PMI IMPACT

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Image 1. PMI IMPACT funding page

Background

PMI IMPACT is a funding initiative launched by Philip Morris International (PMI) in 2016.[1] PMI IMPACT describes itself as “a global initiative to support public, private, and nongovernmental organizations to develop and implement projects against illegal trade and related crimes”.[2] Through its website, “Public organisations, law enforcement, private entities, and non-governmental organisations from around the world” were all encouraged to submit project proposals to PMI IMPACT.[3]

Selection Process

Upon its announcement, PMI pledged $100 million toward the initiative with funding split into distinct rounds with a distinct theme.[1] The selection process was described on PMI IMPACT’S website, and in supporting documentation, as a three stage process. First, applicants submit an expression of interest which PMI conducts “initial due diligence checks” on.[4] At the second stage, selected applicants submit full proposals for review by an expert council. The final stage involves successful applicants being asked to sign a grant agreement with PMI, which includes the following requirement:

“When making public its Project’s work product or any deliverables, to be transparent about PMI’s financial support of the Project, Grantee shall disclose the fact that the Project was funded by PMI IMPACT. Before Grantee makes any of its work product or deliverables public, PMI and Grantee shall agree on the precise language of disclosing PMI’s financial support, ensuring that such language complies with applicable laws, PMI transparency and disclosure policies, and other applicable ethics rules.”[5]

Expert Council

Funding applications were judged by an expert council of, originally seven, individuals with very close links to United Nations (UN) agencies and INTERPOL.[6] INTERPOL accepted a €15 million donation from PMI in 2011 and have promoted access to the tobacco industry’s ‘track and trace’ system Codentify through the INTERPOL Global Register.[7][8]

Mahmoud Cherif Bassiouni

Mahmoud Cherif Bassiouni previously held 22 UN positions, including Chair of the Drafting Committee of the Diplomatic Conference on the Establishment of an International Criminal Court in 1998. In 1973, he served as a consultant to the U.S. Department of State and Department of Justice on projects relating to the international traffic of drugs.[9][6] On 25 September 2017 Bassiouni died, bringing the number of expert council members down to six.[10] On 27 September PMI’s Chief Executive Officer, André Calantzopoulos, released a statement in memory of Bassiouni through PMI IMPACT’s website.[11]

Catherine Volz

Catherine Volz served in the UN Office on Drugs and Crime (UNODC) for over 18 years.[6] In mid-2017, Volz was removed from the PMI IMPACT website’s expert panel list and replaced by Navi Pillay.[12]

Navi Pillay

Navi Pillay was elected by the UN General Assembly to be a judge on the International Criminal Tribunal for Rwanda, serving from 1995-2003 and was UN High Commissioner for Human Rights from September 2008 to August 2014. Pillay was added to the expert council in 2017.[12]

Suzanne Hayden

Suzanne Hayden worked as a PMI consultant on "law enforcement matters" and is the former Senior Advisor to UNODC and the International Anti-Corruption Academy (IACA). She also established the UN’s first financial investigation unit.[6] Hayden was also involved in an Anti-Contraband Tobacco Working Group meeting, partly-funded by Dawson Strategic,[13] which is registered under the Senate Office of Public Records as a PMI lobbying firm.[14]

Alain Julliet

Alain Julliet served as Intelligence Director for the French General Directorate for External Security (DGSE) of the French Ministry of Defence and later took the role of Senior Official in charge of economic intelligence to the Prime Minister’s office, holding this position until 2009.[6] In 2009 he became President of the Académie de l’Intelligence Economique and in 2011, President of the Club des Directeurs de Sécurité des Entreprises (CDSE). From 2016, he worked with INTERPOL as chair to the International Forum of Security Technologies (FITS).[15]

Paul Makin

Paul Makin served in the UN Industrial Development Organization (UNIDO) and is a former Director of the UNIDO Regional Office in Egypt.[6]

Luis Moreno Ocampo

Luis Moreno Ocampo was the first Chief Prosecutor for the International Criminal Court (ICC) from 2003-2012 and he also served as Chairman of the World Bank Expert Panel on the Padma Bridge project.[6] On 11 June 2015, he held a workshop for the Global Order Project on the Philip Morris vs. Uruguay lawsuit, though its content is unknown.[16]

