Blog - Tobacco Reporter

Netherlands Wants to Restrict Cigarette Sales to Tobacconists

The Dutch government plans to restrict sales of cigarettes to tobacconists within 10 years, reports the NL Times.

Supermarkets will have to stop selling tobacco products in 2024 while gas stations and convenience stores may continue selling them until 2030. Over the following two years, all nontobacconist stores will have to phase out tobacco sales.

Earlier this year, supermarket market leader Albert Heijn announced a trial with no tobacco sales at its Pijnacker store ahead of the 2024 ban. The pharmacy chain Kruidvat removed tobacco from sale in 2018, followed by Lidl Nederland.

The government also intends to further reduce the number of places where smoking is allowed. For example, it plans to ban smoking at playgrounds and sports parks from 2025.

In addition, the government wants to further increase the prices of tobacco products. Next year and in 2024, a pack of cigarettes will become €1.20 ($1.24) more expensive on average.

While cigarette prices in the Netherlands have risen steadily in recent years, they have remained stable in terms of affordability due to wage increases. On average, Dutch smokers consistently spent 2.5 percent of their annual income on cigarettes throughout that period.

The Dutch government aims for a “smoking-free generation” by 2040.

November 27, 2022

PMI Announces New Regional Structure

Philip Morris International has announced a new regional structure and related senior management changes.

“We are changing the company’s regional structure to further support the growth of our smoke-free business, reinforce consumer centricity and increase the speed of innovation and deployment—all in alignment with our ambition of becoming a majority smoke-free business by net revenues by 2025,” said PMI CEO Jacek Olczak in a statement.

“The new structure will also create new opportunities to further grow our senior talent, deepening the bench of leaders who will spearhead PMI’s progress toward a smoke-free future for the years to come. I am confident of the exceptional caliber and determination of our people and wish them the best in their new roles.”

By the end of January 2023, PMI will rearrange its operations in four regions, down from the current six, under the leadership of the following members of senior management:

Paul Riley, currently president of the East Asia and Australia region, will be appointed president of the East Asia, Australia and PMI duty-free region;
Frederic de Wilde, currently president of the European Union region, will be appointed president of the South and Southeast Asia, Commonwealth of Independent States (CIS), Middle East and Africa region;
Massimo Andolina, currently senior vice president of operations, will be appointed president of the Europe region; and
Deepak Mishra will continue as president of the Americas region.

Drago Azinovic, currently president of the Middle East and Africa and PMI duty-free region, will leave the organization after a transition period.

In addition, the following appointments will also take effect:

Marco Mariotti, currently president of the Eastern Europe region, will be appointed president of CIS, Central Asia and Israel, reporting to Frederic de Wilde;
Stacey Kennedy, currently president of the South and Southeast Asia region, will be appointed CEO of PMI’s U.S. business, reporting to Deepak Mishra; and
Scott Coutts, currently vice president of global manufacturing, will be appointed senior vice president of operations, succeeding Massimo Andolina and reporting to Jacek Olczak.

“We are changing the company’s regional structure to further support the growth of our smoke-free business, reinforce consumer centricity and increase the speed of innovation and deployment.”

Jacek Olczak, CEO, PMI

According to PMI, the new regional structure better aligns with the business strategy in the approximately 180 markets where the company’s products are sold. It is designed to accelerate smoke-free product growth in markets where IQOS already holds double-digit market shares while also driving the transition from cigarettes to smoke-free products in untapped markets, including the United States.

Furthermore, the new regional structure will support PMI’s efforts to broaden access to smoke-free products worldwide for those adults who would otherwise continue to smoke, including in low-income and middle-income markets, which the company aspires to account for at least half of the markets where its smoke-free products will be available by 2025. Each region will comprise individual markets as well as clusters of markets and will provide opportunities to accelerate career development within PMI’s diverse talent pipeline.

The company’s quarterly results reporting and related filings will reflect the new regional structure as of the first quarter of 2023.

November 26, 2022

Slovakia: Illegal Cigarette Factory Closed

Slovakian authorities uncovered an illegal cigarette factory while inspecting a poultry farm in Ubrez, reports the Slovak Spectator.

