Posts tagged: cigarettes industry

Production of cuban cigars leaf down

HAVANA, – Global economic woes and the worldwide spread of smoking bans are taking their toll on Cuba’s famous cigar industry, with the just-completed harvest of the country’s finest tobacco down 14 percent over 2009, local media said on Monday.

In westernmost Pinar del Rio, home of Cuba’s most famous tobacco, the harvest came in at 22.4 million leaves, down from 26 million in 2009, according to Guerrillero, the province’s Communist party weekly.

The area’s tobacco is used as wrapper leaf and part of the filling in Cuba’s prized cigar brands, including Cohiba, Montecristo, Trinidad and Partagas.

“There was a reduction in planting due to limitations in resources caused by the economic crisis,” the weekly said.

Cuba’s premium cigars dominate the world market with 70 percent of sales.

That jealously guarded market share excludes the United States, where Cuba’s cigars are banned under the 48-year-old U.S. trade embargo against the communist-led island.

But the industry has fallen on hard times in recent years, with production of cigars for export down from 217 million in 2006, to 123 million in 2007 and just 73 million last year as the business drew on its stored inventory, the government reported this month.

Cash-strapped Cuba cut the amount of land devoted to growing its famous tobacco by more than 30 percent last year.

Sales from cigar exports fell to $218 million in 2009, down from $243 million in 2008.

In contrast, domestic demand for lower-quality cigars, which cost as little as a few cents and are made from tobacco grown elsewhere in the country, showed no sign of slowing.

About 300 million were produced last year, compared with 278 million in 2008, the government said.

The exclusive distributor of Cuban cigars, Habanos S.A., a joint venture between Cuba and British tobacco giant Imperial Tobacco Group Plc, was not immediately available for comment.

Some 200,000 private farmers and family members depend on growing and curing the precious leaf under contract with the government. Tens of thousands of workers earn their living hand rolling the crop into the famous “Habanos” or “Puros” for export.

Smoking is good… for China’s infrastructure

The newest recyclable material in China? Cigarette butts.

The Shanghai government might want to question the newly proposed smoking ban, as Chinese scientists announce that they’ve found a new use for the countless cigarette butts that litter local streets every day, leaching into the local environment: use them to protect steel piping, a key part of the Middle Kingdom’s ever-increasing infrastructure.

The recently released Chinese study, reported in the China Post, shows that remnants of used cigarettes butts, one of the world’s most common kinds of trash, “soaked in water can help guard against corrosion in a type of steel commonly used in the oil industry.”

“When people walk on the streets, they usually see cigarette butts scattered everywhere, on the ground or the grass,” says Jun Zhao, a PhD student at the Xi’an Jiaotong University who worked on the study, by telephone to the site. “I felt it was quite significant to do a project related to environmental protection.”

In a country with 30 percent of the world’s smokers as well as world’s largest tobacco grower and cigarette producer, this is very, very, good news.

The study, published in “Industrial & Engineering Chemistry Research,” explains the finding: “The scientists showed that extracts of cigarette butts in water, applied to a type of steel (N80) widely used in the oil industry, protected the steel from rusting even under the harsh conditions, preventing costly damage and interruptions in oil production. They identified nine chemicals in the extracts, including nicotine, which appear to be responsible for this anti-corrosion effect.”

We’re sure smokers around China are now puffing away a bit easier knowing their doing their part to help Chinese growth.

RJR raises cigarette prices, followed by Philip Morris and Lorillard

R.J. Reynolds Tobacco Co. is again testing the brand loyalty and financial elasticity of smokers.

The company said yesterday that it will raise the list price of its cigarette brands for wholesale customers between 8 and 33 cents a pack, effective Wednesday.

The smaller increase affects mostly Reynolds’ top brands, including its flagships Camel and Pall Mall, along with support brands Doral, GPC, Kool, Misty, Salem and Winston.

The larger increase affects mostly Reynolds’ nonsupport brands, such as Capri, Carlton, Eclipse, Lucky Strike, More, Now and Vantage.

David Howard, a spokesman for Reynolds, said that the company doesn’t comment on its pricing strategy and the price that wholesalers set at retail. “It’s just a business decision,” he said.

However, the decision came after Philip Morris USA and Lorillard Inc. announced price increases, both of which were effective yesterday.

Philip Morris increased prices by 8 cents a pack. In addition, Philip Morris said it was ending a promotional initiative for its Basic brand that would raise its price another 21 cents a pack.

Lorillard raised its prices on Newport and other premium brands by 41/2 cents. Old Gold prices were raised by 8 cents a pack. Lorillard took a similar price increase with Newport in February, which was not matched by Philip Morris and Reynolds.

It is the fourth price increase by Reynolds since September 2007.

In March 2009, Reynolds raised the list price in the range of 41 cents to 78 cents a pack for wholesale customers, including 41 cents to 44 cents for most of its growth and support brands. That was in response to Congress passing the 62-cent increase in the federal excise tax to pay for expansion of the State Children’s Health Insurance Program.

The latest increase comes at a time when local tobacco wholesalers say that demand for discount cigarettes is rising.

“Every time you have an increase like this, some more smokers will switch to cheaper brands,” said Ann Yountz, the owner of TNT Smoke Shop in Lexington. “Many consumers want to smoke the main brands, but they can’t afford them anymore.”

For example, Yountz said that it can cost more than $50 a week to buy a carton of some brand-name cigarettes. “For every 10 cartons of Marlboro or Camel I sell, I’m easily selling 200 of the low-end brands,” Yountz said.

Reynolds is raising the list price about two weeks after reporting its cigarette-shipment volume fell 2.5 percent in the first quarter to 18.2 billion cigarettes. The industry decline was down 2.4 percent, according to Reynolds.

Reynolds said that the majority of its shipment decline came from its decision to “move away from private-label brands.” In recent years, Reynolds’ decision to lower its marketing costs on some former top brands has contributed to a slow decline in sales.

“Some people will smoke their brand no matter the cost as long as it remains available,” said Mark Sowers, the vice president of K&M Wholesale Co. Inc. in Lexington.

Analysts said they will focus in particular on how consumers respond to the Pall Mall price increase. Pall Mall sales have surged recently in large part because Reynolds has offered price discounts at times to position it as a high-quality discount brand.

Pall Mall sales jumped 134.3 percent to 4.4 billion cigarettes in the first quarter, just 300 million shy of Camel’s sales. The brand also expanded its grip on being the No. 4 cigarette brand in the United States at 6.5 percent market share, while Camel is third at 7.1 percent.

“They are really counting on the view that the race to bottom in terms of discounting price and reduced quality has to end soon,” said Stephen Pope, the chief global-market strategist with Cantor Fitzgerald Europe.

“They have determined that they are there now, and with a quality product they can afford to press the price a little higher and not experience any detriment to the bottom line.”

By Richard Craver
journalnow, May 11, 2010

Powerful industry alliance rejects proposed duty free tobacco ban

INTERNATIONAL. A powerful alliance of the European Travel Retail Council (ETRC), Airports Council International (ACI), International Association of Airport Duty-free Stores (IAADFS) and the International Air Transport Association (IATA) has united to reject proposals for a ban on duty free tobacco sales.

Powerful industry

The move comes just days before the latest World Health Organisation (WHO) treaty negotiations in Geneva on INB4, the Protocol which aims to stamp out the illicit trade in tobacco (14–21 March).

The alliance members said they supported a strong Protocol on illicit trade, but rejected “the unwarranted proposal for a global ban on duty free tobacco sales being sought by anti-tobacco activists”.

The partners added: “Duty free is amongst the most secure retail environments in the world and controls in place ensure that products are not diverted into illicit trade. Despite unfounded claims to the contrary by anti-tobacco activists, there is no evidence whatsoever that there is a problem with tobacco products intended for duty free being diverted into illicit trade.

“The reality is that if there are discrepancies between recorded sales and stock levels at airports for example, the duty free retailer is obliged to cover the outstanding taxes due. The same rules apply to airlines, ferries and cruise ships and to land border duty free shops.”

Banning duty free tobacco sales would deprive airports, airlines and the maritime trade of US$3 billion in annual revenue, they added, but would have no impact on the criminal elements that control the illicit trade in tobacco.

“The purpose of this Protocol is to combat illegal trade in tobacco products, not to punish legitimate businesses. There is no supporting logic or evidence to back up the demands for a ban on duty free,” said the organisations in a joint statement.

“Airport, airlines and duty free retailers hope that negotiations in Geneva lead to agreement on a Protocol that addresses illicit trade in a coordinated and effective manner without needlessly targeting legitimate businesses and key sources of revenue for the transport industry.”

Tobacco industry bares its butts to bluff Rudd

Kevin Rudd has foreshadowed an imminent major announcement about prevention. The “P” word has featured in almost every speech on health since Labor took office and the three-volume Preventive Health Task Force report provides a wish list of policies that are causing high anxiety in the junk food, alcohol and tobacco industries. In other words, policies that move beyond “prevention” being a motherhood confection to be liberally sprinkled over political health-speak, and into the realm of making a difference.

A key, cost-free recommendation in the tobacco sub-committee’s report is that Australia should become the first country to require “plain”, unappealing cigarette packs. Packs would all look the same, except for the garish health warnings, being distinguished only by their brand names.

