Maldives makes history with generational ban as smuggling makes mockery of tobacco control

The generational ban that took effect on Saturday was widely reported as the Maldives made history with the attempt to phase-out tobacco use. In 2022, New Zealand became the first country to enact a such a law, but it was repealed before the ban could come into force in 2023. The UK is currently in the process of approving legislation for a generational ban.  

The generational prohibition covers both citizens and visitors. By fostering a permanent cohort of people who can never legally access tobacco, it aims to "protect public health and promote a tobacco-free generation," the health ministry said. "The ban applies to all forms of tobacco, and retailers are required to verify age prior to sale.”

According to a UNICEF survey released last week, nearly 90 percent of Maldivian youth are aware that tobacco is harmful. But social and media pressure continue to undermine prevention efforts. A majority of the respondents – 105 students aged 16 to 20 – were confident about refusing tobacco, but 63 percent believed media and influencers make smoking look cool.

The combination of bans and high taxes has created powerful financial incentives for illicit trade, fuelling a thriving black market and sophisticated smuggling operations.

A year after hiked import duties doubled the price of a pack of cigarettes from MVR 110 (US$ 7) to MVR 250, the unintended yet predictable consequences are evident: smuggled cigarettes now exceed legal ones, customs revenue has collapsed, and organised crime has infiltrated border control agencies – stealing seized cigarettes from a "secure" port and leaving behind a mocking profanity-laced meme inside a replica shipping container. 

The profit margin for smugglers is estimated to be up to 400 percent. As one in four Maldivians above 15 years of age are estimated to be smokers (113,414 people), demand has remained largely unchanged.

Last week, President Dr Mohamed Muizzu dismissed two deputy commissioners of the Maldives Customs Service and ordered action against three other customs officials. The  decision followed a parliamentary inquiry into the smuggling of about 200 cigarette cartons on an oil tanker, and the unauthorised clearance of hundreds of cases of cigarettes from a bonded warehouse. A "secret chapter" of the committee report had been shared with the president, Deputy Ahmed Speaker Nazim revealed.

The security services or '241' committee launched its inquiry in late October 2024 after senior customs officials informed lawmakers that ships and cargo boats arriving the in the Maldives "have the discretion to secretly enter anything they want, anywhere in the Maldives – and if they have the intention of importing weapons, that is also possible," Nazim said.  

During its year-long inquiry, the committee discovered the operation of bonded warehouses on the top floors of Malé residences and learned about the docking of boats of "disproportionate sizes" at "private harbours" in Thilafushi. 

When the report was finalised last Monday (October 27), the committee instructed customs to require all employees and their spouses to declare assets. The committee identified several operational shortcomings, including lack of 24-hour cargo surveillance, compromised vessel clearance procedures, and fraudulent invoice pricing. 

Presenting the findings to the parliament floor, Nazim highlighted the scale of the problem: "The number of smuggled cigarettes in the Maldives has now surpassed legally imported, duty-paid cigarettes."

As a result, cigarette import duties have plummeted from MVR 100 million to MVR 5 million – a 95 percent drop despite the higher tariff rates.

Smuggled cigarettes and vaping devices are "widely available" and "sold openly through social media," he observed. Black market vapes are now more expensive but "still cheaper than cigarettes," he added.

Nazim alleged the direct involvement of customs officials in facilitating maritime smuggling operations at sea and using bonded warehouses for illegal cigarette distribution. He also noted the suspected falsification or manipulation of import documents.

The parliamentary investigation documented two major smuggling cases involving a Hawks oil tanker and a bonded warehouse. As the committee prepared its report, the most audacious operation yet was executed in August: the theft of two 40-foot containers with 13.6 million seized cigarettes. 

These three cases tell the story of how the Maldives lost control of its tobacco market, illustrating the pitfalls of prohibition without enforcement capacity. 

The scheme: An oil tanker – MT Hawks Javaahiru (IMO No: 9174232) – belonging to The Hawks Private Ltd, one of the country's leading fuel importers, was used to smuggle about 200 cartons of cigarettes. 

Upon arriving in the country, the tanker turned off its automatic identification system or location tracking device for more than 24 hours, after which it was found unloading cigarette cartons to a company dhoni. 

The discovery: In October 2024, Customs intercepted more than 8,000 cartons of illegal cigarettes. A court-ordered search of the Hawks boatyard uncovered more than a million Manchester-brand cigarette sticks hidden in accommodation blocks and workshop areas – representing up to MVR 20 million in evaded duties.

A senior Hawks official denied any involvement by company management was uninvolved, blaming rogue employees and crew members. Foreign crew members from the tanker were later deported and three Maldivians were charged with smuggling.

A joint investigation by police and customs on suspected money laundering was due to be completed by July but remains ongoing. The Prosecutor General’s Office has not made a decision on pressing charges against Hawks.  

The scheme: Cigarette cartons stored in a bonded warehouse – supposedly one of the most secure customs facilities, requiring 24-hour security, mandatory officer presence, and detailed inventory systems – were systematically removed over multiple dates between September and October 2024.

