April 2010 - CigarettesReviews.com | CigarettesReviews.com

Monthly Archives: April 2010

JT to raise cigarette prices on 100 brands from Oct 1

TOKYO —Japan Tobacco Inc said Wednesday it will raise the prices of around 100 cigarette brands on Oct 1 as it reported double-digit sales and profit declines in the just-ended business year. JT will raise the price of its popular Mild Seven brand to 410 yen a pack from 300 yen and that of Seven Stars to 440 yen from 300 yen in line with a hike in the cigarette tax slated for October.

The tax increase will impose a levy of 3.5 yen per cigarette, or 70 yen per pack. The price hike will exceed the additional tax and is aimed at compensating for declining sales due to tougher rules on smoking, the company said.

JT also said it recorded a group operating profit of 296.50 billion yen in fiscal 2009 ended March, down 18.5% from the previous year, on sales of 6.13 trillion yen, down 10.2%.

JT attributed the sluggish performance to a 5% fall in domestic cigarette sales as well as foreign exchange losses due to the yen’s appreciation against the dollar when overseas subsidiaries converted dollar-denominated earnings into yen for account settlements. But net profit increased 12.2% to 138.45 billion yen thanks to a decline in extraordinary losses.

Japan Tobacco raises investment in Indian unit

The world’s third largest tobacco company by sales volume, Japan Tobacco Inc, has invested $65 million (Rs 293 crore) in its Indian unit without increasing its shareholding, just days ahead of a government decision to ban foreign direct investment (FDI) in cigarette manufacturing.

Japan Tobacco holds 50 per cent equity in JTI India, a joint venture with a Mumbai-based law firm, the Thakkar family. The company manufactures several popular cigarette brands, such as Benson & Hedges and Camel, and other tobacco products like cigars.

Japan Tobacco had been wanting to infuse fresh capital in the Indian unit for some time. The company had earlier sought permission of the Foreign Investment Promotion Board (FIPB) to increase its stake in the Indian venture from 50 per cent to 74 per cent. FIPB, however, put the proposal in “abeyance”, where it has remained for more than a year.

JTI India, sources said, has issued fresh equity of Re 1 each to the Japanese company at a premium Rs 298, amounting to Rs 293 crore. It has issued an equal number of shares to its Indian partners, the Thakkar family, which paid only Rs 1 crore for the shares, as they were issued at par.

By issuing the shares on a differential basis, the company has ensured infusion of more capital from the foreign partners without any increase in their shareholding.

Tobacco Commission OKs funds for uranium study

ROANOKE — The Virginia Tobacco Commission approved up to $200,000 for a socioeconomic study of uranium mining and milling uraniumduring its meeting Thursday at the Hotel Roanoke.

The commission followed that up with a vote to require Danville and Pittsylvania County to pay back $13.1 million in commission funding for the Berry Hill Road mega park — if uranium is ever mined there.

The first vote passed by an 18-8 margin, while the second motion — proposed by commission member Delegate Danny Marshall, R-Danville — got by on a narrow 14-12 vote. Commission member Buddy Mayhew, an investor in Virginia Uranium Inc., abstained from both votes.

Mayhew declined to comment on why he recused himself from the vote.

VUI seeks to mine and mill a 119 million pound uranium ore deposit at Coles Hill, about six miles northeast of Chatham. Virginia has had a moratorium on uranium mining and milling since 1982. VUI is indirectly paying for a statewide scientific study performed by the National Academy of Sciences/National Research Council focusing on the safety and technical aspects of uranium mining and milling.

During the meeting, Tobacco Commission Vice Chairman and state Sen. Frank Ruff, R-15th District, opposed granting money for a socioeconomic study, saying it would be “unwise” to provide the funds before Virginia Beach finishes its study to determine how uranium mining and milling would impact the Lake Gaston water supply in the event of a major rainstorm.

Marshall also reminded the commission that the Danville Regional Foundation is funding a regional socioeconomic study of its own focusing on a 50-mile radius around Coles Hill. Marshall voted against spending the money for the state’s socioeconomic study.

“I think it’s premature right now,” Marshall said during an interview after the meeting. “We need to look at the other two studies and see where they are.”

Marshall said he would, if necessary, ask the Coal and Energy Commission’s Uranium Mining Subcommittee to postpone its socioeconomic study until everyone knows what questions the other two studies will ask. Duplication must be avoided, he said.

“Why do we need to ask the same questions three different times?” Marshall said.

After the commission’s vote on the study, Marshall proposed making Pittsylvania County and Danville repay $13.1 million to the Tobacco Commission if uranium is mined at the Berry Hill Road mega park. Tobacco Commission Chairman Terry Kilgore expressed surprise at Marshall’s motion.

“I didn’t realize there was any uranium there,” Kilgore said.

“We want to make sure we invested money in the mega site to create manufacturing jobs, not mining jobs,” Marshall told the commission. Marshall told the Register & Bee he proposed the idea because of concerns expressed by some residents. Mining opponents’ attempts to get uranium mining banned at the mega park site and the area around it failed.

The mega park site in southwestern Pittsylvania County is located on suspected uranium deposits. Marline Corp. had plans to mine and mill uranium in Pittsylvania County in the early 1980s, and the Danville-Pittsylvania Regional Industrial Facility Authority owns some of that old Marline land.

Phillip Lovelace, a uranium-mining opponent who lives in Gretna, called the vote for the $200,000 “an insult,” and said the vote regarding Berry Hill makes no difference. If uranium is mined at the mega park, the damage would already be done regardless of whether the city and county pay the commission back.

By John Crane
Godanriver, April 29, 2010

FDA Favors Big Tobacco, Small Firms Say

RICHMOND, Va. – Three small tobacco companies say a new FDA regulation favors Big Tobacco by imposing “Draconian restrictions” on commercial speech that could drive small tobacco companies out of business. The regulation bars use of cigarette brands that share a name with non-tobacco products.

Small companies, such as plaintiff Renegade Tobacco, will not be able to keep selling its “Tucson” brand cigarettes, because Hyundai uses the term for cars, according to the federal complaint.

But Big Tobacco companies already have cemented rights to their products, such as Marlboro and Camel, and so will not be affected.

Renegade Tobacco, Alternative Brands, and Seneca-Cayuga Tobacco say the Product Name Restriction regulation will restrict “the ability of cigarette manufacturers to engage in commercial speech using their federally registered trademarks, including brand names that have been in use for years.”

The regulation will impose civil and criminal penalties on manufacturers who sell cigarette brands that share a brand name with non-tobacco products – and in some instances these manufacturers could face jail time, according to the complaint.

Big Tobacco protected from the new restrictions because the FDA provides immunity for brand names that were in effect on Jan. 1, 1995, so long as there were no non-tobacco companies using the same name.

This immunity protects most of Big Tobacco’s major brands, the plaintiffs say.

“The practical effect of this regulation will be to unfairly drive the relatively new, small cigarette manufacturers out of business by banning the use of their established brand names, while protecting the big tobacco companies that have long dominated – and that continue to dominate – the cigarette market in the United States,” according to the complaint.

The regulation is to take effect on June 22.

The plaintiffs sued the FDA and Dr. Margaret Hamburg, Commissioner of Food and Drugs, seeking an injunction preventing enforcement of the regulation. They also want a declaration that the regulation violates due process and the First Amendment.

The companies are represented by William Hurd with Troutman Sanders


Courthousenews,  April 28, 2010

Australia plans to ban imagery on cigarette packaging

CANBERRA—Australia’s government said Thursday it plans to ban brand labels and other marketing imagery on cigarette packaging byban imagery on cigarette packaging 2012, in a world-first move that that drew vows from the cigarette industry to fight the measure.

It comes as Canberra also said it will hike the excise on cigarettes by 25% from midnight Thursday, raising 5 billion Australian dollars (US$4.62 billion) over the next four years to be used to fund public hospitals. The measure will increase the price of a pack of 30 cigarettes by around A$2.16. Cigarette generally cost A$12 to A$15 in Australia currently, depending on the brand.

“Cigarettes kill people, therefore the government makes no apology whatsoever over what it’s doing,” in banning branded packaging, Prime Minister Kevin Rudd said.

“Tobacco companies will hate this measure. They will oppose it. Nonetheless, this and other measures will help to reduce smoking,” he said. “This sort of thing should have been done by governments years ago.”

The new laws will prohibit the use of tobacco industry logos, colors, brand imagery or promotional text on tobacco product packaging—other than brand and product names in a standard color, font style and position.

Aside from mandated health warnings—including graphic images of smoking-related illnesses–the packaging will have only basic product information to help retailers distinguish between brands and to minimize the risk of counterfeiting.

Mr. Rudd wants the legislation to be in place by January 1, 2012, with the ban to take effect by July 1 of that year—an extended time frame that suggests a confidence his government will win the next federal election due by April 2011 at the latest, but which also acknowledges the possibility of a protracted court battle with the tobacco giants.

“Tobacco companies are going to die in a ditch opposing this sort of packaging,” Mr. Rudd said.

Cigarette companies say they are looking at legal options to oppose the advertising ban.

“Introducing plain packaging just takes away the ability of a consumer to identify our brand from another brand and that’s of value to us,” Imperial Tobacco Australia spokeswoman Cathie Keogh told Australian Broadcasting Corp. radio.

“It really affects the value of our business as a commercial enterprise and we will fight to support protecting our international property rights.”

