What’s Being Done

What are the authorities doing to stop illicit trade?

Australian law enforcement agencies have committed a significant amount of effort and resources to stop the spread of illicit tobacco. Their efforts over the last five years have led to significant numbers of seizures and major disruptions to the supply of illicit tobacco entering Australia as well as being grown in the country. Police operations at the smuggler and distributor level have disrupted major syndicates, without which the scale of the illicit tobacco problem would be significantly larger.

In October 2015 the Federal Government established a dedicated strike team within the Australian Border Force (ABF) to specifically target illicit tobacco being smuggled into Australia at the border. Just days later, the strike team landed its first major seizure of 10.6 million illegal cigarettes and seven tonnes of tobacco molasses bound for Melbourne.

Following the strike team’s creation, other agencies such as the Australian Taxation Office (ATO), Australian Federal Police (AFP) and State Police started to focus on domestic sources of illicit tobacco, primarily chop chop.

In July 2018 the combined work of these agencies was formalised under the Illicit Tobacco Taskforce (ITTF) and its Membership expanded to include the Department of Home Affairs, the Australian Criminal Intelligence Commission (ACIC), the Australian Transaction Reports and Analysis Centre (AUSTRAC) as well as the Commonwealth Department of Public Prosecutions.

According to the ATO, “In its first three years of operation, the ITTF has detected and seized more than 264 tonnes of illicit tobacco and more than 540 million cigarettes, with an estimated excise value of over $870 million.”

In addition to the establishment of the ITTF, the Federal Government also introduced the Treasury Laws Amendment (Illicit Tobacco Offences) Bill 2018. The Act introduced a series of new offences for being in possession of illicit tobacco, the sale of illicit tobacco, purchasing illicit tobacco, or manufacturing or producing illicit tobacco. The associated penalties range from up to five years in prison or fines of at least $222,000 – $333,000 or both (Source: ATO.gov.au).

Finally, in 2018 the Federal government also passed laws to require all tobacco importers to possess a permit. This allowed any tobacco imported without a permit to be seized and destroyed, further frustrating smuggling syndicates. Since 2018, such seizures by authorities continue to grow as they make concentrated efforts to seize and disrupt the supply of illicit tobacco into Australia. While there is still a long way to go in bringing the issue under control, these are still important steps to remove illegal activity from the market and protect legitimate retailers from having their businesses undercut by illegal operators. You can continue to follow news updates about seizures by the authorities on your PML trade portal as well as on the news section of this website.