General Counsel for Philip Morris gives testimony on 'illicit' tobacco trade

Global Legal Post
Wed, 19 Jul 2017 17:53 UTC

The Philip Morris International general counsel gives expert testimony at US Commission hearing on global threats posed by illicit tobacco.

Marc Firestone, senior vice president and general counsel of Philip Morris International, today appeared as an invited witness before the Commission on Security and Cooperation to offer expert testimony in support of the Commission's objective of addressing the security and economic threats posed by the illicit trade in tobacco. The hearing was held on Capitol Hill in Washington DC. The Commission is a bipartisan body of the United States Congress with representation from the US House of Representatives and Senate.

Global illicit tobacco trade

'PMI has a clear business imperative to combat the problem of the illegal tobacco trade and ensure our products are legally sold in the market for which they are intended,' Mr Firestone stated. He highlighted that the global illicit tobacco trade annually deprives governments of 40-50 billion USD in lost tax revenue, a figure greater than that of the illicit trade in oil, wildlife, timber, arts and antiquities, and conflict minerals combined. Mr. Firestone noted that 'criminals are the only promoters of the global illegal tobacco trade.'

Threat

'The revenues that governments and law abiding manufacturers like PMI lose every year to the illicit trade in tobacco are huge,' Mr Firestone told Commission members. 'However, the threat posed to safety, security, and the rule of law in Europe, the United States and around the globe is where the interests of our company and the concerns of this Commission most pointedly intersect.' Mr Firestone emphasised the critical role cooperation between industry, law enforcement, and government authorities can play in tackling illicit tobacco, and outlined a series of concrete measures that these groups could take to further reduce the flow of illicit tobacco worldwide.

Expert panel

Joining Mr Firestone on the expert panel were Dr Louise Shelley, founder and executive director of the Terrorism, Transnational Crime and Corruption Center at George Mason University, and Professor David Sweanor, an adjunct professor at the University of Ottawa and global tobacco control policy expert.

A copy of Mr. Firestone's testimony is available here

Comment: Some excerpts from Mr. Firestone's testimony:

However, the threat posed to safety, security, and the rule of law in Europe, the United States and around the globe is where the interests of our company and the concerns of this Commission most pointedly intersect.

The concern for this issue is shared by multiple agencies within the U.S. government, including the State Department, which released a December 2015 interagency report entitled, "The Global Illicit Trade in Tobacco: A Threat to National Security." In this report, the State Department described the problem as follows:

Like other forms of illicit trade, the illicit trade in tobacco products, commonly referred to as cigarette smuggling, is a growing threat to U.S. national interests.Internationally, it fuels transnational crime, corruption, and terrorism. As it converges with other criminal activities it undermines the rule of law and the licit market economy, and creates greater insecurity and instability in many of today's security "hot spots" around the world.

[...]Threats to Security:

The increasing threat to security was recently illustrated by the European Commission:

"The illicit tobacco trade has long been recognized as a main source of revenue for organized crime, and, in some cases, terrorist groups. The new European Agenda on Security adopted by the European Commission on 28 April 2015 recognizes the importance of fighting cigarette smuggling as a means of cutting off criminal groups from this revenue source."

Illicit tobacco trade as a threat to the national security of the United States:

The past two decades have provided a number of cases demonstrating the direct link between cigarette smuggling and serious organized criminal and terrorist activity in the United States. Illicit cigarette tax stamps helped to fund one of the convicted bombers in the first World Trade Center bombing in 1993, and U.S. government reports have found that illegal cigarette smuggling networks here in the U.S. are being used to fund terrorist networks in the Middle East like Hezbollah, Hamas, and al Qaeda. As an American company, we are particularly troubled by these cases and supportive of any efforts the U.S. government takes to shine a light on this problem.

Security threats in other parts of the world:

At the 2009 International Law Enforcement Intellectual Property Crime Conference, Ronald K. Noble, INTERPOL Secretary General, stated:

Paramilitary groups and organized crime rely on counterfeiting - especially of cigarettes - to reap huge profits and even to fund terrorist activities.

Experts have also said illegal cigarette trafficking is a source of funding for terrorist group Islamic State (ISIS). According to one of the witnesses appearing before this commission today, Dr. Louise Shelley:

Oil is not ISIS' only source of revenue...Still more funding comes from the sale of counterfeit cigarettes, pharmaceuticals, cell phones, antiquities and foreign passports. - Foreign Affairs Magazine, 2015.

Christian Eckert, France's Minister of Budget, also recognized the link between terrorism and illicit trade in an interview in 2014, where he stated the following:

What is clearly evolving is to involve Customs in the fight against terrorism. It is demonstrated and known that many jihadists are involved in petty crime (counterfeit, contraband of tobacco, drugs).

Tobacco is being associated with criminality and terrorism. Reminiscent of Hitler's anti-smoking propaganda, the PTB seem to be laying some groundwork. It may be a leap, but it seems that 'smokers are terrorists' or 'smoking is terrorism' is just a thought away...