip Morris Limited and Imperial Tobacco Australia Limited are entitled to rely on this Report for any purpose.”

That would include .. .well … everyone else.

http://blogs.crikey.com.au/croakey/files/2011/06/tobacco-600x167.jpg

• Simon Chapman is professor of public health at the University of Sydney

***

• Meanwhile, over at The Conversation, Donald Rothwell, professor at the ANU College of Law, analyses the case that Philip Morris is launching against plain packaging under Australia’s bilateral investment treaty with Hong Kong.  He doesn’t give the company much chance of success.

Customs cracks down on an illicit cigarette syndicate

http://7thspace.com/headlines/387309/customs_cracks_down_on_an_illicit_cigarette_syndicate.html

Hong Kong (HKSAR) – Customs has mounted a large-scale anti-illicit cigarette operation, code-named “Sky-Eye” since last month. During the operation, Customs officers raided 41 peddlers, cracked 41 warehouses, including 30 residential storages, six mini-storage warehouses and five warehouses in factory buildings, detained 10 light goods vehicles, and arrested 63 persons, including 48 men and 15 women, aged between 21 and 78. The officers also seized about 10 million sticks of duty-not-paid cigarettes, 760 kg of duty-not-paid tobacco, worth about $23 million, with the duty potential of about $17 million. Customs believed that this operation has smashed an active illicit cigarette smuggling syndicate in the territory and its distribution network.

Customs has been closely monitoring the illicit cigarette activities.

Since the upsurge of tobacco duty rate in February, Customs has strengthened its manpower through internal deployment to take vigorous actions against illicit cigarette activities.

Under vigorous Customs actions, the large-scale smuggling activities became inactive. Customs later found the syndicate had changed the modus operandi and adopted the ‘swift distribution’ method to reduce the risk of being detected. Once a small amount of illicit cigarettes was smuggled into Hong Kong by cross boundary vehicles, then they would be dispatched to the peddlers in various districts without delay.

About a month ago, Customs targeted at a territory-wide illicit cigarette smuggling syndicate. After in-depth investigation, Customs found the syndicate smuggled the illicit cigarettes into Hong Kong by making false declaration. Once the illicit cigarettes were smuggled into the territory, they would be transported to peddlers in different districts by light goods vehicles without delay. The majority of the peddlers would sell the illicit cigarettes through telephone order and they would immediately dispatch to the buyers once an order was received.

Customs took follow-up action yesterday afternoon (June 24) and arrested the mastermind while he was receiving the seized 72 cartons of illicit cigarettes (about 870,000 sticks). Later, another 70,000 sticks of illicit cigarettes, 610kg of illicit tobacco and some packing material were seized from the syndicate’s packing and storage centre. It was believed that the syndicate not only smuggled the illicit cigarettes for the local market, but also smuggled some of the illicit cigarettes and tobacco to the overseas markets, including the United Kingdom by express couriers after repacking.

Customs believed that the result of the operation reflected the effectiveness of the enforcement strategy. Customs will continuously make stringent effort to monitor the illicit cigarette situation and combat any illicit cigarette activities.

Under the Dutiable Commodities Ordinance, anyone involved in dealing with, possession, selling and buying illicit cigarettes commits an offence. The maximum penalty on conviction is imprisonment for two years and a fine of $1 million.

Members of the public are urged to report any suspected illicit cigarettes activities to the Customs’ 24-hour hotline 2545 6182.

Source: HKSAR Government

The Illicit Trade in Tobacco Products and How to Tackle It

Download PDF : The Illicit Trade in%0d%0aTobacco Products and%0d%0aHow to Tackle It by the International Tax and Investment Center[1]

Tax Stamp Market from China

www.hgimage.com

Wuhan Huagong Image Technology & Development Co. Ltd (HG Image) is a wholly-owned subsidiary of Huagong Tech Co Ltd, which was founded in1999. Based in Wuhan, the capital of Hubei province and the most populous city in central China, the company went public in 2000 on the Shenzhen Stock Exchange.

It has the backing of the Huazhong University of Science and Technology (HUST), a renowned university able to provide strong R&D support. The company is accredited to ISO 9001:14001 and its core businesses include laser technology, opto-electronics and holography. The main products are thermistors, optical communication modules, laser and processing equipment, laser welded diamond tools and other related products.

It also produces holographic anticounterfeiting and packaging products for tobacco, food and wine. Its main market is the former, and long-standing customers include Baisha Tobacco, producers of China’s leading cigarette brand. Annual holographic output is around 5 billion labels and 50 million sq m of holographic packaging films. And for more than two years now, the company has also been manufacturing and supplying tax stamps to export markets, according to Jin Yong, Assistant General Manager. In the company’s display area, a bottle of vodka had a sophisticated tax stamp with 2D barcode, alphanumeric code and demetalised holographic stripe. The cyrillic script indicated a Russian product but Mr Jin could not grant permission to photograph the bottle on grounds of client confidentiality. It was mentioned that HG Image supplies a tax stamp to Azerbaijan. As has been previously reported in Tax Stamp News, along with several other companies, HG Image is interested in the possibility of a tobacco stamp for the Philippines and has visited that country with a proposal but, so far, no contract has been awarded.

