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Bulletin Issue 101 Thursday ISSUE 101 THURSDAY, 18 MARCH 2010 GENEVA BULLETIN INSIDE THIS ISSUE TIME TO LOOK FOR West African situation 2 BAT’s complicity in smuggling 3 COMMON GROUND Tracking & tracing works in Kenya 4 Yesterday saw some welcome progress on s #LARIFY WHICH 0ARTIES ACTUALLY DISAGREE Les douanes doivent être davantage Part IV of the protocol - fruitful discussions with the core measures of the protocol, or impliquées en Afrique 5 that built upon and improved the work of fundamentally do not believe in a multilateral intersessional drafting group 2. It is highly approach to this issue. There may be a Il est temps d’interdire à l’échelle encouraging to see Parties reaching small minority that cannot be mondiale la vente de tabac par consensus on potentially delicate matters of accommodated, at least for now, and internet/à distance 6 search and seizure or proceeds of crime. Parties should neither tie themselves in knots to appease them nor waste their The big question is whether Parties can breath arguing with them keep this co-operative spirit going when we head back into the thornier issues of s &OCUS ON CORE PRINCIPLES Articles 5-7 - probably tomorrow in plenary, s #ONSIDER WHICH BITS OF TEXT 0ARTIES COULD likely today in corridor conversations. To cut without crippling a useful and realistic state the obvious, real progress on supply- international system of controls chain provisions will require a willingness to listen and to seek consensus on concepts s !DJUST EXPECTATIONS TO REALITIES NO before haggling about wording - as well as protocol can single-handedly solve all exceptionally hard work as we race to beat problems of illicit trade or substitute for the Sunday deadline of the end of INB-4. national efforts to control smuggling We should not kid ourselves: the clock s 2EMEMBER THAT THE PROTOCOL AND THE really is ticking down, and failure to reach international system it will set up, is merely a agreement this week could soon mean no starting point in global efforts to control illicit Illicit Trade Protocol. trade. At least as important as the system initially set up will be the flexibility to develop That would be a major setback for the with changing technology and needs. FCA FCTC, which to date has been an has suggested a technical committee of the extraordinary success, helping bring Meeting of Parties as a possible mechanism SINCE THE OPENING OF THE smoke-free spaces, advertising bans, to achieve this FIRST WORKING GROUP FOR graphic health warnings and other evidence-based tobacco control policies to s ,ISTEN TO OTHER 0ARTIES (ONEST ATTEMPTS THE FRAMEWORK CONVENTION countries around the world. to understand their practical and political ON TOBACCO CONTROL ON constraints do not mean compromising It would be particularly sad to waste this your own principles. 29 OCTOBER 1999 opportunity when the vast majority of Parties seem to honestly want a concerted Some Parties may note a small irony here: 47,381,437 international effort to deal with the health as civil society organisations, we are free to and financial damage caused by illicit trade. give negotiating advice without having to PEOPLE HAVE DIED FROM For the most part, the arguments are about negotiate ourselves or put our government’s TOBACCO-RELATED DISEASES the “how” of implementing supply-chain name on a legally binding document. To controls and co-ordinating systems which we can only respond that controlling (AS OF 09:00 ON 18 MARCH between countries rather than about the illicit trade in tobacco products is a critical 2010) fundamental desirability of tracking-and- part of tobacco control and public health. tracing, licensing or due diligence regimes. We understand that you do the hardest part of the work; we will do what we can to help So what should we do to reach agreement? you do it well. Some humble suggestions from the FCA: 1 ISSUE 101 THURSDAY, 18 MARCH 2010 GENEVA WEST AFRICAN SITUATION 4ELLING GRAPHICS FROM THE 5. /FFICE ON $RUGS AND #RIME REPORT ENTITLED 4RANSNATIONAL 4RAFFICKING AND THE 2ULE OF ,AW IN 7EST Africa: A Threat Assessment, published in July 2009. (http://www.unodc.org/documents/data-and-analysis/Studies/West_ !FRICA?2EPORT?PDF WEST AFRICA’S ILLICIT CIGARETTE MARKET (IN VALUE AT RETAIL PRICES) 3OURCE 7(/ 5. 0OPULATION $IVISION 5./$# AND OTHERS CIGARETTES FROM THE WORLD TO AFRICA Route Traffickers Source: Far East (China, Vietnam); Europe (Bulgaria, Groups involved: Cigarette manufacturers, local distributors Luxembourg, Greece) 2ESIDENCE OF TRAFFICKERS: West Africa Vector to West Africa: Via worldwide free trade zones, PARTICULARLY *EBEL !LI $UBAI AND THROUGH TAX HAVENS Threat Vector within West Africa: Landfall at a) Ghana-Benin-Togo, b) Estimated trend: Increasing Guinea (Conakry) and c) Mauritania, Trans-Saharan routes to Potential effects in region: Corruption, possible insurgent North African markets funding, loss of tax revenues $ESTINATION: West Africa (1/3), North Africa (2/3) Potential effects outside the region: Corruption, possible Value insurgent