This legislation is extremely important, it will effectively end Internet and telephone tobacco smuggling by stopping shipments of cigarettes and smokeless tobacco through the U.S. Postal Service. FedEx, UPS, and DHL have already agreed not to mail tobacco.
The rationale of the bill is as follows:
(b) Findings- Congress finds that--
(1) the sale of illegal cigarettes and smokeless tobacco products significantly reduces Federal, State, and local government revenues, with Internet sales alone accounting for billions of dollars of lost Federal, State, and local tobacco tax revenue each year;
Complete rationale for bill - Prevent All Cigarette Trafficking Act of 2009 by Eternal Hope Digg, DailyKus.com, 7/4/2009..
Related news brief: U.S - PACT legislation passed by House..; U.S. - PACT Legislation to be considered by House this month..; We must get the United States Postal Service (USPS) out of the tobacco delivery business..; PACT Legislation now in the U.S. Senate Judiciary Committee..; U.S. House Passes Bill to Prevent Tobacco Delivery By Mail..; We must get the United States Postal Service (USPS) out of the tobacco delivery business.. and Protect Our Children - Make it illegal to use the U.S. Postal Service to deliver any form of tobacco product...
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Let's Get It Passed - Prevent All Tobacco Trafficking Act of 2009..
Ukraine - lost cigarettes flooding Europe..
The world’s four leading multinational tobacco companies, Philip Morris International, Japan Tobacco International (JTI), Imperial Tobacco, and British American Tobacco (BAT), have produced billions of excess cigarettes in Ukraine, fueling a teeming black market that reaches across the European Union. Today, Ukraine is rivaled only by Russia as the top source of non-counterfeit brand cigarettes smuggled to Europe, EU officials say.
The growing traffic pushes huge supplies of cheap, untaxed, and unregulated cigarettes into the rest of Europe, undercutting otherwise successful attempts to curtail smoking. Worse, officials say, the trade is boosting organized crime gangs, who find the soft penalties and big profits hard to resist.
Each year, Ukraine’s cigarette consumption and legal exports top 100 billion sticks, according to Ukraine’s Ministry of Health. Yet in 2008, tobacco companies manufactured and imported nearly 130 billion cigarettes — 30 percent in excess of what the local market can consume. These “extra” cigarettes disappear in the market, feeding an illicit trade that is worth, conservatively, $2.1 billion annually. Ukrainian cigarette production, meanwhile, has steadily risen since 2003, according to an analysis by ICIJ of data compiled by SOVAT, a tobacco and alcohol industry association, and Ukraine government statistics. In fact, cigarette production in Ukraine increased one-third between 2003 and 2008 — from 96.8 to 129.8 billion — with JTI and Philip Morris leading that trend.
Philip Morris, BAT, JTI, and Imperial — control 99 percent of the Ukrainian cigarette market.
Internet merchants are also making a windfall from Ukraine-made cigarettes. A Web search for “cheap Ukrainian cigarettes” yields about two dozen online stores, most of them located in neighboring Moldova. The sites offer all the well-known brands, from Marlboro to Winston, with Ukrainian tax stamps and health warnings. The price is $22 for a carton (10 packs) of Marlboro — about three times cheaper than prices in the EU. The sellers claim that they will skip customs inspections at the destination country. If customs does try to charge a duty tax, customers are advised to reject the package and ask for their money back. Also plentiful on Ukrainian Internet sites are classified ads offering Ukrainian cigarettes delivered to the EU “in large quantities,” “on constant basis” and “without any paperwork.”
Konstantin Krasovsky, of the Ukraine Ministry of Health, says tobacco companies are doing little to stop smuggling. In Krasovsky’s view, the only way to halt smuggling is to make the trade unprofitable for manufacturers. He and other tobacco control advocates propose that, much like in the Philip Morris-EU agreement, tobacco companies in Ukraine be forced to buy back their seized cigarettes at market prices.
Reference: Ukraine’s ‘Lost’ Cigarettes Flood Europe Big Tobacco’s Overproduction Fuels $2 Billion Black Market by Vlad Lavrov, Tobacco Underground The booming Global Trade in Smuggled Cigarettes, Center for Public Integrity, 6/28/2009.
Click on image to enlarge, graphic by Stephen Roundtree..
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South Dakota - anti-smoking leaders challenge petition..
Leaders of South Dakota’s anti-tobacco movement filed a last hour challenge to their referendum petitions Thursday, July 2nd. If the petitions survive the challenge, a statewide vote would be held as part of the November 2010 general election.
That’s because the leader of South Dakota’s anti-tobacco movement filed a last hour challenge to their referendum petitions Thursday.
The referendum petitions had prevented the ban from taking effect July 1 at the same time as most other new South Dakota laws passed by the Legislature last session.
If the petitions survive the challenge, a statewide vote would be held as part of the November 2010 general election. But if Jennifer Stalley of the American Cancer Society is right, there won’t be a vote at all and the ban would kick in when the legal dust settles. Stalley delivered a thick binder to the office of Secretary of State Chris Nelson, whose staff oversees election compliance, challenging the petitions at about 4 p.m. Thursday.
In her affidavit, Stalley claims there are 9,891 signatures on the petitions which are invalid because they don’t comply in some way with state requirements. Her goal is to have sufficient signatures thrown out so that the smoking ban’s opponents don’t meet the minimum of 17,776 valid signatures necessary for the referendum to proceed.
Deputy Secretary of State Teresa Bray indicated the next step is to begin looking at each one of the 9,891 challenges.
Reference: State vote no longer certain on smoking ban for bars, cafés, The Daily Republic, 7/3/2009.
Related news briefs: South Dakota - smoking ban to start July 1, 2009 may be delayed..; South Dakota - opponents try to stop extended smoking ban..; South Dakota - extends smoking ban effective July 1, 2009...
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Florida's New Tobacco Law - non-Indian tribe members on Indian reservations may no longer dodge the tax..
Florida - As of July 1, 2009 Florida's new cigarette tax is $1.34 per pack. An equivalent increase applies to smokeless and pipe tobacco, but not cigars.
The new law still allows tribal members to purchase cigarettes at reservation retailers without paying the $1 tax. In theory, non-Indians purchasing cigarettes at reservation shops must pay the tax – an attempt to deal with concerns that raising the cigarette tax would simply drive smokers to buy their smokes from tribal retailers. Enforcement may be tricky.
Each tribe will be allotted coupons for tax-free cigarettes based on its size. The law allows each member to receive five packs per day, or 182 cartons of cigarettes over the course of a year. With 3,500 members, the Seminole Tribe, for example, would receive coupons for 6.4 million packs, or 1.27 billion cigarettes.
About 26 million packs of cigarettes are sold each year at stores on the Seminole and Miccosukee reservations, according to the Florida Department of Business and Professional Regulation, which is charged with regulating cigarette sales. Because tribes are sovereign nations, the state can’t stop them from selling cigarettes or force them the tax.