A spokeswoman for British American Tobacco Australia said the company believes the plain packaging proposal will “not hold up to close scrutiny.”

“Governments around the world, including Canada, New Zealand and the U.K., have already looked very closely at this measure and have decided it wouldn’t work,” Louise Warburton, head of corporate communications for the tobacco company’s Australian unit, said in a statement.

“A serious concern is that the plainer the pack, the easier it is to counterfeit. Our industry is already losing over 12% of market share to the criminal black market and the taxpayer A$600 million a year. And as everyone knows the criminal black market doesn’t pay taxes and doesn’t ask kids for identification,” she said.

Health Minister Nicola Roxon said the government is acting on World Health Organization advice that plain packaging of cigarettes should be considered as a measure to curb smoking. The legislation will be carefully drafted to withstand any legal challenge, she added.

“Information from tobacco companies themselves that they use their packaging as a way to market their products that kill people convinces us that this is the next step that should be taken,” Ms. Roxon said.

Smoking has been identified as the single largest preventable cause of disease and premature death in Australia, killing over 15,000 Australians each year.

The government’s aim is to cut smoking rates to 10% or less of the adult population by 2018.

Australia’s main conservative Liberal-National opposition said Thursday it hasn’t yet seen evidence that introducing plain packaging would be effective in reducing cigarette consumption.

“There is evidence that an increase in (tobacco) excise can result in a reduction of consumption but we need to see the government’s evidence on the measures that they are proposing,” opposition health spokesman Peter Dutton said.

Wsj, APRIL 29, 2010

Lucky Strike and Pall Mall cigarettes boost sales at British American Tobacco

The popularity of brands such as cigarette-store.biz/online/lucky-strike and cigarette-store.biz/online/pall-mall continues to boost sales at British American Tobacco, although the Pall Mall cigarettes brandcompany said that a shrinking tobacco market and cash-strapped consumers were denting cigarette volumes.

“Our consumers are finding economic conditions difficult and volumes suffered as a result of market size declines,” said Paul Adams, chief executive of British American Tobacco.

“However, there was continued pricing momentum and good growth in market shares, leading to solid revenue growth. We remain on track for the year.”

Sales volumes of Lucky Strike grew by 8 per cent in the three months to the end of March, whilst Pall Mall grew by 10 per cent. The Dunhill brand increased volumes by 24 per cent, after BAT changed the brand of its Carlton cigarettes in Brazil to “Carlton by Dunhill”.

In the three months to the end of March, revenues in constant currencies grew, helped by the acquisition last year of the Indonesian tobacco group Bentoel Internasional Investama, although BAT declined to give figures for the increase in turnover.

However, in spite of this sales growth and the gains made in its major brands, total cigarette volumes fell in the period, with organic volumes down 4 per cent, whilst volumes from BAT’s subsidiaries down by 1 per cent.

BAT attributed some of the decline in volumes to a reduction in the size of the overall tobacco market, with total tobacco consumption falling fastest in the markets of Brazil, Japan, Ukraine and Romania.

Notwithstanding a reduction in the size of the Japanese tobacco market, Asia Pacific was the only region in the world where BAT increased its sales volumes, with the group selling 45bn cigarettes, up 5 per cent on the same period last year. The region now accounts for 25 per cent of sales volumes.

In eastern Europe, however, sales volumes fell 7 per cent to 25bn cigarettes, with volumes also falling in western Europe, Africa, and the Middle East, although stable in the Americas.

Shares in British American Tobacco fell 14½p to £21.26 on Wednesday.

By John O’Doherty
Ft, April 28 2010

Hookah bars burn over ban

Lansing – With just days until Michigan’s smoking ban takes effect Saturday, hookah bar owners are pushing for a reprieve from a hookah barslaw they say will put them out of business and unfairly targets Arab-Americans.

Members of the National Heritage Association, which represents more than 120 hookah bars in the state, say they hope for a legal opinion on whether they could allow the smoking of tobacco-free herbs in their hookah tobacco under the tobacco-free law, and they may go to court to ask for an exemption from the ban.

The owners are upset hookah bars weren’t included when lawmakers exempted cigar bars, retail tobacco shops and the gambling floors of Detroit’s casinos. Clean air advocates say they’d prefer smoking be banned everywhere — and just because people can smoke in cigar bars doesn’t mean they should be able to in hookah bars.

“It’s not equal rights to all citizens,” said Mike Berry, president of the association and the owner of 360 Lounge and Grille, a Dearborn hookah bar.

The law bans smoking anywhere food or drink is served, and eating and smoking are part of the hookah bar tradition, Berry said. For people of Middle Eastern descent, the hookah bar is a gathering place for friends and family members at the end of the day.

“I go there at least three or four times a week,” said Sami Bazzi, 25, of Dearborn, whose parents moved to the United States from Lebanon.

“It’s very, very unfair for them to say we can’t sit around and socialize and smoke a hookah.”

Most hookah bars are also restaurants, and they can continue to offer hookah if they decide to give up serving food, said Emily Palsrok, a spokeswoman for the Campaign for Smoke Free Air.

She said Michigan, though it’s the 38th state to pass a smoking ban, has one of the strongest smoke-free laws in the nation. Other states have exemptions for everything from hookah bars to bowling alleys, Palsrok said.

“But the reality of getting it through the Legislature was that lawmakers were going to have carve-outs, and (cigar bars) was one of them.”

Kelly Niebel, spokeswoman for the Department of Community Health, said whether hookah bars should be exempt is “a question more geared to the people who wrote and passed the law.”

A change to the law is unlikely, said Matt Marsden, spokesman for Senate Majority Leader Mike Bishop, R-Rochester.

“We’re not going to go back and revisit something that was as contentious and exhausting as the smoking debate was,” Marsden said.

Gary Reed, who lobbied on behalf of cigar bars when the law was being written, said cigar bars worked hard with lawmakers to grant them an exemption.

“During the entire legislative process … (the hookah bars) were pretty silent from what I was able to see,” Reed said.

Canton civil rights attorney Nabih Ayad, a member of the Michigan Civil Rights Commission, said he’s prepared to represent the hookah owners if they decide to take the issue to court.

The law will hurt “a whole class of people almost entirely made up of Middle Eastern background,” Ayad said.

Mike Nolan, president of the Michigan Premium Cigar and Pipe Retailers Association, which represents cigar bars, says hookah shops also should be exempted from the law.

“This isn’t a story of Big Tobacco — these are mostly family businesses,” Nolan said. “I’m very upset because we worked very hard to get them the exemption.

“We didn’t try to sell out the hookah bars in any way shape or form. We’re on their side.”

Karen Bouffard
Detroit News, April 28. 2010

Is Wall Street Like Big Tobacco?

In April 1994, tobacco industry executives testified under oath on Capitol Hill that nicotine wasn’t addictive – and that cigarettes didn’t kill.

That hearing was memorable, and a turning point for tobacco companies. It opened the spigot of litigation and legislation. Since then, the tobacco industry has paid out hundreds of billions of dollars in lawsuits and settlements. Now the federal government is regulating cigarettes under a law passed last year.

The Goldman Sachs executives testifying today before the Senate Subcommittee on Investigations could take a lesson from the tobacco industry’s experience. “Goldman Sachs is to Wall Street as Philip Morris is to tobacco,” said one former tobacco industry executive who was at the Congressional hearing sixteen years ago. At that time, Phillip Morris held an estimated 45 percent share of the U.S. cigarette market.

His advice to Goldman Sachs executives: “If these guys come across as arrogant or confrontational, it won’t be good for them.”

Fabrice Tourre said in his testimony today that “to the average person the utility of these products may not be obvious.” But viewers of his testimony may hear a different message – that the average person isn’t smart enough to understand what Wall Street does.

To the former tobacco executive, it doesn’t sound much different than the message some in the tobacco industry sent back in the 1990s. “What people heard from big tobacco was ‘if you’re stupid enough to believe us when we say cigarettes don’t kill, that’s your own problem.'”

Of course, cigarettes aren’t Collateralized Debt Obligations. Lung cancer is easier to understand than a CDO or derivative. It’s too early to know if public outrage, Congressional investigations, lawsuits and regulatory reform will change change the culture and incentives of Wall Street, but the road ahead for investment bankers could be bumpy.

Imperial Tobacco Posts Profit on Higher Prices for Cigarettes

Imperial Tobacco Group Plc, Europe’s biggest tobacco company, posted a first-half profit after the maker of West, Davidoff and JPS Imperial tobaccobrands increased prices.

Net income was 689 million pounds ($1.06 billion), the Bristol, England-based company said today in a statement. That compared with a year-earlier loss of 149 million pounds, which was caused by currency and interest rate hedging.

Imperial has increased prices and slashed costs and after the 2008 purchase of Altadis, the maker of Gauloises and Fortuna cigarettes, to lift operating profit. The quantity of cigarettes sold in the first six months slid 3.7 percent due to lower demand in the U.S. and Spain and amid a disruption to supply networks in the Middle East. That was less than the 4 percent drop Imperial Tobacco predicted last month. “We made gains with our global cigarette brands,” Chief Executive Officer Gareth Davis said in the statement. “We are focused on maintaining this growth momentum and are encouraged by the upward trend of our most recent cigarette shares in a number of mature and emerging markets.”

Imperial Tobacco shares have slid 0.7 percent this year, valuing the company at 19.8 billion pounds. British American Tobacco Plc, Europe’s second-largest and maker of Dunhill cigarettes, has added 8.8 percent this year.

