Hong Kong Customs seized 600 million illicit cigarette sticks from January through September 2026, nearly matching the total seized in all of 2025, Commissioner of Customs and Excise Chan Tsz-tat said. Of the total, 200 million sticks destined for other locations were intercepted following intelligence received by customs. Authorities recorded about 18,000 illicit cigarette cases during the first nine months, including approximately 16,000 involving passengers who failed to declare carrying more than 19 cigarettes. Chan also said the department plans to introduce more advanced contraband detection equipment.
Blog
-

A vape directory is only as strong as the enforcement behind it
By Jason Carignan
Pennsylvania has officially begun enforcement for its new vape directory regulation, and nicotine vapes missing from the state list are denoted as contraband subject to seizure. The state joins more than a dozen others in tying market access to a product’s federal premarket review status, and it deserves credit for drawing a clear line between what may be sold and what may not. The harder test starts now. Most of what the directory excludes was already illegal to sell under federal law, and unauthorized products still made up about 69% of e-cigarette sales at mainstream retailers in December 2025.
Washington has put real resources behind the problem at the border. Congress required the FDA last November to direct at least $200 million toward vape enforcement, including $2 million for a multi-agency task force on illegal imports. In May, Customs and Border Protection, working with the Coast Guard and the Food and Drug Administration, announced the seizure of more than 18 million vapes valued at over $175 million. Ports matter, but a product that clears one still has to be sold somewhere, and the retail counter is where state officials are best positioned to act.
Retail is also where enforcement is hardest. Authorized products move through a structured distribution chain that is relatively easy to inspect. Unauthorized products tend to surface in tobacco shops, liquor stores and vape retailers, which are far harder to police. Pennsylvania has about 11,000 licensed sellers of other tobacco products, a category that includes vapes, and no directory can inspect any of them. If those sellers conclude that inspections are rare and penalties are manageable, little will change. The market for unauthorized products has persisted through years of federal action, and a new list alone will not end it.
The cost of weak enforcement falls hardest on the companies that did what the law asked. Manufacturers on Pennsylvania’s list invested tens of millions of dollars on the PMTA requirements to submit their products for FDA review, filed annual certifications, paid fees and posted surety bonds of at least $50,000. They compete against sellers of flavored disposables, which account for most unauthorized sales, and those sellers carry none of those costs. Compliance only pays when noncompliance costs more, and until unlisted sellers are out of business, there is no real growth opportunity for the companies that followed the rules.
Pennsylvania’s law gives the attorney general real tools, including seizure of unlisted products, civil penalties that escalate to license revocation for repeat violators and unannounced compliance checks. The state should use them broadly. That means prioritizing inspections where unauthorized products are most concentrated, which is independent distributors, tobacco shops, liquor stores and vape retailers, and acting against every unlisted product rather than a handful of visible ones. Lawmakers should also look at penalty levels. A first offense can be negotiated down to the cost of destroying the seized product, which is unlikely to deter a seller who can restock the next week. Fines that exceed the profit from unauthorized sales would change that math. And because the law links the scale of enforcement to what the General Assembly budgets for it, funding will determine whether any of this happens.
There are fair objections. Stricter enforcement can burden small retailers that are trying to comply, so inspectors should focus first on repeat offenders and high-volume sellers, and the law already requires the state to publish a list of sellers with three or more violations. Enforcement also has limits. It will not by itself stop online or cross-border sales, which is why state action has to work alongside the federal effort at the border.
Technology can help, but only as a complement. Manufacturers can build verification into products from the factory to the point of use, and I work on that problem every day. Even so, those investments pay off only in a market where unauthorized competitors face severe consequences. Enforcement comes first, and everything else depends on it.
When Pennsylvania’s inspectors begin their work, the directory will tell them what may be sold. What the state does next will determine whether the companies that played by the rules finally get a market they can compete in.
Jason Carignan is a founding member of IKE Tech and chief commercial officer of Chemular Inc.
-

PMI Reports Higher Third-Quarter Revenue
Philip Morris International reported third-quarter 2026 net revenue of $11.4 billion, up 5.5% from a year earlier, while operating income increased 14.1% to $4.9 billion. Adjusted diluted earnings per share rose 5.4% to $2.36. Shipment volume increased 0.6% to 206.2 billion cigarette-equivalent units, including 2.7% growth in smoke-free products. Smoke-free products accounted for more than 40% of quarterly revenue.
IQOS heated-tobacco unit shipments rose 1.5% to 41.5 billion, while VEEV e-vapor shipments increased 61.6%. In the United States, ZYN nicotine pouch shipments grew 4.2% to 3.2 billion pouches. PMI raised its regular quarterly dividend 8.8% to $1.60 per share and updated its 2026 adjusted diluted earnings-per-share forecast to $8.29 to $8.44, excluding currency effects.
Following PMI’s third-quarter results, Reuters reported that the company faces rising cost pressures from the war in the Middle East, including energy-related inflation expected to worsen in the fourth quarter. Strikes in Ukraine have also disrupted operations, and PMI expects the effects to continue weighing on operating income this year. The company said the broader effects on consumers and global costs remain difficult to assess, although the situation is currently manageable.
Reuters also highlighted slower ZYN growth amid competition from British American Tobacco’s Velo. PMI plans to increase investment in ZYN and transition most of its U.S. nicotine pouch portfolio from 15-pouch to 20-pouch cans. Reuters reported that PMI shares fell 3% in premarket trading following the results.
-

