NACS Calls for a Fact-Based Approach in EU Tobacco Directive Review

Failure to properly assess the impact of the European Union’s Tobacco Products Directive (TPD) risks driving millions of consumers toward unregulated markets and would undercut public policy objectives while reducing tax revenues, weakening youth access controls and harming legitimate businesses and workers, warned NACS.

NACS is closely following the European Commission's ongoing review of the TPD, a process that could have significant implications for jobs, small and medium-sized enterprises (SMEs), supply chains and illicit trade across Europe.

Across the EU, the convenience retailing ecosystem supports more than 684,000 retail outlets. These are predominantly small and family-run businesses that support retail jobs and generate annual revenues in excess of €250 billion.

But despite this significant footprint, NACS believes the current assessment of the TPD provides insufficient analysis of the potential impact on SMEs, employment and local economies.

“At a time when the European Union is placing competitiveness, re-industrialization and economic resilience at the center of its policy agenda, policymakers must fully consider the economic and social consequences of regulatory change” said Chairman Emeritus & CEO International at NACS Henry Armour. "A robust impact assessment is essential to ensure policy decisions are evidence-based and do not create unintended consequences."

NACS has called on EU policymakers to:

• Conduct a comprehensive socio-economic impact assessment;
• Fully integrate SME and employment considerations into policy design; and
• Avoid premature regulatory action before the potential impact on illicit trade has been fully assessed.

NACS highlighted the critical role that legal retail businesses have in supporting regulatory compliance and addressing illicit trade. It is estimated that 38.9 billion illicit cigarettes are consumed annually in the EU, leading to €11.6 billion in lost annual tax revenues.

“Convenience retailers are essential partners in achieving public policy objectives,” said Armour. “Any revision of the TPD should be developed through a deliberate, evidence-based process that carefully evaluates the impact on businesses, workers, consumers and government revenues.”

Europe Tobacco