1. Markets, opportunities and pollutants: smuggling networks and the black market in ozone depleting substances Prof Lorraine Elliott The Australian National University http://ips.cap.anu.edu.au/ir/tec http://ips.cap.anu.edu.au/ir/tec ESRC Green Criminology Research Seminar University of Northumbria, 4 October 2013

2. 2 Background International agreements and opportunity structures for black markets In theory – illegal trade is time-bound; in practice …

3. Network framework CriminologySocial networks (SNA)Relational Transaction Cost Econmics Value/commodity chains Transactional Public policy/management Governance/structureOrganisational 3

4. Black market Drivers –Price differentials, profit differentials, complex provisions Timeline –1990s: CFCs/developed country markets (esp Nth America/Europe) –Turn of the century/2000s: CFCs/other industrialised countries (eg Japan), developing countries; black market demand for HCFCs –2013: HCFCs/developing countries (demand increasing, freeze on production and consumption) 4

5. Size of the market? A few (selective) statistics –1998-2003 US authorities seized 900 tonnes of CFCs –Project Sky-hole Patching I - >700 tonnes ODS (Sept 2006/Sept 2009); phase II (3 May/2 Nov 2010) 7500 cylinders (>108 tonnes) and 668 pieces of equipement –Europe/Central Asia – 3016 cylinders and 72 pieces of equipment (July 2010 and Aug 2012) 5

6. Logistic trails Nodes (production/export, import, transit) Transportation methods Concealment Sources –Diversion from legal production –Illegal production, counterfeit production 6

7. Trails … cont Destination/consumption –Multiple markets –Global web of trading links –Transshipment hubs (esp Dubai/Singapore) Methods –Hidden in plain sight –Mislabelling, falsifying –Full concealment/double layering 7

8. Entrepreneurial structures Knowledge transfer Mix of star/hub and chain networks Central role of ‘white collar’/legitimate entities as importers/coordinators Divisions of labour and ‘brokerage’ 8