Illicit trade in tobacco products increased by a staggering 28 per cent last year and cost the treasury some €10 million in loss of revenue.

This was the main finding of an EU-wide report that will be discussed at the seventh session of the Conference of the Parties (COP7) which will be held in India in November.

The meeting will bring together the World Health Organisation Framework Convention on Tobacco Control (WHO FCTC) 180 parties – which includes almost every country in the world, as well as regional economic integration organisations like the European Union.

The protocol to eliminate illicit trade in tobacco products is an international treaty to address the increasing illegal trade in tobacco products. The illicit trade is enormous in some countries, with an average of nearly 10 per cent of the global cigarette market estimated to be made up of illegal product. This number is significantly higher in low and middle income countries with up to 50 per cent of cigarettes coming from illicit sources.

The protocol is needed because the illicit trade in tobacco products poses a serious threat to public health. This trade increases access to illicit tobacco products, undermining tobacco control policies. The protocol will provide an international legal framework to implement a series of measures, taken by individual countries, acting in cooperation with each other.

The problem of the illicit trade is a serious issue also for Malta.

The study found that while total legal consumption of cigarettes declined, contraband and counterfeit cigarettes which entered the Maltese market increased.

It also found that cigarettes that are usually manufactured legally in one country or market but which the evidence suggests have been smuggled across borders during their transit to the destination market – known in technical jargon as ‘illicit whites’ – accounted for 60 per cent of counterfeit flows. This figure stood at 22 per cent in 2014.

The report was compiled by international auditing firm KPMG LLP in the UK for British American Tobacco (Investments Limited), Imperial Tobacco Limited, JT International SA and Philip Morris International Management SA.

The KPMG Report, ‘Project Sun’, is about the illicit cigarette market in the EU, Norway and Switzerland. It highlights that at European Level, the total illicit cigarette volumes account for almost 10 per cent of all cigarettes consumed in the continent.

It found that illicit tobacco trade has accounted for one in 10 cigarettes consumed since 2010.

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