The plan, therefore, targets wholesalers, who would collect coupons from tribal retailers in lieu of the tax. Wholesalers would turn in the coupons to state regulators along with information matching tribal sales. Wholesalers would not be reimbursed by the state for cigarettes sold in excess of the tribal allotment. That is, if the tribe sold more cigarettes than the government thinks it would sell just to its own members then the wholesaler is going to be on the hook for tax on cigarettes presumably sold to non-Indians.
“We’re not going to be looking at individual sales,” said Jenn Meale, DBPR spokeswoman. “We’ll be focusing on the allotments.”
The law allows the state to enter into agreements with the tribes over cigarette revenue, a provision that would supersede legislation that went into effect Wednesday.
“The Seminole Tribe has moved ahead to charge the sales tax,” said Gary Bitner, a spokesman for the tribe. “It’s also studying its options for the future.”
Copyright © 2009 Jaxobserver
Related news brief: Florida - besides tobacco tax increase Senate wants to restrict tax-free sales..
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Tobacco company giants expelled from conference to negotiate a protocol on illicit tobacco products trade..
In contrast to the previous two negotiating sessions, this week the public gallery has been packed full of tobacco industry lobbyists. On Monday, June 29th there were more than forty people in the gallery. Twenty-three of the twenty-eight people willing to identify themselves were from the tobacco industry, including twelve from BAT, seven from JT, one from Imperial Tobacco, and one from the Tobacco Institute of South Africa.
The FCTC Article 5.3 guidelines instruct ratifying countries to “Establish measures to limit interactions with the tobacco industry and ensure the transparency of those interactions that occur” (Recommendation 2).
Big Tobacco Attempts to Smuggle Loopholes Into Global Tobacco Treaty..
"We (the governments) decided not to permit the tobacco industry to enter the meeting because they could interfere in the negotiations," said Justino Regalado Pineda, the head of Mexico's National Office for Tobacco Control. "We have to protect people from their commercial interest to poison the population."
Philip Morris International, whose representatives sat in on meetings earlier in the week, said it was "disappointed" by the decision. "It sets a dangerous precedent for the United Nations in what should be a democratic and transparent process," PMI spokesman Greg Prager said.
British American Tobacco, too, opposed the decision. "We strongly believe that a successful fight against illicit trade can only come from direct co-operation between regulators, law enforcement authorities and the tobacco industry," BAT spokesman David Betteridge said. He said the debate leading to the exclusion was "instigated" by Corporate Accountability International.
The U.S.-based watchdog group said the decision was a victory for public health. "This action sends a clear message from customs, health and law enforcement officials that it's not business as usual for the tobacco companies," the group's international policy director Kathy Mulvey said.
References: Cigarette companies kicked out of tobacco meeting by Frank Jordans, Associated Press (AP) - Boston.com, 7/2/2009.
Related news briefs: Tobacco Underground - cigarette smuggling, 6-part series..; Eliminating global illicit cigarette trade would save lives and increase tax revenue...
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New South Wales politician smoking comment totally inaccurate..
Every parent wants their children to lead healthy and happy lives. There's an abundance of evidence that children are more susceptible to the negative effects of second-hand smoke (ETS, environmental tobacco smoke, involuntary smoking, sidestream smoke, passive smoking). Mr. Abbott from what we gather, has three daughters that by now may have their own children. Doesn't he care if his loved ones are exposed to tobacco smoke that could possibly effect their health.
As pointed out by Action on Smoking and Health (ASH) Australia in a February 2009 paper the evidence of second-hand smoke harm to children in enclose spaces is extensive and irrefutable. A 2004 survey of over 1300 Australians in 800 households showed over 90 percent (including 73 percent of smokers) support banning smoking in cars carrying children. A Harvard School of Public Health report indicated that secondhand smoke in cars can be up to 10 times more of a health risk than secondhand smoke in a home.
Vehicles have been found to be the most dangerous space for second-hand smoke levels. Kids exposed to smoke are at higher risk since they breathe in more air by weight than adults. Both the respiratory rate and heart rate are higher in children below the age of 13 than in adults. The younger the child, the greater the potential for exposure. Since the lungs of children are still developing, exposure to second-hand smoke can lead to ear infections, asthma, bronchopneumonia and other illnesses.
The NSW voting public should think twice about putting Mr. Abbott in office since at least on this subject he doesn't have the best interests of his constituents in mind.
Reference: Tony Abbott's smoking comment draws fire, Angus Hohenboken, Australian, 7/3/2009; Abbott slams 'trivial' smoking ban, ABC, 7/2/2009.
Some related news briefs: World Asthma Awareness Day..; Further evidence - STOP smoking in the presence of your children..; Ireland - ban smoking in cars when kids are present..; Ontario law banning smoking in cars with children takes effect ..; Maine - illegal to smoke in cars while children present..; Ban on smoking in cars when children are present..;
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FDA seeks public opinion on tobacco regulations..
The FDA is establishing a public docket to obtain information on the implementation of the Family Smoking Prevention & Tobacco Control Act in order to provide an opportunity for all interested parties to provide information and share views on the implementation of the new law.
The deadline for submit written or electronic comments is Sept. 29, 2009.
To submit a comment electronically, click here. (Submit written comments to the Division of Dockets Management, HFA-305, FDA, 5630 Fishers Lane, Room 1061, Rockville, MD 20852.)
On June 22, 2009, the President Barack Obama signed H.R. 1256, the Family Smoking Prevention & Tobacco Control Act, into law. The act grants the FDA important new authority to regulate the manufacture, marketing and distribution of tobacco products to protect the public health generally and to reduce tobacco use by minors. The act authorizes the FDA to require disclosure of tobacco product ingredients and additives; regulate "modified risk" tobacco products; create standards for tobacco products, including standards for the reduction or elimination of certain constituents; restrict sales, distribution, advertising and promotion of tobacco products; and require stronger health warnings on packaging.
It also requires the FDA to issue its 1996 final regulation restricting the sale and distribution of nicotine-containing cigarettes and smokeless tobacco products. The rule contains provisions designed to limit young people's access to tobacco products, as well as restrictions on marketing to curb the appeal of these products to minors.
Click here to view the the Family Smoking Prevention & Tobacco Control Act (H.R. 1256).
Reference: FDA Seeks Public Input on Tobacco Regulation Agency sets up forum for industry, citizens to offer comment, CSP Daily News, 7/2/2009.
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Indonesia Finance Ministry to cap tax deductions for tobacco companies..
Additionally, the companies are obliged to submit a report on their promotional and distribution spending plans or they will be unable to subtract the costs from total revenues at the end of the year. According to tax office chief Darmin Nasution, the regulation was aimed at limiting the amount of the costs for promotion and distribution that would be subtracted from the companies’ gross revenues, which eventually affect tax revenues.