Jürgen Storbeck

Jürgen Storbeck is a former head of the Central Bureau of INTERPOL and was the first Director of Europol between 1999 & 2004. In 2016 he was a consultant for Governments and public authorities as well as private organizations, including PMI. He advises them on issues such as crime prevention and organised crime. [6]

First Funding Round

The first funding round called for “projects that have an impact on illegal trade and related crimes in the European Union (EU), even if they are implemented elsewhere” (Image 1).[17] The initiative put forward three focus areas, with each funding proposal required to address at least one of them and demonstrate how it was “likely to have a clear impact on the illegal tobacco trade”.[17] The areas were:

  • Research;
  • Education & awareness; and
  • Action

On 15 September 2016, PMI issued a press release stating that 170 organisations, “including government agencies, universities and research institutes, NGOs, and private entities proposed more than 200 projects”.[18]

A further press release issued on 14 December 2016, announced that 41 proposals had been selected to progress to the “next phase” of the selection process.[19] In the press release, expert panellist Luis Moren Ocampo described PMI Impact as:

“a unique initiative: 100 million dollars from PMI distributed by an independent group of experts after reviewing hundreds of projects from public and private institutions. This is a cutting edge exercise of public-private partnership”.[19]

Projects Funded in the First Round

On 7 September 2017, PMI announced it would be spending approximately $28 million on 32 proposals that were approved by the expert council which are expected to be completed over the next two years.[20] Expert council member Jürgen Storbek, stated that the selected projects “can significantly help advance the global efforts against illegal trade and contribute to alleviating the pervasive consequences of crime on our economy, society, and global security”.[20] and Alvise Giustiniani, PMI’s Vice President of Illicit Trade Strategies & prevention, said:

”Illicit tobacco trade is just one face of a growing web of crimes, and we know that it’s only through coordinated actions of many public and private actors that we can put an end to these illegal activities that harm consumers, damage businesses, and allow criminals to prosper.”[20]

The press release that PMI would be calling for project proposals for the second of three funding rounds “soon”.[20]

According to the PMI IMPACT website, the 32 proposals represent 18 countries and come from organisations in the public, private, and academic sectors (Image 2).[21]

Image 2. Snippet from PMI IMPACT website, as seen 11 September 2017.

PMI Impact Funded Organisations: Pre-Existing Tobacco Industry Links

The following organisations listed, have received funding from PMI Impact, and have pre-existing tobacco industry links.

Belbrand

According to Bellbrand’s website, Grodno tobacco factory Newman, which occupies 72% of the market of tobacco production in the Republic of Belarus,[22] is a member.[23]

BOTEC Analysis

BOTEC Analysis have produced multiple research projects, funded by Cornerstone Research “under contract to Altria Client Services”, including a 2015 report entitled the ‘Unintended Consequences of Cigarette Prohibition, Regulation, and taxation’,[24] a 2016 report entitled ‘Cigarette Taxes and Illicit Trade in Europe’,[25] and a 2017 report on ‘Empty Discarded Pack Data and the prevalence of illicit trade in Cigarettes’, which Alberto Aziani of Transcrime was also authored.[26]

The Center for the Study of Democracy (CSD)

In 2011, the CSD and the Balkans’ Customs Agency held an international conference named “Counteracting Cigarette Smuggling in the Balkans” which was attended by representatives of PMI, Japan Tobacco International (JTI), British American Tobacco (BAT), Imperial Tobacco, and Bulgartabac Holding.[27]

The CSD previously held a round table about the Bulgarian cigarette market in 2010, with its website stating that:

”In the presentations delivered at the meeting it became clear that representatives of the cigarette producing companies (Philip Morris international, British American Tobacco, Japan tobacco International and Bulgartabac) along with the law enforcement and financial agencies… embrace the idea of establishing better cooperation among themselves, as well as developing a common strategy to efficiently counteract cigarette smuggling”.[28]

GLOBSEC

In September 2017, GLOBSEC’s website listed Philip Morris Slovakia as one of its partners.[29] In May 2017, PMI’s Vice President of Illicit Trade Strategy & Prevention, Alvise Giustiniani, was a panellist on a GLOBSEC event entitled ‘Threat-financing: money, illicit trade and (in)security’, as part of their GLOBSEC 2017 Bratislava Forum.[30][31]

Kazazi Consulting

According to its website, Philip Morris Albania is one of Kazazi Consulting’s main clients.[32]

KPMG

KPMG has a history of undertaking research on the illicit tobacco trade on behalf of the tobacco industry. For more information on this relationship see KPMG.

