With the cost of living increase biting and international travel opening up following the pandemic, there’s a risk that the illicit tobacco trade could gain further ground in the UK with retailers feeling the sting from cheap imports and counterfeit products.
However, that doesn’t mean responsible retailers should get disillusioned, stresses JTI’s fiscal and regulatory affairs manager Ian Howell. Urging all retailers who are aware of illicit trade in their community to contact the authorities, he says that while it may look like progress is slow, without this vital information, Trading Standards find it difficult to act.
“Things are happening. It’s just that it’s not as much as we would like or as often as we’d like, but unless retailers are doing the reporting, nothing will be done at all,” he explains. “That’s why, it’s really important to keep those calls coming in through to Trading Standards. Please keep doing it. It’s the best way for the authorities to know what’s going on in their area when it comes to the illicit trade.”
Howell said that responsible retailers are being undermined by an increase in the illicit trade.
“In the 12 months to June, we’ve found that 38% of consumers admit to buying some form of illegal tobacco, and that’s up from about 32% in June last year, so there is a noticeable uplift.”
He explained that it’s mostly down to two factors. “Obviously prices have gone up and the cost of living crisis is biting, but also perhaps people have had increased access to overseas markets.
“We’re obviously very concerned about keeping an eye on this situation because it results in less legal volume in the market. While some people might say that’s good, people are smoking less but in actuality, all that’s happening is that volumes are being substituted between illegal volumes and legal volumes, and we need to keep that volume in the legal market as much as we can.”
One area that progress is being made is the introduction of powers for HMRC to issue on-the-spot fines to businesses found to be selling illicit products. What Howell would like to see is these powers being made available to Trading Standards as they are the ones on the front line and visiting shops.
He said that retailers can play their part in moving this along. “We would urge retailers to ask their local MP about these powers? Ask when are they being rolled out because it’s something we keep prompting about because we see it as potentially a big game changer. It would be the first time that Trading Standards would have an easy-to-use power that they can make a meaningful difference with.”
Howell warned retailers that they might be inadvertently breaking the law if they have two price lists on open display in their store.
“It’s one of those little quirks we have noticed over the last three or four months, that a number of our reps have reported that they were in a store and they had two price lists on display,” he explained. “It seems inconsequential because it doesn’t look like advertising material. There’s no branding on it. It’s just a list of brands and prices. But you’re only allowed one of them.
“So, we’re warning retailers that it is an offence and unfortunately, it will be the retailer who carries the can, not the person who’s given them the second price list.”
He also gave an update on the changes to the Track and Trace system introduced earlier this year. The company responsible for the administration of the system change from De La Rue to Dentsu from the first of July this year and so far it’s been going well. There was very minimal impact for retailers - effectively their registration details were ported to the new system and whenever they go into the cash and carry to buy products or get products from our sales force, they use the same operator and facility ID. So there’s no change there which is good.”
The rise of the vape category has created a difficult situation for retailers, in Howell’s opinion.
“I think some retailers may unwittingly be selling the wrong kind of vapes. Perhaps just by the sheer volume of products that are out there and the lack of education, it’s happening. [Education] is something that I think I needs to come back and for people in our business to look at.
“A good start for retailers are JTI products, all the Logic vaping products we sell are fully compliant with the law. And there’s none of this misleading marketing and branding that you see in other products. They’re within the fill limits and the legal nicotine levels. But again, if you suspect a store in your area is selling illicit vape products, don’t hesitate to report them.”