Philip Morris International: New Study Shows Near-Doubling in Counterfeit Cigarettes in the European Union Drives Increase of Total Illicit Consumption in 2020
Philip Morris International Inc. (PMI) (NYSE: PM) is calling for public and private representatives to jointly combat illicit trade as a new report produced by KPMG was released on the consumption and flows of illicit cigarettes in 30 European countries—the 27 European Union (EU) member states, as well as U.K., Norway and Switzerland. The study estimates that, while total cigarette consumption continues to decline, the share of illicit cigarettes increased by one half of a percentage point to 7.8% of total consumption in 2020, reaching 34.2 billion cigarettes consumed across the EU 27 member states (EU27). The increase of illicit cigarettes—which consist of contraband, counterfeit, and illicit whites—was driven by an unprecedented 87% surge in counterfeit consumption. The tax loss for governments in the EU27 now amounts to approximately €8.5 billion.
The annual study, conducted independently by KPMG and commissioned by PMI, shows how legal and illicit cigarette consumption was impacted by the COVID-19 pandemic, a period of lockdowns and restricted movement of people within the EU coupled with declines in affordability. The report estimates that total consumption of cigarettes declined by 4.7% in 2020 to 438.8 billion in the EU27, while the COVID-19-related border controls and travel restrictions resulted in a sharp decrease of non-domestic consumption, which declined in 2020 by 18.5% (11.9 billion cigarettes). It is noted that the decline in total cigarette consumption also coincided with the growth of 6.0 billion cigarette equivalent units in the fine cut tobacco category in 2020.
Consumption of illicit whites and other contraband cigarettes decreased year-over-year, but these declines were more than offset by an increase in counterfeit, which almost doubled in 2020, equating to 10.3 billion fake cigarettes, up from 5.5 billion in 2019. This was estimated to be driven mainly by an unprecedented 609% increase in counterfeit cigarette consumption in France, reaching 6.0 billion fake cigarettes consumed in the country alone.
“It is crucial to protect consumers against counterfeits and that law enforcement, governments, and trademark owners such as ourselves in the private sectors come together as one to address and eradicate illicit trade in Europe and beyond,” said Alvise Giustiniani, Vice President, Illicit Trade Prevention. “Eliminating illicit trade is particularly important within the context of PMI’s transformation toward a smoke-free future, and we need to continue working in partnerships to address any potential illicit trade threats, including in our novel products. Compliance to the law and effective enforcement against criminals profiting from illicit trade is an absolute must.”
Interviews with law enforcement, conducted by KPMG as part of the study, indicate that organized criminal groups continued to move their operations inside the EU borders, as a large proportion of illicit whites and counterfeit cigarettes are also believed to be manufactured in illegal factories within the EU. This is further supported by the increasing number of illegal cigarette factory raids in multiple European countries.
The availability of cheap, fake, and unregulated cigarettes on the black market undermines efforts to reduce smoking prevalence and prevent youth from smoking. To succeed in PMI’s mission to achieve a smoke-free world, it is imperative that illicit trade is eradicated wherever it exists. In order to tackle the illicit tobacco trade, PMI is working closely with a broad range of law enforcement authorities and private actors worldwide to identify and shut down counterfeiting and smuggling operations.
The company recently announced the launch of the third funding round of PMI IMPACT, its global initiative supporting third-party projects aimed at reducing or preventing illegal trade, and fostering an ecosystem of public and private actors to tackle illegal trade in its many forms.
Additionally, in its efforts to combat illicit trade, PMI continues to invest significantly in supply chain controls through preventive and protective measures, implements state-of the-art track-and-trace technology, and has strict due diligence protocols in place for all customers and suppliers. The company also supports regulations such as the FCTC Protocol to Eliminate Illicit Trade in Tobacco Products and the tracking-and-tracing provisions under the EU Tobacco Products Directive.
For more information about PMI’s illicit trade prevention efforts, visit StopIllegal.com.
About the KPMG Report
A detailed overview of results and methodology is available here.