The Financial Administration detained 20 people from various Eastern European countries. Some had been charged for running illegal cigarette businesses before, according to police in Belgium, the Netherlands and Italy.

The Slovak operation, which produced pirated Marlboro, Richmond and Lambert & Butler cigarettes, had avoided an estimated €6.2 million ($6.42 million) in tax payments, according to authorities. In addition to millions of illegal cigarettes, law officials seized 32,000 kg of raw tobacco, production machinery and materials such as filters, tubes, adhesives, foils and packaging.

November 25, 2022

Vietnam Mulls Ban on Novel Tobacco Products

Vietnam’s health ministry has proposed a ban on next-generation tobacco products (NGPs), reports VN Express International. The country’s current law on tobacco harm prevention lacks provisions for e-cigarettes and heated-tobacco products.

According to Tran Thi Trang, deputy head of the Ministry of Health’s legislation department, a trial allowing the distribution of NGPs revealed potential negative impacts, including on youth behavior.

The percentage of people using e-cigarettes in Vietnam increased to 3.6 percent from 0.2 percent during 2015–2020, according to the health ministry.

With 15.6 million smokers, Vietnam ranks 15th in the world in terms of combustible cigarette users, the Legal Affairs Department at the Ministry of Information and Communications said. People in Vietnam spend an estimated VND49 trillion ($2 billion) per year.

November 24, 2022

PMI to Produce Terea Sticks in South Korea

Philip Morris International has started manufacturing Terea tobacco sticks for its IQOS Iluma heat-not-burn (HnB) devices at its Yangsan plant in South Korea, reports The Korea Times.

Unlike PMI’s Heets tobacco sticks, Terea sticks feature sealed tips that leave no residue, thus sparing consumers the inconvenience of cleaning their device after each use.

According to PMI, the Yangsan plant has International Organization for Standardization (ISO) certifications for quality management (ISO 9001), environmental management (ISO 14001) and safety and health management (ISO 45001).

The factory’s quality control team has obtained an internationally accredited testing agency certification from the Korea Laboratory Accreditation Scheme.

“All the workers at Philip Morris’ Yangsan plant in Korea are proud of the fact that they are producing high-quality noncombustible tobacco products such as Terea, which contributes to the realization of the company’s vision of a ‘future without cigarette smoke’ and the development of the national economy,” said Philip Morris Korea Director of Manufacturing Zia Ahmed Karim.

“We will continue to ensure quality control of our products and seek eco-friendly management in the future through providing better alternatives to adult smokers.”

The Yangsan plant, which marks its 20th anniversary this year, employs 600 people. Since 2017, PMI has invested more than KRW300 billion ($225.83 million) in the production of noncombustible products at the facility.

November 24, 2022

China to Restrict E-Cigarette Shipments

China’s State Tobacco Monopoly Administration (STMA) plans to limit the number of vapor products a person can carry on them, reports The Global Times.

According to a notice published Nov. 23, a person can possess a maximum of six “smoking devices,” 90 e-cigarette cartridges and 180 mL of e-liquid.

On the same day, the STMA and the State Post Bureau jointly announced restrictions on the delivery of vapor products. Each shipment may contain a maximum of two “sets,” six cartridges and 12 mL of e-liquid.

Each recipient is allowed to accept delivery of no more than one shipment of vapor products per day.

In April, China’s tobacco regulator approved mandatory national standards for e-cigarettes that came into effect in October.

November 23, 2022

Philip Morris Launches Bonds by IQOS

Philip Morris International has launched its latest heat-not-burn tobacco-heating system, Bonds by IQOS, along with its compatible tobacco sticks, Blends, in a pilot market in the Philippines. The company intends to further commercialize the product during the remainder of 2022 and next year.

Equipped with bladeless resistive external heating technology, Bond emits 95 percent less harmful chemicals compared to cigarettes, according to PMI.

“Bonds by IQOS represents another step forward in our ambition to replace cigarettes with innovative, science-based, smoke-free alternatives,” said PMI CEO Jacek Olczak in a statement.