Last year, Imperial Tobacco said it had “fair value” losses on derivatives used for hedging of 937 million pounds and amortization of 224 million pounds from acquisitions.

Expert warns of tobacco law chaos

A top legal expert has warned shops to prepare for a “bureaucratic logjam” when new restrictions on the sale of tobacco come into force.

Audrey Ferrie, head of licensing at Scottish law firm McGrigors LLP, which has a branch in Aberdeen, has predicted a repeat of the fiasco when new alcohol licensing legislation was introduced last year.

The Scottish Government was forced to postpone the introduction of personal liquor licences for a couple of months after protests from the trade over a huge backlog in applications.

Under the Tobacco and Primary Medical Services (Scotland) Act retailers will have to be licensed to sell tobacco..

Penalties for failing to register include a fine of up to £20,000 or six months’ imprisonment.

The law, which includes a ban on tobacco vending machines, was passed by the Scottish Parliament three months ago.

Ms Ferrie said: “New laws covering the sale of tobacco come into force shortly, and if the experience of the recent overhaul of the liquor licensing regulations is any guide, retailers should brace themselves for a bureaucratic logjam.”

Details of what will be involved in registering are still not clear despite the fact that it will be in force for supermarkets from next year.

Corner shops will not come under the legislation until 2013.

Ms Ferrie said: “The shadow of the new Scottish liquor licensing legislation, which came into force on September 1, 2009, is inescapable.

“The bureaucracy and paperwork associated with that legislation has proved phenomenal, and several boards have still not issued the appropriate licences.”

She added: “Given the likelihood of similar delays with the tobacco licences, retailers – particularly large ones – would be well advised to keep a close eye on any smoke signals from the government as to when the documentation will be made available, and then move quickly.”

A Scottish Government spokeswoman said registration would be straightforward and problems were not expected.

She said: “Signing up for the national register of tobacco retailers will be a simple administrative task designed to minimise the impact on businesses.

“A chain of shops will only require to register once and registration will be free.

“A marketing campaign will give retailers all the information they need about the scheme and how to join. We don’t anticipate that the process will create any backlog.”

Detailed proposals outlining how the ban on tobacco displays will work will be unveiled today as part of a three-month consultation to give shopkeepers a say in how it will be implemented.

Small shops say they could lose a third of their income.

Fiona Barrett, Scottish spokesman for the Tobacco Retailers Alliance, said the government should enforce the law properly before banning tobacco displays.

“The suggestion that youngsters will stop smoking just because they don’t see tobacco being sold in shops is ridiculous,” she said.

Tobacco groups seek to challenge UK display ban

Britain’s three biggest cigarette makers are to challenge through the courts an impending ban on the display of tobacco products at cigarettes salesretailers in England, Wales and Northern Ireland.

Imperial Tobacco, Japan Tobacco International (JTI) and British American Tobacco said on Monday they are to seek a judicial review of the relevant sections of the Health Act 2009, in which the UK government is looking to impose the display ban to discourage smoking.

Imperial, which makes Lambert & Butler and Richmond cigarettes in the UK, said there is no evidence to suggest children start smoking or that adult smokers continue to smoke as a result of the display of tobacco products.

“If this misguided legislation is implemented it will simply fuel the growth in the illicit trade of tobacco and create a huge cost burden for retailers who are already under considerable pressure as a result of the difficult economic climate,” said Chief Executive Gareth Davis in a statement.

JTI, which took over Gallaher in 2007 and makes Benson & Hedges and Silk Cut cigarettes in the UK, called the regulations “unreasonable and disproportionate” and said it had no option but to start the legal process to challenge the ban.

BAT, which makes Rothmans and Pall Mall cigarettes, added there was no evidence to show the move will cut smoking rates in the UK, but argued it would damage competition and the livelihoods of tens of thousands of small businesses.

It said driving legal trade from public view will encourage illegal traders.

The Health Act 2009 requires cigarettes, cigars, pipe and roll-your own tobacco products to be hidden from view in England, Wales and Northern Ireland from October 2011 in large retailers and from October 2013 in smaller outlets.

Scotland is pushing its own banning legislation through its own parliament.

Tobacco giants are using Facebook to subvert smoking bans

TOBACCO giants are using Facebook to subvert bans and international conventions against cigarette advertising, a study by tobacco on FacebookUniversity of Sydney researchers published in the British Medical Journal has found.

”We have gathered here to pay homage to cigarette-store.biz/online/lucky-strike, the best brand in the whole widest world,” says one Facebook page administered by an employee of the tobacco company RJ Reynolds highlighted by the study.

Other Lucky Strike pages, one with tens of thousands of members, had images of old and new tobacco ads and various Lucky Strike tobacco products and merchandise. The report also found employees of British American Tobacco Australia had established similar pages.

In a statement BAT Australia’s managing director, David Crow, said: ”It’s absolutely not our policy to use social networking sites such as Facebook to promote our tobacco product brands. To do so could breach local advertising laws.

”Our rules mean that employees should not post branded material on social networking sites, blog sites, chat forums or other ‘user-generated content’ sites such as YouTube – whatever the intention in posting the material may be.”

The statement said ”if we find group employees have posted material that they shouldn’t, perhaps out of naivety, we will be telling them to remove it”.

The study says that according to Facebook rules the creator of a page must certify that they are ”an official representative of this brand, organisation, or person and that you are permitted to create a Facebook page for that subject”. This suggested only BAT employees and authorised representatives could create such pages.

The study found more than 500 networks for BAT employees, but noted there was no way of knowing if these were a form of promotion. The next most common type of group was for BAT cigarette brands. ”Twenty-six BAT cigarette brand groups were found as part of the search and of these, five had members who were part of the BAT network.”

One large group appeared to be promoting Kent cigarettes and had been established by a Belgium BAT employee.

Six of the brand groups are designated as “health and well-being” types of group, the study said.

The article’s lead researcher, Becky Freeman, a PhD student at the university’s school of public health, said the Facebook pages appeared to break not only domestic laws against cigarette advertising but Australian commitments to the World Health Organisation treaty against the practice. Facebook was unable to comment.

Fewer Businesses Selling Tobacco Products

There are fewer retail outlets for tobacco products in Finland than before. When the sale of tobacco became subject to a licence, cigarettes salemany businesses opted to stop selling it rather than go through the expense and bother of acquiring a licence. The trend is for even greater restrictions on the availability of cigarettes.

New legislation came into effect last summer, requiring all businesses selling tobacco products to apply for a special licence. A number of businesses, especially restaurants and cafes, preferred to stop selling cigarettes altogether.

“It’s not worth it. There are costs, and filling out the application is fairly painstaking,” says Vilhelmiina Ihamäki, who works at the Meritähti restaurant in Helsinki.

Before the new regulations went into effect, the Ministry of Social affairs and Health expected applications from more than 30,000 businesses for tobacco licences. Ultimately only about 10,000 applications came. In Helsinki a licence costs 100 euros, in addition to an enforcement fee of 150 euros a year.

“As there is not much of a profit margin in tobacco sales, many businesses have calculated that it is no longer worth their while”, says Ismo Tuominen, an official at the Ministry of Social Affairs and Health,

Further Restrictions Possible

More restrictions on tobacco sales could be on the way. Parliament is considering legislation that would require that tobacco products be sold from beneath the counter, and should not be openly on display.

“In some countries there is talk of restricting sales of tobacco to a very narrow system, such as pharmacies, or in Finland, to sales outlets of Alko [the Finnish alcohol retail monopoly]. It has also been suggested that buying tobacco might be restricted to those with a licence. That is, if a person wants to smoke, he or she should register for permission to buy tobacco,” Tuominen explains

Discouraging smoking is seen to be in society’s interest, as treatment of tobacco-related diseases is very expensive. Health officials have a long way to go – about one in five Finns over 15 years of age continue to smoke daily.

Smokeless Tobacco Risks ‘Overblown’?

NEW YORK — The Wall Street Journal “Numbers Guy” blog said that while smokeless tobacco products remain far less popular than smokeless tobaccocigarettes in the United States, a collection of products that deliver nicotine without smoke—including dip, chew, snuff and newer items that look more like chewing gum—have sparked a heated debate about health risks.

Opponents of these products have presented numbers that suggest smokeless tobacco is an enormous public-health threat akin to cigarettes, while supporters, including some scientists, suggest smokeless items could offer a solution to smoking’s toll on public health. Both claims are based on misinterpretations of the data, said the report.

Critics of smokeless tobacco have spoken out recently about elevated risks of oral cancer and dangers these items pose to children who accidentally ingest them. All of these risks appear to be overblown, said the blog, particularly compared with smoking, which is far more likely to kill than smokeless alternatives.

But researchers who recommend these products as alternatives for smokers seeking to quit also are relying on hazy figures, the report added. Much of their evidence comes from Sweden, where use of smokeless products has risen in recent decades as smoking, and lung-cancer rates, have fallen. Many scientists who study tobacco use remain unpersuaded that the drop in cancer rates stemmed from the increase in use of smokeless products.

In pressing the case for more stringent regulation of smokeless tobacco, a National Cancer Institute physician last week testified before Congress that smokeless-tobacco products can multiply users’ risk of oral cancer by up to 50 times. The American Cancer Society followed up with a similar statement. But as Brad Rodu, professor of oncology at the University of Louisville whose research is funded by the tobacco industry, pointed out in a blog post this week, the risk figure is based on a survey of individuals who had used a form of tobacco called dry snuff, which is inhaled through the nose—a product that now is little used.

