Recently, the issue of combating the shadow tobacco trade in Ukraine has once again become relevant. The reason for this was the fact that at the end of last year, the amount of budget revenues from the sale of the relevant goods decreased. Although, before that, there had been an increase over a certain period of time.
Various measures are currently being proposed to de-shadow the tobacco market in Ukraine. Most of them involve rebooting law enforcement agencies. However, no matter how well law enforcement officers detect smuggling and illegal production, only expert opinions can be evidence in court of a crime and the state's loss of taxes.
The initiative to create a unified database of tobacco product samples on the basis of Kyiv Scientific Research Institute of Forensic Expertise has not yet found a response from lawmakers. Instead, at the end of April, the Cabinet of Ministers adopted a resolution approving the Procedure for Maintaining the Unified State Register of Equipment for the Preparation or Processing of Tobacco, Tobacco Raw Materials, and Industrial Production of Tobacco Products. The Tax Service was entrusted to maintain this register.
Why the government's decision requires other bylaws that would regulate the involvement of experts in this process, otherwise a significant part of the tobacco market will remain in the shadows, how to establish the fact of counterfeiting or smuggling, and what expertise is needed for this, Oleksandr Ruvin, Director of Kyiv Scientific Research Institute of Forensic Expertise, told UNN in an exclusive interview.
- The Cabinet's resolution is indeed important in terms of attempts to de-shadow the tobacco market. But the question arises - if the equipment of a fictitious tobacco factory produces "left-handed" cigarettes, how will the relevant authorities be able to prove such facts? They need an expert examination, and the resolution does not mention any expert institutions.
- Let's start with the basics: tobacco research generally consists of five stages. Everything goes in the reverse order to the production process. The first step is to examine the packaging, signs of the equipment used to produce the cigarettes, the way the packs were packaged, traces of machines and equipment, the characteristics of adhesive materials, and whether all the markings and protective elements required by the current legislation are correctly applied to the cigarette pack. Next, excise stamps are examined for compliance with the reference samples. After that, it is the turn of the cigarettes themselves - we examine the materials used to make the cigarette and the packaging: paper, filter, polyethylene, glue, etc. Finally, the biological study of tobacco products allows us to study the tobacco itself (the mixture used by manufacturers, which has a unique recipe for each manufacturer). This stage shows the quality of the tobacco, its quantity, compliance with regulations, the content of various substances, etc.
In other words, the essence of our expertise is that tobacco products must fully meet all the requirements and criteria in accordance with state standards. This is determined consistently and in a complete closed cycle of research by experts.
The resolution in question stipulates that a Unified State Register of Equipment for the Preparation or Processing of Tobacco, Tobacco Raw Materials, and Industrial Production of Tobacco Products will be created in Ukraine.
This is just one item on the general agenda, and we have some doubts that it will be as effective as possible in the way it is proposed to be conducted and summarized. After all, this is an important process for us as experts, i.e. we will not be able to identify the line and equipment where the pack was produced at this time.
- What is the problem?
- In our opinion, the Register that will be created is undoubtedly important, but it should be supplemented with criteria that are important for its practical use. Without practical use, new tools to combat the illegal tobacco market will not be effective.
For example, according to the Register, owners or users of tobacco processing and manufacturing equipment must submit information on the basis for importing such equipment into the territory of Ukraine, its type, location address, etc. These data are certainly important and should be recorded, but for the practical study of an existing cigarette pack, other features that are currently not mentioned anywhere are more important - in simple terms, these are the same reference samples from production lines, etc.
- What is the way out of this situation?
- We need more constructive interaction of all involved participants, development of additional regulatory documents, and a joint cooperation plan. First and foremost, this is, of course, a matter of the State Tax Service, and it should be the main initiator of our involvement in this area and the provision of thorough expert assistance. In case of effective cooperation, we will have every opportunity to determine not only which line produced the pack, but also the quantity of products and other indicators.
- We clearly understand that expert opinions are key, and if one element is missing, the case can easily be dismissed in court?
- This is the crux of the matter - it is the expertise that is evidence in court, so this is a joint task for both expert institutions and law enforcement agencies, all government agencies involved. Of course, the processes are very complex, not all manufacturers are open to cooperation, and there are other difficulties. In Ukraine, there are major players - tobacco manufacturers - large companies that are interested in ensuring that both the state and themselves do not suffer losses from counterfeiting. After all, if there are fewer counterfeits, the manufacturer will sell more of its legal products, make more profit, and, accordingly, more taxes will go to the state budget. They are ready to provide all samples, open data, and cooperate in every way. However, there are cases where the opposite is true, and it is logical to assume that in those cases there are a lot of risks, we are talking about very large-scale losses for the state, which are measured in huge amounts.
Therefore, let there be a Unified State Register of Equipment for the Preparation or Processing of Tobacco, Tobacco Raw Materials, and Industrial Production of Tobacco Products, but it should probably complement this large-scale work and function as efficiently as possible.
At one time, we had an idea to create a thematic register of manufacturers. The State Tax Service provided us with a list of companies licensed to sell tobacco products - more than 50 representatives. The companies were supposed to provide us with reference product samples. We received some of the information, but this work is not being used as effectively as it could be.
In addition, the experts have all the technical capabilities to conduct, let's say, direct monitoring visits to production facilities. The steps are simple: experts arrive, produce a few packs in their presence, quickly analyze all the characteristics on site (tobacco, packaging, filter elements, other components and their characteristics), and draw a conclusion here and now.
Resolutions on the appointment of expert opinions on the investigation of the facts of illegal production of tobacco products are now received in the number of dozens per day, the state should have clarity on this issue.