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“The illegal cigarette market has halved” - Ukrtiatyun

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The Bureau of Economic Security of Ukraine held a meeting with representatives of the Association  "Ukrtiutiun". During the event, the participants discussed the results of the Bureau's work, systemic problems faced by the BES specialists, as well as proposals for further steps to combat illegal trafficking of excisable goods.

According to Natalia Fesyun, CEO of the Association "Ukrtiutiun", the data  of the latest "wave" of the study of the illegal tobacco market conducted by KANTAR Ukraine shows that the share of the shadow tobacco market has decreased to 12.6% against 25.7% in October 2013.

"We are finishing the year quite optimistically, as evidenced by the KANTAR data. However, after the end of active measures by law enforcement and regulatory authorities, illegal products began to appear on the shelves again. Therefore,  we hope that the pace of the fight will not slow down," Fesyun said.

In his turn, Philip Morris Ukraine's trademark protection manager Sergiy Verbov noted recent high-profile cases of seizure of cigarette production lines, noting that each such line is a real prevention of the growth of the illegal cigarette market by 1-2%.

According to representatives of the Bureau of Economic Security, since the beginning of the year, 237 criminal proceedings on illegal tobacco trafficking have been brought to court and 16 industrial production lines have been seized. The value of the seized goods is over UAH 1.3 billion. The BES initiated the revocation of tobacco production licenses of 3 companies.

In addition to the results of the work, the participants also discussed plans to develop legislative changes that would facilitate the de-shadowing of the sector.

It is about increasing the liability for committing crimes under Article 204 of the Criminal Code of Ukraine, as well as amending the procedure for storing seized excisable goods and equipment for their manufacture. 

According to the EBA members, the initiatives under discussion, in combination with  the introduction of State Tax Service checkpoints and a round-the-clock video surveillance system at tobacco manufacturing facilities, will have a positive effect on reducing the share of the shadow cigarette market.

As a reminder, at the end of 2023, the leadership of the Bureau of Economic Security changed, and now the Main Detective Unit of the BES is headed by Oleksandr Tkachuk.

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