When asked if HG Image could supply more than just the tax stamps, Mr Jin replied that they were in a position to supply the complete fulfillment and track and trace systems to accompany the stamps.

It appears that HG Image has only started producing tax stamps recently, but the technical support available to it from the government-sponsored university implies that through this channel, China could soon become a significant player in the world tax stamp market.

HG Image is a member of the IHMA (International Hologram Manufacturer’s Association), the China National Anti-Counterfeit Engineering Research Center and the FSEA (Foil Stamping and Embossing Association).

Contact: www.hgimage.com;

New US Tobacco Excise Stamp Solution Unveiled by Meyercord Revenue

www.taxstampforum.com – May/June 2011

Download PDF : tsn_may-jun_ 2011

Sixty-three held in smuggling probe

http://rthk.hk/rthk/news/englishnews/news.htm?main&20110625&56&765137

25-06-2011
Customs officers have arrested 63 people during a major operation against the cigarette smuggling.

They have also seized illicit cigarettes worth about 23-million dollars during raids on 41 warehouses. The head of the smuggling operation is said to be among those detained. Officers said the syndicate delivered the cigarettes to dealers by courier, and buyers would place orders with the dealers over the phone.

Tobacco control and the epidemiological framework

http://tobaccocontrol.bmj.com/content/20/4/318.2.full.html

Download PDF : Illicit loss revenue, 2nd article 12 countries. TC 11 07

Now tobacco can save us from mobsters, whores, terrorists…

19 June , 2011

Gangsters claim the packs are ‘easier for us to copy’, state they will ‘use persuasion’ to protect profits, say their other drug sales are ‘unbranded’, suggest they could bomb critics and finally murder a rival over their ‘cut’.

A SHORT film that appears to be based on a John le Carre spy novel – think people smugglers, prostitutes, terrorists – is the latest salvo in the tobacco industry’s battle against federal government plans to introduce plain packaging for cigarettes.

According to the seven-minute film by British American Tobacco, the proposal will cause organised crime gangs to flourish, encouraging the syndicates to use their networks to flood Australia with smuggled drugs, weapons and cigarettes.

Replete with scenes of menacing Russian mobsters, exploding cars, street prostitutes and drug-addled teens, the film is part of a global campaign to block Australian anti-smoking health reforms that could set a commercially damaging precedent for the international tobacco industry.

The short film was panned as ”Z-grade fiction” by Quit Victoria, who reckon the film would be unlikely to earn a nomination at a Tropfest festival.

”I have no doubt people will see this for the big tobacco propaganda it is,” said the group’s executive director, Fiona Sharkie.

While the film seems to stretch credulity, a voice-over claims: ”Law enforcers say some gangs [that distribute counterfeit cigarettes] are also behind people, weapons and drug trafficking. Some have terrorist links.”

Australian law enforcement agencies, however, were reluctant to speculate on whether the introduction of plain packets would threaten national security or leave the nation awash with guns and drugs.

”It would not be appropriate for ASIO to comment on advertising,” said an ASIO spokeswoman.

Spokespeople for the Australian Federal Police and Victoria Police also declined to comment on the film, which has been released on YouTube and the company’s international website.

British American Tobacco Australia spokeswoman Louise Warburton refused to comment on the film when contacted by The Sunday Age.

She said the content was not ”Australia specific” and referred inquiries to the company’s London head office, where the film was produced.

”The links between cigarette smuggling and other forms of organised crime have been well documented and reported in recent years,” the company’s global spokeswoman, Catherine Armstrong, said.

”You may find this report by the International Consortium of Investigative Journalists [based in Washington] useful, as it contains a number of direct quotes from people in law enforcement, as well as details of the links between the forms of crime.”

The Australian Competition and Consumer Commission is already investigating the industry over claims in recent advertisements that plain cigarette packets would lead to a surge in children smoking counterfeit tobacco.

British American Tobacco Australia chief executive David Crow warned last month that plain cigarette packets would provide a ”field day” for organised criminals, who had profited from a 150 per cent increase in illegal tobacco sales in Australia in the past three years.

Last week, ABC’s Media Watch admonished Channel Nine’s A Current Affair over a story it did in conjunction with British American Tobacco Australia. The story featured a Malaysian triad member, who claimed he had smuggled people in shipping containers into Australian cities. The man, who had been provided to ACA by British American Tobacco investigators, said the organisation’s tobacco and drug trafficking operations had provided the template for their people-smuggling business.

Customs and Border Protection said there was no evidence to support the claim.

Read more: http://www.theage.com.au/national/now-tobacco-can-save-us-from-mobsters-whores-terrorists-20110618-1g9ba.html#ixzz1PdzoMLBZ