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Tobacco lawsuit could impact enforcement

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.

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