Cigarettes, which kill half of long-term users, would thus look like prescription drug packs (that save lives), which have historically come in plain dull boxes, with brand name, lots of words about dosage and contraindications, and stored out-of-sight in the dispensary. If ever there was a symbol of a government’s serious intent about prevention, a move to stop cigarette packs looking like fashion accessories would take some beating and would quickly spread globally, as has every piece of tobacco control legislation.

The global tobacco industry is packing death over the proposal and local industry leaders will be humiliated if it gets up. Philip Morris has launched a dedicated website attacking the proposal. It is a site of such abject amateurishness as to make anyone wonder about the calibre of today’s crop of tobacco industry issues management staff. Their strategists have concentrated their attack around four arguments, which range from the very silly, to the very, very silly.

First, vox pop videos of retailers (including a bouncy one who breezes “I’m for everybody being healthier”) argue that plain packs will cost the government and retailers money. That can only mean that they fear sales will go down as a result — precisely the whole idea, fellas! As the cover story on the tobacco industry trade magazine Tobacco Journal International put it very nicely in 2008: “Plain packaging can kill your business.”

Next, because all the brands will look the same, it’s argued that this will confuse customers and retailers. Come again? The packs will still have brand names such as Marlboro or Alpine on them, smokers will still be able to ask for their brands, and unless some shopkeepers have IQs lower than it takes to grunt, they will be able to read the brand name on the pack like they do now.

Next, they argue that there’s no evidence from anywhere that plain packs will lower sales. No country has introduced it, so there’s no evidence it works. Aside from me thinking they do protest rather too much about a plan they say will not affect sales, the intellectual force of this argument would kill all innovation. By this argument, no country would have ever introduced health warnings, random breath testing, seat belts, or indeed anything for the first time.

Despite knowing that no company has ever received a cent in compensation for the massive appropriation of the pack for health warnings (Uruguay leads with 80% front and back), the big stick the industry keeps warning governments that they hold behind their backs is the threat of legal action and massive compensation for trademark violation.

This is desperate bluff. International public health groups have marshalled extensive legal expertise to examine such industry claims. In Australia for example, High Court rulings have established that the sort of “acquisition” where the government merely prevented the use of trademarks in packaging, would not constitute an “acquisition” of property as described in s.51(xxxi) of the Constitution as it would not provide any benefit to the government that ordered the “acquisition” other than reduced sales.

Similarly, the industry blusters that plain packaging would violate terms of the World Trade Agreement. But it has made the same forlorn arguments for years that bans on words such as light and mild contravene WTO law even though such bans now operate in dozens of nations, again with no compensation paid.

It also says that the packs would violate international Trade Related Aspects of Intellectual Property Rights (TRIPs) law. Again, this is nonsense as there is nothing in TRIPS that requires WTO Members to permit trademark owner s to use their trademarks. Instead, TRIPs prevents third parties from using others’ trademarks — not at issue here.

Simon Chapman is professor of public health at the University of Sydney

Japan Stocks Fall After U.S. Raises Rate

Japanese stocks fell the most in two weeks after the Federal Reserve raised the rate it charges banks for direct loans for the first time in more than three years, raising concern economic stimulus programs are being phased out.

Mitsui & Co., which counts commodities as its biggest source of profit, slid 3.2 percent as commodity prices declined. Real-estate companies collectively retreated after K.K. daVinci Holdings said its liabilities probably exceeded assets. Japan Tobacco Inc. sank 2 percent on a newspaper report the health ministry will urge all local governments to ban smoking in public places.

The Nikkei 225 Stock Average fell 2.1 percent to close at 10,123.58 in Tokyo. The broader Topix index slid 1.7 percent to 889.08, with all of its 33 industry groups retreating. Both gauges had their biggest drops since Feb. 5.

“The U.S. economy isn’t in such good shape that the central bank had to raise the discount rate,” said Yuuki Sakurai, chief executive officer of Fukoku Capital Management Inc. in Tokyo, which manages the equivalent of $7.5 billion. “If people think the Fed assumes the U.S. economy is resilient enough for a rate hike, they will start to expect stimulus measures to be withdrawn. That will be bad for markets.”

The Nikkei 225 has advanced 0.3 percent for the past five days, a second weekly advance, as a Fed report showed manufacturing in the New York region posted a bigger-than- estimated increase this month. The average daily value of stocks traded in Tokyo fell 24 percent this week as investors awaited the reopening of China’s market after the Lunar New Year holiday.

‘Further Normalization’

Before this week’s holiday, China ordered banks to set aside more deposits as reserves in an attempt to reduce lending and slow economic growth.

The Federal Reserve Board lifted the discount rate charged to banks for direct loans by a quarter point to 0.75 percent, saying the change is intended as a “further normalization” of the Fed’s lending facilities. Futures on the Standard & Poor’s 500 Index slid 1.1 percent. The dollar jumped to 92.09 per yen today from 90.91 at the 3 p.m. close of Tokyo stock trading yesterday.

Stocks across Asia tumbled after YTN television reported North Korea declared a firing zone off its west coast near the maritime border with South Korea.

“Concern about geopolitical risk stoked pessimism,” said Norikazu Kitta, a strategist at Nikko Cordial Securities Inc.

Mitsui, Japan’s No. 2 trading company by market value, fell 3.2 percent to 1,352 yen, while bigger rival Mitsubishi Corp. sank 1.7 percent to 2,212 yen. Crude oil for March delivery dropped 1.4 percent today, while copper slumped 1.6 percent.

Real Estate Shares

Mitsui Fudosan Co., the nation’s biggest property developer, and closest competitor Mitsubishi Estate Co. retreated 4.3 percent. Real-estate companies as a group posted the steepest drop among the Topix’s 33 industry groups.

K.K. daVinci, which manages investments mainly in real estate, said a slump in the property market prompted the company to write down inventory, which probably reduced its assets to less than liabilities. The stock plummeted by its daily limit of 1,000 yen or 19 percent.

“Real-estate companies have to sell their properties as the end of this fiscal year on March 31 is drawing near,” said Fukoku’s Sakurai. “I’m cautious about property stocks.”

Japan Tobacco, the world’s No. 3 listed cigarette maker, slid 2 percent to 322,000 yen. Health Minister Akira Nagatsuma told reporters today that the government will issue a recommendation on passive smoking this month. He didn’t provide details.

By Masaki Kondo, Businessweek
February 19, 2010

China tobacco sector reports higher taxes, profits after tax hike

BEIJING, Jan. 14 — Combined profits and taxes in China’s tobacco industry in 2009 topped 513.11 billion yuan (75 billion U.S. dollars), a rise of 55.9 billion yuan from a year ago, Zhang Xiulian, spokesman with the State Tobacco Monopoly Administration, said Thursday.

Industrial and commercial taxes paid by the industry last year reached 416.3 billion yuan, up 26.2 percent year on year, said Zhang at the annual news conference of the tobacco industry.

The rise of taxes and profits were made possible by a major tobacco tax hike, despite curb of production.

In June, the government raised the tobacco consumption tax by 36 percent to 56 percent, depending on different tobacco classes.

To further curb smoking in line with the law and international treaties China has ratified, the Ministry of Commerce and the State Administration of Taxation (SAT) issued a circular on August. 10, 2009, declaring an end to tax breaks on promotional spending for tobacco firms.

China has also promised to ban all forms of tobacco promotions since January, 2011.

British American Tobacco’s Influence on the European Union

Impact assessment (IA) of all major European Union (EU) policies is now mandatory. The form of IA used has been criticised for favouring corporate interests by overemphasising economic impacts and failing to adequately assess health impacts. Our study sought to assess how, why, and in what ways corporations, and particularly the tobacco industry, influenced the EU’s approach to IA.

Methods and Findings

In order to identify whether industry played a role in promoting this system of IA within the EU, we analysed internal documents from British American Tobacco (BAT) that were disclosed following a series of litigation cases in the United States. We combined this analysis with one of related literature and interviews with key informants. Our analysis demonstrates that from 1995 onwards BAT actively worked with other corporate actors to successfully promote a business-oriented form of IA that favoured large corporations. It appears that BAT favoured this form of IA because it could advance the company’s European interests by establishing ground rules for policymaking that would: (i) provide an economic framework for evaluating all policy decisions, implicitly prioritising costs to businesses; (ii) secure early corporate involvement in policy discussions; (iii) bestow the corporate sector with a long-term advantage over other actors by increasing policymakers’ dependence on information they supplied; and (iv) provide businesses with a persuasive means of challenging potential and existing legislation. The data reveal that an ensuing lobbying campaign, largely driven by BAT, helped secure binding changes to the EU Treaty via the Treaty of Amsterdam that required EU policymakers to minimise legislative burdens on businesses. Efforts subsequently focused on ensuring that these Treaty changes were translated into the application of a business orientated form of IA (cost–benefit analysis [CBA]) within EU policymaking procedures. Both the tobacco and chemical industries have since employed IA in apparent attempts to undermine key aspects of European policies designed to protect public health.

Conclusions

Our findings suggest that BAT and its corporate allies have fundamentally altered the way in which all EU policy is made by making a business-oriented form of IA mandatory. This increases the likelihood that the EU will produce policies that advance the interests of major corporations, including those that produce products damaging to health, rather than in the interests of its citizens. Given that the public health community, focusing on health IA, has largely welcomed the increasing policy interest in IA, this suggests that urgent consideration is required of the ways in which IA can be employed to undermine, as well as support, effective public health policies.