Philip Morris International: Delivering a Smoke-Free Future
Philip Morris International (PMI) is leading a transformation in the tobacco industry to create a smoke-free future and ultimately replace cigarettes with smoke-free products to the benefit of adults who would otherwise continue to smoke, society, the company, its shareholders and its other stakeholders. PMI is a leading international tobacco company engaged in the manufacture and sale of cigarettes, as well as smoke-free products, associated electronic devices and accessories, and other nicotine-containing products in markets outside the U.S. In addition, PMI ships versions of its IQOS Platform 1 device and consumables to Altria Group, Inc. for sale under license in the U.S., where these products have received marketing authorizations from the U.S. Food and Drug Administration (FDA) under the premarket tobacco product application (PMTA) pathway; the FDA has also authorized the marketing of a version of IQOS and its consumables as a Modified Risk Tobacco Product (MRTP), finding that an exposure modification order for these products is appropriate to promote the public health. PMI is building a future on a new category of smoke-free products that, while not risk-free, are a much better choice than continuing to smoke. Through multidisciplinary capabilities in product development, state-of-the-art facilities and scientific substantiation, PMI aims to ensure that its smoke-free products meet adult consumer preferences and rigorous regulatory requirements. PMI's smoke-free product portfolio includes heat-not-burn and nicotine-containing vapor products. As of March 31, 2021, PMI's smoke-free products are available for sale in 66 markets in key cities or nationwide, and PMI estimates that approximately 14.0 million adults around the world have already switched to IQOS and stopped smoking. For more information, please visit www.pmi.com and www.pmiscience.com.
# # #
To view this piece of content from cts.businesswire.com, please give your consent at the top of this page.
Philip Morris International
+54 911 3828 4288
About Business Wire
Subscribe to releases from Business Wire
Subscribe to all the latest releases from Business Wire by registering your e-mail address below. You can unsubscribe at any time.
Latest releases from Business Wire
iBASIS Wins Best Global Wholesale Carrier – Voice at the Global Carrier Awards 202125.10.2021 08:00:00 CEST | Press release
iBASIS, the leading provider of communications solutions for operators and digital players worldwide, won Best Wholesale Global Carrier – Voice 2021 at the 17th edition of the Global Carrier Awards (GCAs) held during Capacity Europe in London, U.K. Commending the greatest accomplishments in telecom, tech, and ICT space, the win recognizes iBASIS’ transformation under the leadership of Alexandre Pébereau, its Chief Executive Officer. In 2019, Pébereau also received the GCA for Best Strategic Acquisition of SFR ICS from the Altice Group and iBASIS from Royal KPN. The company received four additional Global Carrier Awards, including Best Strategic Acquisition of NOS International Carrier Services (NOS ICS) in 2020. “It is remarkable that iBASIS is being recognized as it celebrates the 25th anniversary of its launch of VoIP. Then, live calls on the Internet seemed impossible. Today, the transformation of Tier 1 voice services depend on the very same platform,” comments Pébereau. “This win
EIG Signs Agreement to Acquire 10% Interest in APLNG for US$1.592 Billion24.10.2021 23:30:00 CEST | Press release
EIG, a leading institutional investor to the global energy and infrastructure sectors, today announced that it has entered into a definitive agreement under which it will acquire a 10% interest in Australia Pacific LNG Pty Limited (“APLNG” or the “Project”) from Origin Energy Limited (“Origin”) for an equity purchase price of $1.592 billion. This innovative agreement represents the first ever acquisition of an interest in an operational integrated LNG project by a private equity sponsor. Asset Highlights and Strategic Rationale A tier-one, integrated LNG project with an established liquefaction facility, APLNG is the largest LNG project by liquefaction capacity on Australia’s eastern seaboard and a major supplier of LNG to Asia and gas to Australia’s domestic market. The Project, which is located in Gladstone, Queensland, has a track record of consistently achieving its nameplate capacity of 9.0 Mtpa and holds a leading acreage position spanning the prolific Surat and Bowen basins, pro
SES-17 Successfully Launched on Ariane 524.10.2021 06:08:00 CEST | Press release