In 2008, the tobacco industry paid IDR 60 trillion (EUR 4.2 billion) in taxes or about 10 per cent of total government earnings from taxes. Tobacco companies spent IDR 375 billion on advertising in the first quarter of this year, according to AGB Nielsen Media Research. (pi)
Industry players warned it would burden a sector that directly and indirectly employs more than one million people.
The rules cap the advertising tax deduction for cigarette producers with annual gross revenue of more than Rp 5 trillion ($490 million) at 1 percent of gross revenue, and less than Rp 100 billion overall. Deductions for companies with annual gross revenue of between Rp 500 billion and Rp 5 trillion have capped at 2 percent of gross revenue, up to a maximum of Rp 30 billion. Deductions for companies with annual gross revenue of Rp 500 billion or less have been capped at 3 percent, up to a maximum of Rp 10 billion.
The corporate income tax rate currently stands at 28 percent after all deductible components are taken out. With the latest change in the rules, the tax burden on cigarette firms is likely to increase significantly.
Niken Rachmat, head of corporate communications at PT HM Sampoerna, one of the country’s biggest cigarette manufacturers, said the company would be forced to cut advertising spend to comply with the new regulations, because the more it spends, the more tax it will have to pay.
“It’s capped at Rp 100 billion,” Niken said. “If we spent Rp 200 billion on ads, what would happen to the additional Rp 100 billion? We would have to include it in our revenue and it would be taxed. The bottom line is that it’s an attempt to limit our advertising.” Under the new regulations, Niken said, producers would be forced to choose between cutting ad spending or paying more taxes.
According to Sampoerna’s 2008 financial statements, the company posted Rp 34.68 trillion in revenue, while spending on advertising and promotions stood at Rp 1.165 trillion, or 3.36 percent of gross revenue — higher than the 1 percent cap and significantly higher than the Rp 100 billion maximum limit in the new rules.
Despite the threat of higher taxes, Naya Tirambintang, a tobacco industry analyst, said that cigarette firms were unlikely to cut spending on advertising. “Because of the nature of the business, their sales are highly dependent on the images they create through advertising,” Naya said. “If they are forced to cut their ad spending, there’s a possibility that sales could fall. This will pose a challenge to companies and shareholders, as their dividend payouts will also be lower.”
Both Niken and Naya said the new regulations could prove particularly damaging to the media industry, which garners a great deal of its advertising revenue from lavish tobacco campaigns.
One tax official denied that the government was trying to curtail cigarette advertising. “We’re not out to limit it,” Syarifuddin Alsah, the tax service’s director of taxation regulation, told the Jakarta Globe by telephone.
References: Tax Sweetener Won’t Curb Smoking Rate, Jakarta Globe, 7/1/2009; Govt caps deductible revenue for tobacco firms, Aditya Suharmoko and Benget Besalicto Tnb., The Jakarta Post, 7/1/2009; Deductible revenue for tobacco firms limited, Tobacco Journal International, 7/1/2009.
Indonesia related news briefs: Indonesia - Smoking hits poor families the hardest, making the poor even poorer..; Indonesia - Cigarette makers defy crisis, grows stronger..; Indonesia - government may raise cigarette excise tax next year..; WHO - Indonesia is crying out for your help..; Indonesia - dispute with U.S. over banning the use of clove in cigarettes..; Indonesia 'cash cow' for Philip Morris International..; Tobacco industry has long targeted young people as "replacement smokers"; Indonesia - district court dismisses request to ratify FCTC..; Asean Countries - Tobacco Industry Blocking Global Treaty On Tobacco..; Indonesia - farmers hold rally protest tobacco controls..; Indonesia - tobacco farmers reject Islamic council's edict..; Indonesia - Ulema Council - debate results is split on smoking..; Indonesia - Withdraw Sponsorhip of Another Rock Concert..; Indonesia to increase tax on tobacco products..; Semarang, Indonesia - Cigarette Smoking Areas to be Prepared..; Jakarta, Indonesia - Malls help enforce non-smoking ban..; Indonesia - federal anti-smoking laws in one year - MAYBE..; Indonesia - NGO's (non-government organizations) Demand the Government Ratify WHO's FCTC.; Indonesia to raise cigarette tax by 6 to 7% in 2009..; Surabaya, Indonesia - anti-smoking bylaw 10/2009 - FOR REAL??; Indonesians smoking more than ever before..; Indonesia further rise in the excise tax would hurt the cigarette industry..; Alicia Keys - Jakarta Concert (July 31st) tobacco companies forced to withdraw sponsorship.. and Most Indonesians support moves to ban tobacco advertisements...
Click on image to enlarge, An Indonesian that refused to quit..
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Ireland - tobacco display ban came into force on July 1, 2009..
Irish retailers have campaigned for their right to display tobacco products since the proposals were first announced in 2001, believing the move would have a detrimental effect on small businesses.
MPs will cast their votes in the House of Commons next week on a proposed tobacco display ban for England and Wales as part of the Health Bill.
“It is disappointing that Ireland has gone ahead with this measure, particularly after retailers raised concerns that it would fuel the increasing black market, place a massive burden on shops, and do nothing to curb youth smoking,” said Ken Patel, national spokesman for the Tobacco Retailers Alliance.
"We hope that rather than follow Ireland's lead, the House of Commons votes against the ban and follows the example of New Zealand, where a decision to ban tobacco displays was dropped because of a lack of international evidence it would reduce youth smoking.
Reference: Tobacco display ban begins in Ireland, Beth Phillips, thegrocer.co.uk, 7/2/2009.
Some Ireland related news briefs: Ireland - Office of Tobacco Control 2008 annual report - Positive..; Ireland - modest penalty for cigarette smuggling..; Ireland - to amend tobacco legislation to to include pictoral warnings..; Ireland - as of July 1, 2009 no advertising or display of tobacco products will be permitted in retail outlets..; Ireland - cigarette tax abandoned over smuggling fears..; Ireland - may raise tax on cigarettes as part of emergency budget..; Ireland - ban smoking in cars when kids are present..; Ireland - further provisions of the Public Health (Tobacco) Acts 2002 and 2004 are to be commenced on 1 July 2009.; Ireland - 80% of smokers want a ban on tobacco advertising in shops to stop youngsters starting the habit..; Ireland to ban tobacco displays..; Ireland - reduction in admissions for acute coronary syndrome...
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BBC: a summary - recent wave of smoking bans around the world..
July 2, 2009 -
Smoking curbs: The BBC News Website traces the recent wave of smoking bans around the world as governments seek to improve the health of their populations.
Smoking curbs: The global picture..
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PMI to buy Swedish Match South Africa..
Swedish Match South Africa Ltd. reported sales of 687 million South African rand last year. Its brands include Boxer, Best Blend and Taxi. Philip Morris estimated that Swedish Match South Africa's pipe tobacco and snuff products represent about 31 percent of total tobacco consumption in South Africa.