Cellular Industry Gives Big Tobacco a Run for Its Money

Concerns arose not long after it hit the market. External studies seemed to confirm what industry insiders feared: The product could pose a public health risk. But as sales soared, whistleblowers who didn’t leave their jobs were forced to keep quiet. Companies maintained a posture of denial as a mountain of damning evidence, some of it from their own investigations, kept growing. Bowing to pressure, some consented to warning labels and other notices, but still insisted that claims of product-related injuries and deaths remained unproven.

It’s a familiar story. And in the latest installment of its “Driven to Distraction” series, the Times lays out in detail how, in this case, it was the mobile phone industry that continued to market its product for use in a manner long believed to be hazardous to its customers and the population at large. The result: As far back as seven years ago, the Times reports, “drivers using cellphones were causing 2,600 fatal crashes a year in the United States and 570,000 accidents that resulted in a range of injuries, from minor to serious.” Now a lawsuit, among the first of its kind, has been filed against Samsung and Sprint Nextel by a woman whose mother was killed by a distracted driver in Oklahoma City in 2008.

Of course a key issue is the line between provider and motorist responsibility. The driver in this case, who pleaded to misdemeanor negligent homicide, does not blame the cellular industry. “It’s our choice if we’re going to talk on the cellphone while driving or walking down the street or in the office,” he said. “The cellphone companies don’t say you should talk on the phone and drive.”

Actually, they do — and, as the Times reveals, they always have. It’s certainly true that “the mobile device has moved well beyond its origins as a car phone,” to paraphrase industry reps, but cellphone manufacturers and sellers are advertising the benefits of talking while driving to this day, even as they inch toward acknowledgment of the inherent dangers.

The CTIA, the industry’s trade group, supports legislation banning texting while driving. It has also changed its stance on legislation to ban talking on phones while driving – for years, it opposed such laws; now it is neutral.

“This was never something we anticipated,” said Mr. [Steve] Largent, head of the CTIA, adding that distracted driving is a growing threat now that more than 90 percent of Americans have cellphones. “The reality of distracted driving has become more apparent to all of us.”

This supposed revelation comes nearly 50 years and thousands of casualties after Motorola developer Martin Cooper testified of the earliest mobile phones: “There should be a lock on the dial so that you couldn’t dial while driving.”

State could lose tobacco money

MONTGOMERY — Alabama will have to prove it is upholding its end of the national tobacco settlement, but if lawyers cannot do so, the state may lose hundreds of millions of dollars that support vital social services.

With a lawsuit hearing date approaching, officials at the highest levels of Alabama’s government are expressing concern. One concern is whether Alabama responded too late to effectively defend against tobacco allegations the state has been overpaid and who is ultimately responsible for protecting Alabama.

Chief Justice Sue Bell Cobb in October set off a series of letters between her, Gov. Bob Riley, and Attorney General Troy King over who should be protecting Alabama’s interests against tobacco company allegations.

Cobb expressed “grave concerns” Oct. 5 whether Alabama can prove by past performance that it deserves future tobacco payments.

“As a founding member and former chairman of the Children First Foundation, I also have grave concerns in a general sense that Alabama may not have done its due diligence in adhering to the master settlement agreement and thus jeopardize the monies received in the settlement,” Cobb wrote.

She asked Riley and King to “immediately retain counsel” to represent Alabama in arbitration and to create a “dedicated unit” within the appropriate state agency to enforce Alabama’s master tobacco settlement laws.

“This is not a time to point fingers of blame but instead to work cohesively to insure that Alabama does not lose any of its funding from the master settlement agreement,” Cobb wrote.

They responded and only recently was outside counsel hired to begin defending Alabama at a binding arbitration hearing over billions of dollars in tobacco payments. The arbitration hearing involves dozens of tobacco companies and more than 40 states, including Alabama, early next year, possibly in February.

Tobacco companies allege nonenforcement of state laws protecting them from illegal competition that hurts their ability to make annual settlement payments, according to Securities and Exchange Commission filings.

At the arbitration hearing, tobacco companies that signed the 1998, $206 billion national lawsuit settlement agreement will say that some or all states may not deserve more tobacco money.

At stake is at least $1.1 billion to dozens of states and at least $95 million in tobacco payments made to Alabama in 2003. There’s the potential Alabama could lose up to $400 million in future payments if lax enforcement is determined for 2004-2008.

“These potential 2004-2008 (tobacco payment) adjustments total an additional $4.1 billion” nationwide, said Peter Levin, chief tobacco counsel for the National Association of Attorneys General, in a Nov. 30 notice to state AGs.

If Alabama cannot defend its tobacco enforcement, about one-third of the budget of Children’s Trust Fund including half the agency’s salaries would be jeopardized, director Kelley Parris-Barnes said.

“The loss would be devastating to children’s services and health care and everything surrounding children’s services,” Barnes said last week. “We let about 170 grants to communities on the local level to prevent child abuse and neglect.”

After Cobb’s alarm, King and Riley swapped letters about whose responsibility it is defend Alabama’s tobacco interests.

King wrote Riley Oct. 15 saying his chief deputy has made “repeated requests over the last many months” about resources to pay for Alabama’s arbitration hearing defense.

“Without any additional appropriation, the Alabama Department of Revenue has been enforcing the MSA since 1998,” King wrote Riley. “In 2008, I added additional counsel to assist revenue in the preparation for the 2010 arbitration proceedings and in reviewing diligent enforcement issues.”

King said Riley hasn’t identified or dedicated new resources.

The state of Kentucky has several assistant attorneys general assigned to the due diligence arbitration issue but no special budget appropriation, said Kentucky AG spokeswoman Shelley Johnson.

Riley responded Oct. 20 saying it was King’s predecessor, Bill Pryor, who signed off on the litigation but “diligent enforcement” of tobacco laws is King’s responsibility.

“Please develop a plan of action that we can immediately begin discussing and hopefully that we can quickly agree upon and that we can quickly implement,” Riley wrote.

King responded two days later saying it was Riley’s predecessor, Don Siegelman, who started the lawsuit, and added that the revenue department is responsible for proving Alabama has been upholding the tobacco lawsuit settlement agreement, according to several laws passed since 1999 and according to then-Gov. Don Siegelman and then-Attorney General Pryor in 2000.

King released a letter dated April 4, 2000, signed by Siegelman and Pryor that “our state department of revenue is the agency responsible for enforcement of this act.”

“In fact, that department has never informed this office of any contrary position and has performed those duties for eleven years,” AG King wrote Riley on Oct. 22, 2009.

Riley’s office last week was asked for relevant documents in its possession about arbitration but as of Friday it had not complied with the Open Records law request. King supplied requested correspondence involving Cobb, Riley and himself.

Riley’s revenue commissioner, Tim Russell, last week assured The Gadsden Times his office has properly upheld Alabama’s tobacco settlement statutes but he contended it’s King’s office that is responsible for defending the state in upcoming arbitration.

“We have been” upholding the agreement, Russell said. “We’re the official escrow agent but the litigation part is overseen by the AG.”

Despite concern beginning in October, Montgomery attorney David Boyd was hired only “recently” to defend Alabama, Russell’s office said.

King spokesman Chris Bence said King’s office has no compliance budget since the revenue department is “tasked with that responsibility.” Bence said Boyd is being paid $195 an hour by the revenue department.

Revenue department attorney Wade Hope said the department doesn’t have a special appropriation to cover compliance costs but it has “a whole group of auditors in the tobacco tax section” making sure reports are filed and sales are monitored.

Hope said he works with other department tax, audit, and enforcement employees to uphold tobacco settlement laws and police tobacco companies that are required to pay into an escrow account to offset settlement losses.

“We think we’ll be able to do credible job,” Hope said. “We think we’ve enforced the statutes. In Alabama we’re pretty diligent in making sure we collect excise tax (on tobacco) sold in the state.”

Alabama and other states get tobacco settlement money because of lawsuits over the hazards and costs associated with smoking. Tobacco companies agreed to pay $206 billion over 25 years and they would get the money largely from higher prices.

States agreed to protect participating companies against market intrusion. Any tobacco company not part of the settlement has to pay to offset payment losses caused by declining sales by tobacco companies in the settlement.

Tobacco companies pay nearly $1 billion a year and are arguing that more than 40 states have not protected them against illegal competition that cuts their ability pay the states.

Tobacco companies will argue at a binding arbitration hearing probably in February that if states aren’t policing illegal competition, tobacco companies are paying more than they should be and deserve a reduction in or elimination of future payments.

Alabama got between $94 million and $131 million a year in tobacco funds since 2000, including $116.6 million last year.

The Fiscal 2010 tobacco appropriation of $106.1 million is broken down as $43 million to 11 state social service agencies, $50 million to five other agencies including $33 million to Medicaid, and $12.6 million to the General Fund.

With the Legislature coming into session in January to write fiscal 2010-2011 budgets, any loss of tobacco revenue would be a significant blow to social agencies and the overall general government budget.

In an agreement between participating states and the tobacco companies, 20 percent of state payments won’t be subject to arbitration so the potential loss to Alabama is anywhere from zero percent to 80 percent of the $119 million it got in 2003, or $95.4 million. Any deficit would be deducted from future payments.

