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Combating the counterfeiters Imperial Tobacco
COMBATING THE COUNTERFEITERS
“Imperial Tobacco Polska is one of the largest manufacturers of tobacco products in Poland. The company complies with the highest standards of business and puts great emphasis on excellence in production and sales,” says Agnieszka Świergiel, the president and CEO of Imperial Tobacco Polska SA.
Imperial Tobacco Polska SA (ITPL) is a part of Imperial Tobacco Group, the UK-based leading international tobacco company, which manufactures and sells a wide range of cigarettes, loose tobacco, rolling papers, cigarette tubes and cigars. In Poland the Imperial Tobacco Company consists of a modern factory in Jankowice near Poznan, one of the largest units throughout the Group, and a trading division located at the same spot. The group also comprises Imperial Tobacco Polska Manufacturing SA in Radom, which has a tobacco factory.
Corporate social responsibility is one of the company’s priorities. “As part of our CSR policy, we have been carrying out a number of campaigns and projects designed to benefit our employees, local communities and the environment. For all of its activities, and above all for its great economic results, growth in exports and charitable activities, the company received the Golden Statuette of the Polish Business Leader 2011,” says Ms Świergiel. “Furthermore, we received many other prestigious awards and honours, including the Certificate of Top Employers Poland for the highest quality personnel policies and campaigns designed for employees.”
Problems with the illicit tobacco market
The tobacco industry in Poland is facing many challenges. One of the most serious is the illegal trade of tobacco products: smuggling and counterfeiting. “The size of the illicit tobacco market in Poland is estimated at about 15–20 per cent, which represents about PLN 3–4 billion in losses. Since 2004 there have been more than 40 illegal tobacco factories closed in Poland,” Ms Świergiel observes.
Imperial Tobacco Polska has been cooperating for years with all government agencies in combating crime within the tobacco market. It has held professional trainings for customs officers and police officers from economic crime departments all over the country. The company also acceded to the Programme of Cooperation for Rights Protection, created by Allegro auction website. “The problem of the intellectual property rights violation is a priority for Imperial Tobacco Polska SA,” remarks Ms Świergiel. “Our participation in the programme is aimed at providing the most effective protection against a possible violation of intellectual property rights for all those who buy and sell our products on the Allegro website.”
In order to raise awareness of the public and decision-makers about the scale of risk resulting from market presence and consumption of illegal, counterfeited tobacco products, the company has organised two nationwide information campaigns. The first one, named “Stop Fake Cigarettes”, was conducted in autumn 2010. Its aim was to warn consumers against the dangers of counterfeit cigarettes, whose composition and method of production ignore health and safety standards. An important objec-
tive of this action was to draw public attention to the problem of losses and damages that the state, commerce, employers and employees of legitimate companies suffer from illegal cigarettes. The second campaign, named ‘Stop Counterfeit Loose Tobacco’, was conducted in autumn 2011 and was aimed at alerting internet users against buying fake products labelled as brands owned by the company.
Ms Świergiel continues: “To eliminate the uncontrolled circulation of raw tobacco, it is necessary to have effective regulation, which would enable the complex control of the cultivation and sale of raw tobacco. There is also a need for clear rules on the mandatory destruction of tobacco manufacturing equipment seized at illegal factories. Now it is back on the market, as the Treasury sells it off through bidding procedures after a court orders confiscation.”