Peter Shields, deputy director of the Lombardi Comprehensive Cancer Center at Georgetown University, looked at several studies on smokeless tobacco risk and concluded that smokeless tobacco raises the risk of oral cancer by three to 10 times compared with nontobacco users, rather than 50 times, the Journal blog said.

Dr. Thomas Glynn, director of cancer science and trends for the American Cancer Society, said this week that his organization will no longer use the statistic citing a 50-fold increase in risk.

Several recent studies focused on other risks. This week, a study published online by the journal Pediatrics reported that chewable tobacco products were the second-most-common tobacco product accidentally ingested by children, as reported to poison-control centers nationwide. The study echoed fears among health advocates that newer smokeless items including strips and lozenges could be mistaken by children as candy.

But the study didn’t note that smokeless products—categorized as chewing tobacco—caused just three major incidents, which are defined as life-threatening, disabling or disfiguring, and no deaths from 2005 to 2008, said the Journal.

Add up all the risks of smokeless tobacco, say supporters of its role in smoking prevention, and using smokeless products raises the risk of premature death by only 2% of the amount that taking up smoking does, according to the report, citing Joel Nitzkin, chair of the tobacco control task force of the American Association of Public Health Physicians.

Some scientists agree, said the blog. “If nicotine could be provided in a form that is acceptable and effective as a cigarette substitute, millions of lives could be saved,” reported the U.K.’s Royal College of Physicians’ tobacco advisory group in 2007.

If researchers could be assured smokers really would quit, they would get behind it. “If we can get everybody to switch to smokeless, great,” Gregory Connolly, a professor at Harvard University’s school of public health, told the newspaper. “That would be wonderful.”

But he and others doubt that will happen. They point to surveys showing that smoking rates are higher among smokeless-tobacco users than among the rest of the population.

Much of the available data on smokeless tobacco comes from Sweden. There, men gradually have cut down on smoking and increased their use of snus, a form of moist snuff that doesn’t require spitting, in a shift that began in the 1970s. Lung-cancer deaths among Swedish men peaked in 1978; since then, the death rate has declined to the lowest in the European Union.

This is the major basis for claims that smokeless tobacco can have a massive public-health benefit. But even believers acknowledge they are making some assumptions beyond what can be proven. “I would be just as interested as you in any study that directly shows that snus use is a cause of decline in smoking rates,” Lars Ramstrom, director of the Institute for Tobacco Studies in Stockholm, told the paper. “But I do not have a real hope of ever finding such a study.”

The experience of another effort to induce American smokers to switch clouds the picture for Terry Pechacek, associate director for science in the Centers for Disease Control & Prevention’s office on smoking and health. He recalled that many smokers switched to low-tar cigarettes beginning in the 1960s, under the mistaken belief they were safer. “We need to be careful not to repeat this experience,” he told the Journal. Public-health officials, he added, are reluctant to advocate any form of tobacco use.

CSP Daily News, April 26, 2010

Cigarette Firms Not Running Out of Puff

If foreign antismoking activists had not criticized the tobacco sponsorship of US singer Kelly Clarkson’s concert in Jakarta next week, would Indonesians even have noticed?

Given the prevalence of tobacco advertising throughout the country, probably not.

Ricky Pesik, secretary of the Jakarta chapter of the Indonesian Association of Advertising Agencies, said “tobacco companies remain some of the biggest spenders on advertising.”

Figures from Nielsen Media Indonesia back this up, showing that tobacco firms were in the top 10 of advertising spenders in all types of media in the first quarter of the year.

The report shows advertising for clove cigarettes was among the top five, with Gudang Garam the third biggest buyer of television commercial slots with total spending of Rp 73 billion.

Ika Jatmikasari, associate director of Nielsen Media Indonesia, said makers of clove cigarettes spent Rp 377 billion ($42 million) in the first quarter of 2010, 8 percent more than the Rp 349 billion spent in the same period last year.

LA Lights, the canceled sponsor for Clarkson’s concert, was among the top 15 for cigarette advertising in the first quarter of the year for its clove cigarettes, with manufacturer Djarum spending billions of rupiah.

But with companies facing more restrictions on placing advertisements in the mass media, Ricky said they were shifting their advertising budgets to sponsorships instead, such as of concerts and other events that provide “an interactive channel for the product with the consumer.”

“There’s a concept of ‘brand experience’ introduced by sponsoring events,” he said.

The report shows that there has been a 35 percent decrease in spending on advertising clove cigarettes in all types of media, including a percent decline in television commercial spots and a 53 percent decrease in print media advertisements.

The chairman of the National Commission for Child Protection (Komnas Anak), Seto Mulyadi, said the move to withdraw LA Lights’ sponsorship for the concert should be the impetus for Indonesia to ban smoking in public spaces. “Not only music, but other events, even sports, are often sponsored by cigarette producers,” he said.

Many events in Indonesia, the world’s fifth-largest tobacco market, are still sponsored by cigarette companies, including the country’s main football league.

Tobacco companies also sponsor several music festivals and often are seen handing out cigarettes at those events, even though they are mainly handed out in areas restricted to people aged 18 and older.

Seto said activists should use the momentum of LA Lights’ sponsorship withdrawal to step up the antismoking fight.

“This is a good momentum, along with the Alicia Keys concert a few years ago,” he said.

Two years ago, a tobacco affiliate of US-based Philip Morris International, which dominates Indonesia’s tobacco market, removed its logo from advertising promoting an Alicia Keys concert in Jakarta after the singer publicly denounced the sponsorship and apologized to her fans.

A study by Komnas Anak in 2007 found that almost half of the teenage smokers polled said they had taken up the habit because of advertising. The study also found that tobacco companies had sponsored 1,350 youth-oriented events from January to October in 2007.

Indonesia, a country with about 240 million people, has yet to ratify the UN Framework Convention on Tobacco Control, an international treaty that became law in February 2005. The framework’s 152 ratifying nations have to implement effective methods to reduce tobacco use.

The Ministry of Health is preparing two bills regarding cigarettes; one to ratify the UN framework and another on controlling the negative health effects of tobacco. A spokesman for the ministry’s legal division said the bills had been given priority to be passed by the House of Representatives.

Indonesia sells a pack of cigarettes for less than $1, making it one of Asia’s cheapest markets, compared with Singapore, where a pack costs $5.

Thejakartaglobe, April 23, 2010

Cigar bars around Michigan get OK to sell food, drinks

LANSING — Michigan’s statewide smoking ban, which is to take effect May 1, will allow established cigar bars to sell food and drink, the state Department of Community Health (DCH) announced Friday.


But the law will not allow any new smoking cigar bars; they had to have been established by April 1.

And patrons in cigar bars can’t smoke cigarettes, pipes, so-called little cigars or any other tobacco products. Only tobacco-wrapped cigars that retail for more than $1 each can be smoked in cigar bars.

The rule clarification was sought by cigar bars that serve food and drinks. To qualify for the exemption, cigar bars must prove that at least 10% of their monthly income is from the sale of cigars and the rental of humidors.

“To fail to recognize how cigar bars will generate the other 90% of their gross annual income would be absurd,” DCH director Janet Olszewski wrote in a memo Friday.

She said the Legislature intended to allow eating and drinking in cigar bars when it wrote the new law. Tobacco shops and hookah lounges can’t serve food and drinks, according to the ban.

Gary Reed, a Lansing lobbyist who represents cigar bars, said he did not know how many cigar bars are in Michigan but guessed several hundred.

The smoking ban includes all workplaces, restaurants and bars and enclosed public places such as shopping malls, arenas and health facilities.

Smoking will be allowed on the gaming floors of Detroit casinos, and at cigar bars and tobacco shops that qualify under the rules. The casino restaurants and bars must be smoke-free.

The smoking ban does not apply to American Indian-owned casinos.

Avatar on DVD Review

The top-grossing film in movie history is No. 1 again. The James Cameron epic Avatar, which has earned more than $2.7 billion in avatar reviewstheaters worldwide since its Dec. 18 release — nearly 50% more than the previous record holder, Cameron’s Titanic — went into video stores yesterday and sold about 4 million copies. That established new standards for sales of both DVDs (topping Twilight as the year’s top seller) and Blu-ray discs (smashing The Dark Knight’s stash by nearly a million units). Actually, we’re not sure how the folks at Fox calculated that, since the Blu-ray edition of Avatar is offered only packaged with a DVD for $39.99 (currently half price on amazon.com). Anyway, it’s quite a haul.

More surprising than the sales figures is the composition of the DVD package. Released on Earth Day, April 22, to underline the film’s eco-friendly message, the first home version of Avatar is hardly fan-friendly. It boasts no extra footage; apparently the picture that Cameron showed in theaters was his director’s cut. You’ll find no making-of documentaries, no “behind the scenes in Pandora” mini-movies, though several of these played in heavy rotation for months on the Fox Movie Channel. The presentation also skips the usual trailers for other Fox movies. The only “extra” is an anti-smoking public service announcement. And one other caveat, which sends the collective voice of Avatar’s admirers ascending into a shrill chorus: no freakin’ 3-D.

