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Richard's Diary

September 2011

Habanos S.A. or not Habanos S.A. - is there even a question?

By Richard on September, 27th 2011 - 4:20 pm

I am sure you have noticed the recent increase of Cuban cigar sites claiming to be based in and shipping out of the Swiss Free Zone and yet, have their Sales or Administrative offices in another country. You must be wondering how big the Free Zone is here in Geneva with all the new sites that keep popping up every day. Believe me, I am the most surprised and the most frustrated by this worrying trend. What these new sites are not saying or omitting to say, is where and how they get their supply of Cuban cigars. Let us remember a very simple fact. Habanos S.A. distribute their cigars onto the world market through regional Importers. These Importers are contracted to distribute locally. Every region of the world has an Official Importer (the most recognizable being InterTabak (Switzerland), Altadis S.A. (Spain & France), Hunters & Frankau (UK) or Havana House (Canada), see Habanos S.A. site for full list of world Importers). A cigar merchant who is an official Habanos S.A. retailer is obliged to get their Cuban cigars supplied through these Official Regional Habanos S.A. Importers. This is regulated by a very simple factor, the cigar merchant must be located in the country where they are supplied (not in a free zone, as these areas are not and cannot by supplied by the Regional Importers). Any sites claiming to be based in the free zone of a country in not being supplied by a Habanos S.A. Regional Importer. This naturally begs the question; where are these cigars coming from? I mention all this as recently I have had a number of new Members asking me why we are so much more expensive that other sites based in Switzerland. I turn the question around, how do these new sites who claim to be in Switzerland, sell their cigars so much cheaper than all the established Swiss Official Habanos S.A. sites and more worryingly, why do these new sites claim to be Official Habanos S.A. retailers, when clearly they cannot be?

originally posted Oct 2008

// richard // September, 27th 2011 // 4:15 pm

Many thanks for your feedback. Havana Harry, it would be great if you could supply us with the names of the free zone sites in Spain you are giving as examples. Being in Switzerland, this has less effect on us, as we are not part of the EU, but it is always interesting to see what happens elsewhere. Just a note, one is permitted to do whole sale from Free zones. What is not permitted is to import in whole sale, and resell from the free zone in retail form (i.e. having a shop in the free zone), as many of the sites online now claim to do. This is a sure case of a company not being legally in the country they claim to be in. Very dangerous for them and any unsuspecting clients who make the mistake of buying from them thinking they are getting a great deal.

// Havana Harry // July, 29th 2011 // 3:08 am

It is a very provocative article. I have a question about your comment though, in an effort to be better educated.

"Any sites claiming to be based in the free zone of a country in not being supplied by a Habanos S.A. Regional Importer."

I visited another online supplier who claims to be an "established company" in the Canary Islands or more specifically the port area of Gran Canaria Island. A visit to the Gran Canaria Free Zone website lists them an established company of the zone. With that, they do apparently realize some significant advantages as follows from the GCFZ website:

"Kyoto agreement considers that free zones are the enclaves located within customs places, perfectly delimited with physical enclosures and preferably with direct access to the exterior; normally having its own or adjacent port or airport.

According to the European Union Customs Code, free zones form part of the communitarian customs territory, where unlimited warehousing, goods transformation and distribution without customs taxes neither indirect duty can be made.

Neither there will be the application of trade policy measures, such as quota, share or restrictions.

The stored goods in free zones could receive all the possible destinations: sold, delivered or exported outside the EU territory."

In addition to the advantages of no tariffs, taxes or levies, this firm also claims to be supplied by Sotabac. A visit to the Habanos SA website shows Sotabac as the official distributor to Islas Canarias also located in Gran Canaria.

Sotabac confirmed that they do in fact supply this firm with Habanos SA brand Cuban cigars.

A friend of mine from London purchased a certain box of cigars from LCDH and the same box from this place and they were identical in every respect, except one, price - Gran Canaria was significantly cheaper.

All this said - I also found many more sites who were seemingly bogus with these "free zone" claims. In fact, I couldn't verify any others.

So am I wrong that at least one "free zone" place exists - at least this one - or am I totally blinded by the smoke and mirrors? Trying to discern what is legit and what isn't is truly an epic battle. I have friends who have traveled to Cuba (en politico) and have been duped on fakes while there - and that's in their own backyard!

An important side note for cigar lovers is that there are many high quality cigars besides Cuban. Will you ever carry a larger stock of Nicaraguan cigars for example? Pepin Garcia in Miami, who also owns his farm in Nicaragua, as I'm sure you know makes some of the best cigars on the market worldwide imho. And they smack of mother Cuba to boot. He is an absloute master.

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