In a statement, Jean-Claude Kunz, president of Philip Morris' Eastern Europe, Middle East and Africa region, said the deal "represents an excellent strategic fit for our business in South Africa," which he called an important market.
As cigarette demand falls, Philip Morris and other tobacco companies have focused on smokeless tobacco products and international markets to replace lost revenue.
In February, Philip Morris announced a 50-50 joint venture with Swedish Match to make and sell smokeless products like snus -- teabag-like pouches that users stick between their cheek and gum.
Philip Morris said it expects to complete the acquisition by the end of the fourth quarter, following approval by South African regulators. In a statement, Philip Morris predicted the deal will be "immediately marginally accretive" to its earnings per share.
Philip Morris, the world's largest non-governmental cigarette seller, separated from Altria Group Inc. in March 2008. It has offices in New York and Lausanne, Switzerland.
"This agreement with Philip Morris International is in line with Swedish Match's strategy to focus on smokefree tobacco, cigars and lights products," added Swedish Match President and CEO Lars Dahlgren in a statement.
Swedish Match agrees to sell South African operations to Philip Morris International.
Swedish Match South Africa will continue to distribute lighters, matches and cigars for Swedish Match, the company said.
Reference: Philip Morris to buy Swedish Match South Africa, Associated Press, Richmond Times-Dispatch, 7/2/2009..; Philip Morris International Announces Agreement to Acquire Swedish Match South Africa for $222 Million, Philip Morris International, 7/2/2009.
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Big Tobacco Attempts to Smuggle Loopholes Into Global Tobacco Treaty..
The report comes at the midpoint of an eight-day negotiating meeting (June 28th - July 5th) in Geneva, Switzerland on a protocol to the FCTC on illicit tobacco trade, where tobacco giants such as Philip Morris International (PMI), British American Tobacco (BAT) and Japan Tobacco (JT) have a strong presence. The document, produced by Corporate Accountability International and the Network for Accountability of Tobacco Transnationals (NATT), criticizes FCTC Parties such as Lebanon and the Philippines for collaborating with tobacco corporations and falling short of commitments under the treaty.
FCTC Article 5.3 obligates treaty Parties to “protect [public health] policies from commercial and other vested interests of the tobacco industry in accordance with national law.” Guidelines for the implementation of this measure were adopted at the third Conference of Parties (COP) last November in Durban, South Africa (full text available online). “In November, ratifying countries unanimously adopted rigorous guidelines to protect public health policy against tobacco industry interference,” explains Kathryn Mulvey, International Policy Director for Corporate Accountability International. “Now, Big Tobacco is trying to get governments to ignore their obligations under the treaty and make exceptions to these new rules. We urge the international community to reject the tobacco industry’s attempts to subvert the FCTC and derail the illicit trade protocol.”
We find the text of the entire disclosure is significant.
Big Tobacco Attempts to Smuggle Loopholes Into Global Tobacco Treaty Ratifying countries criticized for collaboration with Philip Morris International and British American Tobacco, CONTACT: Corporate Accountability International Bryan Hirsch, +41 76 547 3476
Susan Cavanagh, +41 78 626 4490, 7/1/2009.
Related news brief: Eliminating global illicit cigarette trade would save lives and increase tax revenue.. New Report from the Framework Convention Alliance: "How Eliminating the Global Illicit Cigarette Trade would Increase Tax Revenue and Save Lives."
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Anti-smoking drugs (non-nicotine) - Chantix and Zyban to carry mental health warnings..
The drugs also have been reported to cause changes in behavior, hostility and agitation in users, whether users had a history of psychiatric illness or not. In many cases, side effects started shortly after use began and ended when the medication was stopped. The FDA does not know what is causing the changes and said people taking these products should be monitored by their doctor.
The agency also is requiring Pfizer Inc. and GSK to conduct a study looking at how often these serious symptoms occur. The FDA says that since Chantix was approved in 2006, the agency has had reports of 98 suicides and 188 attempted suicides. Zyban has had reports of 14 suicides and 17 attempts.
Zyban contains the same active ingredient as the antidepressant Wellbutrin and already carried a box warning about the increased risk of suicidal thinking and behavior.
Reference: Two anti-smoking drugs to carry mental-health warnings by Saundra Young, CNN, 7/1/2009.
Chantix - related news briefs: Another Chantix Warning in Canada..; Operators of any form of transportation warned on the use of Pfizer's smoking-cessation drug Chantix..; Pfizer Changes Chantix Label..; Chantix Reports of Suicidal Thoughts and Aggressive and Erratic Behavior...
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Iowa - smoking ban has resulted in fewer people smoking..
At a news conference Wednesday, July 1st they pointed to a survey from the Iowa Department of Public Health that indicates 14 percent of state residents smoke. That's down from 19 percent two years ago and 41 percent in the 1960s.
Despite complaints from some business owners about the law, which bans smoking in bars, restaurants and most work places, Rep. Janet Petersen says the Legislature shouldn't change the law. The Des Moines Democrat called for waiting another year or two before considering any changes.
Reference: Backers Of Smoking Ban Say Fewer Iowans Light Up, IoaAP News, 7/1/2009.
Related news briefs - Iowa: Iowa Smoking Ban Lawsuit Dismissed..; Iowa - fire safe cigarettes - January 1, 2009..; Butts Out: Iowa joins 22 states with a workplace smoking ban..; Iowa - cigarette sales fall by 36% after $1 bump in cigarette tax..; It's Illegal for Women to Smoke in Public..; Des Moines: Iowa's cigarette tax is now $1.36 per pack, following a jubilant bill-signing ceremony Thursday morning (3/15/2007)..
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China - iIllicit cigarette operations ..
By one tally, some 200 illicit cigarette operations are hidden in Yunxiao, a southwestern Fujian county about twice the area of New York City. Over the last 10 years, production of counterfeit cigarettes has soared in China, jumping eightfold since 1997 to an unprecedented 400 billion cigarettes a year—enough to supply every U.S. smoker with 460 packs a year. Once famed for its bright yellow loquat fruit, Yunxiao is the trade's heartland, the source of half of China's counterfeit production.
Cigarette counterfeiting is immensely lucrative, with profits easily rivaling those of the narcotics trade. While a pack of fake Marlboros costs 20 cents to make in China, it can fetch up to 20 times that amount in the United States. And though a drug trafficker might land a life sentence if caught, a cigarette counterfeiter usually receives a comparative slap on the wrist—a handful of years in jail or possibly a fine.
In 2001, Chinese manufacturers were producing eight different varieties of counterfeit Marlboros. As of last year, though, Chinese counterfeiters were manufacturing separate versions of Marlboro tailored for some 60 countries—down to the specific details of tax stamps and regional health warnings. As many as 99 percent of counterfeit cigarettes in the United States come from China.
