New research uncovers tobacco industry’s latest scam

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A study from the Tobacco Control Research Group at the University of Bath exposes evidence that big tobacco companies are still facilitating tobacco smuggling, while also attempting to control a global system designed to prevent it.  

The new research, which draws on leaked documents and investigates industry front groups, highlights the elaborate lengths the industry has gone to control a global track and trace system and to undermine a major international agreement – the Illicit Trade Protocol – designed to protect public health by stopping the tobacco industry from smuggling tobacco.

Authored by researchers at the University of Bath’s Tobacco Control Research Group, the paper, published today (Thursday 14 June) in the journal Tobacco Control, calls on governments and international bodies to crack down on Big Tobacco tactics and to instead ensure systems designed to control tobacco smuggling are free of industry influence.

In 2012, off the back of a string of inquiries, court cases and fines aiming to hold the major tobacco companies to account for their involvement in tobacco smuggling, governments around the world adopted the Illicit Trade Protocol (ITP). Part of a global treaty, the Framework Convention on Tobacco Control, the ITP aims to root out tobacco industry smuggling through an effective track and trace system – a system in which tobacco packs are marked so they can be tracked through their distribution route and, if found on the illicit market, can be traced back to see where they originated.

Fearful of developments, the new study argues that at this point the tobacco industry claimed to have changed, no longer the perpetrators of smuggling, but instead themselves the victims of counterfeit tobacco. Accordingly, instead of being held to account for smuggling, industry lobbied to work with governments to help tackle a ‘growing’ problem of counterfeit tobacco.

Yet, reveal the researchers, the tobacco industry is still facilitating tobacco smuggling. Approximately two thirds of smuggled cigarettes may still derive from industry; by contrast counterfeit cigarettes make up a far smaller proportion (circa 5% to 8% of the illegal cigarette market). At best, the authors suggest, this shows the tobacco industry’s failure to control its supply chain, but they point to growing evidence from government investigations, whistleblowers and leaked tobacco industry documents all suggesting ongoing industry involvement.

Simultaneously, the study authors highlight how the major tobacco companies have developed their own track and trace system, ‘Codentify’, lobbying governments around the world to see it adopted as the global track and trace system of choice. The study suggests that in order to bolster support for their system and enhance their credibility, Big Tobacco created front groups, paid for misleading data and reports and poured funding into organisations meant to hold it to account and into initiatives that would curry favour. These included:

  • Big Tobacco funding (through a front group) the World Customs Organization’s conference on illicit or smuggled tobacco;
  • Philip Morris International setting up a $100M fund for research on illicit which funds organisations whose previous reports on tobacco smuggling have already been widely criticised;
  • PMI funding INTERPOL which, rather than promoting ‘Codentify’, should have been holding the industry to account.

Leaked documents show the four major transnational tobacco companies hatched a joint plan to use front groups and third parties to promote ‘Codentify’ to governments and have them believe it was independent of industry and how these plans were operationalised. For example, the study reveals how a supposedly independent company fronted for British American Tobacco (BAT) in a tender for a track and trace system in Kenya.

Professor Anna Gilmore, Director of the Tobacco Control Research Group, explains: “This has to be one of the tobacco industry’s greatest scams: not only are tobacco companies still involved in tobacco smuggling, but they are positioning themselves to control the very system governments around the world have designed to stop them from smuggling. Their elaborate and underhand effort, implemented over years, involves front groups, third parties, fake news and payments to the regulatory authorities meant to hold them to account.

“Governments, tax and customs authorities around the world appear to have been hoodwinked.  It is vital that they wake up and realise how much is at stake.Our simple message is this: no government should implement a track and trace system linked in any shape or form to the tobacco manufacturers. Doing so could allow the tobacco industry’s involvement in smuggling to continue with impunity.”

Co-author Andy Rowell adds: “By analysing new leaked documents from the tobacco industry and other contemporary evidence, it’s clear that the masters of deception are up to their old tricks. The evidence suggests the industry is still facilitating tobacco smuggling, whilst trying to control the international system to stop smuggling. But authorities should not let the sly old tobacco fox look after the hen house.”

The team are now calling for a robust international track and trace system that is truly independent of the industry, and its front organisations. They suggest governments need to be alert to what the tobacco industry is doing and to realise it is now operating via a complex web of front groups and companies. They suggest any track and trace system linked to ‘Codentify’ should not be trusted.

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