Rothmans, Benson & Hedges asks Ontario government to ban promotion of contraband tobacco
Rothmans, Benson & Hedges (RBH) is advocating that Ontario ban the promotion of contraband tobacco being sold online; launch a campaign aimed at educating smokers of organized crime’s role in illegal tobacco sales and the threat to community safety; and make smoke-free alternatives more widely available to smokers.
Kory McDonald, RBH’s head of external affairs, outlined the company’s recommendations before the Legislative Assembly of Ontario's Standing Committee on Finance and Economic Affairs on Jan. 9. The committee is in the midst of consultations for the province’s 2025 budget.
“Banning the advertisement of illegal tobacco online is a common-sense step that can have a big impact in terms of slowing the continued growth of the contraband tobacco market and keeping Ontarians safe,” said McDonald.
The second in a series of studies conducted by Ernst and Young and commissioned by the Convenience Industry Council of Canada (CICC) concluded that in 2022 contraband cigarettes accounted for at least 38.7% of the total cigarette market in Ontario and as much as 50.3%.
“As well, there's a need for government to acknowledge harm-reduced product categories within the Tobacco Tax Act to encourage adult consumers to switch to potentially less harmful alternatives to cigarettes,” she added. As part of its strategy to be a leader in smoking harm reduction, RBH introduced a new heat-not-burn tobacco product—Smartcore Induction System—in 2023.
A third study of the Ernst and Young report published in October 2024 found a number of online websites sell and deliver “native brand” contraband cigarettes anywhere in Canada in violation of federal laws. (It’s illegal for non-reserve residents or individuals that are not First Nations to purchase or possess unstamped, tax-free First Nations-produced tobacco products.)
READ: CICC releases new study on contraband tobacco in Canada
While some online retailers indicate they operate from First Nations reserves, others are believed to be managed by organized criminal groups off-reserve.
These products often also include age and health warnings to give an air of legitimacy. Some websites also offer volume discounts for more than one carton purchased. A carton of 200 contraband cigarettes costs an average of about $40 to $55 when purchased from an online platform with home delivery included in the final price, according to the Ernst and Young study. Some websites also offer volume discounts for purchasing multiple cartons (e.g.,5 to 24 cartons costs $50; 25 to 49 cartons costs $75, etc.)
RBH shared a number of social media ads from online cigarette sellers, including Cheap Smokes Canada, which sponsored posts promoting $27 per carton and 15% off first orders, and Discount Native Smokes, which promoted that it’s “accepting major credit cards” in sponsored posts.
Canada’s Tobacco and Vaping Products Act prohibits the promotion of tobacco products including online. However, provincial legislation would come with earmarked funds and resources to help shut down online promotion of illegal cigarettes.
“This change would mirror recent changes the province made to the Cannabis Control Act,” RBH said in a news release. The Safer Streets, Stronger Communities Act that, if passed as expected later this year, would strengthen the Cannabis Control Act by prohibiting advertising and promoting the sale of illegal cannabis.
Ontario has also said it would invest $31 million over three years to “respond to the challenge of illegal online operators and crack down further on the production, sale and distribution of illegal cannabis in the online and offline space.”