All 50 states sued tobacco companies but four filed separate suits and 46 others stuck with the national lawsuit. Of the 46, all but one will be theoretically liable for payment reductions in the arbitration hearings. That one state is in state court.

“Alabama may show it diligently enforced the statutes and are due this portion of the money,” R.J. Reynolds spokesman David Howard said. “States found to not be diligently enforcing are responsible for the adjusted (loss) amount.”

Children’s First’s Barnes hopes Alabama’s money doesn’t go up in smoke.

“I am not an expert and cannot speak for those, but I feel it will be aggressively defended on behalf of the state of Alabama but surely there is that potential we could lose that funding,” she said.

By Dana Beyerle
Times Montgomery Bureau

Thais battle ties to tobacco industry

Nakhonratchasima, Thailand — Thailand is currently doing battle with one of the world’s most dangerous killers – the tobacco industry. This includes those involved in the manufacture, marketing and consumption of tobacco products.

This is the industry that was powerful enough to get Hollywood to change the villain in a famous novelist’s script. In 1996 John Grisham published “The Runaway Jury,” the story of a court case in which the surviving spouse of a smoker who died from cancer sues a tobacco company for wrongful death.

In 2003 the story was turned into a successful Hollywood production, “Runaway Jury.” But in the conversion, the story is changed to a wrongful death suit against a gun manufacturer, arising out of an incident where a shooter takes a semiautomatic handgun into his brokerage office and kills with it. While the substance of the book is retained in the movie, it is altered to avoid negative impact on powerful political and commercial interests – the tobacco industry.

A “smoking gun” used to mean some kind of lurking, underlying proof behind an evil deed. Oddly, now it has come to show how much influence the tobacco industry has over government, mainstream media, the entertainment industry and individual economies, when a simple novel about the evils of smoking is turned into one about gun control.

If the tobacco industry is powerful enough to impose its will on Hollywood, it certainly won’t have much trouble in Thailand. It is trying to do just that through a gathering of industry players, including its “thought leaders,” at a three-day forum in Bangkok called Tabinfo Asia 2009, which runs from Nov. 11-13. It boasts the biggest tobacco exhibition in Asia and business and networking opportunities for regional players.

Despite the industry’s influence, however, a coalition of protesters gathered to confront it at the Impact Exhibition and Conference Center where the forum is being held. One of the protest leaders, Prakit Vathesatogkit, executive secretary of Action on Smoking and Health Foundation (ASH Thailand), said at Wednesday’s protest, “Tabinfo Asia 2009 is a signal for the international community to understand that the tobacco industry will not stop brainstorming new strategies to lure new smokers, particularly youths and women.”

Almost as if to underscore Prakit’s words, Tabinfo posted four main issues to be discussed by the tobacco industry’s “thought-leaders” in a global environment of changing regulations and negative public perceptions. The last of the four – which should have appeared first, if only for diplomatic purposes – was “harm and risk reduction.”

Harm and risk are messages that are not getting through to the Thai smokers of all ages who are running about the country on motorcycles, holding the handlebar with one hand and smoking with the other; or to the young students and bar patrons and academics with a lot on their minds who are smoking their way to death.

Another Hollywood script, “The Insider” – a Russell Crowe-Al Pacino movie about an insider who spills the beans on a tobacco company’s conniving to hide data on physical harm and addiction associated with tobacco products – was more successful in imparting a message about the dangers of smoking. After the movie came out Brown and Williamson, the company depicted in the film, accused the Walt Disney Company of “distorting the truth.” Brown and Williamson also sent representatives to over half a dozen cities where the movie was screened, handing out cards to moviegoers to provide “clarification.”

This movie is considered to have had a meaningful impact in helping turn the tide of public opinion against smoking. The tobacco industry does not want this scenario to recur in Asia, so that regulations and social attitudes make marketing tobacco a no-win situation. That is why Tabinfo is being held in Bangkok, to bring together “a very diverse representation of industry players, up and down the supply chain.”

Time will tell whether there is enough political clout in Thailand, and throughout Asia, to fight back against immense political and commercial pressures in order to achieve what has been achieved in the West – severe restrictions on smoking and second-hand smoke.

The fact that the state’s Thailand Tobacco Monopoly is heading up the three-day conference/exhibition/game plan meeting is not a good sign. Local influence and vested commercial interests with Thai tobacco are rife. As far back as 1950, the Thai government’s Excise Department bought 256 acres of land from the Crown Property bureau to increase tobacco production for domestic and export use. Four years later responsibility for the industry was transferred to the Ministry of Finance.

Given such grassroots beginnings and ties, it’s an uphill battle for anti-smoking advocates battling against tobacco interests. The global tobacco industry is going full bore to keep its feet planted on the ground and keep sales at all-time highs.

This is of immense concern to world players such as the World Health Organization, which warned of a “global tobacco epidemic” in 2008. The WHO also reported that by the year 2100, up to 1 billion people may die through “continuous consumption of tobacco.” That is fifteen times the entire population of present-day Thailand.


By Frank G. Anderson

Reynolds in Talks for Sweden’s Niconovum

NEW YORK – Reynolds American(RAI Quote), the second-largest U.S. cigarette maker, is in advanced talks to buy Niconovum, a Swedish maker of smoking-cessation products for 30 million euros ($44.5 million), a report says.

The Wall Street Journal report cites David Sweanor, a Canadian law professor and tobacco expert, who was briefed by people close to the development. Sweanor said he has no stake in the potential deal between the two companies.

Niconovum, based in Helsingborg, was formed in 2000 and makes nicotine-replacement therapies such as Zonnic pouch and Zonnic gum, and currently doesn’t sell its products in the U.S.

Tobacco sales in the U.S. have been on a decline for years and this development would mark the latest and most dramatic move by Reynolds into nicotine products that represent an alternative to cigarettes, the Journal notes. Reynolds and other tobacco companies, including bigger rival Altria(MO Quote), have owned pharmaceutical businesses, but none yet market or sell an approved smoking-cessation product, according to the newspaper. Reynolds has been marketing smokeless tobacco products.

If Reynolds was to acquire Niconovum it’s unclear whether and how soon its products might hit the U.S. market, as they would be subject to approval from the Food and Drug Administration.



Thestreet

Retailer tells small shops to ignore tobacco industry ‘scare tactics’

Responding to the vote to end the display of tobacco in shops and the Government’s draft regulations published yesterday, a prominent independent retailer accused the tobacco industry of misleading retailers, the public and politicians about the real impact of display bans.

Tobacco manufacturers have placed ads in the retail trade press warning shopkeepers that their businesses could close as a result of the proposed law.

But former North of England President of the National Federation of Retail Newsagents, John McClery, has described information circulated by the tobacco industry about Government proposals to end the display of tobacco as “scare tactics”.

McClery visited Ireland at the invitation of the Smokefree Action Coalition to find out how the Irish have implemented their display ban, which came into effect on 1 July this year.

Although he had long believed that a display ban would have little impact on legitimate adult tobacco sales he was surprised by the level of enthusiasm for the ban expressed by retailers.

McClery said: “I was amazed at how enthusiastic retailers were. Complying with the legislation had not been expensive and sales to adults hadn’t been affected.

“In the shops I went into, retailers were using the premium display space freed up from cigarettes for products that bring in a better profit.

“One Dublin retailer told me ‘Tobacco doesn’t need advertising. We should have done it years ago.’ ”

McClery walked through Dublin entering shops at random asking to speak to managers about how the new law was fitting in. Many retailers were promoting their own goods where once they had been obliged to promote cigarettes.

The owner of four outlets in the Supervalu franchise said: “If anything it has been good for business. There was a slight downward blip when the new law came in but that was compensated by a slight upward blip in fresh fruit sales. That suits me because we have better margins on fruit and veg. We’re not interested in selling to teenagers. We take that very seriously here.”

The manager of a nearby Spar added: “At the budget end of the market tobacco companies used to have price wars to capture each other’s customers.

“It was retailers who would get caught in the middle and our margins would suffer.

“Now those aggressive price promotions look a thing of the past.”

Independent retailer Mahesh Patel from West London also believes that the display ban is not something which retailers should fear but that it will provide opportunities for them to increase profits.

In a letter to Retail Express he wrote: “Less emphasis on tobacco sales in the future will allow independent retailers to expand what they stock and concentrate on items that will provide higher profit margins.

“At the moment margins on cigarettes are low, so the ban will give small retailers the opportunity to boost profits.”

Martin Dockrell, Director of Policy and Research at the health charity Action on Smoking and Health, has visited Ireland three times this summer to meet with small retailers.

“Before the new law came in on 1 July, retailers were ready but apprehensive. Then they were relieved as they saw their customers came in just as they always did and tourists would ask just as they always did. Now it is striking how optimistic Irish retailers are. They get to sell more of the things people really need and they are doing very well from it.”

October 13, 2009 Christiantoday

Smoking ban would hurt bowling alleys

UNIVERSITY CITY — The smoking ban on the Nov. 3 ballot in St. Louis County would severely hurt bowling alleys there if passed, a proprietors’ group said Wednesday.

Representatives of the 23-member Greater St. Louis Bowling Proprietors Association were at a news conference Wednesday in the Delmar Loop to announce their opposition to Proposition N.

