Europe Must Set Proper Precedent for Fighting Tobacco Corruption

Europe, Setting a Global Precedent

What happens in the European Union often has global ramifications. In the case of the Tobacco Products Directive, perhaps even greater ramifications then usual. When the EU set out to implement the Framework Convention on tobacco control protocol they created an opportunity to set a positive global trend regarding by what standards governments should fight illicit tobacco production and trade.

The World Health Organization’s FCTC was designed to fight illicit trade. Their protocol called for governments around the world to take certain steps to aid in the fight which included creating stronger means to track and trace tobacco products. This is what inspired the EU to initiate the Tobacco Products Directive, a directive currently in its final stages of preparation by the EU health commission before final presentation and voting.

Clear Definitions by FCTC

The FCTC’s protocol states in article 8.3 that a unique identifying code must be placed on all products which is both “unique” and “secure” in nature.

Article 8.3 of FCTC

In article 8.12 the FCTC stated that obligations should not be conducted by the tobacco industry themselves and in article 8.13 that governments should limit their interactions with the industry or those representing it whenever possible.

FCTC article 8.13

Big Tobacco’s History of Misdealings

Big tobacco of course has a long history of profiting from illicit trade as well as more general misdealing and corruption. A recent example of this came in the form of the expose on BAT’s cash moving operations in Africa.

With behavior such as this one can only imagine how controlling their own supply chains is critical to maintaining business as usual for big tobacco.

Big Tobacco’s Codentify

With the upcoming EU decision on the Tobacco Products Directive pending, the need for maintaining control over supply is a pressing concern for heavy hitters in the tobacco industry. The industry is pushing hard for the EU to accept an internally developed serialization technology called Codentify. Codentify was developed as a tool meant for internal use by the big tobacco manufactures. It was intentionally designed to contain as little meaningful information about tracking and tracing as possible in order to protect each company from competitive spying.

Allowing a tobacco industry created system to be utilized to track and trace those very same companies and their tobacco products would be a grave mistake. The purpose of tracking for tax revenue as well as to fight illicit trade of tobacco products within Europe must be done by an independent third party, anything else would set a bad global precedent.  Codentify has virtually no ability to prevent code duplication or cloning as this was never its intended goal. Additionally, the system does not seem to be able to discern between a real or copied code.

Rebranding Codentify as Inexto

Today, Codentify has been re-branded as an independent system called Inexto but as far as we can tell it is the same deeply flawed system originally developed by big tobacco.

Inexto and Codentify are two technologies convenient for the tobacco manufacturers but terrible for the governments they are meant to serve. The implementation of this tool would reinstate big tobacco as an untrustworthy partner, in the fight against illicit trade. After much hard work the EU managed to rid itself of a toxic partnership with PMI which was meant to fight tobacco smuggling. In reality this deal simply legitimized PMI and other big manufacturers and allowed them to continue profiting from smuggling and illicit trade.

Why Codentify and Inexto are in conflict with the FCTC

Francis Thompson of the FCA recently pointed out in a reference to article 8.3 of the FCTC that: “For ‘secure’ and ‘unique’ to have meaning, they must be secure against those with the strongest incentive to cheat by copying codes; manufacturers themselves.

Additionally, allowing Codentify or Inexto to be implemented in Europe would directly conflict with Articles 8.12 and 8.13 of the protocol because it would allow the tobacco industry (Codentify) or those who represent their interests (Inexto) to be responsible for executing orders meant to limit them.

What Needs to be Done

The EU Health Commission must unequivocally exclude Inexto and Codentify as acceptable partners in carrying out their directive. A failure to do so  would set a terrible global precedent and will negatively impact the very mission the EU set out to fulfill.

If the EU Health Commission fails to prohibit Inexto and Codentify from moving forward, then the responsibility will then fall on the shoulders of MEPs to insure the success of this directive and the exclusion of tobacco industry tools.



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