This, after all, was a movie sold on the need to see it in its full stereoptic grandeur, and audiences bit: about 75% of theatergoers paid higher prices to see the picture in 3-D or IMAX venues. Some people waited for weeks to get seats in those theaters, because, as critics and fans agreed, who wants to see Avatar in poor old 20th-century 2-D? Yet here the movie is, available in a format that only a quarter of the moviegoing public saw it in. If, as DreamWorks Animation boss Jeffrey Katzenberg keeps saying, 3-D is the biggest transformation in movies since color, then this is Avatar in black-and-white. Remember Col. Quaritch’s warning, at the beginning of the movie, that “You are not in Kansas anymore”? Welcome back to Kansas.

In an interview with Entertainment Weekly, Cameron said he didn’t release a DVD in 3-D because “Our feeling is there just aren’t enough players out there. We don’t want it to come out and be a fart in the frying pan.” Yet if there’s one event that could cue a 3-D DVD buying spree, it’d be the release of Avatar in that format. Instead, the Na’vigator hopes to milk his movie’s popularity dry with no fewer than three home versions. “Right now, today, if people want them some Avatar, they can get it. And I think they will. And then in August, we’re going to take those six minutes of deleted scenes and finish them up to a level of photo-reality equal to the rest of the film and re-release the film theatrically. Then we’ll get creative with the DVD technology in November.”

So what do you get right now? A crisp keepsake of the movie; a thing to hold called Avatar; a fetish for acolytes; a slim box to put on your video shelf, with space for the real editions coming out later. Seen in its flat format, the film looks ordinary, especially in its first half-hour or so, as Cameron none too adroitly sets up his premise. The middle section, in which Jake (Sam Worthington) befriends the Na’vi princess Neytiri (Zoe Saldana) and becomes part of her world, is much more beguiling; 2-D can’t rob Pandora of its majesty, and the colors, especially in Blu-ray, are as spectacular as ever. Those who fell in love with the love story, with Jake and Neytiri and their blooming emotional connection, will get a lot more out of this Avatar than moviegoers who were just wowed by the spectacle.

But will any home version, in DVD, Blu-ray or 3-D, equal what the theatrical version offered? The whole economic and artistic point of the Avatar we all saw — indeed, of any 3-D movie — was to create an experience that couldn’t be duplicated at home. On the big screen, in that process, the picture hypnotized moviegoers with its size and scope. The gigantic image had no competition for a viewer’s attention; in the darkened cathedral of a large theater, the movie was the only light, and watching it was a votive experience, with Cameron the high priest controlling the message and the tempo. Sitting there, in the company of a thousand other communicants, we entered Jake’s virtual, much more beautiful life. We were all dreamwalkers.

There’s no way to duplicate that intensity at home, with a much smaller image, and the ordinary interruptions of phone and email messages, of the ordinary importuning of kids and spouses. Yet in an important and diminishing way, you are in charge, not Cameron. You can fast-forward through the slow spots, click back to relive a scene, stop when it’s dinnertime and maybe never come back. Even a movie as powerful as Avatar can’t work its spell on a distracted viewer. To stay with it requires an act of will, not the blessed passivity of a moviegoer.

Later this year we’ll doubtless pony up more money for a fuller version of the film. But I’d rather believe the rumor now circulating: that Fox has found a hole in the crowded schedule of the year’s 3-D movies, and will rerelease Avatar in theaters. That’s really the only way to see it — until Cameron and his video savants come up with a 3-D home machine that can duplicate the theater experience. I wouldn’t put it past them. After all, they figured out how to turn an epic vision into a trailblazingly glorious movie.

By Richard Corliss
Time, April 24, 2010

Legalizing marijuana in California

Below the perpetual fog that shrouds the redwood groves, green hills and rocky coastline of remote Humboldt County thrives a lucrative but hush-hush industry — marijuana.

Pot pays the bills in this Northern California enclave, home to hippies and good old boys alike who espouse the weed’s curative and economic benefits. The expensive trucks, bustling restaurants, escalating rents and plentiful wads of cash all point to profitable pot cultivation in Humboldt.

Now, a state voter initiative on the November ballot that would make California the first U.S. state to legalize and tax this cash crop has locals jittery about losing their dominant market position.

“We’ve always had a cannabis tinge to our culture,” said Kevin Hoover, editor of weekly newspaper The Arcata Eye. “What we have now is a very entrenched industry that’s making a lot of money off the fact that it’s illegal.”

Starting in the 1960’s, free-thinkers wanting to get away from it all moved to the area long dominated by the lumber and fishing industries. Marijuana cultivation supported these new residents and newly unemployed blue-collar workers who watched the demise of Humboldt’s traditional manufacturing base.

Although the underground pot economy makes for poor statistics, Beth Wilson, an associate professor of economics at Humboldt State University, estimates the area’s annual income from marijuana at about $500 million.

The “multiplier effect” of that money circulated to support local businesses — garden centers do a brisk business and the town of Arcata’s sushi restaurant is always packed — could push that figure to $1 billion annually, she said.

“It’s not negligible,” said Wilson.


Everyone knows someone who grows pot. In the north county, indoor growing that fetches prices of over $3,000 per pound is popular, while in the south, marijuana is planted outdoors.

The industry has also fueled an itinerant labor force of “trimmers” who make $20 per hour or more snipping the leaves from the more potent dried buds of the plant.

“This vote has become a conflict of interest,” said Deniz Farnell, 31, an Arcata hotel worker, who, like the vast majority of locals, supports decriminalizing pot smoking.

“Do you vote for the good of the state or for the next-door neighbor who’s a mom who’s supplementing her income through trimming? When that law passes, she’ll be on food stamps.”

That is because legalizing marijuana could turn a cottage industry into Pot Inc. Locals fear big tobacco will swoop in and drive down prices, supplying millions of new, legal pot smokers with “Marlboro Green.”

Rumors abound in Arcata that the tobacco giants have already snatched up land and copyrights to the most popular names of weed strains, whether Purple Kush, Big Bud, Headband, Trainwreck or L.A. Confidential.

But at least one big tobacco company, Reynolds American, says it has no plans to move in. “Everything else would be purely rumors and speculation,” said spokesman David Howard.

“We better hope it doesn’t become legal because this area is going to become a ghost town,” one reader wrote to the North Coast Journal in a response to a recent article on how to stay afloat in the post-illegal pot era.

The Tax Cannabis campaign has gained traction in the cash-strapped state of California, historically at the forefront of contentious social issues. It led the nation in 1996 by approving the use of cannabis for medical purposes.

An April 2009 Field Poll showed 56 percent of state voters supported legalizing pot for social use and taxing the sales.

On a statewide level, that could bring in $1.4 billion per year, according to the office that regulates sales tax.

“Think of all the pot smokers out there,” said a mid-30s mom who has grown for six years, plans to enter law school, and favors legalization. “They can bail California out of its deficit. Smoke more pot!”

Under the initiative, possession and cultivation of small amounts of pot for personal use would be legal for those 21 and over. The measure allows municipalities to determine how to tax and regulate the drug — with monies going to local governments — and does not affect medical marijuana laws.

Pot is illegal under U.S. law but the Obama administration halted raids on medical marijuana clinics last year. It is unclear how state legalization would be affected by federal law, and whether the U.S. government would interfere.


Those who favor legalization predict it could curtail the seamier side of the industry. The profusion of “grow houses,” gutted to accommodate indoor greenhouses, have pushed up rental prices, while robberies of cash and plants are on the rise.

With no real organized opposition to the measure, local leaders in Humboldt say it’s time to face up to the future and brainstorm creative ideas to offset any impending slump.

“Here we have an industry with whom our county’s name has, quite frankly, become synonymous,” said County Supervisor Mark Lovelace. “We’ve lived with the downside of that name association for the past thirty years. Maybe it’s time to capture some of the upside.”

Ideas include taking a tip from French champagne, branding the Humboldt name as an appellation and focusing on terroir and tasting rooms. Others say that’s a pipe dream.

“We don’t need to panic and create weed Disneyland,” said one grower, who believes the risk to growers has been overblown and foresees a continuing black market even if the law passes.

The 32-year-old illegal grower, who declined to be identified, predicts connoisseurs will eschew the cheaper varieties in a legal market and pay a premium for Humboldt’s best strains.

Pot growers could also harness their know-how for other horticultural pursuits, he said.

“It’s easy money right now,” said the self-described “average indoor grower” with $40,000 in income every two and a half months. “But these might be the future organic farmers of the area. That skill can be applied to more things than just marijuana.”

Higher prices, snuff volume boost Reynolds American

Reynolds American posted a sharp increase in first quarter profit Thursday as higher prices, growth in smokeless tobacco and lower costs offset a continuing decline in cigarette volume.

Reynolds /quotes/comstock/13*!rai/quotes/nls/rai (RAI 55.77, +0.36, +0.65%) earned $82 million, or 28 cents a share, on the period, up from $8 million, or 3 cents a share, in the same quarter of 2009. On an adjusted basis, the company would have earned $1.11 a share.

Sales rose 3.4% to $1.99 billion from $1.92 billion.

The average estimate of analysts polled by FactSet Research had been for the company to earn $1.07 a share on sales of 1.91 billion.

But while Reynolds’ cigarette market share increased 0.2 share points to 27.9%, volume fell 2.5% — slightly higher than an estimated industry-wide decline of 2.4%.