Carolyn Haupt, who owns Hazelwood Bowl, said her business had been off since the Ford plant in Hazelwood closed in March 2006.

“If the St. Louis County smoking ban passes, that will be the nail in our coffin,” Haupt said.

Also voicing opposition to the ban were a coalition of owners of bars, restaurants, tobacco shops and others making up Citizens Against Proposition N.

Scott Simon, a spokesman for the bowling association, and its president, Tom Shucart, said they planned a media campaign to oppose the ban.

Haupt said about half the bowlers at her alley smoke.

“Nobody is trying to condone smoking, but the ban doesn’t give us an even playing field,” Haupt said.

The ban would prohibit smoking in indoor public areas countywide except on casino floors, in smoking lounges at Lambert-St. Louis International Airport and in bars whose income from food is 25 percent or less of gross income. On the other side, supporters of Proposition N have formed their own committee, County Citizens for Cleaner Air. Advocates of a ban say also that the St. Louis area and Missouri lag far behind most of the rest of the country in adopting bans. Only Clayton, Ballwin and Arnold have adopted bans and a ban is on the ballot in Kirkwood in November. Other Missouri cities with bans include Kansas City, Columbia and Springfield. Illinois has a statewide ban.

At the news conference, Jon Rand, president of Discount Smoke Shops and a ban opponent, said that as long as neighboring jurisdictions do not have smoking bans, St. Louis County businesses could be hurt by a ban.

“Why would you want to drive business from one county to another — put jobs in jeopardy — during a time like this?” Rand said.

The Rev. Harold Hendrick of the Bott Radio Network said St. Louis County government was “coddling casinos” by exempting casino floors.

“Once again, government has caved in to predatory casinos,” he said.



BY MARGARET GILLERMAN

Mexico Law for the Protection of the Health of Non-Smokers

When Mexico DF’s Law for the Protection of the Health of Non-Smokers came into effect in April 2008, the city joined others around the world that have enacted comprehensive laws requiring public spaces and workplaces to be smoke-free. The law effectively protects workers, clients and customers from exposure to second-hand smoke. Mexico DF’s smoke-free law has few exemptions – its rejection of smoking rooms sets it apart from the national law. The law has proved popular with the city’s residents and the level of compliance has surpassed the expectations of proponents, the general public and hospitality sector businesses. Moreover, initial indications suggest that the law has not damaged the economic performance of the hospitality sector in the city.

Success Factors

Political champions. The active role taken by key politicians and senior civil servants – both Members of the DF Legislative Assembly and from the DF Ministry of Health – in steering the law through the legislative process and engaging with a high-profile media debate was vital in achieving a comprehensive smoke-free law.

Strong, knowledgeable, and coordinated NGOs support. The presence of informed, influential and dedicated tobacco control advocates able to support the political process, lead campaigns and to be flexible and responsive to a rapidly changing policy environment was also an essential ingredient of success. Their willingness to work together combined with knowledge of the rationale for smoke-free laws and of good practice from elsewhere, as well as their links to key decision-makers, significantly boosted the prospects of a successful outcome.

Coordinated and well-funded communications efforts. The DF experience reinforced experience from elsewhere in the world of the value of having coherent campaigns to inform and reassure workplaces about the reasons for the law, what the law means for them, and how it will work in practice. At the same time, it highlighted the benefits of using promotional campaigns and the media to raise awareness of the dangers of exposure to second-hand smoke, counter opponents’ arguments and mobilize support for comprehensive smoke-free legislation. Ensuring consistency in the primary messages, emphasizing the health rationale and explaining that the law was not antismoker were key.

Adequate funding and technical support. Funding was available to NGOs and government to ensure paid staff working full-time on the campaign, and sufficient budgets to run media campaigns and other supportive activities. The funding was complemented by high-level technical support from international experts when needed, which supported in-country activists to move more quickly and effectively.

Clear, comprehensive law. Successful implementation and perceived high levels of compliance were greatly aided by having a law that prohibits smoking in all enclosed workplaces and public spaces, with very few exemptions. Mexico DF’s law confirms experience elsewhere that such laws are clearer, simpler to draft, fairer and easier to enforce. The DF law also meets the criteria favoured by most of the hospitality sector for smoke-free laws that cover all premises.

Readiness to respond to industry arguments, and research to support arguments. Many of the issues and 20 arguments raised during the debates about the law were similar to those that arise in almost every place when smokefree legislation is considered. The ability of smoke free advocates to tap into tried and tested arguments – particularly where they were backed up by local or, at least, national research – was a major advantage.

Other Lessons Learned

Other lessons and insights from the DF experience include the importance of:

- leading by example – ensuring that the DF Government and other public sector buildings were effectively smoke-free avoided the risk of undermining the law from the outset;

- enhancing the credibility of smoke-free legislation by putting in place a strategy to ensure compliance with the law and a willingness to enforce it where necessary;

- having the regulations rapidly in place after the passing of the law;  the relative rapidity of the process, which made it difficult for the tobacco industry or other opponents to react or coordinate their response effectively;

- the potential for tobacco control advocates to use the perceived success of the DF smoke-free legislation to influence the wider smoke-free agenda at federal level and within other states.

With hindsight, there are also some places in which proponents of the law felt the smoke-free agenda in Mexico DF could have been stronger. In particular, it was argued that:

- despite the advantages of a rapid legal process, the 30 days given to businesses to comply with the law made it challenging for some businesses to prepare – particularly for restaurants and other hospitality sector businesses that wished to adapt external spaces to cater for smoking customers;

- availability of more robust evidence of smoking prevalence for DF could have been beneficial. The lack of a largescale smoking prevalence survey at city level will make it more challenging to measure the impact of the law on smoking prevalence rates.

Next Steps

It is important to ensure that the success and popularity of Mexico DF’s smoke-free law is maintained. Continued attention may be needed to ensure robust enforcement in future and to counter claims that the law has damaged the hospitality sector – particularly during the current economic downturn.

While challenges remain, the smokefree law is a major public health achievement for Mexico DF and will generate significant health benefits for citizens in the years ahead. The Mexico DF smoke-free experience is an example for others to learn from and to follow. The progress made with relatively modest resources, and in a short period of time, demonstrates the potential for other large cities in Latin America and elsewhere to adopt similar laws.


Electronic cigarettes make their way to the U.S.

UTICA, New York – A strong majority of Americans want to see electronic cigarettes regulated by the U.S. Food and Drug Administration (59%), but nearly half (47%) say the smokeless devices should be an option available to people trying to quit smoking, similar to patches, gum and lozenges currently on the market, and that number increases to 57% among those who have heard about ecigarettes prior to taking the poll.

The Zogby Interactive poll of 4,611adults was conducted August 28-31 and carries a margin of error of +/- 1.5 percentage points. Margins of error are higher in sub groups.

In the hunt for a safer cigarette, electronic cigarettes, often referred to as ecigarettes, are becoming a popular option among those either trying to quit or who are looking to replace standard tobacco smokes with an alternative that manufacturers claim to be safer. Ecigarettes vaporize a solution often containing nicotine, but there is no smoke, just odorless water vapor, and produce almost no dangerous carcinogens.

Almost half of all respondents (48%) say they have heard of electronic cigarettes. About a third of those polled (35%) say that because electronic cigarettes produce no smoke, they should be allowed in places where smoking is currently prohibited, while about half (46%) say they should not.

Men who have heard of ecigarettes are far more likely than women who have heard about them to say they should be an option available to people trying to quit smoking (65% vs. 49%), and only one percent of those polled say they have used an ecigarette, but 16% overall say they would try one if they were given a chance, and 81% say they would not. First GlobalsTM those age 18-29, are the most likely age group to say they would try an ecigarette if given the chance (25%) compared to just 8% of those 65 and older who say the same. Respondents who are single (23%) are almost twice as likely as those who are married (12%) to say they would try it.

Methodology: Zogby International conducted an online survey of 4,611 adults from 8/28/09 thru 8/31/09. A sampling of Zogby International’s online panel, which is representative of the adult population of the US, was invited to participate. Slight weights were added region, party, age, race, religion, gender, education to more accurately reflect the population. The margin of error is +/- 1.5 percentage points. Margins of error are higher in sub-groups.


Controversy continues about safety and toxic substances in E-cigarettes

Electronic cigarettes have a cartridge filled with liquid nicotine that is heated by a battery, which produces a vapor that is inhaled.
Manufacturers of electronic cigarettes have sued the FDA to permit the sale of their product. The FDA has stopped some shipments because the e-cigarette is considered an unapproved drug delivery device. The concern is about the safety of the device and how the product is being marketed.

e-cogarettes
The manufacturers state that their product is not marketed as a device to quit smoking nor is the product intended to wean smokers off of nicotine. Yet testimonals on websites that sell e-cigarettes, are from individuals telling how e-cigarettes helped them stop smoking.
E-cigarettes are sold as a smoke free alternative to smoking cigarettes. The manufacturers say the product is less harmful than cigarettes but the FDA has found the product contains carcinogins and toxic substances. The main concerns are:

* It is unknown how the body is affected by this nicotine delivery system which is a water vapor that is inhaled.
* A substance used in anti-freeze, diethlyene glycol has been found in some products, which when substituded in toothpaste, has killed hundreds worldwide.
* Nitrosamines, a cancer causing substance in tobacco has been found in some products.
* Many e-cigarettes are manufactured in China where there is little quality control.
* Levels of nicotine vary greatly and some no-nicotine cartridges were found to contain nicotine.
* E-cigarettes come in different flavors which might be appealing to children and may be easy for those under 18 to purchase on line.


