Identifying an approach to measure the illicit market for tobacco

Filter cigarettes on a heap of loose tobacco, Photo by Maren Winter info@maren-winter.de/Adobe Stock

Maren Winter info@maren-winter.de/Adobe Stock

Background

Illicit trade in cigarettes and other tobacco products (ITTP) is a global phenomenon which results in significant loss of revenue for governments and legitimate businesses, while offering an important source of income for organised crime and terrorist groups. With many illicit products failing to comply with EU legislation on ingredients and the presentation of health warnings, ITTP also presents a potential public health risk.

Due to the harmful effects ITTP has, the EU and member states have made the fight against the illicit tobacco trade a policy priority. However, measuring the size and scale of the phenomenon has proven to be extremely challenging, making this an important first step in countering ITTP.

Goals

RAND Europe has been commissioned by the EU Anti-Fraud Office (OLAF), to develop an independent methodology to measure the illicit market for tobacco. The project will aim to address:

  • Which methodologies are available to measure the illicit market for tobacco in a reliable, robust, replicable and cost-effective manner, as well as how these methodologies can be assessed and compared.
  • Which available data sources may contribute to:
    1. measuring the illicit market for tobacco; and
    2. identifying the key considerations and factors which influence legal and illegal trade flows in tobacco.
  • What other data could be collected to improve the methodology and resultant estimate of the size of the illicit market.

Methodology

This study will investigate the full spectrum of possible approaches in a range of member states, analysing each based on their strengths and weaknesses, alongside a review of the relevant literature. Upon completion of the study, the research team will advise on a recommended methodology, or combination of methodologies, to measure the illicit market in tobacco products, along with any specialised knowledge, resources or skills required to apply it.