Every year, China's smokers consume 2.2 trillion cigarettes. The number of counterfeits flooding the domestic market is similarly off the charts. In China, all legal manufacture and distribution of cigarettes is state-owned and state-controlled. With cigarette sales accounting for nearly 8 percent of China's budget in 2007, the state has a strong motive to keep its supply counterfeit-free. (Officials are zealous about protecting the market, too: Until this April, officials in the central Chinese province of Hubei were required to smoke a collective 230,000 packs of regional brands a year.)
For the U.S. consumers, inhaling the knockoff cigarettes may do even more damage than their genuine counterparts. Lab tests show that Chinese counterfeits emit higher levels of dangerous chemicals than brand-name cigarettes: 80 percent more nicotine and 130 percent more carbon monoxide, and they contain impurities that include insect eggs and human feces. "The feedback from Russian customers is that they've gotten used to the fake flavor, and now they don't want the real ones anymore."
Reference: China's Marlboro Country The strange, underground world of counterfeit cigarettes. by Te-Ping Chen, Slate, 6/29/2009.
Related news briefs: Made-in-China Marlboros - a major mistake by Philip Morris International..;
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Netherlands - Marijuana /Tobacco Cigarettes - Confusion..
Dutch coffee shops are licensed to sell small quantities of cannabis to adults over 18.
Jacobsen: "It's absurd. In other countries they look to see whether you have marijuana in your cigarette, here they'll look to see if you've got cigarette in your marijuana." Paul Wilhelm, owner of De Tweede Kamer, a popular Amsterdam coffee shop, said: "It's a bit like saying to someone you can go into a cafe and you can buy a beer, but you can't drink it there - you'll have to stick to whisky, rum and vodka."
Research shows that the majority of coffee shop patrons prefer less-potent joints in which cannabis is mixed with tobacco, and only 18 percent favor the pure cannabis alternative.
Some cafes have said they will get round the problem by producing more pure cannabis brownies or "space cakes", while others have built smoking chambers within their premises which are off-limits to staff. Others have started to sell alternatives to tobacco, such as the herb coltsfoot.
But a catering industry spokesman said 1,600 coffee shops across the country have been put up for sale because their owners were convinced their businesses were doomed.
The Food and Consumer Product Safety Authority, which is responsible for enforcing the ban, said it had trained around 200 inspectors. A spokesman said: "They can tell the difference between a mix or a pure joint from its smell and appearance."
The Dutch (Holland, Netherlands) Ab Klink, the Dutch health minister,
said he hoped the law would help to rid the country of cannabis-induced idleness. "Consumers who spend the whole day hanging out in coffee shops will find other things to do," he said.
References: Dutch tobacco ban means cafe smokers can only light up pure cannabis cigarettes Smoking tobacco in restaurants and cafes across Holland is now illegal, but customers are still allowed to light up pure cannabis cigarettes by Lucy Cockcroft, Telegraph,co.uk, 7/1/2009; Marijuana Loopholes In New Netherlands Tobacco Policy, Reuters, 6/27/2009.
Related news briefs: Netherlands - small bars/cafes with no staff could be exempt from smoking ban..; Court spares small Dutch cafe over smoking ban..; Netherlands - 1st court case for flouting smoking ban..; Netherlands - ban on smoking in bars and restaurants NOT enforced..; Netherlands - ban on smoking in bars and restaurants NOT enforced..; Netherlands the smoking ban must be enforced - Ab Klink, Health Minister...; Congratulations are in order: Netherlands, Romania & Alberta...
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Paraquay - top producer of contraband tobacco..
Following the tax increase, dozens of cigarette factories opened in Paraguay, many of them owned fully or in part by Brazilians. Within three years, Paraguay was home to more than 30 cigarette manufacturing plants, some of which counterfeited well-known international brands.
Paraquay - Cigarettes produced in Tobacco Factories..
Click on either image to enlarge..
For more information click on reference below.
Reference: Smuggling Made Easy Landlocked Paraguay Emerges as a Top Producer in Contraband Tobacco by Marina Walker Guevara, Mabel Rehnfeldt, Marcelo Soares, Tobacco Underground, The Center for Public Integrity, 6/28/2009.
Click on image to enlarge..
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Smuggled Cigarettes Give Boost To Pakistani Militants..
Afridi isn’t the only counterfeit cigarette producer in the tribal belt. Smugglers also transport cigarettes from illegal factories in neighboring provinces of Kohat and Bannu into Afghanistan through the border town of Miramshah. The area is in the grip of an al-Qaeda militia of ethnic Uzbeks loyal to Mehsud. Pakistani intelligence sources say cigarette smugglers pay the militant groups up to 20 percent commission for each convoy. American and Japanese model trucks leave the sprawling, high-walls cigarette factories almost daily, while bigger convoys of five to seven trucks leave twice a week, local residents say.
For more information click on the reference below.
Reference: The Taliban and Tobacco Smuggled Cigarettes Give Boost To Pakistani Militants by Aamir Latif, Kate Willson, Tobacco Underground, The Center for Public Integrity, 6/28/2009.
Pakistan - related news brief: Pakistan - strong tobacco control measures..; Pakistan - Government must withdraw Statutory Regulatory Order..; Bloomberg Grant: Tobacco Reforms in Pakistan...
Click on image to enlarge..
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Isle of Wight , England - Celebrates 2nd anniversary of the nationwide smoking ban..
The move is to mark the second anniversary of the nationwide smoking ban in public buildings.
The Isle of Wight hopes it might lead to other UK cities doing the same and maybe even help create a smoke-free British Isles.
"We are delighted to lend our support to this campaign," said the IoW's assistant tourism director John Metcalfe. "We pride ourselves on our green and beautiful island and we are also extremely keen to promote healthy lifestyles so visitors and residents can fully enjoy all we have to offer.
"The island is known for its stunning scenery, award winning beaches and a great selection of outdoor pursuits such as walking, cycling and sailing.
We believe the island is the best place in the UK to fill your lungs with healthy fresh air. We are affordable and with 350 ferries per day, we are easy to reach wherever you are in the UK."
The initiative is being supported by NHS Smoking Cessation Services, QUIT and the Isle of Wight council. Another sponsor, Nicorette, is offering support to anyone who needs it, with activity centred around the island's capital, Newport.
"Obviously, we're not going to be locking up people who are smoking," a spokeswoman told Sky News Online. "But we'll be trying to offer encouragement to those who want to give up."
Research shows 20% of adults on the Isle of Wight smoke, with more than two thirds wanting to give up.
Greece, meanwhile, as of July 1, 2009 is the latest European Union (EU) country to impose a ban on smoking - it will be its third attempt in a decade to stamp out the country's love affair with cigarettes. But critics fear loopholes in the legislation and its unpopularity mean it could suffer the same fate as previous anti-smoking bids. Around 20,000 Greeks die a year from tobacco-related ailments and 42% of the population smokes. Greece lags behind many of its European peers who have outlawed smoking in public places in recent years.