Copyright © September 8 2009 Examiner

Kansas General Tobacco Enforcement Obtains $2.6 Million

Topeka, Ks – infoZine – Attorney General Steve Six announced that his Tobacco Enforcement Unit obtained two judgments totaling $2.6 million against companies who failed to pay the required payments in to escrow.

“It is the Attorney General’s responsibility to enforce the Tobacco Master Settlement Agreement and the subsequent statutes governing tobacco sales in Kansas,” Six said. “My office will ensure that Non-Participating Manufacturers live up to the requirements of Kansas law and the Agreement.”

Under Kansas law, Non-Participating Manufacturers are required to make payments into escrow accounts held for the benefit of the State. This money may then be used to satisfy future judgments obtained against a Non-Participating Manufacturer for tobacco-related claims. The Attorney General sued and obtained default judgments against Veneto, S.A. and Tapti Tobacco Products, Pvt., Ltd. after they failed to make the required payments for sales in 2007 and 2008.

In addition to the penalties owed, according to Kansas law the companies are also “prohibited from selling cigarettes to consumers in the State of Kansas, whether directly or through a distributor, retailer, or similar intermediary, for two years.”

Tapti and its “Nova” brand, and Veneto and its “American Hero” brand were removed from the Kansas Directory of Compliant Non-Participating Manufacturers earlier this Spring. Barring certain, specific exceptions, it is illegal to possess cigarettes or roll-your-own tobacco not listed on the Kansas Directory of Compliant Non-Participating Manufacturers or the Kansas Directory of Compliant Participating Manufacturers.

The Tobacco Enforcement Unit provides notice of directory updates via e-mail to Kansas wholesale dealers and distributors who have opted to receive such notices. Wholesale dealers or distributors interested in receiving these notices should contact the Attorney General’s Tobacco Enforcement Unit.


Kansas Attorney General’s Office
Tobacco Enforcement Unit
tobacco@ksag.org
(785) 368-6289

Smokers cost Swedish councils billions

Smokers are costing Swedish municipalities 2.6 billion kronor ($367 million) per annum in the form of breaks and sickness absences, a new report from the Swedish Public Health Institute (Statens Folkhälsoinstitut) shows.

The amount is equivalent to 6,000 full time positions.

“We know that three out of four smokers want to quit and most municipalities that introduce bans during working hours also offer help. In that way the workplace supports those wanting to stop. We can now see that a smoke-free work environment provides financial benefits to councils,” Cecilia Birgersson at the institute said in a press release on Tuesday.

A smoke-free workplace means in practice that smoking is banned during paid working hours, including breaks. Lunch hour is not considered to be part of regular working hours.

The Swedish Association of Local Authorities and Regions (SKL), along with union groups, supports the introduction of smoking bans. A survey conducted by SKL earlier in 2009 showed that 64 of Sweden’s 290 local municipalities had decided to introduce work time smoking bans.

The institute has calculated the cost of smoking in terms of “smoking hours” at an average 282 kronor, based on a national average hourly wage.

The total cost is a multiple of the time taken to smoke a cigarette by the number of cigarettes per day (for the normal smoker) and the time to go to and from a designated smoking area – a total of 30 minutes per day per smoker. The cost per smoker is thus 31,300 kronor per annum.

Smokers typically claim an additional eight sick days in comparison with a non-smoker and this costs an additional 13,700 kronor per annum per smoker, bringing the total cost per smoker to 45,000 kronor, according to the institute’s calculations.


Copyright © Thelocal

China revokes advertising tax break for tobacco firms

Aug. 12, 2009 (China Knowledge) – China has canceled tax breaks for tobacco firms on advertising, sponsorship and promotional spending, according to a notice released by the Ministry of Finance and the State Administration of Taxation on Monday.

Tobacco companies will wind up paying higher taxes and earning smaller profits as a result of the new policy, which is a part of the Chinese government’s effort to curb smoking.

The new regulation is effective as of Jan. 1 2008 and will remain in effect until Dec. 31, 2010.

Beginning in 2011, China will enforce a policy prohibiting all tobacco advertising, promotion and sponsorship, said Xu Guihua, vice president and secretary general of the Chinese Association on Tobacco Control.

Up to now, Chinese firms could claim rebates on advertising costs totaling up to 2% to 8% of their taxable income. Now the maximum rebate is 15% of taxable income, but rebates are not available to the tobacco industry at all.

Cosmetic, medical and non-alcoholic beverage companies can deduct advertising expenditures totaling up to 30% of their total sales revenue.


Copyright © 2009 www.chinaknowledge.com

Learn from tobacco learn from history

As far back as 1979, the director of NORML, told an Emory University audience that they would be using the issue of medicinal marijuana as a “red herring” to give marijuana a good name.

When someone tells you they’re going to scam you, it’s best to pay attention.

On December 30, 1996, General Barry McCaffrey stated at a news conference that the California pro-marijuana physicians were pushing marijuana for twenty-six conditions, including writer’s cramp, corn removal, and other critical problems …

During those California and Arizona campaigns, color TV advertisements fraudulently promoting marijuana as a medicine were permitted, even though scientific evidence still does not support such claims.

Now we know even more, and the legalizers have made even more revealing statements but warnings were not given delineating marijuana’s dangers then and are still “missing in action”. Marijuana damages the heart, brain, lungs, and immune system, and worsens many diseases. It does not prevent blindness due to glaucoma.

Did you notice one area of damage above? The immune system … And they recommend this drug for patients with full-blown AIDS.

One hundred years ago, there was a major drug epidemic in our country because physicians were pushing addictive drugs, … ‘snake-oil medicines’ and such – even heroin cough drops.

As a result federal consumer protection laws were eventually enacted which required that substances be scientifically shown to be safe and effective before being presented to the public as medicine.

As seen, in high-profile cases recently, prescribing addictive drugs can be a very lucrative practice. Physicians then, went to court unsuccessfully to try to continue providing addictive drugs, such as morphine, to addicts.

According to the National Institute on Drug Abuse, marijuana is an addictive drug, emergency room visits because of marijuana use (higher THC content) and hundreds of thousands of Americans have had to enter drug treatment due to marijuana addiction.

This and other harmful effects of marijuana are, of course, denied by physicians connected with NORML.

In fact NORML states in its newsletter that it aims to “educate” the public that marijuana is not a dangerous drug. Furthermore, again just like the tobacco industry, the illegal drug industry targets children.

Marijuana legalization proponents often say that the gateway theory has been disproved, then don’t offer proof.

Virtually all drug addicts start as children, and marijuana is generally the first illegal drug used. “Medicinal” marijuana is the Joe Camel of the marijuana industry (with its’ nose under the tent) as children are falsely taught that marijuana is “a safe medicine”.

We should learn from the history of the tobacco industry’s deception and the history of our previous prescription drug epidemic that addictive drugs constitute a lucrative business which destroys lives.

Just as the people should not be subjected to flashy advertisements falsely promoting tobacco as medicine, they should not be subjected to the fraudulent marijuana campaign which tragically deceived voters and continues to do so.

Circumventing the intent of the Food & Drug Administration, with voter initiatives while billionaires bankroll the plan ought to make the voters suspicious of the motivations … read what these people are saying behind the scene, … and follow the money!


Japan Tobacco 1Q Grp Net Pft Y42.87B Vs Y16.91B Yr Earlier


TOKYO (Dow Jones)–Japan Tobacco Inc. (2914.TO) Thursday reported a sharp rise in net profit for the first quarter ended June, boosted by robust sales domestically and in key international tobacco markets such as Russia, the United Kingdom and Europe.

The world’s third-largest tobacco company by sales volume after Altria Group Inc. and British American Tobacco PLC posted a net profit of Y42.87 billion, more than 1.5 times the Y16.91 billion earned the same period a year earlier.

Its revenue fell 14.9% to Y1.463 trillion from Y1.720 trillion, mainly due to a strong yen eroding earnings from overseas. Operating profit took a 23.7% slide to Y84.2 billion from Y110.45 billion.

For the current business year ending March 2010, Japan Tobacco left unchanged its net profit forecast of Y100 billion, operating income profit of Y244 billion and revenue of Y6.0 trillion in view of solid fundamentals across all areas of business.

The firm compiles its earnings based on Japanese accounting standards.

SF Supervisors Approve Cigarette Cleanup Fee


San Francisco supervisors on Tuesday unanimously approved a proposal by Mayor Gavin Newsom to add a 20-cent per pack fee on cigarettes to help pay for the city’s cleanup of discarded butts.

The vote was included as part of a package of budget-related city fee increases.

The fee will be collected from retailers and will go specifically to city departments that conduct street cleanup of cigarette butts.

According to the mayor’s office, discarded cigarette butts account for a significant portion of the litter that has to be cleaned from sidewalks and gutters, and can leach toxins into the environment.

According to the Department of the Environment, the city expects to make about $6 million each year from the cigarette fee, the bulk of which will go to the Public Works and Recreation and Park departments.