“It’s important to note that first-quarter comparisons benefited from unusually low cigarette and moist-snuff shipment volume in last year’s first quarter, as wholesalers and retailers significantly reduced inventories ahead of federal excise-tax increases that took effect last April,” said Susan Ivey, chief executive, in the earnings report.

She added that the company managed to boost profit “in a challenging environment, marked by significant competitive promotional activity and product introductions in both the cigarette and moist-snuff categories” along with “consumer spending patterns [that] continued to be affected by the ongoing impact of higher tobacco taxes and the weak economy.”

The company’s American Snuff unit posted a shipment volume increase of 12.2%, helped by easier comparisons but it noted that “on a consumer off-take basis, which better reflects retail sales, American Snuff Co.’s volume increased about 6.7%.”

Looking ahead, the maker of Camel, Pall Mall and other smokes, said that it still expects to earn $4.80 to $5.00 a share on an adjusted basis for the full year.

By William Spain, MarketWatch

Copenhagen, Marlboro boost Altria profit

Tobacco titan Altria Group Inc. said Wednesday that its first-quarter profit rose 38%, helped by demand for Marlboro cigarettes and marlboro cigarettesCopenhagen smokeless tobacco.

Altria /quotes/comstock/13*!mo/quotes/nls/mo (MO 21.46, +0.29, +1.37%) earned $813 million, or 39 cents a share, in the quarter, up from $589 million, or 28 cents a share, a year earlier.

Revenue at the Richmond, Va.-based company rose 27% to $5.76 billion from $4.52 billion.

On an adjusted basis, the company said it would have earned 42 cents a share in the latest quarter.

The average estimate of analysts polled by FactSet Research had been for the company to earn 40 cents a share.

Altria said the business environment this year is likely to remain challenging. It maintained its forecast that its 2010 profit would come in at $1.78 to $1.82 a share, including charges of 7 cents a share related to exit, integration and implementation costs, UST-acquisition-related costs, and SABMiller /quotes/comstock/23s!a:sab (UK:SAB 2,009, 0.00, 0.00%) special items.

Knocking those out, profit is forecast to be $1.85 to $1.89 a share.

Altria spun off Philip Morris International /quotes/comstock/13*!pm/quotes/nls/pm (PM 51.99, +0.07, +0.13%) at the end of March 2008 in a move designed to separate the fast-growing overseas cigarette business from a U.S. unit hobbled by litigation worries, huge payments to states and seemingly inexorable year-on-year volume declines.

During the period, Philip Morris USA’s domestic cigarette shipments were down 0.7% while its flagship Marlboro brand’s retail share rose 0.3 percentage point to 42.7%. Marlboro volume was up 1.6%, while all of the company’s other brands suffered, in aggregate, double-digit declines.

Cigar volume at its Middleton unit was down 18.3%, a decline the company attributed to its belief that wholesalers stocked up in the year-earlier period in advance of an increase in federal excise taxes.

On the brighter side, sales of smokeless tobacco brands, including Copenhagen and Skoal, rose 28% versus the prior-year period.

“Marlboro achieved record retail share results in the first quarter, and Copenhagen regained its position as the largest smokeless tobacco brand, as measured by retail share,” Chief Executive Michael Szymanczyk said in the earnings report.

Standard & Poor’s reiterated its strong buy recommendation on the company’s shares following the report.

The company’s adjusted earnings were better than S&P’s estimate, wrote analyst Esther Kwon and “shipment decline of 0.7% was better than our view on easy comparison on inventory draw down last year.”

Further, “Marlboro retail share rose 0.3% year over year, while premium smokeless share increased from the fourth quarter and year ago quarter,” she added. “While we see volumes continuing to be impacted by inventory changes, we look for strong free cash flow generation.”

Shares rose about 1.4% to close at $21.46.

Smoking ban in public goes into effect in Syria

DAMASCUS, Syria — A smoking ban that few are expected to abide by went into effect in Syria Wednesday, a country where people light up even in hospitals.

The ban targets most public places such as restaurants, cafes, schools, universities, hospitals, parks, movie theaters, museums and public transport.

The law, which also forbids the sale of cigarettes to minors, was approved six months ago by President Bashar Assad, a British-trained eye doctor.

The Middle East’s favorite pastime — smoking water pipes — is also prohibited in public under the new law except in well-ventilated and designated areas. Also outlawed are tobacco advertising and the sale and import of sweets and toys modeled after tobacco products.

Offenders will face fines ranging between $45 and $870 and a possible three to 12 months in jail.

“The ban is good, but I doubt I will stop smoking,” said businessman Bassam Shanna, 47.

The ban’s effects are already being felt in Damascus’ famous cafes.

The normally bustling indoor area of the Nowfara Cafe in the city’s downtown area was almost entirely empty on Wednesday.

“Fifty people would be sitting here if it weren’t for the ban” complained the manager, Shadi Rabbat.

However, the cafe’s terrace was crowded with some 50 customers smoking water pipes.

“We hope the government will reconsider the ban,” said another cafe owner who refused to give his name because he feared reprisals by the authorities.

Syria had in the past taken steps to try to restrict smoking, including a 1996 decree issued by Assad’s late father, President Hafez Assad, that banned smoking in government offices, hospitals and the airport.

A 2004 law banned smoking in internet cafes and another law in 2006 made buses, railway stations, movie theaters, parks and cultural centers smoke-free, with violators facing a fine of about $10 and three months in jail. But the bans were often flouted and not strictly enforced.

This time, however, more sweeping measures were being taken, reflecting Syria’s desire to join other Arab countries struggling to control smoking with bans and anti-smoking campaigns.

Fines are also steeper this time round — the fine for smoking in a cafe is $45 while it goes up to a staggering $870 in five-star hotels.

Health ministry officials will be frequently carrying out on site inspections to ensure the law was being observed in public places.

“It’s a chance for me to seriously try to quit smoking,” said Mohammed al-Kash, a sociology professor at Damascus University. “I am fully committed to the ban.”

Three million people — or 15 percent of Syria’s 23.5 million population — smoke. As much as 23 percent of these are university students, according to figures published in the state media. Syrians are thought to spend $565 million a year on smoking.

Other Arab countries are also struggling to create a more smoke free environment.

In the tobacco-loving Arab world, people smoke in offices, universities, taxis, hair salons and even hospitals and smoking has long been a social imperative and a rite of passage for young men.

Packs can cost as little as 50 cents in some Arab nations.

Egypt, Lebanon, the United Arab Emirates and most recently Iraq have imposed restrictions on smoking in public, but the bans vary in scope and enforcement.

The Palestinian Authority in the West Bank, for example, has no laws banning smoking in government offices or public places, and government employees — including President Mahmoud Abbas and Prime Minister Salam Fayyad — regularly smoke in their offices.

Kelly Clarkson Tries and Fails to Snuff Out Cigarette Controversy

Where there’s smoking, there’s ire. Unfortunately, Kelly Clarkson’s just landed in the crosshairs.Kelly Clarkson

The original American Idol winner created quite a stir when billboards and TV ads popped up in Jakarta promoting her concert—and its sponsor, Indonesian cigarette company L.A. Lights. As with Alicia Keys before her, antismoking activists immediately challenged Clarkson to cancel the show or risk sending a bad message to her young fans.

Alas, Miss Independent claims she knew nothing of the matter.

“My morning began with finding out that I am all over billboards, TV ads and other media formats alongside a tobacco company who, unbeknownst to me, is sponsoring my Jakarta date on my current tour,” she writes on her blog. “I was not made aware of this and am in no way an advocate or an ambassador for youth smoking. I’m not even a smoker, nor have I ever been.”

That said, she has no intention of canceling her April 29 performance.

“I can’t justify penalizing my fans for someone else’s oversight,” she explains. “This is a lose-lose situation for me and I am not happy about it but the damage has been done and I refuse to cancel on my fans.

“I think the hardest part of situations like this is getting personally attacked for something I was completely unaware of and being used as some kind of political pawn,” she concludes. (Guess she doesn’t pay attention to the fine print when she signs those big-bucks concert contracts.)

But the Campaign for Tobacco-Free Kids isn’t buying Clarkson’s “for the fans” spin.

She “has let down her fans and chosen to be a spokesperson for the tobacco industry” by going on with the show, says CTFK spokeswoman Marina Carter. “In doing so, Ms. Clarkson is allowing her name, image and talent to be used to promote cigarettes to Indonesian youth.

We again call on Ms. Clarkson to withdraw tobacco industry sponsorship of her concert and to demand the removal of any tobacco-branded advertising and promotions associated with it.”

Kelly Clarkson attacked over cigarette ads

Kelly Clarkson has been attacked by the media over being sponsored by a cigarette company for her Jakarta concert on April 29, 2010.Kelly Clarkson

The company has splashed their L.A. Lights logo all over the posters advertising the show, which has anti-smoking activists in an outrage.

The same thing happened to Alicia Keys in Jakarta in 2008, but she insisted the logo be removed from any ads featuring her likeness.

Matt Myers, president of the Campaign for Tobacco-Free Kids says, “If Kelly Clarkson goes ahead with the concert, she is by choice being a spokesman for the tobacco industry and helping them to market to children. She has the power now to turn this situation around and to send a clear message to Indonesian young people, and frankly, to the young people of the world.”

Cigarette companies object to pictorial warnings

The implementation of pictorial warnings on cigarette packs in the local market has reached a deadlock with manufacturers saying that rotational pictures would mean huge costs.

