Augusto Cigars Fights Off Disastrous Fees

Not being part of the EU, Norway didn’t implement the EU Tobacco Products Directive (TPD) from 2014 until March of this year. Part of this directive was a mandatory registration of every product by tobacco importers in the EU-CEG database, which has been used by the countries in EU since 2016. So far, so good, the Norwegian cigar businesses were prepared for this. What they didn’t expect, was the Norwegian Health Agency suddenly hitting them with unannounced registration fees.

“First of all, the government decided to join the EU directive already in 2017, so this took them nine years,” Øystein Kleven, owner of Augusto Cigars sighs. “And we don’t care about the database. It’s just a technical thing, but during the consultation round for the proposition made by the Ministry of Health last year, there was no registration fee for cigars. Suddenly the Health Agency implemented the old regulations, where we were supposed to pay 800 euro per SKU, plus an annual fee of 300 euro”

In the first year this would have added up to 1150 euro for each size of each cigar. For Augusto Cigars, that would have meant paying 345,000 euro in fees, almost a third of their yearly turnover of 1.2 million euro

“All the importers in Norway would have gone bankrupt, and not just that,” Kleven says. “Altogether the four importers of Norway were supposed to pay more than 2 million euro, when the whole budget of the Norwegian Health Agency is 1.1 million euro. It’s illegal for them to charge more than they actually spend, and that’s four small companies paying double what the budget is for the whole administration of all the tobacco in Norway. Last year, they actually had to give back half the budget, because they only needed half as much as they initially had asked for.”

They didn’t discover this right away, though.

“We were super busy with new health warning stuff and trying to figure out what registering in the database actually meant. We started having a look at it during the summer and found they had added text that was getting very specific.”

So they contacted the Health Agency.  

“They had no idea what we were talking about, because the people responsible now weren’t there when the first proposition was written almost ten years ago, and the new one was written by the Ministry of Health. So they stuck to their guns and told us to contact the ministry if we had any questions.”

Last day of registration was set for September 30, but instead Augusto chose civil disobedience and sent a letter to the Ministry of Health.

“We decided it was too risky to register anything,” Kleven says. “Then they would have a list of products to base an invoice on, and if there were any penalties, they would be so much lower than the fees.”

After a few back and forths with both the Health Agency and Ministry of Health, mostly due to the right people being on vacation during fall break, the Ministry of Health admitted the mistake.

“They actually have people who understand the business. Because we have a large variety of artisanal products, produced in quite low volumes, they have declared cigars special, which is great. It means we can put on the health warnings ourselves, for instance.”

The weirdest part is that the fees would have ended up being a one-time thing. The proposition from the Ministry of Health has been scheduled for a vote in early 2027 for about a year now. When it passes – and according to Kleven it most probably will – the Norwegian government will implement a sector levy based on market share, similar to the one in Denmark, instead of fees. It was a close call, though. Since the fees would have counted for all of 2026, not just the remaining months, once would have been enough to put the entire Norwegian cigar scene to sleep.

“So the Ministry of Health froze the collection of fees until the new law is voted on, and the levy will be calculated based on how much tobacco tax you pay. So, instead of 345,000 euro, we will now pay about 1,800 euro.”

While celebrating the win, they still don’t understand how this happened.

“We’ve been trying to find out, but they refuse to tell us,” Kleven laughs. “I think the problem was that the regulations were written years ago, when these fees were popular in other countries. Then nobody thought about this again until this proposition suddenly popped up.”