Illicit Trade in Tobacco – Industry calls for strong Protocol without unjustified targeting of duty-free - 15/03/2010

Geneva 12 March 2010 - Airports, airlines and duty-free operators call upon WHO Member States to agree a strong Protocol on illicit trade in tobacco products during negotiations being held in Geneva from 14-21 March. Illicit trade in tobacco is estimated to cost governments and legitimate businesses US$ 20 billion in lost revenue annually.

However, the European Travel Retail Council (ETRC), Airports Council International (ACI), International Association of Airport Duty-free Stores (IAADFS) and the International Air Transport Association (IATA) completely reject the unwarranted proposal for a global ban on duty-free tobacco sales being sought by anti-tobacco activists.

Duty-free is amongst the most secure retail environments in the world and controls in place ensure that products are not diverted into illicit trade. Despite unfounded claims to the contrary by anti-tobacco activists, there is no evidence whatsoever that there is a problem with tobacco products intended for duty-free being diverted into illicit trade.

The reality is that if there are discrepancies between recorded sales and stock levels at airports for example, the duty-free retailer is obliged to cover the outstanding taxes due. The same rules apply to airlines, ferries and cruise ships and to land border duty-free shops.

Banning duty-free tobacco sales would deprive airports, airlines and the maritime trade of US$ 3.0 billion in annual revenue but have no impact whatsoever on the criminal elements that control the illicit trade in tobacco.

The purpose of this Protocol is to combat illegal trade in tobacco products, not to punish legitimate businesses. There is no supporting logic or evidence to back up the demands for a ban on duty-free.

There are a number of common-sense measures in the draft of the protocol that will form the basis for discussions in Geneva on 14-21 March. Airports, airlines and duty-free retailers support a strong Protocol and are willing to implement provisions in the protocol that will help strengthen the duty-free supply chain.

Airport, airlines and duty-free retailers hope that negotiations in Geneva lead to agreement on a Protocol that addresses illicit trade in a coordinated and effective manner without needlessly targeting legitimate businesses and key sources of revenue for the transport industry.

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