Manufacturers have said that they would have to incur extra printing costs to have five rotational pictures as warnings on the cigarette packets throughout the year and would force them to increase cigarette prices.

According to the Director-General of Emirates Standardisation and Metrology Authority (ESMA), Mohammed Badri, several manufacturers have objected to the concept of having more than one picture warning. “They are not comfortable with the concept of rotating pictures because of the huge costs involved and have asked for changes in the design,” he said.

The recently passed federal No Tobacco Law stipulates that all tobacco products, including cigarette packets, should display pictorial warnings on 50 per cent of the product before
being marketed.

Though the World Health Organisation requires that the warnings cover 30 per cent of the product, the GCC authority for specifications requires display on 50 per cent of the product.

“The manufacturers are also not agreeing to the 50 per cent display,” said Badri. He said another meeting scheduled for next month would decide what course of action would be taken on this protest. Commenting on the decision of the manufacturers/traders, Dr Wedad Al Maidoor, Head of the National Tobacco Control Committee at the Ministry of Health, said, “This is not up to them to decide.

“The specifications are part of the law and all companies need to abide by the law eventually.”

She said several companies have objections to operating in the local market despite the fact that they have already been complying with such regulations in other parts of the world. “Australia demands that 75 per cent of the packs be covered, and companies do it,” she said. Many of the objections were just delaying tactics.

“The companies are just pressuring the authorities but it will not work,” she added.

A local manufacturer said that adding pictures would mean increasing costs by at least 20 per cent. “We need special colour printers and scanning facilities,” said a representative of a Fujairah-based company manufacturing a brand available locally and for export as well.

He, however, said more than the printing costs, the annually increasing price of tobacco is a source of concern. “Each year, tobacco prices go up by 30-35 per cent and if we are forced to increase even 25 fils per packet a year, the customers will feel the pinch,” said the representative who did not wish
to be named.

He also said that if the law required the changes, they would implement them without delay. “All we want is that the law should be the same for all companies,” he added.

Huge fines for tobacco price-fixing

IMPERIAL Tobacco Group, one of 12 companies facing fines for price fixing, said at the weekend it would fight a record ruling by Britain’s fair trade watchdog.

Imperial, Gallaher Group and 10 retailers were fined £225m for co-ordinating cigarette prices between 2001 and 2003, the UK’s Office of Fair Trade (OFT) said on Friday. Imperial, the maker of the West, Davidoff and JPS brands, received the largest penalty of £112,3m. Gallaher, a unit of Japan Tobacco, was fined £50,4m. The fines are the largest of their kind by the regulator.

Wal-Mart Stores’s Asda unit was fined £14,2m and The Co- operative Group £14,1m, for their roles in a scheme that the OFT says barred retailers from setting their own prices.

The affected markets are worth about £13bn.

“Practices such as these, which restrict the ability of retailers to set their resale prices for competing brands independently, are unlawful,” OFT senior director Simon Williams said. “They can lead to reduced competition and disadvantage consumers.”

The OFT said it dropped allegations made in 2008 about the relationship between the tobacco companies and Tesco, because it did not have enough evidence. The regulator also abandoned claims relating to indirect exchanges of proposed future retail prices.

Some of the companies, including Imperial, said they would challenge the fines.

Frances Murphy, a competition lawyer at Jones Day in London, said the fine and the decision to drop some claims were “rare” examples of the regulator’s ability to deal with cases swiftly and tactically. The OFT was “willing to let more serious things go in order to get a quick result, which perhaps points towards the OFT being more tactical and pragmatic in the application of tight resources,” Murphy said.

Imperial denied breaking any laws and said it would appeal to the Competition Appeal Tribunal. Japan Tobacco views the fine as a “positive” development since the fine has been formally decided, a spokeswoman said.

The OFT issued initial fines in the case two years ago after alleging that some of the same retailers and manufacturers linked retail prices of tobacco brands to those of competing products. The investigation started seven years ago.

William Morrison Supermarkets said it would challenge the fines, saying the OFT’s stance was “illogical and without foundation”. “The practices to which the OFT refers were intended to reduce the retail prices charged to consumers, and the OFT has itself acknowledged that its case is based on a novel interpretation of the law,” Morrison said.

J Sainsbury, the UK’s third- biggest supermarket owner, alerted the OFT to the price-fixing and was the first to apply for leniency. The company received immunity from fines.

Brooksville backs away from tobacco restrictions

BROOKSVILLE – City council members backed away from a policy that would require all employees to eventually be tobacco free.smoke cigarettes

How strict the policy might extend, however, remains to be seen.

During a public meeting today, Brooksville council members voiced their opposition to various parts of a proposed tobacco policy, citing concerns of how far it went into restricting employees’ habits while outside of work.

While Vice Mayor Richard Lewis and councilman Joe Bernardini both opposed restricting tobacco use in employees’ personal vehicles, councilmen Frankie Burnett and Joe Johnston III went further in opposing the policy — stating it went too far when addressing employees’ tobacco use when off duty.

Under the proposed policy, current employees would have one year to quit using tobacco while new employees would have to sign an agreement that they don’t use tobacco products and won’t start after the start of their employment. Currently new hires in the Hernando County Sheriff’s Office have to sign similar agreements.

Burnett, who admits he smokes, said it’s not the place of government to dictate what an employee does once he or she is off the clock and leaves city property.

“If we do do it, it should be about having a tobacco-free workplace,” Burnett said. “But what an employee does in their own home or cars? No, I don’t agree with that.”

All four councilmen however did support other aspects of the policy, such as making city properties and vehicles tobacco free.

Mayor Lara Bradburn, who is a staunch supporter of creating a tobacco-free policy, said the purpose of the policy isn’t to allow government to dictate what employees can do in their personal lives. Instead, she said the purpose is to promote healthy living, lessen healthcare costs for taxpayers and establish a provision that’s been in effect in the private sector for many years.

“Decreasing healthcare costs for taxpayers is a plus, but the better, overall health of our employees is the biggest gain,” Bradburn said. “I’ll tell you, I don’t like smoking and I don’t like to be around smoking. I watched my mother whither away — and I can tell you she’d be upset with a policy like this.”

However, City Planner Steven Gouldman, who smokes, criticized the proposed policy and said the process to survey employees about the policy was misleading and the data isn’t accurate.

He said most of the data presented was to create a tobacco free workplace. However, hidden in the data he said it creates provisions that affect employees’ personal lives. “The only way most people would even know about this is because it was in the newspaper,” Gouldman said. “I oppose this policy, not just because I’m a smoker.”

He added that a survey of employees is misleading, both the questions to employees and how staff used the results to verify their findings and questioned what other recommendations have been made based off of poor information put before council.

Bradburn agreed and said more data would be collected before council reexamines the issue.

“I think we can agree that there are elements of this data that could be a bit better,” Bradburn said. “I think our folks definitely have some things to work on.”

April 19, 2010

SALES of cigarettes go up in Spain

SALES of cigarettes have gone up in Spain since the so-called ‘anti-smoking law’ became effective at the beginning of 2006.

According to the ministry of the economy, last year saw tobacconists netting sales of 12,536 million euros, a growth of 1.38 per cent on the previous year’s 12,365 million.

Only in the Comunidad Valenciana and the Balearic Islands have sales fallen, but this could partly be due to a drop in tourist figures, since northern European holidaymakers are known to take huge consignments of Spain’s much cheaper cigarettes with them.

Sales went up the most in Extremadura, Spain’s main tobacco producer, with a rise of 7.48 per cent in a year.

Andalucía sold 2,241 million euros’ worth of cigarettes and roll-your-own tobacco, just below Catalunya and just ahead of Madrid and the Comunidad Valenciana.

Sales of roll-your-own tobacco have gone up in the past year, given the recession and the higher prices of ready-rolled cigarettes.

Korea’s KT&G – Masters of the Super Slim

Domestic market

KT&G’s brand portfolio retains a 63% of market share in Korea.Korea cigarettes brand

Its major brands include: Esse cigarettes (17% market share), The One (6.9%), Raison (6.0%), This Plus (5.1%), This (2.2%), Season (1.9%), Time (1.8%) and Bohem (1.7%). The company controls 80% of the super slim segment, 67% of the slim and 40% of the king size segments.

Domestic manufacturing is carried out at four high-technology KT&G factories in Korea producing 140 billion pieces of cigarettes annually, and these factories account for 50% of the world’s super slim cigarettes.

The addition of new cigarette factories in Turkey, Iran and Russia (to be opened this year), along with the constant process of automation and facility upgrades will strengthen KT&G’s production capacity globally.

Packaging innovations

Packaging is an important medium for Korean consumers and manufacturers strive to create striking and effective solutions to appeal to customers. Cigarette packaging reflects this preference in Korea, and KT&G has made great efforts to create appropriate packaging for its brands.

“A lot of special packaging or edition products with various design and function, have been already introduced in the market,” a KT&G spokesperson told Tobacco Asia. “Special edition products are often offered in metal packaging to enhance a premium image. Also, the slide pack was introduced in year 2003 for the Zest brand, a major innovation over previous pack design. With regards to developing packaging, since it is most important for us to source materials that are suitable for the concept and which contribute to the desirability and value of each brand, we do not put importance on where materials are coming from. They could be either produced in-house or outsourced.”

Growth segments

Korea’s domestic market has shown a growing preference for super slim and low tar products, and KT&G is strong in both these segments. Demand for both super slim and low tar products will most likely keep on growing, which will help KT&G to maintain its lead.

