Interview with Fabian Lorenz

Co-chair of EuroCham Anti-illicit Trade Advocacy
Group Senior Associate at Luther Law Firm

Please tell us more about your organization.

Luther is a German law firm that has been active in South-East Asia for the last 20 years. We opened our first office in Myanmar shortly after the country’s political opening. Officially established in 2013, Luther has meanwhile grown to a team of more than 50 professionals, including German, French and Myanmar lawyers as well as corporate secretaries, accountants and tax advisors providing legal, tax and regulatory advice as well as corporate services. I joined the team about five years ago and mostly work on corporate compliance, commercial law and employment law matters.

How did you get started with the Anti-illicit Trade Advocacy group?

As part of my responsibilities, I advise a number of clients on illicit trading activities in Myanmar and joined the anti-illicit trade advocacy group at EuroCham in 2018. This year I was elected as a co-chair and provide legal expertise on this matter to the group and other members of EuroCham.

What are the opportunities and challenges existing in the legal environment of Myanmar with regards to anti-illicit trade?


Myanmar’s current legal framework already offers a lot of possibilities to combat illicit trade. As often, the implementation of the existing rules and regulations is most challenging


The ‘best’ laws are basically useless the relevant authorities cannot or do not enforce them properly.

What we have learnt from the second edition of the Anti-Illicit Forum is that the relevant government actors are very much aware of this problem and the many negative effects caused by illicit trade. They seem to welcome ideas from the relevant stakeholders to better implement the existing rules and regulations, and we would be happy to provide information and our expertise for the establishment of more effective mechanisms.

What are the impacts of illicit trade on legal businesses as well as the country’s revenue?

Illicit trade has a huge impact on businesses and the country’s revenue.

In general, it refers to any practice related to distributing, selling, or buying products prohibited by law, including tax evasion, which means the sale of products without payment of the applicable taxes, counterfeiting, disguising the origin of products, and smuggling. Illicit trade can be undertaken both by illicit players who are not registered with the relevant government agencies, as well as by legitimate entities whose business operations are contrary to applicable laws and regulations.

In general, it refers to any practice related to distributing, selling, or buying products prohibited by law, including tax evasion, which means the sale of products without payment of the applicable taxes, counterfeiting, disguising the origin of products, and smuggling. Illicit trade can be undertaken both by illicit players who are not registered with the relevant government agencies, as well as by legitimate entities whose business operations are contrary to applicable laws and regulations.

In most cases, the prices of illicit products are lower than the retail price of legal products, in order to make them more attractive to consumers. Both Myanmar and foreign-owned companies following the law struggle to compete with products that have entered the country illegally, and they rely on the government to solve this problem. Otherwise they may refrain from making (further) investments and offer (more) jobs to people in Myanmar. This has a direct impact on the government, which collects less taxes and therefore generated less revenue.

How is Advocacy group structured to address the illicit trade in Myanmar?

To support the interest of its members and foster dialogue with Myanmar stakeholders, EuroCham Myanmar developed advocacy services for its members. In the advocacy groups, we promote the interests of European companies, have regular seminars and publish position papers.

The Anti-illicit Trade Group consists of members from many different economic sectors, who are all affected by illegal trade and want to join forces in finding solutions for this problem. We have two chairs that head the group together and closely work with the EuroCham team.

How is illicit trade currently being tackled by the government?

We are well aware of the fact that effectively confronting illicit trade poses complex political, legal, and technological challenges to each and every government. As such, illicit trade is one of the topics on which the relevant authorities should frequently request information and technical collaboration from international organizations and other stakeholders.

We consider the establishment of the anti-corruption commission as a step in the right direction. The Myanmar government should now work on further mechanisms to take better action against illicit players.

How is the current status of illicit trades across industries in Myanmar?

In Myanmar, illicit trade is present in many industries, for example beer, liquor, tobacco products, fast-moving consumer goods and health-care products industry.

According to official Myanmar import data collected by MMRD, total illicit trade value of six selected consumer goods was US$2.37 billion out of US$6.44 billion in total. And last year, Myanmar ranked the lowest on the Global Illicit Trade Environment Index.

With these numbers in mind, I think that we can honestly say that there is still a lot of space for development.

What plans does the group have in future as well as further strategic partnerships with organizations to raise awareness?

We will try to establish AIT forum as a regular event basically to show what has achieved and what can still be improved as well as to directly communicate and engage with the different stakeholders that are involved. We will also try to build stronger types of local businesses and seize opportunities and support their actions of relevant industries involved in fighting illicit trade.

Please share with our readers why it is important for a frontier market like Myanmar to fight illicit trade.

Fighting illicit trade is very important, as it affects many different stakeholders and has grave negative impacts: firstly, the investors that follow the law will do less business because they cannot compete with the price of illicit products; secondly, the government, that is collecting less taxes and duties and thus generating less revenue. Thirdly, the consumers, who may think that they benefit from cheaper prices of illicit products, but may ultimately pay a high price, as such products, may jeopardize their health and life.

If you could suggest one change to government policy, what would it be?

I would suggest to closely cooperate with relevant stakeholders, such as local and international investors, international organizations and other countries in the ASEAN Region. Listening to them and learning from their experiences could truly help the Myanmar government to establish mechanisms to effectively combat the illicit trade in Myanmar.