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Illicit trade is a growing concern in Europe. Over the past few years, investigators have noted an increase in factories making illicit products within the bloc. This represents a shift, as previously, most of the illicit products consumed within Europe originated outside the EU. However, the COVID pandemic, as well as Russia’s invasion of Ukraine, have resulted in the restriction of some routes that were traditionally used by smugglers at the Eastern border.

Taking tobacco as an example, in 2022 alone, international operations involving the European Anti-Fraud Office (OLAF) led to the seizure of 531 million illicit cigarettes, more than 205 tonnes of raw tobacco and 65 tonnes of water-pipe tobacco. The majority of these cigarette seizures were made from illicit production sites within the EU.

With regards to consumption, a report by KPMG estimates that while total cigarette consumption is declining in the EU, some of that reduction is offset by an increase in illicit cigarette consumption in the region. This grew by 3.9 percent in 2021, reaching 35.5 billion cigarettes in total. A better understanding of the increase in illicit cigarettes is required. One potential explanation may be the high excise tax increase throughout the EU in recent years.

Join this EURACTIV Hybrid Conference to discuss illicit trade in Europe. What practices can Member States put in place to tackle this issue?