Customs Act Imposes Harsh Penalties on Smuggling Illicit Cigarettes

KUALA LUMPUR, 12 MAY 2026 – Migrant workers who handle, store, distribute, or sell illicit cigarettes in Malaysia face serious criminal and immigration consequences under existing Malaysian laws, warns Arunachala Research & Consultancy Sdn Bhd (ARRESCON), a think tank specialising in criminology, law, and strategic risk analysis.

This warning follows increasing reports of foreign nationals being recruited into and are active in illicit cigarette distribution networks and trading, often for low wages and high-risk roles.

Involvement in Illicit Cigarette Trade can Face Jail Time

“Syndicates may treat workers as disposable, but the law does not. Anyone involved in the illicit cigarette trade can still face arrest, prosecution, imprisonment, deportation, and long-term immigration consequences under Malaysian law, regardless of their role in the operation,” said R. Paneir Selvam, Principal Consultant of ARRESCON.

Recent enforcement actions show that migrant workers are frequently detained during raids related to illicit cigarette activities. For example, in Sungai Buloh, four foreign labourers aged 21 to 38 were arrested while unloading contraband cigarette cartons from a lorry.

Immigration Action May Be Involved

The government has repeatedly emphasised that foreign nationals involved in unlawful business or commercial activities will face enforcement action, including immigration penalties.

Under Section 135(1)(d) of the Customs Act 1967, possession of uncustomed goods, including illicit cigarettes, carries a minimum fine of RM100,000 or a minimum custodial sentence of six months for a first offence. For repeat offences, penalties increase to a minimum fine of RM200,000 and imprisonment ranging from six months to seven years.

For smuggling offences under Section 135(1)(a), offenders may face fines based on the value of unpaid customs duties and custodial sentences of up to five years for repeat offences.

“For many migrant workers, these penalties are financially out of reach. As a result, imprisonment is likely upon conviction, even for those performing lower-level tasks within the supply chain. Workers should also not expect their employers or the syndicates to pay these penalties on their behalf. The law holds each individual personally liable,” said Paneir Selvam.

The Immigration Act 1959/63 imposes consequences for foreign nationals who misuse their documentation to engage in illicit activities. Under Section 6(3), individuals found using their passes in breach of permitted conditions, including participation in illegal trade or commercial activities, may face fines, imprisonment, whipping, and deportation. Those deported may also be blacklisted from future entry into Malaysia.

ARRESCON also emphasised that workers who are acting on instructions, be it an employer or any other person, are not exempt from prosecution. Under Sections 107 and 108 of the Penal Code, anyone who assists in committing an offence faces the same punishment as the person who carried it out directly. 

“Many workers may believe they are protected because they act on instructions or perform minor roles. However, Malaysian law permits enforcement action against every individual involved regardless,” Paneir Selvam added.

“Malaysia’s laws on illicit cigarettes are strict, and enforcement agencies are actively applying them. Migrant workers must understand the legal and immigration consequences when being involved in these activities, even for short-term income,” he concluded.