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The TF1 report traces the wider European supply chain behind illegal cigarettes, from production and cross-border transport to street-level sales in France. The French television crew visited illegal cigarette factories in Hungary that had been shut down by the National Tax and Customs Administration (NAV), highlighting the industrial capacity and technology used by criminal organizations.
According to the latest KPMG study cited in the report, 41.8 billion illegal cigarettes were consumed in the European Union in 2025, representing 10.3% of total consumption. The resulting loss in tax revenue for EU member states was estimated at EUR 16.7 bln.
KPMG also said the structure of the illegal market was changing, with counterfeit cigarettes gaining ground as traditional smuggling became less dominant.
France is one of the clearest examples of the scale of the problem. According to KPMG, 20.5 billion illegal cigarettes were consumed there in 2025, accounting for 41.4% of total cigarette consumption.
Counterfeit products alone represented almost 9.7 billion cigarettes. France remained Europe’s largest illegal cigarette market and recorded the biggest increase in illicit consumption in 2025, the study said.
TF1 reported that a significant proportion of illegal cigarettes sold in France originate in Eastern Europe and identified production sites in Hungary as one of the focal points within the region.
The supply chain, however, extends across several countries and involves interconnected production, logistics, financing, transport and sales networks.
NAV experts appearing in the report demonstrated the technological and logistical infrastructure needed for industrial-scale illegal cigarette production.
The equipment, raw materials, packaging and transport solutions found at illegal facilities suggest that criminal groups operate with considerable expertise and financial resources, according to the report.
NAV also highlighted the logistics involved in moving and storing illicit products. Criminal organizations were described as using modern logistics solutions similar to those employed by legitimate businesses, while seeking to avoid traceability.
The French market also illustrates how a large illegal market can persist despite increasingly strict regulation.
Sales, distribution and free provision of disposable e-cigarettes have been prohibited in France since February 2025, with violations carrying fines of up to EUR 100,000, or around HUF 36.5 mln.
Nevertheless, a recent survey cited in the release found that more than half of night-time grocery stores surveyed in northern France continued to sell cigarettes and disposable e-cigarettes illegally.
France also banned the possession and use of nicotine pouches from April 2026. Violations can carry penalties of up to one year in prison and a EUR 15,000 fine, rising in more serious cases to as much as five years in prison and EUR 375,000.
Laure Brunet Ruinart, secretary-general of the French Retailers’ Association, warned that prohibitive measures could have consequences that ultimately undermine public health objectives.
“Illegal trade affects health first and foremost. We do not know what is actually contained in counterfeit products,” she said.
The release argues that tighter regulation alone does not necessarily eliminate demand, with some consumers potentially turning to illegal channels when products become more difficult or expensive to obtain legally.
The illicit nicotine market is also extending beyond conventional cigarettes.
According to figures cited in the release, unauthorized vaping products account for 48% of the overall e-cigarette market, with turnover already exceeding EUR 6.6 bln.
That figure could approach EUR 10.8 bln by 2030, the release said, raising concerns not only about economic losses and jobs but also about public health.
The growing sophistication of illegal tobacco and nicotine trade means enforcement increasingly requires authorities to target entire criminal infrastructures rather than individual shipments, the release said.
For Hungarian authorities, combating the illicit trade is therefore not solely a domestic issue, but part of a wider European economic and public security challenge requiring coordinated international enforcement and efforts to dismantle the full illegal supply chain.
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