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WHO Urged to Seek Expert Advice on Track and Trace Standards

22 November 2019

An association which brings together world-leading suppliers of tax stamps and traceability systems has urged a new working group on tobacco track and trace systems to call on industry experts to help shape credible standards for the implementation of secure, independent systems.

The group was created following a historic first meeting of the parties (MOP) to the World Health Organisation (WHO) FCTC Protocol to Eliminate Illicit Trade in Tobacco Products last year. Its purpose is to create a best-practice framework relating to national or regional track and trace (T&T) and unique identification (UID) systems, and to explore the feasibility of creating a global information-sharing system.

The International Tax Stamp Association (ITSA) has welcomed the creation of the group, which will have its first meeting on November 26 in Panama, and has urged it to work with industry experts to ensure credible standards and specifications are in place before the second meeting of the parties (MOP2) in October 2020. The association has offered to provide advice and support to the head of the MOP Bureau.

Juan Carlos Yañez Arenas, chairman of ITSA, said: “ITSA members stand ready to share their experience and expertise in any appropriate way with parties to the Protocol and members of the working group. It is essential that this group has access to, and – for its credibility – is seen to have considered, all legitimate options if it is to make the right recommendations.

“Our members have deep, practical expertise of what works on the ground. Their technology has powered several highly effective T&T programmes – many of which use tax stamps – that have helped to reduce the fraudulent trade of cigarettes and allowed revenue agencies to recoup significant sums of excise monies. The effectiveness of these programmes has been recognised in several international reports, including one by the World Bank which highlights programmes in operation in Canada, Georgia, Chile, Colombia, Ecuador, Malaysia and Kenya. All of these programmes use systems created by ITSA members.”

Mr Yañez Arenas said it was crucial that the working group demonstrates its independence from the tobacco industry.

“This is a core requirement of the WHO Protocol,” he said. “We are concerned about tobacco companies’ influence on the EU T&T system, which lacks transparency, hands too much power to the industry and is not aligned with the spirit of the Protocol.  These issues have been highlighted in a recent Framework Convention Alliance (FCA) report which outlines concerns about the compatibility of specific components of the European T&T system with the Protocol.

“The tobacco industry continues to do everything it can to avoid independent controls and promote its deadly product. The narrative around reducing harm to human health has in no way changed the philosophy, approach or intent of the industry. This is illustrated by its cynical behaviour around the world, promoting smoking wherever it is allowed and attacking ITSA, its members and the effective implementation of their systems.”

The European Anti-Fraud Office (OLAF) estimates that the illicit trade in tobacco products drains ten billion euros annually from EU and national budgets. T&T systems can tackle this key issue and are proven to help drive down fraud and protect human well-being. They are also cost-effective, with many countries seeing a significant return on investment.

Tax stamps are at the heart of many T&T systems currently in operation. ITSA was founded by several leading industry companies and stakeholders to ensure a better understanding of the benefits of tax stamp programmes and to promote the highest professional standards within the sector.

More than 150 revenue agencies (national and state governments) globally use tax stamps to collect valuable tax duties and excise payments, involving the worldwide production of some 140 billion stamps annually. As well as providing visible proof of tax payment and revenue collection, tax stamps have also taken on product authentication, anti-tampering and track and trace applications.

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