Illegal tobacco

Fighting the black market in tobacco addresses a threat to our business, while also helping to fight organised crime and preventing smokers from getting access to unregulated tobacco products.

Illegal cigarettes: Who pays the price?

Tobacco is one of the most extensively smuggled legal substances in the world, funding an underworld of organised crime.

A report by KPMG LLP into the problem of illegal tobacco in Australia estimated illicit consumption in Australia to be 14.5% of total consumption in 2014 which is an increase from 13.5% the previous year. [1]

If all of this tobacco had been consumed in the legitimate market it would have represented an excise amount of $1.35bn. [1]

This is government revenue that has gone into the hands of criminals.

Trading in illicit tobacco product can have serious consequences for retailers, including significant fines and prison sentences.

We urge retailers to report any persons either trying to wholesale the product to them or any other retailers who are actively selling illegal tobacco. Call the Australian Customs on 1800 061 800 or British American Tobacco Australia on 1800 643 562.

We will continue to support and work closely with the Australian Taxation Office, Australian Customs and other enforcement authorities to address all forms of illegal trade. We continue to be an active member of the Tobacco Industry Stakeholder Group (TISG).

To read our media releases and reports into the problem of illegal tobacco in Australia please visit our Media section.

Keeping our house in order

We require our companies and employees to support only legitimate trade in our products. Through our ‘Know Your Customer’ guidelines and procedures, we try to ensure that the volume of tobacco products we supply is consistent with legitimate demand. It is our policy to stop doing business with customers or suppliers that we find to be complicit in illicit trade.

Our approach to fighting the black market in tobacco includes:

  • Effective internal governance and supply chain security;
  • Gathering commercial information on the illegal trade;
  • Working with authorities to ensure that appropriate enforcement action is taken;
  • Engaging with international bodies like the World Customs Organisation to increase understanding of the issue;
  • Informing regulators about the impacts of the illegal tobacco trade; and
  • Raising awareness of the issue among our employees, business partners and the public.

WHO Protocol

We have always publicly supported the development of a World Health Organisation (WHO) Protocol to eliminate illicit trade in tobacco products.

In November 2012, after more than five years of negotiations, the Protocol to Eliminate Illicit Trade in Tobacco Products was unanimously adopted by the delegates of the Parties to the WHO’s Framework Convention on Tobacco Control (FCTC).

[1] Illicit Tobacco in Australia Full Year 2014 Report prepared by KPMG LLP.