The specialists of “Vlasta Consulting” ltd conducted the independent research based on the 186 first instance court decisions on the cases of the illegal production, acquisition, storage, transport and sale of the unmarked alcohol and tobacco products is bulk, including the infringement by a group of people by prior conspiracy.
As a result of the work carried out, it was revealed that for the period 2021-2021. only 2.7% of criminal cases (5 decisions) ended with a real term of imprisonment. In the course of the analysis, it was found that most of the court decisions in criminal cases consisted in bringing the infringers to justice by issuing a suspended sentence or paying a fine, fines were also analyzed under Article 171 of the Criminal Code of the Russian Federation, as well as the criminal terms received by the accused. The tobacco industry is one of the most profitable parts of the Russian budget. The illegal market of tobacco products that avoid tax payments, reflects in the shortfalls with the state budget that have the negative impact on the Russian economy in general.
Such insignificant level of the liability and slight punishment for the illegal activity leads to the development of the “shadow” tobacco market. The infringers that are suppressed receive the punishment of the conditional sentence or fine that is much less than their illegal income, that is why the criminals are not afraid of being caught and could continue their illicit activity without any high risks.
Although the LEA officers are actively combating illegal tobacco business and catch the infringers in order to get them to the liability, these suppressed criminals are committed with hardly impunity, as such small court measures do not put enough pressure on the criminal tobacco business.
Taking into account the current situation in Russia with all the sanctions imposed by other countries, there is a 100% possibility of the significant increase of the illegal tobacco market share and the growth of the “underground” producers and illegal distributors of the counterfeit products.
