Our position

JTI takes a stand against illegal tobacco

Illegal trade undermines the equity of JTI’s brands and erodes consumer confidence in JTI’s products. Simply put, it is bad for business.

JTI’s number one priority is to prevent genuine JTI products from appearing in illegal distribution channels. Additionally, JTI does not tolerate the copying of its brands or the violation of its intellectual property rights, and will continue to have counterfeiters prosecuted to the full extent of the law.

While a wide range of industries and products are affected by illegal trade, cigarettes are of significant appeal to smugglers. Cigarettes are easily transported and sold, and can generate huge profit margins for illegal traders:

  • The annual consumption of illicit tobacco products is estimated to exceed 392 billion cigarettes globally (excluding China);

  • An estimated 40 to 50 billion US Dollars in global tax revenue is lost each year to the illegal trade.

Smugglers operate across multiple borders and continents, and quickly adapt their operations to take advantage of new opportunities that result from changes in taxation and regulation.

Government tax policies which result in excessively high retail prices are the key drivers of the growth of the illegal trade in tobacco products.

Weak laws, penalties and inadequate enforcement, whether from limited resources and training or conflicting priorities, are also important factors which encourage the
illegal trade.

There is no single solution which will eradicate this growing problem. No government, regulatory body, law enforcement agency, or manufacturer - acting alone - can hope to eliminate the illegal trade in tobacco products.

In addition to JTI’s own stringent internal controls and programs, JTI cooperates fully with governments, regulators and law enforcement agencies in the fight against the illicit trade. We have signed Memoranda of Understanding in over 30 countries, and have entered into formal cooperation agreements in Europe and Canada.

Governments must lead the fight. While JTI is committed to the fight against illicit trade, the efforts of JTI and other industry members will be futile if governments do not lead this important effort.