“We know that no single smoke-free product will appeal to all adult smokers. Providing a range of alternatives to continued smoking—with a variety of taste, technology, usage and price options—is imperative and helps us to address a range of preferences as diverse as adult smokers themselves—ultimately encouraging them to leave cigarettes behind.

“Bonds by IQOS provides an opportunity to address consumer acquisition barriers for this segment, most notably up-front device costs and authentic tobacco taste satisfaction—providing further options of innovative smoke-free options to help ensure they do not go back to cigarettes. Through continuous innovation, we want to ensure that all adult smokers who would otherwise continue smoking switch and abandon cigarettes.”

According to PMI, Bonds by IQOS is designed to be used only with Blends tobacco sticks to deliver a variety of tobacco tastes. At the time of launch, Blends tobacco sticks will be available in five different flavors, including classic, menthol and aromatic. When fully charged, Bonds by IQOS delivers up to 20 uses, including three consecutive experiences. Bonds by IQOS comes in four different colors.

November 22, 2022

Greenbutts’ Filter Certified

Greenbutts has received the Hohenstein Quality Label for a novel biodegradable filter technology designed to replace the most littered single-use plastic item—cigarette filters.

“Receiving this certification of biodegradability from Hohenstein is validation of all the hard work over the past decade to develop and optimize our Greenbutts filter technology to be a truly eco-friendly replacement for cellulose acetate,” said Greenbutts CEO Tadas Lisauskas in a statement.

“We are excited to offer this certified material to a variety of filtration media products in the near future to help eradicate single-use synthetics used in the filtration industry.”

“We have put our best minds toward delivering a transformative solution for the global tobacco industry,” said Greenbutts Chief Strategy Officer Luis Sanches. “Our world demands high corporate responsibility coupled with measurable impact, and no matter where our customers may be, we all can do our part.”

Using patented material science, Greenbutts filters are biodegradable, plastic-free and water dispersing. According to the company, Greenbutts filters will disperse in water within a few minutes and will degrade in compost within days as opposed to 10–15 years as is the case with traditional cellulose acetate filters.

November 22, 2022

Hong Kong Confiscates Black Market Cigarettes

Hong Kong customs officers arrested three men and confiscated HKD180 million ($23 million) in black market cigarettes, reports the South China Morning Post. This marks the second-largest smuggling bust of its kind this year.

Three container trucks at two shipping yards near Tsing Yi Road, Tsing Yi, and Container Port Road South in Kwai Chung carrying three 40-foot cargo containers with 31 million suspected illegal cigarettes were seized. Three more containers in the same yards were seized, holding 33 million sticks of tobacco.

If the illegal cigarettes were legally imported, the products would have generated HKD120 million in tax revenue.

Customs has seized 640 million suspected black market cigarettes this year, an almost 50 percent increase from last year’s 427 million, according to the South China Morning Post.

Many of the brands seized were popular overseas but uncommon locally. “Following the relaxation of anti-pandemic measures and the increase in the flow of people, the market demand for illicit cigarettes has increased,” Senior Investigator Lam Wai-kit said.

An investigation is ongoing to trace the source and flow of the illegal products, according to Lam.

November 22, 2022

Baltimore Sues Tobacco Companies Over Litter

The city of Baltimore is suing several major tobacco companies, requesting as much as $5 million annually for the cleanup of cigarette butt litter, according to WBALTV11.

Since 2014, more than 12 million cigarette butts have been cleaned up from the waters surrounding Baltimore, city officials said.

“There are all kinds of cleanup problems, from catching them [cigarette butts] to getting rid of the chemicals they leave in their wake,” said James Shea, Baltimore City solicitor.

The lawsuit alleges that the tobacco companies have refused to place warnings on their boxes explaining how to properly dispose of filters and that they have chosen not to make filters biodegradable.

“They didn’t change it—according to documents we’ve seen—to biodegradable filters because smokers preferred the draw that comes with the filter,” Shea said.

The ultimate goal is to see the companies become more environmentally friendly, according to Shea. “We’d like to have the practice stop, but, in the meantime, we want damages in the nature of cleanup costs and their fines associated with various litter ordinances that are being violated.”

The companies have 30 days to respond in court.

November 22, 2022