No minimum price allowed on cigarettes

The European Commission is taking action against Member States that impose minimum retail selling prices on cigarettes.

In a press release the Commission said that in line with the jurisprudence of the European Court of Justice, “it takes the view that such minimum prices infringe Community law, distort competition and just benefit manufacturers by safeguarding their profit margins.”

The Commission notes that the relevant Council Directive (95/59/EC) on taxes contains the right of the manufacturer and/or importer of tobacco products to determine the retail selling price.

“Minimum State prices impair this right and are therefore not compatible with the Directive. To achieve the objective of reducing tobacco consumption, the Commission advocates an increase of the excise duties on cheap cigarettes,” it said.

Taxation Commission Laszlo Kovacs said that while he strongly supports Member States in their efforts to implement new health policy, “this must respect Community law.”

“Introducing minimum retail prices for cigarettes is against Community law and mainly benefits manufacturers who are able to protect their profit margins”.