Cigarette smuggling is defined as the “undeclared import of products across the border,” because the goods can be sold at a lower price in the country of origin due to tax, customs, or other reasons. Product piracy, on the other hand, involves the counterfeiting of branded products. The importation of counterfeit or illegal goods into Germany poses a significant problem for many industries and is a major threat to millions of consumers. For decades, classic tobacco cigarettes have been among the most smuggled and/or counterfeited products in Germany. Criminals are drawn to the high profits that can be generateds due to the low manufacturing costs.
Nearly every sixth cigarette consumed in Germany in 2022 was not taxed in this country. This is the conclusion of a representative survey of the cigarette industry ("Disposal Study"). Since 2004, more than 12,000 empty cigarette packets have been collected monthly via disposal stations and, since 2014, additional packets via street collections in this progress study and evaluated by the market research institute Ipsos. The study set-up (methodology, sampling, evaluation) has been confirmed by the Hamburgisches Weltwirtschaftsinstitut (Hamburg Institute of International Economics) and the TÜV Berlin/Brandenburg also audits and reviews the study implementation.
According to the KPMG Report, the black market for illegal cigarettes in the European Union had a total volume of 35.5 billion units in 2021. This corresponds to a solid eight per cent share of the entire cigarette market of the 27 EU member states and a total tax loss of approximately 10.4 billion euros. Additionally, every third cigarette illicitly traded within the EU was also a counterfeit.
Smuggling and product piracy only serve to benefit criminals who operate in an unregulated market. That's why Reemtsma is fully supportive of all legal measures to combat illegal trade. We actively work with German and EU authorities to fight cigarette smuggling and product piracy, to the best of our abilities.
We're paying increasing attention to the issue of product piracy, which is becoming a growing threat to other sectors of the consumer goods industry. All our products and brands are manufactured in accordance with the highest quality standards and meet all regulatory requirements. However, counterfeit products are generally not up to these standards.
Whether you are a consumer or a retailer, obtain tobacco products and novel, potentially risk-reduced product alternatives exclusively from trustworthy legal sources!