“Since the segment grew fast from the beginning on account of health concern and the perceived well-being of Korean smokers, we anticipate that the super slim and low tar segment will enjoy steady market expansion,” KT&G told Tobacco Asia.

New technologyPine cigarettes

KT&G has not been slow in developing and embracing new technology to further the growth of its brands.

Innovations that have been introduced recently include the development of various types of filters with specific inherent function, such as the tube filter, a bamboo charcoal filter, the three-layered cavitec filter and so on.

Research and development of ultra low tar brands (cigarettes with tar levels as low as 0.5mg or even 0.1mg) and innovative less smoke smell (LSS) cigarettes is well under way, and we can expect to see initial offerings in these segments presented quite soon, according to the company.

“There are several steps for new products to be launched in market,” KT&G said. “Various surveys are performed prior to launching, and marketing strategies that are developed in accordance with 4P mix are articulated in order to create smoker/market-oriented products.”

Distribution and suppliers

KT&G operates it own direct sales distribution force all across the country covering various channels, and it has developed a formidable domestic supply chain.

“Regardless of type of material, high quality is the most important thing we look for in any supplier,” the company said.

The company sources much of its leaf tobacco domestically, with flue-cured leaf sourced primarily in the Chunbuk, Kyungbuk region and burley from the Geonnam, Geonbuk area.

“KT&G deals with farmers directly and it is the exclusive buyer from the farmer,” the spokesperson told us. “Farmers try their best to produce good leaf quality and meet KT&G’s standard for tobacco leaves. KT&G supports Korean tobacco farmers through various training programs.”

Rules and regulations

The Korean government has various programs regulating tobacco production, sales and consumption, including the Tobacco Business law, the Health Promotion law, and a Youth Protection law. Recent legislation has expanded smoke-free areas and most buildings are divided into smoking and non-smoking areas. Some buildings have been declared smoke-free areas in their entirety. Health Promotion Funds, levied on tobacco, are utilized for non-smoking education, to finance stop smoking campaigns and no smoking ads. Most recently, warning messages on cigarette package have been expanded to list potentially cancer-causing ingredients.

“Korea ratified FCTC in 2005 and has been participating very actively on its implementation since then,” according to our source. “Korea is known as one of the countries with a strong smoking ban policy. The obligatory and advisory articles in FCTC were already implemented in domestic law before the agreement was signed. Since FCTC ratification, the national assembly as well as executives have been paying attention to anti-smoking policy and proposing various bills related to non-smoking and health.”

Tax structures

The Korean government has announced that it believes that raising taxes on cigarettes will serve to reduce the country’s smoking rate through price control.

An tax increase of KW500 (US$0.45) per pack was introduced in December, 2004, and an additional hike was planned. However, there were protests over the sudden price increase of cigarette, and so far the plan has not yet been executed.

“KT&G is expecting a fair decision on reasonable tax increases that conform to a timely schedule that considers the opinions of other producers and consumer resistance, and KT&G will abide by governmental policy to decide the price of its products,” the spokesperson said.

ExportsThe One cigarettes

Exports are a growing factor in KT&G’s growth, and it has enjoyed notable success with several of its products in various overseas markets. The largest market for KT&G cigarettes currently is the Middle East region, including Iraq, Iran and Afghanistan.

“We have also enjoyed rapid development in the CIS region where Esse cigarettes was accepted very well by female smokers,” we were told. “Esse is our global flagship brand and has enjoyed wide success all across the world. The super slim segment will most likely keep expanding its influence and KT&G plans on developing its Esse brand globally and becoming a household name for super slims.”

Esse is certainly well on the way to achieving this goal as it has already proved itself to be a potent brand.

“Esse is a major success for KT&G and it has targeted a very specific segment of the market, the health-oriented and premium image category,” KT&G told us. “Esse has taken advantage of its position as the first super slim brand in the market in various regions. Esse has enjoyed high performance and has become well-accepted by female smokers, particularly in the CIS and Russia.”

Esse’s success owes perhaps as much to the ground work done assessing the potential market and preparing the product to meet the relevant criteria as anything else.

“Prior to launching products, a consumer survey is always done in order to measure the suitability of the product in a specific market,” the company said. “A brand is developed and tailored for certain markets; it could be adjusted in terms of blending and packaging for different regions.”

Future markets

KT&G is looking forward to introducing its brands to new consumers elsewhere in the world, building on the success of its efforts in existing markets. According to the company, new market development will be focused on Europe and South America.

“KT&G will have its third overseas manufacturing facility soon as its factory in Russia is finished in 2010,” the company said. “Operating a factory in Turkey has made it easier for us to reach out to smokers in Europe where KT&G hasn’t made a breakthrough – yet.”

To ensure the maximum potential for success, it is critical that the right distributor is selected, a process that KT&G takes great care to assess candidates based on its own experience in the domestic market.

“It is critical for KT&G to keep good relations with distributors since they manage and are in charge of our overseas distribution in different regions,” KT&G said. “We have worked closely with several distributors ever since we started global operations. Without a direct sales force in overseas markets, we wish to continue working closely with distributors to reach out to global consumers. It is important that KT&G and its distributors should be able to exchange information about market and to discuss the issues concerning marketing activities in specific regions. However, most important qualification, and an overriding condition in the selection and appointment of any overseas KT&G distributor, is credibility.”

Stars talk about the smoking sex life all the time

This month’s Vogue carries an interview with the A-list actress and Coldplay wife Gwyneth Paltrow. She has a film to promote, a smoking starscookbook, a website, an exercise “empire”, a toned body, but most of all, Gwynnie is advertising her full and active sex life. Or rather, in time-honoured tradition, a series of well-placed friends are jostling to do it for her. “I’m sure 90% of her relationship with her husband is physical,” whispers one. “She loves food and wine and sex,” says another. And at a sleepover party to launch a hotel, Gwyneth and Chris are witnessed joking about “all the rampant naughtiness” in store. Got that? Gwyneth and Chris are having lots and lots and lots of sex. Everyone knows she loves it. Because — as we are quickly discovering — Oscars, beauty, wealth and a happy family are all very well, but if you want to be a serious contender you must have proof of a smoking sex life. Especially if you are married.

The truth is, in most houses, marriage plus kids equals an ever-so-slight reduction in a couple’s enthusiasm for sex. But celebrities can’t afford to admit to doing what everyone else does — plan a sex night, then drink too much and accidentally fall asleep in front of Outnumbered (the episode in which they plan to have sex, open a bottle, then decide they don’t have the energy). Celebs need to be seen to be hotter, more sensual and throbbing with desire than mere mortals. They are competing with kids, such as the luscious Amanda Seyfried, who aren’t yet hitched, and divorcees like Madonna with twentysomething lovers, so what are they going to do? Bar making their own sex tape and putting it on YouTube, their only option is to talk about how much they like it, whenever the opportunity arises.

This is why the Beckhams are letting it be known that Victoria demands her five a day, and we’re not talking superfoods. It’s why Sandra Bullock mentioned her love of food and sex in her Critics’ Choice acceptance speech, and at the Screen Actors’ Guild awards she referred to her “really hot” husband, adding: “I want you so much.” (Note: “Thank you for your love and support” is no longer sufficient. “You are great in the sack” is more the order of the day.) It’s why Nicole Kidman talked about exploring “strange sexual fetish stuff” last year, having never felt the need to mention it before, and why Madonna bragged about married sex with Guy in the song Incredible. Marital-nooky boasting is not new, but now that the competition is stiffer, so to speak, it has become a compulsory part of the deal, like getting your teeth done. And if you’re approaching 40, as Gwyneth is, it’s probably written into your contract.

Obviously, nooky boasting does not necessarily equal nooky having. It is well known that men who bang on about their sex lives are invariably covering up some inadequacy, and married women who feel the need to tell everyone what terrific sex they’re having are even more suspect. Besides, you can tell if people are having a lot of sex just by looking at them. They glow, they flirt, they laugh a lot, they look sort of loose — the opposite of uptight. Gwyneth doesn’t need to talk up her sex life, she already has the moves. VB, nice try.

Philip Morris Funds Tobacco Tax Ad Campaign

VERONA, N.Y. – Philip Morris has launched an advertising campaign asking New York to collect cigarette taxes from Native American stores, Indian Country Today reports. The tobacco company took out full-page ads in newspapers in Albany, Buffalo, Syracuse and other north central New York cities during the first part of April.

The ads, which state “Albany Lets Billions Slip through Its Fingers. Tax Dollars We Need for Vital Services Go Uncollected,” are designed to pressure the state to start collecting cigarette taxes from Indian reservation tobacco sales. “The state loses revenue. Retailers lose sales. Their employees could even lose jobs. And it adds to the burden on hardworking taxpayers,” the ad reads.

However, Native American officials and business leaders believe the ads are part of an effort to make the tribes collect state taxes. “There is nothing altruistic about Philip Morris,” said James Ransom, one of the chiefs of the St. Regis Mohawk Tribe. “Their primary mission is to sell cigarettes and eliminate the competition. They will do whatever they have to do to do that and they know that tribes are the competition. They have little respect for the sovereignty of tribes because we represent a threat to their bottom line.”

The ads and Web site are part of a long-running battle with Indian nations over cigarette taxes. New York state claims millions of dollars has been lost because tribes do not collect cigarette taxes, while the nations dispute that they should even collect such taxes.