Reference: Isle Of Wight Tells Smokers To Butt Out, Sky News, 7/1/2009.
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Tobacco Underground - cigarette smuggling, 6-part series..
As delegates from nearly 160 countries meet in Geneva this week to negotiate a global protocol to crack down on tobacco smuggling, the new ICIJ series also reveals that terrorist groups are increasingly turning to cigarette smuggling for financing. At least a half-dozen terrorist groups rely on tobacco black markets, including al-Qaeda, the Taliban, the Real IRA, and the Colombian FARC, the project reports.
Terrorist financing through cigarette smuggling is “huge,” says criminologist Louise Shelley, an advisor to the World Economic Forum on illicit trade. “Worldwide — it’s no exaggeration. No one thinks cigarette smuggling is too serious, so law enforcement doesn’t spend resources to go after it.”
The six-part series is part of Tobacco Underground, a year-long investigation by ICIJ into cigarette smuggling — featuring interactive maps, undercover video, online interviews with experts, and links to groups and documents worldwide.
China - iIllicit cigarette operations..
Paraquay - top producer of contraband tobacco..
Smuggled Cigarettes Give Boost To Pakistani Militants..
Reference: Tobacco, Terrorism, and Illicit Trade, Source: Center for Public Integrity, Docuticker, 6/1/2009.
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More evidence - Casino workers face greater chance of disease..
Casino workers “are really the most exposed group in society now,” Repace said. “The only other group that’s exposed so much is bartenders,” but many states have banned smoking in bars and restaurants. The Flight Attendant Medical Research Institute — which has studied the risk of secondhand smoke to flight attendants when airlines allowed smoking — funded the study. The casino findings appear online and in the August issue of the American Journal of Public Health.
PAPER: Secondhand Smoke in Pennsylvania Casinos: A Study of Nonsmokers’ Exposure, Dose, and Risk, James L. Repace, published online ahead of print Jun 18, 2009 American Journal of Public Health, 10.2105/AJPH.2008.146241, ABSTRACT..
Nonsmoking mandates at casinos remain rare in the United States. As a result, gambling and smoking still have a strong connection.
Repace recruited volunteers to visit three Pennsylvania casinos for four hours. After the visits, he measured the levels of a byproduct of tobacco smoke in the urine of eight subjects. The levels were approximately 10 times higher than average.
The author also tested the air quality inside three casinos. He found that the levels of two indicators of tobacco smoke — cancer-causing chemicals and particles small enough to inhale — were an average of four to six times higher inside than outside. Both measurements led to the estimate of the number of deaths attributable to tobacco exposure in non-smoking casino workers in Pennsylvania; Repace said the total number of casino workers in the state is expected to soon reach 12,000.
Finally Pennsylvania's Smoking Ban Takes Effect Today..
Scientists expect that more than 90 percent of the deaths will be from heart disease, with the rest from lung cancer, which is uncommon in nonsmokers. Repace said that an annual death rate of six per 10,000 is roughly five times the extra risk of death for mineworkers from Pennsylvania mine disasters.
Holly Thomsen, a spokesperson for the American Gaming Association, a trade group for the casino industry, said its members are committed to “the highest level of safety and comfort” inside casinos. Casinos serve both smoking and nonsmoking customers, she said, and “we realize that balancing the needs of these two distinct sets of patrons, as well as those of our employees who don’t smoke, is of paramount importance.”
Reference: Secondhand Smoke Threatens Casino Workers’ Health by Randy Dotinga, Health Behavior News Service, 6/30/2009.
Some examples of smoking bans but casino have been excluded: Kansas City, Missouri - court upholds smoking ban..; Michigan public smoking ban fizzles..; Oregon January 1, 2009 Smoking Ban Expanded..; National Institute for Occupational Health & Safety (NIOSH) Report Recommends Eliminating Tobacco from Vegas Casinos..
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In Process - EU Sweden takes over presidency..
SNUS..
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Tobacco control initiatives starting Wednesday, July 1, 2009..
New South Wales - Australia New South Wales - July 1, 2009 - Great Day for Tobacco Control..
Hong Kong - Bars, clubs, nightclubs, bathhouses, and massage and mahjong parlors will be made smoke-free premises when their temporary smoking ban exemption ends July 1, 2009.
Greece - Europe’s heaviest smoking nation, will try to kick the habit by banning tobacco in indoor public places beginning July 1, 2009.
Ireland - on July 1, 2009 Ireland introduces a ban on the advertising and display of tobacco products in retail shops. At the same time, under new provisions of the Public Health (Tobacco) Acts 2002 and 2004, tobacco retailers will have to sign up to a retail register and tighter controls will be imposed on the location and operation of tobacco vending machines. (Ireland - Office of Tobacco Control 2008 annual report - Positive..) In Canada, 12 of the 13 provinces and territories, together representing over 98% of the country’s population, have now passed laws requiring the removal of point-of-sale tobacco displays. Display bans have been in place in Iceland and Thailand since 2001 and 2005 respectively, and Ireland’s and New South Wales - Australia's (see above) bans will come into force on 1st July 2009. The removal of tobacco displays in the Australian state of Tasmania will take effect in 2011. (Cancer Research UK (last updated: 21 January 2009..
Pakistan - Pakistan Railways will go smoke-free from July 1, 2009. Also, as of July 1, 2009, no tobacco company will be allowed to offer goods, cash rebates, or discounts as a marketing incentive. (Pakistan - strong tobacco control measures..)
South Dakota - Bars and restaurants are suppose to go smoke free July 1, 2009.
Indiana - A new Indiana law taking effect July 1 will require all cigarettes sold in Indiana to burn out more quickly when left unattended in an effort to reduce the number of smoking-related fires.
Florida - As of July 1, 2009 Florida's new cigarette tax is $1.34 per pack. An equivalent increase applies to smokeless and pipe tobacco, but not cigars.
Hawaii - the Legislature has approved and Gov. Linda Lingle has signed a 60-cent increase to the cigarette tax, bringing the total cigarette tax to $2.60 per pack beginning July 1. The state cigarette tax will further increase by 20 cents per pack annually in July 2010 and July 2011, reaching a total of $3 per pack.
Maine - law banning flavored tobacco products goes into effect July 1, 2009.
Nevada - Prisoners forced to give up tobacco have until July 1, 2009 to kick habit cold turkey. Nevada is joining the majority of other states in banning tobacco outright. Prisoners will be punished for having cigarettes. Staff could lose their jobs for bringing it on the premises.
Goodyear, AZ Smoking ban on Goodyear parks starts July 1, 2009. Goodyear - 17 miles from Downtown Phoenix..
Some other events in July, 2009..
Turkey - on July 19, 2009 will mark the beginning of “100 percent smoke-free air” in this country..