Lithuanian Free Market Institute

The Lithuanian Free Market Institute (LFMI) is a member of the European Policy Information Center (EPICENTER)- a group of 6 think-tanks, spanning multiple countries within the EU. While EPICENTER’s funding sources are unclear, the Institute of Economic Affairs (IEA) is a key member of the collective and has a history of close collaboration with the tobacco industry. See: Institute of Economic Affairs.

Oxford Economics

Oxford Economics has produced multiple industry-commissioned reports on illicit tobacco trade in Asian markets. For more information on these reports and Oxford Economic’s links to the tobacco industry, see: Oxford Economics.

Panta Rhei Research Limited Company

According to Endole Suite.com[33] and Companies House,[34] Dr. Peter Neumann and Zora Hauser are Directors of the Panta Rhei Research Limited Company. Hauser is currently a PhD Candidate at the University of Oxford, and worked in corporate affairs for PMI between 2014-2017.[35] Panta Rhei Research Limited Company should not be mistaken for Pantarhei- the Austrian public relations company.

Royal United Services Institute for Defence and Security Studies (RUSI)

On 3 July 2017 KPMG released the first report from the annual Project SUN series on illicit tobacco in the EU that was not directly commissioned by tobacco companies, instead being commissioned by RUSI.[36] RUSI then received funding from BAT, Imperial Tobacco, and PMI to provide “additional qualitative research” to the study.[37][38]

Siracusa International Institute (SII)

Until hs death, Mahmoud Cherif Bassiouni of the PMI IMPACT expert panel was Siracusa International Institute’s (SII) Honorary President.[39]

Southeast European Law Enforcement Center (SELEC)

In 2013, SELEC held an event on ‘combating illicit trade’ in conjunction with JTI.[40] For several years, SELEC have held annual meetings on fraud and smuggling which often feature representatives from tobacco companies.[41]

Transcrime

PMI has previously funded a series of reports by academics at Transcrime, several of which focussed on illicit tobacco trade. For more information on these reports and Transcrime’s links to the tobacco industry, see: Transcrime.

Additional Projects Funded by First Funding Round

19 other organisations’ applications were successful in PMI IMPACT’s first funding round. These included multiple universities and research groups, public institutions including the Romanian Police and the Hellenic Coast Guard, and private companies.[21]

’Combating Illicit Trade’ Conference

On 27 and 28 September 2017, PMI IMPACT and the Financial Times, held an event titled ‘Combating Illicit Trade: Progress, Challenges and Collaborative Solutions’. The conference featured 45 speakers and involved panel discussions, dialogues, presentations, and interviews. These included discussions of projects accepted through the first funding round of PMI IMPACT and an address from PMI’s Chief Executive Officer André Calantzopoulos. Speakers included members of the expert panel, academics, and representatives of the European Commission, Europol, Her Majesty’s Revenue & Customs (HMRC), the Organization for Economic Cooperation and Developments (OECD), the World Customs Organization (WCO), the World Trade Organization, and UNODC.[42]

Second Funding Round

On 29 September 2017, PMI released a press release calling for proposals for the second funding round of PMI IMPACT.[43]

“For this second funding round, PMI IMPACT will focus on initiatives that address converging forms of illegal trade and related crimes, such as corruption, money laundering, and organized criminal networks. The projects can be implemented anywhere in the world, but should have an impact in one or more of these geographic areas: Eastern Europe, Middle East, North Africa, Tri-Border Area in South America, Central America, South and Southeast Asia.”[43]