The Board of Supervisors also Tuesday approved an ordinance cosponsored by Newsom and Supervisor Bevan Dufty that would require city departments to pay for the carbon footprints created from airline travel by city officials and department employees.

The Carbon Mitigation Program will require departments to offset that cost of carbon pollution by paying 13 percent of the airline ticket price.

The money is to be used for sustainable projects in the Bay Area that offset greenhouse gas emissions, according to the ordinance.
Copyright © 2009 Cbs5

Abbott slams ‘trivial’ smoking ban

Coalition frontbencher Tony Abbott says New South Wales is playing nanny state politics with its ban on smoking in cars when children are present.

The former federal health minister has told a public health debate at Sydney University that smoking in front of children is a trivial issue and states should not intervene.

The NSW ban comes after similar moves in South Australia and Tasmania, with other states expecting to follow suit.

Anyone caught smoking in their car with a child as a passenger now faces a $250 on-the-spot fine.

Mr Abbott says the ban is over the top.

“I was a child that was regularly imprisoned in a car with heavy smokers,” he said.

“My parents both smoked heavily when I was a kid. Now has it done me any harm?

“You be the judge… maybe I would have been six foot six and I would have had much greater intelligence, who knows?

“But I have got to say, I wouldn’t do it. I would probably hope it didn’t happen.”

‘Trivial’ issue

Mr Abbott says he supports bans on tobacco advertising and selling cigarettes to children. But he says there are things to worry about other than parents who smoke in front of their kids:

“Being hard-hearted to your kids. Not encouraging them to be their best, I think are probably much more serious parental crimes,” he said.

“I personally would not get hung up on something, in my view, as trivial as smoking while the kids are in the car.”

Long time anti-smoking campaigner Professor Mike Daube from Curtin University disagrees.

“We found that a child in a car exposed to two cigarettes was getting 70 times the level of toxic exposures they would be getting that are reckoned to be dangerous by the US EPA,” he said.

“So there are clear implications for the health of children, asthmatic children, children with other respiratory symptoms.”

And he says it is irresponsible to rely on just hoping that people will not smoke in front of their children.

“We also know this is an area where education programs haven’t work,” he said.

“Legislation will work. It is not a matter of policing it to the death. It is not a matter of police being taken away from crime and violence and so on.

“This will be policed opportunistically. It is just protecting the health of kids.”

Mr Abbott says while there are important issues where the state should restrict certain freedoms, he says there should be limits.

And he cites double demerit points for speeding on public holidays as another example of an overbearing nanny state.

“What makes these actions intrinsically more harmful because they happen on a long weekend or at Christmas or at Easter?” he said.

“Again, it strikes me as a revenue grab rather than a genuine safety measure.”


Copyright © 2009 Abc

Fighting big tobacco

In a rare challenge to one of the mainland’s most powerful institutions, a scholar has proposed the scrapping of the State Tobacco Monopoly Administration and allowing private companies to compete on an equal basis in this lucrative sector. Zou Fangbin, an economics professor at the Guangdong University of Business Studies, says the monopoly discriminates against smokers and tobacco farmers, gives excessive wages and benefits to STMA officials, and encourages corruption and smuggling.

Established in January 1984, the STMA is one of the two biggest cigarette producers in the world, with Altria – the parent company of Philip Morris – in terms of sales revenue. . . .

One of the best-known anti-tobacco campaigners in the mainland is Yang Gonghuan, deputy director of the Chinese Centre for Disease Control and Prevention in the Ministry of Health.

“The issue is not the monopoly but the separation of the government from the tobacco producers, as demanded by the World Health Organisation,” she said.

“How can someone supervise an industry in which he has a financial stake?”

She referred to article five, section three of the WHO’s Framework Convention on Tobacco Control, which Beijing has signed: it took effect on January 1. . . .

In its latest report on tobacco, published on May 31, Dr Yang’s centre said the STMA was not implementing regulations set out by WHO convention.

Use tobacco industry data to reach ‘social smokers’

Maria Hynes doesn’t think of herself as a smoker, even though she often lights up with friends. Real smokers are people who can’t make it through a day without their cigarettes, Hynes says.

“I don’t crave nicotine,” explains the 42-year-old nurse from Bridgeton, N.J. “I’ve never been one to have a cigarette while watching TV or reading the paper. When I was pregnant, it was no big deal to quit. So I’ve always checked nonsmoker on medical forms.”

While smoking has been declining for the past decade in the United States, the number of “social smokers” like Hynes is on the rise, according to a new study. Between 1996 and 2001, the rate of nondaily smoking jumped from 16 percent to 24 percent of smokers. And it has continued to climb since then. In California, for example, the percentage of smokers who light up only occasionally went from 26 percent in 1992 to 30 percent in 2005, state health figures show.


And that’s exactly the way cigarette companies planned it, says Dr. Rebecca Shane, a researcher at the Center for Tobacco Control Research and Education at the University of California at San Francisco. She’s a lead author on a new study published in the August issue of the American Journal of Preventive Medicine. The study aims to turn tobacco company research on its head, using industry data to help find ways to help social smokers quit.

In the 1970s and 80s — as the health risks of smoking became increasingly apparent — the tobacco industry spent millions studying social smokers to figure out what made them tick, Shane says.

Social smokers are defined as those who tend not to smoke alone; who restrict their use to social situations, such as parties, bars or nightclubs; and who swear to friends and health care workers that they’re not real smokers after all.

Tobacco firms targeted social smokers
The tobacco makers hired anthropologists and psychologists to help design advertising campaigns that would make cigarettes more alluring to people who weren’t wired to become addicted to nicotine. The idea was to show that cigarettes could be a social lubricant, a necessary addition to any social gathering.

Shane and her co-author turned up the new information while searching through reams of tobacco industry documents that were released as part of a settlement in one of the landmark state suits against big tobacco.

Tobacco companies worked hard to develop an image of smokers as “cool,” Shane says. Brown & Williamson, for example, came up with “Kim,” a brand that appealed to people who were “style conscious” and read magazines like Cosmopolitan and Glamour. RJ Reynolds developed its “Bright” brand for people “who enjoy the ritual of smoking, but who really don’t enjoy the tobacco taste,” the study showed.

The challenge, Shane says, is to counter that alluring image and to find a way to get occasional puffers to acknowledge that they truly are smokers, too. Until experts figure out a way to do that, there won’t be much progress in getting social smokers to quit, says Dr. Antoine Douaihy, an associate professor of psychiatry and medical director of Addiction Medicine Services at the University of Pittsburgh School of Medicine.

“Conventional anti-smoking campaigns will fail to reach them,” Douaihy says. “We’re going to need to be creative and come up with different messages targeted directly to them.”

Because social smokers appear to be susceptible to peer pressure, it may help to emphasize the damage done by second-hand smoke, says Dr. Arthur Brody, a professor at the University of California, Los Angeles, and director of the Smoking Cessation Program at the federal Veterans Affairs West Los Angeles Healthcare Center. Another approach would be to emphasize the fact that even infrequent smoking may damage your health, he adds.

“No amount of smoking is good for you,” Brody says. “And while smoking one or two a day might not be as bad as a pack a day it’s still not good for you.”

‘I do know better.’
There are times when this message gets through to Hynes, who says she can go days and even weeks without picking up a cigarette.

“I do know better,” she says. “I’ve seen what lung cancer can do. And there is some guilt involved, especially after a heavy night of smoking when I wake up coughing up a lung and feel like crap. I wonder, why do I do this when I’m not even addicted? Why do I do this to my body? And then I kind of forget about it till the next time.”

The biggest challenge may be in getting social smokers to admit that they do, in fact, smoke. Shane suggests that doctors might get more truthful answers if their forms simply asked if the patient had a cigarette recently rather than attempting to categorize a person as a smoker or a nonsmoker.

Hynes isn’t particularly hopeful since she and other social smokers don’t see their habit as being dangerous. Besides, she says, they feel like they’re in control because they’re not technically addicted. Theoretically, they could quit at any time.

But even without an addiction to nicotine, the link between cigarettes and a good time can be tough to break. If Hynes gets a good friend on the phone or sits down for a visit, the urge for a cigarette adds to the feeling of closeness, she says.

“I look at myself as a lost cause,” Hynes says. “Somewhere in my brain it’s wired that I need to smoke to relax and enjoy myself. The cherry on top is the cigarette.”
Copyright © 2009 Msnbc

Tobacco Investments: Profits over Health

More than a decade after Harvard University researchers first revealed that life and health insurance companies were major investors in tobacco stocks—prompting calls upon them to divest—the insurance industry has yet to kick the habit, they say. A new article on insurance company holdings, published in the New England Journal of Medicine, shows that U.S., Canadian, and U.K.-based insurance firms hold at least $4.4 billion of investments in companies whose subsidiaries manufacture cigarettes, cigars, chewing tobacco, and related products. These tobacco products currently contribute to the deaths of 5.4 million people worldwide annually, according to the World Health Organization. Tobacco use is a major risk factor for stroke, heart attack, lung disease and cancer.