North Dakota - a statewide anti-tobacco plan to be released during July..
Professor Simon Chapman's annual course on tobacco control in 2009 - will be held over three days on 30 & 31 July and 3 Aug and will be run at the University of Sydney's School of Public Health. (Tobacco Control in the 21st Century)
13th World Conference on Lung Cancer, July 31, 2009 - August 4, 2009..,
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EU Health Chief - proposes uniform laws to regulate smoking..
The recommendation calls on all member states to implement laws that will limit exposure to tobacco smoke in public places, workplaces and public transport, and aims to protect children.
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Many EU countries have laws limiting exposure to second-hand, or passive, smoking. The rules are strictest in Britain and Ireland, where smoking is banned in enclosed public places, public transport and workplaces, including restaurants and bars. Only 10 member states have comprehensive laws, Vassiliou said.
She said in countries with looser regulations on smoking, nearly one in five people were exposed to tobacco smoke in the workplace. Second-hand, or passive, smoke has been linked to heart disease and lung cancer. According to estimates given by Vassiliou, 19,000 non-smokers in the EU died due to second-hand smoke at home and in workplaces in 2002.
At present member states decide the level of their smoking restrictions. In Belgium, for example, smoking is allowed in restaurants in separate rooms where no food is served, and smoking is banned in all enclosed workplaces.
Greece, Europe's heaviest smoking nation, is to introduce a ban on tobacco in indoor public places from Wednesday. The country breaks all European records, with more than 40 percent of the population smoking and six out of 10 being exposed to smoking at work, according to an EU poll.
A poll last year by EU survey group Eurobarometer said 84 percent of respondents supported smoke-free offices and other indoor workplaces, 77 percent were in favor of smoke-free restaurants, and 61 percent supported smoke-free bars and pubs.
Reference: EU health chief proposes stricter laws on smoking, Reporting by Caroline Linton, editing by Mark Trevelyan, Reuters, 6/30/2009.
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Turkey - on July 19, 2009 will mark the beginning of “100 percent smoke-free air” in this country..
Despite some question marks raised by the public about the implementation of the ban as of July 19, the smoking ban, which went partially into effect on May 19, 2008 is due to be expanded to include restaurants, coffeehouses, cafeterias and bars, and as the day draws nearer, experts say the public will successfully adjust to the ban in a short time if everyone plays their part.
National Cigarette and Health Committee (SSUK) Chairwoman Elif Dağlı said although there are nearly 22 million smokers in Turkey, there are also around 50 million non-smokers, 10 million of whom suffer from lung and cardiovascular disease. Noting that there is sufficient public support to enforce the law, she said if everyone plays their part in adjusting to the law, Turkey will implement it successfully.
Reference:Turkey will successfully implement smoking ban, experts believe, Today's Zamen, 6/28/2009.
Related news briefs: Turkey - national smoking ban starts July 19, 2009..;
Turkey - quit smoking photo displayed in İstanbul's Taksim Square..; Turkey - data on tobacco usage - Turkish Statistics Institution..; Turkey - smoking ban in all bars, restaurants and coffeehouses starting July 19, 2009..; Smoking ban in Turkey lowers cigarette consumption..; Turkey's ban on pubic smoking goes into effect on Monday, May 19, 2008..; British American Tobacco (BAT) reported group volume sales up for first quarter 2008..; More on the quick fix for outdoor smokers..; BAT to Acquire Most of Denmark's ST..; More on Philip Morris International of the Future..; WHO Report on the Global Tobacco Epidemic 2008...
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Hong Kong - total smoking ban in effect - Wednesday, July 1, 2009..
NO Matter How Much People Complain the Hong Kong's government will put the ban in force. Hong Kong workers fume over smoking ban, Agence France Presse (AFP), 6/30/2009.
The smoking ban has already been implemented in all indoor areas of workplaces, public places, restaurants, bars for all ages, karaoke lounges since January 1, 2007.
Studies have shown that second hand smoke affects the health of staff and customers at indoor public areas. “The arrangement can further protect the public from exposure to second hand smoke,” the spokesman said.
The spokesman also called for the co-operation of venue management in providing a smoke-free environment for their staff and customers. The spokesman said venue managers of designated no-smoking areas were empowered to implement the smoking ban in the no-smoking areas under their management.
“Venue managers are authorized to require any smoker to stop smoking in the no-smoking areas. They can request those refuse to produce proof of identity and address for follow up; or ask them to leave the no-smoking area,” he said.
Members of the public should be considerate and cooperate with venue managers for the smooth implementation of the legislative requirements, he said.
Up to May 31 this year, DH's Tobacco Control Office (TCO) had issued some 13,800 summonses to people smoking in no smoking areas. Anyone who committed a smoking offence is subject to a maximum penalty of $5,000.
TCO has launched a series of publicity and education activities to promote smoke-free environment in establishments where smoking is being banned. A number of workshops have been organized to facilitate them to understand the legislative requirements as well as to implement smoke-free measures.
Staff wishing to quit smoking are also provided with smoking cessation seminars.
Smoke free ambassadors of TCO have been visiting the establishments to promulgate smoke-free message and disseminate leaflets, posters, stickers and implementation guidelines. “We will continue to liaise with the operators of these establishments and to ensure the legislative requirements would be observed by the parties concerned” the spokesman said.
References: Extension of smoking ban to six types of listed establishments in Hong Kong, Web Newswire, 6/29/2009; Hong Kong extends smoke ban to more recreational venues, People's Daily Online, 6/30/2009; Smokers Snuff Out in Hong Kong Bars as Ban Begins (Update1) by Sanchez Wang and Nicholas Olczak, Bloomberg.news, 6/30/2009.
Hong Kong related news briefs: Hong Kong - smoking statistics..; Hong Kong - movie poster woman smoking - NOT ALLOWED..; Hong Kong - bar owners an employees march to protest smoking ban starting July 1, 2009..; Hong Kong - cigarette smuggling soars after tax increase..; Hong Kong - attempt to delay July 1, 2009 smoking ban fails..; Hong Kong - Tax on cigarettes pushed up by 50 percent..; Honk Kong - smoking increase raise tobacco duties??; Hong Kong - temporary smoking ban exemption ends July 1, 2009..; Hong Kong - after smoking ban cigarette consumption up 14 percent..; Hong Kong - public smoking ban - smoking rooms??; Shanghai Tobacco's Golden Deer Cigarettes - Hong Kong..; More on Philip Morris International of the Future...
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North Dakota - statewide anti-tobacco plan to be released in July 2009..
Mangskau briefed the Legislature's Budget Section on Tuesday on the work of the tobacco control committee, which is independent of the state Health Department. The Budget Section includes legislative leaders and members of the appropriations committees in the state House and Senate.
North Dakota voters approved a ballot measure last November 2008 to form the committee and order a portion of the income from a 1998 settlement with the nation's largest tobacco companies be set aside to finance its operations. The agency has a two-year budget of almost $12.9 million.