IGEN, Vertex Expand Excise Tax Compliance Integration
IGEN and Vertex Inc. expanded their collaboration to integrate IGEN’s excise tax calculation capabilities into Vertex’s SAP-certified connector, allowing businesses to manage excise and other indirect taxes within a single transaction flow. The solution is designed for companies in highly regulated industries, including tobacco and oil and gas, and supports enterprises transitioning to SAP S/4HANA. IGEN’s system calculates excise taxes based on products, movements, and regulatory requirements, while Vertex provides sales and use tax, value-added tax, and goods and services tax capabilities.
The integration is intended to simplify tax reconciliation and audit preparation. IGEN President Ryan Padget and Vertex Chief Strategy Officer Chirag Patel said the companies plan to expand the collaboration, with integrations for additional enterprise resource planning systems planned for the future.
-

Armenia Seizes Nearly 38,000 Packs of U.S.-Bound Cigarettes
Armenia’s State Revenue Committee uncovered an attempt to smuggle 37,900 packs of cigarettes into the United States concealed inside laminate doors, the agency said. The cigarettes, manufactured in various countries, lacked excise stamps. Customs officers inspected the doors at a cargo terminal after receiving intelligence that an Armenian-registered company planned to export tobacco products while concealing them from customs control. Officers dismantled the doors and discovered the cigarettes inside.
-

Vietnam Proposes Online Tobacco Sales Ban, Larger Pack Warnings
Vietnam’s government submitted draft amendments to the Law on Prevention and Control of Tobacco Harms that would ban online tobacco sales, prohibit retail displays unless otherwise authorized, and clarify restrictions on e-cigarettes and heated-tobacco products. The proposal would also cover e-cigarette components and liquids, nicotine pouches, shisha, and certain tobacco raw materials. If approved, the law would take effect July 1, 2027.
The National Assembly’s Committee on Culture and Social Affairs recommended requiring health warnings to cover at least 85% of the front and back of cigarette packs and cartons, with a possible timetable to increase coverage to 100%. It also called for warnings to be printed directly on packaging and supported allowing retailers to refuse sales to customers unable to prove they are of legal age. The draft follows Vietnam’s 2024 ban on e-cigarettes and heated tobacco and seeks to clarify enforcement provisions covering production, sales, possession, transportation, and cross-border trade.
-

Haypp to End Snusnetto Sales After Age-Verification Ruling
Haypp Group subsidiary Snusbolaget Norden AB stopped selling tobacco and nicotine products through Snusnetto.se effective Oct. 19, after Sweden’s Supreme Administrative Court declined to hear an appeal concerning age verification for parcel locker deliveries. The decision follows a ruling by the Stockholm Administrative Court of Appeal that geo-located BankID verification at parcel lockers does not meet legal requirements for secure age verification. The closure affects about 500 active customers and is not expected to have a material impact on Haypp Group’s financial results.
Haypp’s other Swedish e-commerce sites are introducing a new verification system that checks the age of the person opening the parcel locker and collecting the shipment. The rollout began in October and is expected to be completed by the end of the month. The changes do not affect deliveries to staffed collection points, where employees verify recipients’ ages when handing over parcels.
-

Zimbabwe Tobacco Exports Surpass $1 Billion
Zimbabwe exported 189.98 million kilograms of tobacco worth $1.003 billion so far this year, up from 154.26 million kilograms valued at $844 million during the same period last year, according to the Tobacco Industry and Marketing Board. The average export price was $5.28 per kilogram. The Far East was the largest market, accounting for 84.33 million kilograms worth $577.2 million, at an average price of $6.84 per kilogram.
Exports to Africa rose to 42.32 million kilograms valued at $169.4 million, while shipments to the Middle East totaled 22.27 million kilograms worth $69.4 million. Exports to the European Union fell to 19.87 million kilograms valued at $93 million, down from 23.52 million kilograms worth $135.8 million a year earlier. Shipments to other European markets and the Americas increased to 12.49 million kilograms and 8.69 million kilograms, respectively.
-

ASH Report Challenges UK’s Illicit Tobacco Market Numbers
Action on Smoking and Health (ASH), a U.K. tobacco-control charity, has challenged tobacco industry estimates of the country’s illicit cigarette market, citing a discrepancy between government figures and industry-funded research. In a report published Oct. 19, ASH said HM Revenue & Customs estimated that illicit cigarettes accounted for 12% of U.K. cigarette consumption in 2024-25, or about 1.9 billion cigarettes. A KPMG report commissioned by Philip Morris International estimated that 45% of cigarettes consumed in the U.K. in 2025 were illicit, including counterfeit and contraband products and cigarettes purchased legally abroad.
ASH said illicit cigarette consumption had fallen by nearly 90% since 2000, from 15.1 billion cigarettes annually to 1.9 billion in 2024-25, with cigarette prices more than tripling. Japan Tobacco International said the industry’s estimates use different methodologies from HMRC’s, including analysis of collected cigarette packs, and cautioned against treating any single estimate as definitive. The Tobacco Manufacturers’ Association also cited uncertainty in HMRC’s estimates of the illicit tobacco tax gap.
-

T&C Backs Down on Tobacco Licensing Fees
The Turks and Caicos Islands government is replacing its proposed fixed annual alcohol and tobacco import licensing fees of $75,000 and $50,000, respectively, with fees based on import value following public backlash. Under the revised proposal announced Oct. 14, alcohol importers would pay 5% of the accepted customs value of their imports. Tobacco importers would pay the higher of 5% of accepted customs value or 5% of a reference value calculated by tobacco weight. Both categories would have a minimum annual fee of $1,000. The revised fee structure remains subject to stakeholder consultation and government approval.
The government plans to maintain its licensing timetable, with businesses required to register and apply for licenses Nov. 1-30. Beginning Dec. 1, commercial alcohol and tobacco shipments imported without valid licenses could be detained, seized or forfeited. The government also proposed replacing the existing tobacco import license with a Customs tobacco import license, subject to legislative amendments.

