More than a year after EIA first exposed Europe’s illegal multi-million euro trade in climate-damaging hydrofluorocarbons (HFCs), we are calling for an investigation into the growing black market in greenhouses gases.
Our report Europe’s Most Chilling Crime revealed Romania to be a major illegal entry point into the EU – but the failure of that country’s authorities to act on the findings has compelled us to urge the European Public Prosecutor’s Office to launch a formal probe into the ongoing crime.
HFCs are industrial refrigerant gases used in, among other things, air-conditioning and supermarket cooling units.
As part of a gradual phase down in using HFCs, the EU has introduced a quota system via its F-Gas Regulation to limit the volume of these greenhouse gases on the market.
It cut the supply by 37 per cent in 2018, which caused prices to skyrocket and fueled a lucrative black market across Europe.
The EIA report in July 2021 exposed how illegal cylinders of Chinese-made HFCs entered Romania via Ukraine and Turkey and were then shipped around the continent through courier services and in the luggage compartments of transnational coaches.
Apart from identifying the smuggling routes, the report also named individuals and companies involved in the illegal trade. To bypass border controls, smugglers exploited loopholes in the F-Gas Regulation and customs procedures, paid off corrupt officials and benefited from lax border controls.
“Despite giving Romanian law enforcement our evidence 12 months ago, no action appears to have taken place,” said EIA Senior Climate Campaigner Fionnuala Walravens.
“The illegal trade not only jeopardises the achievement of the EU’s climate objectives, but it has also resulted in the loss of approximately €77 million a year in VAT and customs duties.
“So, in a first for EIA, we are now asking the European Public Prosecutor’s Office, which exists to protect EU taxpayers’ money from criminals, to investigate this growing black market in greenhouses gases.”
EIA’s investigation compared data reported under the EU F-Gas Regulation with trade data and other multiple information sources, estimating that the volume of illegal HFCs smuggled into the EU amounted to between 20-30 per cent of the legal trade.
Losses to legitimate businesses are significant. In 2020, Europe’s five major HFC manufacturers noted that illegal imports cost about $500 million in lost profits per year.