Illicit Cigarettes Flood Into EU From the East

Millions of illegally imported cigarettes, many made specifically for smuggling in the Russian enclave of Kaliningrad, are distributed within the EU every year after passing Poland’s northeastern borders. The point of entry isn’t accidental: Kaliningrad is surrounded by the European Union’s passport-free Schengen zone.

Cigarette smugglers try their luck on border crossings with Russia and Belarus, and the open border with Lithuania, where customs officers use increasingly sophisticated X-ray machines and sniffing dogs to stop them.

“The majority of those crossing the Polish-Russian border are smugglers,” says the regional customs office based in Olsztyn, in northern Poland. The region borders with the region of Kaliningrad, where Baltic Tobacco Factory produces Jin Ling, a brand not available through legal channels in the EU. The company hasn’t returned calls for comment.

Its cigarettes cost $3.20 for a carton of 10 packs in Russia. On the Polish side, they cost almost $2 per pack and around 3 pounds in Britain, Polish authorities say. Varying tax rates are a major factor behind the price differences.

According to British American Tobacco estimates, 20%-25% of smokers in England smoke illegally imported cigarettes, with the proportion rising to 50%-70% in poorer regions there.
An attempt to smuggle certain amounts above limits is a minor infraction under Polish law, punished with fines. Three years ago, a smuggler attempted to bring in 7,000 packs. He was given a fine of €10,000, which he paid in cash, Polish customs officials said. No surprise there, even including the fine, the smuggler would have made a profit of thousands of dollars had he been able to sell the ware in Poland. No small sum for someone living in a country where the average net salary is just over $1,000 a month.

More than three years after Poland and Lithuania joined the European Union’s passport-free Schengen area, cigarettes smuggled through the EU’s external borders with the Baltic States pour into the rest of the EU through the open border between Poland and Lithuania. Customs in the region of Podlasie, which borders Lithuania and Belarus, last year seized about 110 million cigarettes, about 60% on the freeway border with Lithuania where customs officials stop selected trucks for inspection.

Smugglers, trying to avoid customs officers who stand at the roadside of the former border checkpoint, use roads through the forests, which reopened as barbed wire was removed when Poland and Lithuania joined the Schengen zone.

Smugglers also use the border with Belarus, where not every truck is X-rayed. Last year, authorities seized a truck full of cigarettes, declared as wooden boards. The smugglers used 12 tons of steel sheets to make the vehicle’s weight correspond with the weight of the declared payload, said Maciej Czarnecki, spokesman for the customs office in the Podlasie region.