European Anti-Fraud Office

Tobacco smuggling

Tobacco smuggling

Tobacco smuggling causes heavy yearly losses to the budgets of EU countries and the EU institutions in lost customs duties and taxes. Furthermore, illegal tobacco:

  • poses great risks to consumers and businesses
  • undermines anti-smoking and public health campaigns
  • is a significant source of organised crime 
  • violates the strict rules that the EU and its member countries have on manufacturing, distribution and sale.

It is difficult to estimate the size of the illegal tobacco market accurately. This is because - as with other illicit practices - tobacco contraband and counterfeiting are clandestine activities in constant fluctuation and change. Fraudsters go to great lengths to conceal and change their patterns to escape the law.

What is OLAF's role?

OLAF has an explicit mandate to fight cigarette smuggling. We do this in 2 ways:

  • helping the EU institutions and national governments shape policies to combat smuggling 
  • through our investigative work, in close cooperation with national law enforcement agencies, judicial authorities and customs services both inside and outside the EU

Investigations

OLAF carries out investigations into allegations of tobacco smuggling. We can also bring significant added-value in complex cross-border cases, by helping coordinate anti-smuggling operations carried out by law-enforcement agencies across Europe. 

OLAF provided effective support to the actions of national authorities, which resulted in the seizure of some 2 billion cigarettes over the five years up to 2018. That’s about 38 packs every minute, over 5 years. 

Recent examples of such operations include: 

  • May 2020 - Officers from Italy’s Guardia di Finanza have arrested nearly 40 people on charges of corruption, embezzlement and smuggling thanks to information supplied by OLAF. Press release 
  • February 2020 – cooperation between OLAF, the Royal Malaysian Customs and Belgian customs led to the seizure of approximately 62 million cigarettes due to be smuggled into the EU. Together with an earlier record-breaking seizure, this joint action stopped nearly 200 million smuggled cigarettes entering the EU. Press release
  • 2019 – authorities from 7 countries, with the active support of Eurojust, Europol and OLAF, dismantled an international organised crime ring involved in large-scale illegal tobacco smuggling.18 people of different nationalities were arrested, suspected of money laundering and the illegal storage and sale of some 670,000 kilos of tobacco. Press release
  • 20 March 2018 – the Court of Turin sentenced several individuals to prison and ordered the seizure of assets worth millions of euros, in a major tobacco contraband case that had occupied police across Europe for years. The case had originally been uncovered by OLAF who coordinated the investigations of the national authorities. Press release

You can find many more stories of success in tackling cigarette smugglers in our press releases

Coordination of joint customs operations 

OLAF also organises joint customs operations (JCO), which bring together law enforcement authorities from EU countries and, increasingly, non-EU countries – as well as other bodies like the World Customs Organisation or Europol. 

These operations are targeted actions of limited duration that aim to combat fraud and the smuggling of sensitive goods in certain risky areas and/or identified trade routes. 

We recently coordinated a number of successful joint operations: 

  • 2019 – during Operation HYGIEA, 77 million cigarettes and 44 tons of counterfeit water pipe tobacco were seized by Asian and EU customs authorities in an ASEM-led operation coordinated by OLAF. Press release
  • summer 2017 – over 19 million cigarettes were seized during a joint customs operation coordinated by the OLAF and the Estonian customs, involving 14 EU countries, FRONTEX and EUROPOL. Press release
Cigarettes seized with the support of OLAF (rounded to million sticks)
Year 2014 2015 2016 2017 2018
Coordination and investigation cases/
Exchange of information
168 602 458 470 302
JCOs 132 17 11 75 48
Total 300 619 469 545 350

(Source: OLAF Report 2018)

Related documents

International Cigarettes Task Group Conference (2016): International efforts to fight cigarette smuggling 

Other counterfeit goods

Following a reorganisation in 2012, OLAF's activities were extended to cover investigations into fraud related to intellectual property rights

OLAF has long been investigating the illegal trade in counterfeit cigarettes and tobacco products but its scope now also includes other counterfeit goods entering the EU through its external borders.