Use of United Nations Global Compact

The United Nations Global Compact (UNGC) is a UN initiative that aims to encourage businesses to adopt and report on the implementation of sustainable and socially responsible policies.[44] The UNGC requires its members to release yearly ‘Communications on Progress’ reports to show their commitment to the UNGC’s aims.[45] In 2016 and 2017 respectively, PMI released two ‘communication on progress’, the first of which outlined the launch of PMI IMPACT as a “catalyst for a more holistic approach against the illegal tobacco trade, corruption and organized crime” (Image 3)[46] with the second describing PMI IMPACT as “a global initiative governed by independent experts to sponsor third-party initiatives”[47]

Image 3. Page on PMI IMPACT, taken from PMI’s year-2015 ‘communication on progress’ for the UNGC.[46]

PMI’s use of its former UNGC membership (in September 2017, the UNGC excluded tobacco companies from participating in the initiative[48]) to promote PMI IMPACT, and its attempts to portray this association as evidence that PMI is in collaboration with the UN and supports “broader UN goals”[46] exemplifies tobacco industry Corporate Social Responsibility (CSR) strategies. Tobacco companies use associations or partnerships with other organisations to enhance their reputation and present themselves as good corporate citizens, despite the harms caused by tobacco products. See: CSR Strategy. Dr. Vera da Costa e Silva, head of the WHO FCTC Secretariat, addressed this point in a July 2017 blog post, stating that:

“(Tobacco companies) have masqueraded as partners for decent and well-meaning programmes designed to improve the lot of the world’s poorest and most vulnerable. And you can see what they gain: an invitation to speak to decision-makers at the highest levels, which offers an aura of respectability and feeds the narrative of responsible partnership.”[49]

Global Compact Distances Itself from the Tobacco Industry

On 12 September 2017, the UNGC announced that, from 15 October 2017, participating companies whose business involves manufacturing or producing tobacco products would be delisted so that UNGC policies “more closely align with the broader UN system”.[48]