SES announced today that the SES-17 satellite was successfully launched into space onboard an Ariane 5 launcher operated by Arianespace from the Europe’s Spaceport in Kourou, French Guiana at 11:10 pm local time (02:10 am UTC). This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20211023005019/en/ SES-17 Successfully Launched on Ariane 5 (Photo: Business Wire) The multi-mission Ka-band satellite will provide comprehensive coverage across the Americas, the Caribbean and the Atlantic Ocean. From its orbital slot of 67.1 degrees West orbital slot, the very high throughput geostationary (GEO) satellite incorporating cutting-edge technologies is set to deliver the best connectivity experience for SES customers operating in the aeronautical, maritime, enterprise, and government markets. Built by Thales Alenia Space, SES-17 marks an important milestone in satellite technology as the first Ka-band geostationary satellite to embark a fully
Peru Holds a Ribbon Cutting Ceremony at Its Pavilion at Dubai Expo and Wins 4 World Travel Awards22.10.2021 19:15:00 CEST | Press release
The Dubai World Expo took place in an electrifying musical atmosphere where thousands of attendees were captivated by the variety of artistic, musical and cultural expressions that characterize the different regions of Peru. All this was part of the inauguration of the Peru Pavilion at the most important cultural event in the world. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20211022005454/en/ Peru inaugurated its Pavilion at Expo 2020 Dubai and received four awards from the “Tourism Oscars.” (Photo: Business Wire) The Peru Pavilion was inaugurated by the Commissioner General for Peru at the Expo, Amora Carbajal, and Najeeb Mohammed Al-Ali, Executive Director of Expo 2020 Dubai, in front of official representatives from different country pavilions. “The purpose of the pavilion is to offer a complete learning experience about ancient Peruvian wisdom throughout the visit, communicating the importance of the heritage, biodive
Schlumberger Announces Third-Quarter 2021 Results22.10.2021 12:50:00 CEST | Press release
Schlumberger Limited (NYSE: SLB) today reported results for the third-quarter 2021. Third-Quarter Results(Stated in millions, except per share amounts)Three Months EndedChangeSept. 30, 2021Jun. 30, 2021Sept. 30, 2020SequentialYear-on-yearRevenue* $5,847 $5,634 $5,258 4% 11% Income (loss) before taxes - GAAP basis $691 $542 $(54) 28% n/m Net income (loss) - GAAP basis $550 $431 $(82) 28% n/m Diluted EPS (loss per share) - GAAP basis $0.39 $0.30 $(0.06) 30% n/m Adjusted EBITDA** $1,296 $1,198 $1,018 8% 27% Adjusted EBITDA margin** 22.2% 21.3% 19.4% 90 bps 280 bps Pretax segment operating income** $908 $807 $575 12% 58% Pretax segment operating margin** 15.5% 14.3% 10.9% 120 bps 460 bps Net income, excluding charges & credits** $514 $431 $228 19% 126% Diluted EPS, excluding charges & credits** $0.36 $0.30 $0.16 20% 125% Revenue by Geography International $4,675 $4,511 $4,210 4% 11% North America* 1,129 1,083 1,034 4% 9% Other 43 40 14 n/m n/m $5,847 $5,634 $5,258 4% 11% *Schlumberger dive
Disruptive.Asia: Huawei's Ryan Ding and Peng Song Discuss How Operators Can Leverage Connectivity to Unlock New Growth22.10.2021 12:30:00 CEST | Press release
Disruptive.Asia reported that Ryan Ding and Peng Song stressed the growing importance of connectivity in driving industry growth and generating value amid a rapidly evolving landscape at the 7th Ultra-Broadband Forum (UBBF 2021) in Dubai, which is jointly hosted by the UN Broadband Commission and Huawei. Ding, Executive Director of the Board and President of the Carrier Business Group, Huawei, said that connectivity has made it possible to innovate, especially in a digital age where increasing efficiency has become paramount. The pandemic has also ushered a paradigm shift in connectivity, as homes turned into multi-functional centers for education, work, and business. It became increasingly clear that connectivity not only drives digital economies forward but also maintains the functioning of society. Peng, President of the Global Carrier Marketing & Solution Sales Department, Huawei, said that looking at connectivity through Huawei's C.A.F (Coverage, Architecture and Fusion) model can
Suzano Brings Its Target for Capturing 40 Million Tons of Carbon From the Atmosphere Forward To 202522.10.2021 12:19:00 CEST | Press release
Suzano, the world's leading eucalyptus pulp producer and a global benchmark in the manufacture of bioproducts developed from eucalyptus, announces today that it has revised one of its 14 long-term goals – collectively known as Suzano’s “Commitments to Renewing Life”*. Suzano’s goal to remove 40 million tons of carbon from the air by 2030 has been brought forward by five years to 2025. With this revision, Suzano reinforces its capacity to make an even more positive contribution to the planet's climate by achieving net carbon removals from the atmosphere at a faster pace than previously expected. The new five-year target will be supported by the expansion of Suzano’s forest covering which will involve both an uplift in commercial planting operations and setting aside new designated conservation areas that were previously anthropized. Alongside these improvements, Suzano will maintain its focus on reducing carbon emissions across its own operations and supply chain and will continue to im
In our pressroom you can read all our latest releases, find our press contacts, images, documents and other relevant information about us.Visit our pressroom