Stemming cigarette smuggling has always been one of the priorities for the border guard and customs agencies of Moldova and Ukraine as well as for the EU Border Assistance Mission to Moldova and Ukraine (EUBAM). These joint efforts have led to an impressive decrease in the suspected movement of tobacco products along the Moldovan – Ukrainian border.
Past analysis of trans-boundary movements indicated that the delivery of tobacco products to Transnistria through the central segment of the border with Ukraine greatly exceeded local consumption needs. In the period January-August 2014, more than 11 billion cigarettes and 2,300 tonnes of raw tobacco were delivered to Transnistria, a small territory with a population of approximately 0.5 million inhabitants. This analysis suggested such goods were being diverted illegally to Ukraine. A sharp increase in seized cigarettes by the Ukrainian border services at the central segment of Moldovan-Ukrainian border starting from January 2014 confirmed this presumption.
Based on the results of the analysis, in August – October 2014 EUBAM together with Ukrainian partners carried out a number of exercises aimed at tightening the measures to curb cigarette smuggling. The Mission stepped up its 24/7 monitoring of cigarette and tobacco consignments in particular from Odessa and Illichevsk ports to Transnistria. During this period, EUBAM experts participated in the end-to-end processing of all transit of cigarettes. At the same time, Ukrainian customs authorities required all cigarette consignments to bear the excise marks of the Republic of Moldova and be destined only for those Transnistrian operators which are registered in Chisinau.
This tightening in the transit of tobacco products to Transnistria enabled the Ukrainian customs authorities to detect a number of attempts of illicit transit of cigarettes both in Odessa and Illichevsk sea ports and at the international border crossing points ‘Kuchurgan-Pervomaysk”. The State Fiscal Service of Ukraine reported that these actions and the cooperation with Moldovan customs led to the detention of 2.8 million packs of cigarettes which were shipped in four containers and two trucks.
In November and December 2014 the transit of cigarettes from Odessa and Illichevsk ports to Transnistria dropped to zero (as shown in the graph).
It is premature to suggest an end has come to the smuggling of tobacco products to Ukraine through the central segment of Moldovan – Ukrainian border. The profit motive for smugglers remains high, given the price differentials across the Moldovan, Transnistrian and Ukrainian markets and the increased profit margins in customs duties avoidance. However, EUBAM and its partners are working closely together to stay ahead of any new ways devised by tobacco smugglers to pursue their illegal gains and thereby avoid the payments of proper customs and excise duties.