Mangskau told lawmakers Tuesday that a nine-member advisory board in charge of drafting the statewide anti-tobacco plan has almost finished its work. The blueprint will be made public in early July, she said.
Board members have held public forums on the plan in Fargo, Devils Lake, Minot, Bismarck, Williston and Dickinson, and went over specifics at a two-day meeting last week.
Local public health units have been invited to apply for $6.1 million in grants. Rural health organizations, which in the past may have gotten only about $5,000 for anti-tobacco projects, will now be eligible for at least $20,000, Mangskau said in an interview.
North Dakota has 28 local public health units. Some grant money may be used to coax local school districts into adopting tobacco-free policies covering their buildings and grounds, Mangskau said.
The policies would prohibit smoking in buildings or school facilities, whether or not school was in session. The bans would cover school-owned outdoor stadiums and private facilities when school events are held there.
"We know that promoting tobacco-free environments does cut down on tobacco use," Mangskau said.
Reference: N.D. panel expects July rollout of anti-tobacco plan by DALE WETZEL
Associated Press Writer, The Bismarck Tribune, 6/24/2009.
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No one likes a tobacco user..
June 30, 2009 - JENSEN BEACH - A man was charged with domestic battery after he drenched his wife with a garden hose and attacked her for smoking in the house, according to a police report.
The altercation began Saturday evening when the victim entered the couple's residence in the 1400 block of Northeast Chardon Street while smoking a cigarette.
The affidavit says the victim's husband, John Jeffrey Murray, 51, began yelling at her about smoking in the house and sprayed her with the hose.
When the victim picked up the phone and began calling a friend, Murray believed she was trying to call police and began trying to grab the phone from her. According to the affidavit, he hit the victim in her mouth with his elbow during the struggle.
Despite the victim's clothes being soaked with water, Murray told deputies he had been watering the grass and did not intend to spray her. The affidavit says he claimed the water was simply "over spray."
Reference: Treasure Coast man charged with spraying wife with garden hose for smoking, TCPalm.com, sun-sentinel.com, 6/30/2009.
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More on FDA tobacco regulations..
Content:
included within regulations,
harder for smaller companies to compete,
impact on the industry,
immediate changes - flavoring - Other Tobacco Products (OTP),
no guarantee this law will achieve its goals.
The Food and Drug Administration now has the power to regulate the content of tobacco products including: removing ingredients considered as hazardous; restricting the marketing and distribution of cigarettes and smokeless tobacco; focusing on limiting the impact of advertising on youth; expanding warning labels; and stopping the use of such characterizations as “light” or “low tar.“
From the consumer end, the initial cost of FDA regulation is projected at 1 to 2 cents a pack, likely beginning in October. Even when the new FDA agency, Center for Tobacco Products, is fully operational by 2012-13, the cost is not projected to exceed 7 cents a pack, according to research by UBS Investment Research.
However, FDA regulation is likely to spur consolidation by driving up compliance costs for smaller discount manufacturers. “It will force them to register with the FDA and test their products,“ said Adam Spielman, an analyst with Citigroup Global Markets Inc. “It probably will make it impossible to launch new brands and lines without a series of tests that will be expensive for them. “It probably will require them to use tobacco that has been treated in complicated ways to reduce certain constituents.“ All of which could add tens, if not hundreds, of thousands of dollars in expenses, Spielman said. “Due to lesser-scale efficiencies, these manufacturers could either be forced to take meaningful price increases - lower price gaps for premium brands - or be forced out of business due to the costs of new labeling costs of compliance with FDA standards and more complex inventory management,“ said Nik Modi, an analyst with UBS.
Calvin Phelps, the chairman and chief executive of Renegade Holdings Inc. of Mocksville, said that it will take years of FDA regulation to determine how much of an impact it will have on the industry. Phelps based that on his experience with the 1998 Master Settlement Agreement, which limited the advertising and marketing of tobacco products. "I doubt the consumer will notice anything from FDA regulation in the near future,“ Phelps said. “The regulation is being rolled out in stages, and there’s a lot of gray area right now about how compliance will be handled.
“We’re expecting the FDA to require manufacturers to be able to trace the constituents and ingredients in their products the way pharmaceutical companies have had to for years.“
The most immediate change is that cigarette flavorings outside menthol will be banned, beginning in September. Analysts said that part of the law will have little impact since most manufacturers abandoned candy- and fruit-flavored cigarettes in recent years. Spielman said that despite stricter requirements for introducing tobacco products under the FDA, he believes regulation will not undercut R.J. Reynolds Tobacco Co.‘s smokeless innovation programs. The law requires premarket approval for new products, those introduced after Feb. 15, 2007.
“We disagree with the consensus view, which is that the legislation will harm Reynolds because it will make it harder (or nearly impossible) to introduce new products like Camel Crush,“ Spielman said. “This is because the rules on new products do not require sign-off from the FDA if the product is substantially equivalent health-wise to existing products.“ Camel Snus were introduced before February 2007, said Maura Payne, a spokeswoman for Reynolds. “There were also substantially equivalent snus products sold in the United States prior to Camel Snus.“
Payne said that the orbs, sticks and filmlike strip for the tongue are substantially equivalent to dissolvables sold by Star Scientific Inc.‘s Ariva and Stonewall.
Spielman said he doubts that “the FDA will interpret the law in an obsessive way, trying to block every line extension.“
Bill Godshall, the executive director of SmokeFree Pennsylvania, said that where Reynolds could be impacted is in its elaborate cigarette packaging compared with Marlboro. “Whereas most Marlboro smokers know that a red Marlboro box means regular, gold means light and silver means ultra light, there is no similar color coding for Camel,“ Godshall said.
Analysts said that there’s no guarantee that the law will fulfill the lifesaving messages touted by anti-tobacco groups. For example, UBS research found that in four of five countries that have regulatory warnings covering most of the cigarette pack - Australia, Brazil, Canada and United Kingdom - sales dropped only between 0.8 percent and 2.4 percent in the first three years. In India, sales increased by 0.5 percent. “None of the goals envisaged will be achieved as similar provisions in other countries have failed,“ said Anthony Hemsley, a vice president of Commonwealth Brands, which has a plant in Reidsville. “Congress has rushed through regulation that will have a disproportionate effect on smaller manufacturers, hurt honest adult consumers and create an illicit trade nightmare.“
A few related news briefs: Impact for retailers of law that has the FDA regulating tobacco..; Key elements of the FDA regulation law as articulated by the White House..; FDA regulations ban on clove cigarettes Indonesia may protest to WTO..; FDA tobacco regulation - unintended consequences..; Fitch Ratings - FDA oversight to favor big established brands...
Reference: FDA Regulations On Tobacco Could Take 3 Years by Richard Craver, Winston-Salem Journal, 6/23/2009.
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