Official Note Verbale issued on TI Interference & ITIC

14 March 2016

Has the International Tax and Investment Center (ITIC) been talking to your government? What recommendations has it been proposing? The FCTC Convention Secretariat (FCS) has issued a Note Verbale warning Parties about the ITIC and its activities, and to reject the tobacco industry’s interference in addressing tobacco smuggling problem.

The FCS has warned governments that the ITIC, which has 4 transnational tobacco companies on its Board, has been working to further the interest of the tobacco industry. The ITIC has been organising regional and global meetings where the meetings feature discussions on tobacco taxation and promote tax policies favouring the industry rather than the recommendations of the FCTC especially Article 6 and its Guidelines.

The ITIC will be holding its next annual Asia-Pacific Tax Forum in Jakarta, on 23-25 May 2016. It has routinely invited government officials, especially from customs departments, to attend its meetings. On its website and publications, the ITIC promotes photos of its own executives posing with officials from Asia to illustrate its close association with Asian governments.

Smuggling of tobacco is a problem is faced by many countries in the region. Big Tobacco (PMI, BAT, JTI and IB [Imperial Brands]) has blamed substantial excise tax increases and high tobacco taxes as the problem. Additionally, the industry promotes its own ‘Codentify’ system to solve the smuggling problem.

The FCS’s Note Verbale advices governments not to accept ‘Çodentify’ to address the illicit trade in tobacco products. The Note Verbale reminds Parties to “reject partnerships and non-binding or non-enforceable agreements with the tobacco industry”.

In addition, Article 8.12 of the Protocol on Elimination of Illicit Trade in Tobacco Products, explicitly states that a Party’s obligations shall not be performed by, or delegated to, the tobacco industry. An expert paper, The Tobacco Industry and the Illicit Trade in Tobacco Products provides further information on the tobacco industry’s behaviour in addressing tobacco smuggling.

For information on TI denormalization, check out SEATCA’s Tobacco Industry Watch website

Previous ASEAN Tobacco Watch updates can be found here

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