TobaccoTactics Resources

TCRG Blogs

Relevant Link

Notes

  1. 1.0 1.1 Philip Morris International, Press Release: Philip Morris International Launches New Initiative to Fight Smuggling and Related Crimes; Pledges USD 100 million to Fund Projects, 27 May 2017, accessed October 2017
  2. PMI IMPACT, PMI IMPACT: Supporting projects with lasting impact against illegal trade, 2017, accessed October 2017
  3. PMI IMPACT, ABout PMI IMPACT: An inclusive approach to achieve better and more targeted results against illegal trade and related crimes, 2017, accessed October 2017
  4. PMI IMPACT, Application Terms and Funding Rules, Second Funding Round, 2017, accessed October 2017
  5. Key Terms of a PMI IMPACT Grant Agreement, 2017, accessed October 2017
  6. 6.0 6.1 6.2 6.3 6.4 6.5 6.6 6.7 PMI, Expert Council, accessed June 2016
  7. L. Joossens, A. Gilmore, The transnational tobacco companies’ strategy to promote Codentify, their inadequate tracking and tracing standard, Tobacco Control, 2013, 23, e3-e6
  8. INTERPOL, INTERPOL Global Register unveiled at Google Ideas INFO summit,17 July 2012, accessed July 2017
  9. M. Bassiouni, Biography, accessed June 2016
  10. H. Smith, , M. Cherif Bassiouni, ‘father of international criminal law,’ dies at 79, 26 September 2017, accessed October 2017
  11. A. Calantzopoulos,, In memory of Professor M. Cherif Bassiouni, Philip Morris International, accessed October 2017
  12. 12.0 12.1 PMI, Expert Council, 2017, accessed October 2017
  13. MacDonald Laurier Institute, Photos and Video: Anti Contraband tobacco working Group meets in Ottawa, 1 December 2014, accessed June 2016
  14. Dawson Strategic, Lobby Registration, accessed June 2016
  15. FITS, La lettre du président Alain Juillet, accessed June 2016
  16. L. Moreno Ocampo, A. Eibelshäuser, Workshop on the Investment Dispute between Philip Morris and Uruguay, Global Order Project website, accessed June 2016
  17. 17.0 17.1 Philip Morris International, Explore: Funding Theme, accessed June 2016
  18. PMI, PMI IMPACT September 2016 Press Release, 15 September 2016, accessed October 2016
  19. 19.0 19.1 Philip Morris International, The Expert Council of PMI IMPACT selects 41 proposals for final review as part of global initiative to fund projects dedicated to fighting illegal trade, 14 December 2016, accessed December 2016
  20. 20.0 20.1 20.2 20.3 Philip Morris International, PHILIP MORRIS INTERNATIONAL ANNOUNCES FIRST ROUND OF PROJECTS TO BE FUNDED THROUGH PMI IMPACT, A USD 100 MILLION GLOBAL INITIATIVE TO FIGHT ILLEGAL TRADE, 7 September 2017, accessed September 2017
  21. 21.0 21.1 PMI IMPACT, Selected Projects: First Funding Round, 2017, accessed September 2017
  22. JSC Grodno Tobacco Factory Newman, About company, accessed September 2017
  23. Members of the Association, 2017, accessed September 2017
  24. J.D. Kulick, J.E. Prieger, M. Kleiman, Unintended Consequences of Cigarette Prohibition, Regulation, and taxation, January 2015, accessed September 2017
  25. J.E., Prieger, J., Kulick, Cigarette Taxes and Illicit Trade in Europe, 20 January 2016, accessed September 2017
  26. A., Aziani, J., Kulick, N., Norman, J.E., Prieger,[1], 26 January 2017, accessed September 2017
  27. Center for the Study of Democracy, International Conference: Counteracting Cigarette Smuggling in the Balkans, undated, accessed September 2017
  28. Center for the Study of Democracy, Round Table: Cigarette Markets in Bulgaria: Current State and Trends, undated, accessed September 2017
  29. GLOBSEC, Partners in detail, April 2016, accessed September 2017
  30. GLOBSEC, Panelist: Alvise Giustiniani, 2017, accessed September 2017
  31. http://www.globsec.org/upload/documents/globsec-2017-bratislava-forum-summary/globsec2017-bratislava-forum-summary.pdf GLOBSEC 2017 Bratislava Forum Summary: Adapting (to) the Future], 2017, accessed September 2017
  32. Kazazi Consulting, Our main clients are:, 2017, accessed September 2017
  33. Endole Suite, Panta Rhei Research Limited, 1 September 2017, accessed October 2017
  34. Companies House, PANTA RHEI RESEARCH LIMITED, undated, accessed October 2017
  35. LinkedIn, Zora Hauser, undated, accessed October 2017
  36. KPMG, Project SUN: 2016 Results, 2017, accessed October 2017
  37. RUSI,Project SUN: A Study of the Illicit Cigarette Market in the European Union, Norway and Switzerland, 4 July 2017, accessed October 2017
  38. Telegraph,Illegal cigarette market costs UK taxpayer nearly £2bn, study finds, 4 July 2017, accessed October 2017
  39. Siracusa International Institute, Board of Directors, undated, accessed October 2017
  40. SELEC, Croatia led the regional combat against illicit trade of tobacco products, 2016, accessed October 2017
  41. SELEC, Anti-Fraud and Anti-Smuggling Task Force, 2016, accessed September 2017
  42. Financial Times Live, Combating Illicit Trade: Progress, Challenges and Collaborative Solutions, undated, accessed October 2017
  43. 43.0 43.1 Philip Morris International, PHILIP MORRIS INTERNATIONAL CALLS FOR PROPOSALS IN SECOND FUNDING ROUND OF PMI IMPACT, A GLOBAL INITIATIVE TO FIGHT ILLEGAL TRADE AND RELATED CRIMES, 29 September 2017, accessed October 2017
  44. United Nations Global Compact, Our Mission, undated, accessed October 2017
  45. United Nations Global Compact, The Communication on progress (COP) in Brief, undated, accessed October 2017
  46. 46.0 46.1 46.2 PMI, PMI UNGC Communication on Progress, 2015, 2016, accessed October 2016
  47. Philip Morris International, Communication on Progress, 2016, 12 September 2017, accessed October 2017
  48. 48.0 48.1 United Nations Global Compact, UN Global Compact Integrity Policy Update, 12 September 2017, accessed October 2017
  49. V. da Costa e Silva, Time to ban the wolves in sheep’s clothing, 11 July 2017, accessed September 2017