Illegal Trade in Tobacco and E-Cigarettes Continues to Rise in Germany, BVTE and BDZ Call for Enforceable Regulation

Key Takeaways

• BVTE and BDZ said illegal trade in tobacco products and e-cigarettes in Germany continues to increase, challenging the rule of law, youth and consumer protection, and fiscal authority.
• The groups said Germany still lacks reliable overall statistics on the illegal trade in tobacco products, e-cigarettes, nicotine pouches and oral nicotine products.
• BVTE cited studies saying 40% of e-cigarettes in Germany are illegal.
• BVTE said the black-market share of e-cigarettes could double to 80% if the government bans menthol and cooling substances in vape liquids.
• The groups said the current regulatory situation around nicotine pouches is causing annual losses of EUR 100 million in tobacco tax and VAT revenue (approximately USD 116 million, based on 1 EUR = 1.16 USD).

2Firsts, March 12, 2026

According to the joint press release of BVTE and BDZ, illegal trade in tobacco products and e-cigarettes continues to rise in Germany and poses major challenges to the rule of law, youth protection, consumer protection and the state’s fiscal authority. The German Association of the Tobacco Industry and Novel Products (BVTE) and the German Customs and Finance Union (BDZ) presented current customs enforcement findings and studies on the development of the black market for nicotine products at a joint press conference in Berlin.

The two groups said there is still no reliable overall statistic for the illegal trade in tobacco products, e-cigarettes, nicotine pouches and oral nicotine products. These products are not currently shown separately in official annual customs statistics. Only seizures are recorded, not the actual volume of smuggling. A substantial share of the trade takes place through online orders, small consignments and passenger traffic, and therefore remains largely outside statistical capture. Thomas Liebel, federal chairman of BDZ, said what is currently visible is only part of what is actually happening, and that the illegal market is real and growing dynamically, while much of it remains in the dark.

The groups said customs experience with illegal e-cigarettes shows the consequences of weak enforceability, including high investigative and analytical costs, long storage periods, significant safety risks from lithium batteries, and high storage and disposal costs, all borne by taxpayers. In one investigation by Customs Investigation Munich alone, storage and destruction costs for seized vapes amounted to around EUR 750,000 (approximately USD 870,000, based on 1 EUR = 1.16 USD).

BVTE said studies conducted by IPSOS, Kanthak and the Institute for Tobacco Research Berlin found that 40% of vapes in Germany are illegal. These e-cigarettes are often untaxed, contain too much nicotine, and frequently do not comply with the Tobacco Products Act in terms of presentation and packaging. BVTE said that with the federal government’s planned ban on menthol and cooling substances in vape liquids, the black-market share could double to 80%, because menthol is used in four out of five liquids for flavour balancing. BVTE chief executive Jan Mücke warned that political missteps could create a boom for organised crime. He said the state should focus on enforcing existing bans on e-cigarettes more effectively instead of repeatedly considering new bans that are then poorly enforced and only fuel illegal trade.

The groups also said the illegal trade is increasingly shifting to online and parcel delivery channels. More than five billion parcel shipments per year are expected by 2030. Despite increased inspection intensity for new product categories, only a fraction can be checked. Thomas Liebel warned that with current inspection capacities, little can be achieved in this area. He said new products appear faster than enforceable regulatory frameworks can be developed, and that bans do not replace controllable structures.

On nicotine pouches, the groups said demand in Germany is already substantial, but under the current regulatory status this demand is largely being served through illegal or grey-area channels. They said the current regulation leads to annual losses of EUR 100 million in tobacco tax and VAT revenue (approximately USD 116 million, based on 1 EUR = 1.16 USD), uncontrolled value creation in Germany, and ineffective market supervision. Jan Mücke said the key question is not whether this market exists, but whether the state regulates and controls it or leaves it entirely to the black market.

The groups also cited known seizures to show the scale of the problem. According to the Reemtsma Black Market Tracker, at least 23,741 cans of tobacco for oral use or nicotine pouches were seized in 2025, explicitly as a minimum figure. Individual customs operations revealed larger dimensions, including more than 10.5 kilograms of snus and nicotine pouches in one operation in Bielefeld, more than 14,000 cans of snus in a warehouse linked to illegal cigarette trade, and 36 pallets of prohibited snus tobacco products in a warehouse in Hesse with an estimated sales value of more than EUR 1 million (approximately USD 1.16 million, based on 1 EUR = 1.16 USD). The groups said these individual findings demonstrate the relevance of smuggling but do not provide a reliable basis for quantifying the true total volume, which is likely only the tip of the iceberg.

The groups said that in an illegal market there are neither age checks nor binding product standards nor transparent ingredient declarations. Consumers are pushed into uncontrolled distribution structures in which state protection mechanisms do not function. BDZ described the situation as a structural enforcement problem that goes far beyond isolated cases. De facto bans do not eliminate demand for nicotine products, but shift it into the illegal market. Germany, as both a transit and destination market, is especially affected. The lack of EU-wide harmonisation favours circumvention strategies and makes cross-border control more difficult. The separation of responsibilities among tax, health and market surveillance authorities also significantly limits the effectiveness of state measures and complicates cross-department strategies.

BVTE and BDZ said jointly that their aim is not to downplay nicotine products, but to establish controllable and enforceable regulation that makes state enforcement, youth and consumer protection, and tax compliance possible. They said repeated new bans cannot replace functioning market surveillance, and poor enforceability of new bans ultimately undermines state authority.

Image source: Joint press release from BVTE and BDZ.