Illegal cigarettes are back: business is concerned and calls on Europol, G7 and IMF to step up and continue the fight against shadow trade

Shadow cigarette producers have resumed their work and are flooding the Ukrainian market. The situation in Ukraine requires more effective mechanisms and steps and has already attracted the attention of Europol, and international organizations are calling on the G7 and the IMF to activate all political instruments to continue the fight against the circulation of illegal cigarettes in Ukraine.

This was discussed at an event of the American Chamber of Commerce in Ukraine dedicated to the fight against illegal markets with the participation of representatives of embassies, members of the Ukrainian Parliament, government officials, including law enforcement agencies, and business.

In particular, MP Oleksii Ustenko raised the issue of counterfeiting international brands sold in kiosks.

"Illegal producers have resumed their work on a massive scale and are selling their products all over Ukraine, for example, we see Marlboro in kiosks in Kharkiv and Poltava regions," the MP said.

During the roundtable, Howard Pugh, former Head of the Excise Fraud Unit at Europol, called for continuing the fight against the largest illegal cigarette producers in Ukraine.

"Illegal cigarettes are a threat to national security. Political will to fight against illegal tobacco production and trade is absolutely essential. Huge amounts of lost revenue could be used to provide important public services. Public demand can be reduced only when people realize that consumption of illegal products directly finances organized criminal groups," said Howard Pugh.

It should also be noted that the U.S.-Ukraine Business Council sent a letter to the G7 members and the IMF calling for increased efforts to continue the fight against the illegal tobacco market. "We call on the G7 members and the IMF to mobilize all political instruments and, together with Ukraine, make every effort to fight the most serious forms of organized crime, illegal trade, and corruption in the illegal cigarette market," the letter says.

As a reminder, according to a study by Kantar Ukraine, the level of illegal trade in tobacco products in Ukraine in July 2024 decreased to 14.6% compared to 18% in April this year. Tax losses in the state budget of Ukraine in 2024 from the illegal tobacco market are estimated at UAH 23 billion.