“Despite calls upon the insurance industry to get out of the tobacco business by physicians and others, insurers continue to put their profits above people’s health,” says J. Wesley Boyd, lead author of the article. “It’s clear their top priority is making money, not safeguarding people’s well-being.”
Boyd and his colleagues point to Newark, New Jersey-based Prudential Financial (PRU), which sells life insurance and long-term disability coverage. With total tobacco holdings of $264.3 million, Prudential Financial is a major investor in three tobacco firms, including Reynolds American (RAI), whose subsidiary R.J. Reynolds manufactures Camel and Pall Mall cigarettes, and Philip Morris (PM), maker of the popular Marlboro brand.
Sun Life Financial (SLF), based in Toronto, sells life, health, disability, and long-term care insurance. It also owns slightly more than $1 billion in stock in two tobacco companies, including $890 million in Philip Morris.
London-based Prudential, which offers health, disability, and long-term care insurance, has holdings of $1.38 billion in two tobacco companies, including British American Tobacco (BTI), which markets Kent and Lucky Strike cigarettes.
The researchers also itemize the substantial tobacco holdings of Northwestern Mutual of Milwaukee and Massachusetts Mutual Life of Springfield, Massachusetts, along with those of Standard Life (SLFPF.PK), a health and life insurer based in Edinburgh, Scotland.
Boyd and his co-authors, David Himmelstein and Steffie Woolhandler at the Cambridge Health Alliance and Harvard Medical School, culled their data from Osiris, a proprietary database of industrial, banking and insurance companies. Osiris draws upon Securities and Exchange Commission filings and news reports from providers like Dow Jones and Reuters.
“Although investing in tobacco while selling life or health insurance may seem self-defeating,” the authors write, “insurance firms have figured out ways to profit from both. Insurers exclude smokers from coverage or, more commonly, charge them higher premiums. Insurers profit—and smokers lose—twice over.”
Copyright © 2009 Seekingalpha

Former Tobacco Industry

Education is key for one former tobacco industry scientist. Back in the 80′s Dr. Victor DeNoble worked for Philip Morris, a tobacco company.

Through research, he discovered the detrimental affects of nicotine. So he invented a safer cigarette, but he was fired. Since then he’s made it his mission to teach young people the truth about the tobacco industry.

“What young people don’t realize it that nicotine is a drug, just like any other drug that changes the way your brain work and it’s not some habit. You’re actually changing the way your brain works for year and years of you life,” said DeNoble.

DeNoble visits the Yakima Valley every couple of years to talk with middle school and junior high students, telling his story of testifying in congress against the tobacco industry.

First person: ‘I fought the tobacco industry’

My husband John and I moved from the UK to Hong Kong in 1969. I worked in medical research and then as a doctor on an intensive care ward before focusing on women’s health issues. In the early Eighties, there was a huge drive by the tobacco industry to get Asian women addicted to cigarettes.

At that time, 60 per cent of Asian men were smokers, compared to just 3 per cent of women. So the industry came up with adverts such as: “You’ve come a long way, baby!” They hoped to woo their audience with a message of liberation – that it was a woman’s right to smoke.

I had been writing a health column for a newspaper for a while, and filed an article calling for a ban on advertising. Immediately, the tobacco industry and its supporters descended on me, trying to discredit my argument. In 1982, I received a letter from a press officer working for the tobacco industry, whom I’d never met. He wrote: “I enclose some documents which will soon be released by our client. I thought you might be interested to see them for yourself”. It read: “The anti-smoking lobby in Hong Kong is largely anonymous, unidentifiable, entirely unrepresentative and unaccountable. The tobacco industry comprises identifiable, legal, accountable, commercial organisations.” I couldn’t believe what I was reading, and made it my mission to fight my cause to the end.

I left clinical medicine and started the Asian Consultancy on Tobacco Control, which still exists today. At that time, there was no one else campaigning for such a cause in Asia, and it was a very lonely existence. I started advising the government. Asia is a huge market for the tobacco industry, so my work posed a threat. As a result, I made a lot of enemies. In a 1989 report, A Guide for Dealing with Anti-tobacco Pressure Groups, I was labelled “A key individual [whose] presence is a danger signal”. The same year, I was branded one of the three most dangerous people in the world by the tobacco organsiation Infotab.

A Smokers’ Rights Group in the United States in the Nineties called me “nothing more than an evil-possessed, power-lusting piece of meat” and threatened to “utterly destroy me”. The FBI took up my case and interpreted this as a death threat. This was just one example of the extreme abuse I have suffered for trying to take on the pro-smoking lobby. Until recently, I had very little support in what I was doing and was painted as a deluded extremist.

Finally, however, I have gained recognition: I received the Time 100 award in 2007 for my work, and this year was honoured with a lifetime achievement award from the British Medical Journal. My one-woman campaign has now spread, and today we are an army rather than a general. The cause has finally reached the international agenda, but it has been a right royal battle getting it there.

Copyright © 2009 Independent

Province gets tough on smoking

The P.E.I. government is eliminating designated smoking rooms in public places and work
places; eliminating designated smoking areas on hospital grounds, with the exception of Hillsborough Hospital; prohibiting smoking in vehicles with minors under the ages of 19 present; prohibiting smoking on patios/decks of eating establishments and
licensed establishments during certain hours of operation (Exempted
between the hours of 10 p.m. to 3 a.m.).

There will be exemptions that permit designated smoking rooms for residents in long-term care facilities (public and private) as well as shelters for victims of domestic violence.

Health Minister Doug Currie announced the changes Friday.

“We would like to thank the individuals and groups who made presentations to the standing committee,” said Currie.  “The proposed amendments reflect many of the recommendations of the Standing Committee, following public consultations.  I am
confident that these changes will help to protect Islanders from the
harmful effects of second hand smoke.”

The proposed amendments include changes to the existing legislation that will prohibit smoking in motor vehicles when minors are present. Government is also proposing amendments to the Act that will prohibit smoking on hospital grounds, with the exception of Hillsborough Hospital. The amendments proposed to the General Regulations made under the Act will also limit outdoor smoking areas in certain public places, including patios and decks of eating establishments and licensed premises.


Smoke Free Places Act

What is the purpose of the Smoke Free Places Act?
The primary purpose of the province’s Smoke Free Places Act is to
protect Islanders from the harmful effects of second hand tobacco smoke.
A secondary purpose of the Act is to reduce the overall consumption of
tobacco products by those who smoke.

What are the amendments to the Act?
The amendments proposed to the Smoke Free Places Act (or to the General
Regulations made under the Act) include:
–    Eliminating designated smoking rooms in public places and work
places;
–    Eliminating designated smoking areas on hospital grounds, with
the exception of Hillsborough Hospital;
–   Prohibiting smoking in vehicles with minors under the ages of 19
present;
–   Prohibiting smoking on patios/decks of eating establishments and
licensed establishments during certain hours of operation (Exemption
between the hours of 10 p.m. to 3 a.m.);
–    Provide exemptions that permit designated smoking rooms for
residents in long-term care facilities (public and private) as well as
shelters for victims of domestic violence.

What changes have occurred since the original amendments were brought
forward in the spring of 2008?

Amendments to the Act proposed one year ago were sent to the Standing
Committee on Social Development who held public consultation on the
proposed changes. The current amendments support most of the
recommendations of the Standing Committee. Proposed amendments which
have been removed from the new Bill include prohibition of designated
smoking areas in long-term care facilities, prohibition of smoking in
provincial parks as well as relaxing the prohibition of smoking on
outdoor patios and decks to permit smoking during certain hours of
operation.

Why are these amendments necessary?
When PEI implemented the Smoke Free Places Act in 2003, it led the
country in developing smoke free public places and workplaces.  Now, the
Act is six years old and needs to be modernized. PEI is currently the
only province to allow Designated Smoking Rooms in public places, like
bars and restaurants.

How will these changes affect Islanders?
The proposed amendments would eliminate some of the existing exceptions
to the Act that currently allow smoking in public places and workplaces,
reducing Islanders’ exposure to second-hand smoke.

How do the proposed changes compare to other provinces?

Designated Smoking Rooms
–    PEI is the only province that still permits Designated Smoking
Rooms.

Smoking on Hospital Grounds
–    Smoking has already been prohibited by individual hospitals or
health entities within Canada, such as the Capitol Health in Halifax,
(which includes QE2 and IWK), the Calgary Health Region and the
Provincial Health Services Authority in British Columbia.  PEI would be
the first province to ban smoking provincially on all hospital grounds.
This proposed amendment was supported by the Standing Committee report.

Smoking on Patios and Decks
–    A majority of the provinces have legislation restricting smoking
on patios and decks of eating establishments.

Smoking in Vehicles
–    Nova Scotia, Ontario, Yukon and British Columbia have all passed
legislation that prohibits smoking in vehicles when children are
present. The city of Summerside recently adopted a motion to ban smoking
in cars with minors present. This was also supported by the Standing
Committee Report.

What is the penalty for non-compliance with amendments to the Act?
Currently, fines for breaking the act range from $500 to a maximum of
$2,000. A proposed amendment to the Act reduces the minimum fine for a
contravention of the Act from $500 to $100 to reflect that fines may now
be levied against the individual for smoking in a vehicle when minors
are present.

If the amendments are passed, when will the changes to the Smoke Free
Places Act be enforced?

The changes will become law on the date of proclamation (September 15).
The changes will not come into full effect immediately, in order to allow business owners who may be affected by the amendments to make any
required changes to their operation.

Source: Journalpioneer