The case involved fake Camel brand cigarettes imported on December 3, 2023. by a company called Exotic Enterprises. When Camel's local agent with exclusive distribution rights filed a lawsuit, the civil court ordered customs to hold the shipment, which was supposedly kept at a bonded warehouse on the second floor of a Malé residence. Amid the legal dispute, the owners of Exotic Enterprises transferred their shares to two other persons.

But when the 241 committee asked customs to check, “there was no bonded warehouse there and no cigarettes either,” Nazim said, stressing the loss of MVR 47 million in unpaid import duties.  

How it worked: While customs was awaiting duty payment, documentation was altered to show goods remained in storage while they were secretly removed without proper clearance. The fake cigarettes are believed to have entered black market distribution channels.

The 241 committee examined 127 documents, conducted multiple hearings with customs officials, reviewed surveillance footage, and analysed import and export records. The probe revealed violations of the tobacco control law, anti-corruption law and customs regulations on the operation of bonded warehouses.

The seizure: On April 26, 2025, Customs discovered 1,360 cases of cigarettes (13.6 million sticks) hidden in two 40-foot containers declared as plywood for the Velana International Airport's new passenger terminal construction. The containers were shipped under the terminal developer Saudi Bin Laden Group's name via local agent Leo Trading, whose managing director said the company immediately informed customs upon discovering the cigarettes. A Chinese national associated with the Bin Laden Group's construction project left the country shortly after the seizure. It contained Manchester-brand cigarettes with Dhivehi warning labels. The estimated duty value was MVR 122 million and the potential street value was MVR 340 million.

The containers were seized and placed in Maldives Ports Limited custody at the Hulhumalé port.

The heist: According to detailed reporting by Mihaaru and Adhadhu, organised criminals spent months planning the elaborate theft. At a Thilafushi site, they manufactured two replica containers – painted navy blue, bearing identical serial numbers and shipping labels. Three MPL employees were recruited. Two accepted apartments as bribes.

The third MPL employee demanded MVR 350,000 in cash rather than property. He initially received MVR 250,000 and paid off his wife's credit card debts, then gambled MVR 10,000. He won MVR 100,000 from that bet and immediately gambled it all away, losing everything. When he received a second payment of MVR 100,000, he gambled that away too. The sudden debt payments and casino activity made his wife suspicious when news of the heist broke. She called the police, leading investigators directly to the port insiders.

The execution: In the first week of August 2025 – not October as initially believed – the operation unfolded around 11:00pm. Security cameras were disabled in key areas. Other containers were positioned to block remaining camera sightlines. A boat registered as "Fiya" was listed to enter the port, but CCTV footage showed a different Apollo Holdings vessel instead. The genuine containers were loaded and taken to Hulhumalé Phase 3, where cigarettes were repackaged into jumbo bags for black market distribution. The replica containers, filled with old tires, were placed in their exact positions.

The theft occurred despite MPL opening a new security building in 2021. The ports authority made repeated claims in annual reports about the Hulhumalé port's compliance with the International Ship and Port Facility Security Code – which mandates 24-hour security cameras and comprehensive record-keeping.

The discovery (two months later): The theft remained undetected until October 8, 2025, when a senior government official received a tip. At 1:00am, Home Minister Ali Ihusan, Customs Commissioner Fathimath Dhiyana, and MPL CEO Mohamed Rishwan each received identical WhatsApp messages from a Sri Lankan number warning: "Do not open the containers or you will be shamed."

According to Adhadhu, when officials opened the containers, they found not just tires but a large printed meme of former president Maumoon Abdul Gayoom with profanity – "*oruhandaa Dhen" ("p*** off") – written on the wall behind him. A separate message stated the cigarettes were stolen "without the knowledge of investigating agencies, journalists and social media accounts."

The meme demonstrated, in Adhadhu's assessment, "the power of thieves over government companies, security forces and institutions," and warning that "no matter what they smuggle, authorities cannot seize it."

The arrests: Nine suspects were arrested, including prominent businessmen Mohamed Waheed (Apollo Holdings CEO, 65), Ahmed Arif (Lotus Company owner, 61) – both alleged financiers – Customs Superintendent Ziwar Ismail (40), Maldives Industrial Fisheries Company General Manager Muaz Ali (48), three MPL employees (Ahmed Shameem, Ahmed Firshan, and CCTV operator Husain Samihu), boat captain Adam Waheed, and Hassan Abdurrahman. Twelve others were barred from travelling out of the country.

The investigation: According to Mihaaru's reporting, the case broke when the bribed employee's wife contacted the authorities. Police found replica container parts in Thilafushi, traced gambling losses at casinos, and analysed financial records showing sudden debt payments and property offers.

All three cases involved suspected official complicity and sophisticated planning, suggesting a common supply source from regional hubs while the repeated involvement of legitimate businesses indicates an organised network rather than isolated incidents.