EU proposals are ‘detrimental to Poland’
In 2010 the European Commission launched a public consultation on changes to Directive 2001/37/EC. According to Ms Świergiel the EU proposals would have serious adverse consequences of an economic and social nature for the Polish market, for workers employed in the tobacco sector, and for the state budget. “The proposals are excessive and disproportionate,” she asserts. “They are not supported by credible scientific arguments, nor do they take into account the serious economic and social consequences for Poland. In our opinion, all adjustments should be preceded by thorough analysis and supported by scientific evidence showing that the solutions would be effective for public health, and they wouldn’t lead to further development of a grey area at the expense of legitimate companies. The
CLIP Group is a developer and logistic service provider of warehouses and industrial facilities, and owner of the most attractive investment land for sale in the area of Poznań. About 80 ha of CLIP investment land in Swarzędz (10 km from Poznań) were included into the Kostrzyn-Słubice Special Economic Zone. The companies operating on CLIP investment land employ the total of about 3000 people. In January 2011 CLIP opened Intermodal Container Terminal. Thanks to the Terminal, CLIP and its customers may benefit from railway transports along the second trans-European railway corridor E 20 (Paris-Beijing), and profit from the proximity of the A2 motorway. In May 2012 a regular train connection between CLIP Terminal and the Rotterdam port was established. See also : www.kssse.pl, www.clip-group.com
CLIP Logistics
CLIP Logistics (member of CLIP Group) is a Polish logistics company that has been operating for Imperial Tobacco for three years. Since then both companies have realized many common projects, such as the implementation of customs clearance under simplified procedures. In two ‘A’ class warehouses CLIP Logistics provides high and reliable KPI’s level according to the ISO and AEO requirements. As a result, and thanks to the operational synergies and particular emphasis CLIP Logistics puts on the biological security of tobacco, at the end of last year Imperial Tobacco centralized all of its warehouse operations in one place, which is the multimodal logistics centre of CLIP Logistics.
about Center for Logistics and Industrial Investments Poznan
proposed changes can worsen the financial situation of more than half a million Polish citizens involved in tobacco cultivation, and production and trade of tobacco products.”
One of the Commission’s demands is to prohibit or significantly limit the use of additives in tobacco products. Such a ban is a threat to 40 per cent of tobacco growing in Poland (Burley variety), as lack of additives makes it impossible to use. Burley tobacco is a key component of the American Blend tobacco mixture that is used in virtually all cigarettes sold in Poland. “A drop of 40 per cent of national cultivation growing can cause deprivation of the livelihoods of thousands farmers and their families,” explains Ms Świergiel.
The changes will also have implications far beyond the realm of cultivation and production. Standardised packages of cigarettes, virtually indistinguishable from the original packages, will become much easier to forge. “Poland will be inundated with illegal goods, exacerbating the state budget losses coming from lost revenue from excise duty,” Ms Świergiel claims.
Currently, revenues from excise taxes and VAT on tobacco are estimated at about PLN 20 billion annually, which is approximately 9 per cent of total receipts of the state’s budget.
High excise tax rate drives smuggling
Under EU law, Poland is obliged to achieve a minimum level of cigarette excise tax of €90 per 1000 cigarettes. However, it was granted a transitional period to achieve this minimum level by the end of 2017.
“Although we still have five years to achieve a desired level of taxation, the excise tax increases, both this year and last, were much higher than necessary,” says Ms Świergiel. Decision-makers forget that Poland is a special country in the EU due to its eastern border, which is also the EU outer border. The level of cigarette smuggling across this border still remains high, and the illicit manufacturing of tobacco products has been developing in Poland. The increase in prices, which is a consequence of the excise duty rate growth, is a key factor driving the development of illicit production and trafficking. Increases in excise duty should be gradual and mild.” n
Agnieszka Świergiel took over as President of the Board and Director General of Imperial Tobacco Polska in January 2010. She is the first woman as president of ITP and its first Polish president. The company’s decision was an expression of appreciation for her knowledge, long experience and management competence. Agnieszka Świergiel has been working for Imperial Tobacco in Poland since 1995, occupying a number of positions in the Financial Division. Agnieszka Świergiel combined her extensive experience with substantial creativity, entrepreneurship and unique skill in building internal communication and social engagement. In a short time it led to a significant strengthening of the company’s market position and its wide recognition.
For her charitable and social sensitivity Agnieszka Świergiel received in 2011, the Social Solidarity Medal. She also took the first place in the ‘Businesswoman of the Year 2011’ contest in the corporation category, won the fifth place in the ranking of “100 Women in Business 2011”, and was recognised by the daily newspaper ‘Rzeczpospolita’ as one of ten rising stars in business.
