Brussels, 06/10/2006 (Agence Europe) - On 5 October, the European Commission announced an agreement on the sum of one billion dollars (€800 million) to be paid over twelve years by Philip Morris International (PMI) to contribute to fighting contraband and counterfeiting of cigarettes in the EU (EUROPE 8745). Those benefiting from this hand-out are the European Commission and the ten EU Member States (France, Germany, Greece, Italy, Belgium, Luxembourg, Netherlands, Finland, Portugal and Spain) that had launched into the political and legal battle against the unlawful trade in cigarettes before signing the cooperation agreement with Philip Morris in July 2004 (EUROPE 8745). Since 2004, PMI has already paid out €325 million (€270.8 million). Placed up till now in an interest-paying account, the money may now be paid out to the beneficiaries.
According to the key for breakdown of the sum, the Commission pockets 9.7% of the total €800 million sum promised by Philip Morris, i.e. €77.5 million. The ten Member States share out the rest between them. The main winners are Italy (28.63% of the total, i.e. €229 million) and Germany (24.62%, €197 million). After these come France (11.69%), Spain (10.19%), Greece (6.35%), Belgium (6.02%), Portugal (4.48%), the Netherlands (4.17%), Finland (2.63%) and finally Luxembourg (1.22%).
In June this year, the Commission announced that all the other Member States, except for the United Kingdom, had signed this cooperation agreement (EUROPE 9206). These 14 Member States (Austria, Ireland, Denmark, Sweden, Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia), who had arrived a little later than the ten others in the adventure against PMI, are not entitled to a slice of the cake. Nonetheless, these 24 Member States (plus the United Kingdom if it follows the movement taken by the others) would harvest the fruit of identical agreements that the Commission hopes to conclude with the other cigarette manufacturers in the EU's sights, RJ Reynolds and Japan Tobacco. Furthermore, PMI is paying out rewards to all EU Member States that seize smuggled cigarettes of the PMI brand.
The EU Member States have pointed out to OLAF that, in 2005, they had seized over 4.409 billion cigarettes (contraband and counterfeit of all brands), a little more than in 2004 (4.140 billion). Contraband should tend to fall, unlike counterfeiting, which may, according to some estimates, account for over 50% of the cigarettes on the market in the EU. (lc)