funding, loss of tax revenues Volume: 11 billion illicit cigarettes for West African consumer markets, 21 billion for North Africa Value 53 MILLION 2 ISSUE 101 THURSDAY, 18 MARCH 2010 GENEVA BAT’S COMPLICITY IN CIGARETTE SMUGGLING IN AFRICA Internal corporate documents from major tobacco from the North. I will countersign this document which will enable MANUFACTURES MADE PUBLIC THROUGH TWO 53 LITIGATION BAT to pay them – via Sorepex…[translated from original French] settlements in 1998, provided evidence of tobacco companies’ Similarly, to avoid detection between Niger and Nigeria, complicity in cigarette smuggling throughout Asia, Europe, the Sorepex reported that “;$=IRECT IMPORTS TO .IGERIA ;WOULD BE= Middle East, North America, and Latin America. /NLY ONE YEAR through Mr Adji…[who] would disguise the cigarette after British American Tobacco (BAT) opened its litigation importations by calling the shipment something else, e.g. document depository to the public, BAT’s public relations firm matches….” reported to the company that its depository located in 'UILDFORD 5+ WAS A hSKELETONv IN THE COMPANYS CLOSET IN Smuggled cigarettes were also essential to BAT’s management part due to the public airing of BAT’s internal documents of its cigarette brands in Africa. A 1991 internal BAT memo relating to cigarette smuggling. While the tobacco industry has regarding the launch of a new brand in West Africa states: long asserted that price differentials were (and continue to be) The reasons why we were so enthusiastic about Lambert & responsible for increases in transborder cigarette smuggling, Butler[L&B] were ... the possibility of GT [General Trade, a term used analyses of internal tobacco company documents have shown to refer to smuggled cigarettes] exploitation were considered to be that “transit” or “duty not paid” cigarettes (terms used internally good (Ghana, Cameroon) ... I accept that in retrospect we may have by the tobacco industry to refer to smuggled cigarettes) were been over optimistic about its [L&B] potential in Togo, Benin, Niger, incorporated into industry business plans and played an but the main reason for its launch in those markets was not to essential role in increasing market share, particularly in exploit domestic markets but for GT opportunities. emerging markets in low- to middle-income countries. Similarly, a 1990 internal BAT memo states, Publicly available internal BAT records, dating from the 1980s and 1990s, also suggest cigarette smuggling has played an Kool is considered to be the best B&W [Brown & Williamson, then important role in BAT’s market penetration across Africa. "!4S 53 SUBSIDIARY= product offering for the Nigerian market.... $OCUMENTS DESCRIBE HOW "!4 KNOWINGLY WORKED THROUGH KEY Both legal and transit importing would be required to properly – and distributors in Africa which, acting as middlemen, purchased profitably– develop the brand… cigarettes from BAT only to then supply them to “transiteers”; a BAT’s documents show that it also used legal cigarette sales term used to refer to those parties who physically transport “to provide cover for advertising and GT business.” In a 1991 CONTRABAND ACROSS BORDERS $ISTRIBUTORS ALSO INSULATED "!4 memo, BAT marketing executive Joe Green considered the from direct contact with transiteers, thus reducing the risk of distribution strategies for Cameroon in terms of two scenarios exposure for BAT. According to one BAT document stamped where legal imports were permitted and where legal imports “Secret”, one distributor, Soropex, “provide[d] ‘cover’, albeit were prohibited. Even if legal imports were allowed, Green increasingly flimsy, for BAT in some fairly shady business.” A stated, BAT memo regarding Cameroon stated: “GT shipments will remain the mainstay of our activity....The Malabo “It was agreed that Michel Chevaly [of Sorepex] was in an exposed distribution channel will have to be maintained…Maintain a minimum POSITION AND IN ;THE= FUTURE *-4 ;*OHN 4ICEHURST "!45+% "!4 = COVER LEVEL OF "(3& ;"ENSON AND (EDGES BRAND= via legal imports.” SHOULD NOT TRAVEL WITH HIM IN #AMEROON /NE OF THE MAIN FUNCTIONS OF 3/2%0%8 WAS TO ALLOW "!4 TO KEEP AT ARMS LENGTH FROM TRANSIT The findings from BAT’s internal documents suggest that the customers — particularly in Cameroon.” company’s complicity in contraband trade extended across the African continent. Any contribution by the tobacco industry to Additionally, distributors offered BAT detailed knowledge of address the problem of illicit tobacco trade should be viewed major entry points to the African continent, including Port Said, within this context. %GYPT FOR .ORTH !FRICA $JIBOUTI FOR %AST !FRICA AND -ALABO Equatorial Guinea for West Africa. Further, plans to conceal Monique E. Muggli cigarettes among other merchandise and falsify documents on Campaign for Tobacco-Free Kids the origin of the shipment were made known to BAT by Sources: Sorepex: ,E'RESLEY %, -UGGLI -% #OLLIN * 0ATEL 0 ,EE + (URT 2$ British Sales departing from Malabo to North Cameroun and Chad.
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