OLAF Fights Smugglers. The EU Feeds Them.

OLAF, the European Union’s Anti-Fraud Office, just announced the seizure of illicit tobacco worth more than 10 million euros. 50 people were arrested. That is a win against organised crime, but probably not more than a drop in the ocean of illicit nicotine products.

OLAF Director-General Petr Klement said: “While smoking is dangerous, smoking counterfeit cigarettes is even worse. On top of the harm to health, every illicit cigarette robs taxpayers and rewards organised crime. That’s why OLAF is there, to detect illicit trafficking and to contribute with cross-border intelligence and coordination.” Hold that thought, Mr. Klement. We’ll come back to you.

Earlier this year a study by the Fraunhofer Institute found the same rot in a second market. This is not just a cigarette problem. The black market for vape products is growing just as fast. According to the research, nearly half of all vaping products consumed across the EU are now traded irregularly, worth around €6.6 billion. If nothing changes, that figure could hit €11 billion by 2030.

Where there is money to be made, bad actors will appear. The question is how to tackle it.

One option is to reach for more draconian laws. Higher fines, prison for smugglers, and eventually criminalising the consumer. This is what some countries in the EU are trying, and they are failing.

In the Netherlands, one year after a flavour ban, vaping among minors more than doubled, from 3.7 to 7.6 percent. Cigarette consumption went up. 27 percent of former vapers reported smoking more, or having started again, since the ban came in. That is the actual health outcome. Fewer vapers, more smokers, more kids vaping.

How does that happen? Because the ban did not remove the products. It just moved them. 42 percent of inspected retailers were non-compliant, and 8 out of 10 consumers said flavoured vapes are still very easy to buy. Where from? The black market, obviously. So the Dutch government is actively fueling the black market through its bans while worsening public health.

Other countries are debating similar bans, and some have already gone after nicotine pouches. They are banned outright in Belgium, the Netherlands, and, since April, France. Germany is heading the same way with a de facto ban on domestic sales, even while personal use stays legal. France goes furthest of all and criminalises the consumer directly. Get caught with a tin and you face a fine and prison time. The maximum penalties in the law climb to five years and 375,000 Euros. Will any of this eradicate the demand for nicotine? Unlikely. People have reached for nicotine for centuries, and no government decree is going to switch that appetite off. So the only thing these bans achieve is to gift organised crime more business.

Which brings us back to Petr Klement. OLAF’s Director-General knows exactly where illicit trade comes from. So he, of all people, should be speaking out against more bans, not just applauding the seizures those bans make inevitable. What we need instead is sensible, consumer-friendly regulation. Adults should be able to buy these less harmful alternatives in regulated shops, not in sketchy alleys or out of the back of someone’s car.

Sounds straightforward. Unfortunately, the EU Commission is lining up to walk the same failed path of prohibition all over again. Updates to the European Tobacco Products Directive and the Excise Directive are on the table right now. And every Commission proposal boils down to the same reflex. Tax it out of existence, regulate it out of existence, and if that is not possible, ban it outright. If the Commission gets its way, we will get rising smoking rates, because access to less harmful alternatives dries up, and a booming black market on top.

So here is one thing to hope for. That somewhere behind closed doors, OLAF is telling the Commission it does not need the extra work. Every new ban is a gift to the smugglers OLAF exists to chase. Handing them the nicotine market is not fighting crime. It is job creation.

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Vaping can save 200 million lives and flavours play a key role in helping smokers quit. However, policymakers want to limit or ban flavours, putting our effort to end smoking-related deaths in jeopardy.

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