The European Commission is in talks with US tobacco company Philip Morris about ending a legal action against the firm over cigarette smuggling.
The European Commission has been waging a long-running lawsuit in US courts accusing the company, along with US rival RJ Reynolds, of colluding in the smuggling of cigarettes to evade customs and taxes in the EU.
"We have not yet finalised these talks. I can confirm that there are payments envisaged over a number of years, to the Commission and 10 member states. These payments should not be considered a fine," the spokeswoman added.
The Financial Timesreported today that Philip Morris was offering $1 billion to settle the case, but the Commission spokeswoman would not confirm the figure.
The company, which makes Marlboro, L&M and Chesterfield, said it had offered "substantial payments over a number of years" to help fund anti-contraband and anti-counterfeit efforts in a bid to end the EU litigation.
Philip Morris said in a statement issued at the weekend that a draft agreement had been drawn up by the two sides but still needed to be approved by EU member states and the board of directors of Philip Morris International.
The Commission said an end to the dispute was in sight. "It would be an agreement to cooperate in some areas to fight against fraud, including . . . tracking products to ensure Philip Morris products are sold legally," the spokeswoman said.