Category: News This Week

BAT cleared of tax-evasion charges
A South Korean court has acquitted British American Tobacco (BAT) from charges of tax evasion, citing lack of evidence, reports Yonhap News Agency.
In April, prosecutors indicted BAT Korea and two senior executives on charges of evading KRW50 billion ($43 million) in taxes by falsely reporting a cigarette shipment on Dec. 31, 2014, one day before a cigarette tax hike went into effect.
Prosecutors accused the cigarette company of earning an illegal profit of KRW50 billion by selling the 24.63 million packs taxed at a pre-hike rate to consumers at post-hike prices.
But the Seoul court said it was unable to conclude from the evidence submitted by the prosecution that BAT intentionally committed the false shipment report.
“In addition, any motivation for tax evasion has not been found and it seemed that company employees didn’t perceive the concerned shipment report via computers as an illegal act,” the court said.

December 25, 2019
Korean imports investigated
The U.S. has launched an antidumping duty investigation into cigarettes imported from South Korea following a complaint by two domestic manufacturers, reports Yonhap News Agency.
The U.S. International Trade Commission said it will determine whether “there is a reasonable indication” that an industry in the United States is materially injured or threatened due to imports of South Korean cigarettes that are allegedly sold in the U.S. at less than fair value.
The commission must reach a preliminary determination in antidumping duty investigations by Feb. 3, 2020, unless the U.S. commerce department extends the time for initiation.
Tobacco manufacturers Xcaliber International and Cheyenne International requested the probe through a petition on Dec. 18.

December 25, 2019
Expanding in Canada
Turning Point Brands (TPB) has executed a binding letter of intent with its Canadian partner and distributor of Zig-Zag rolling papers, Imperial Tobacco Co. (ITC).
According to TPB, the agreement presents an opportunity to complement the traditional direct-store-delivery network of ITC with supplemental distribution in the alternative channels space, including dispensaries, through a recently established partnership with ReCreation Marketing.
“Our long-standing partnership with Imperial Tobacco remains strong and highly collaborative as we jointly work to grow the Zig-Zag brand in the rapidly evolving Canadian marketplace,” said Graham Purdy, chief operating officer of TPB.
Efforts to expand Zig-Zag’s retail footprint into the alternative channels space are expected to begin in the second quarter of 2020.
“Together with both ITC and ReCreation, we intend to ignite new growth momentum on behalf of Zig-Zag in the Canadian marketplace,” said Purdy.
December 24, 2019
Saudi brands unaltered
Phillip Morris International (PMI) insists that, despite consumer complaints, its cigarettes in Saudi Arabia taste the same as they did before the introduction of generic tobacco packaging in the kingdom, reports Arabian News.
Since the implementation of plain packaging in August, a number of smokers have reportedly complained to the Saudi Food and Drug Authority (SFDA) about a perceived difference in cigarette quality.
The SFDA has sent samples to product-testing lab Eurofins to see if there has been any change in the quality of cigarettes over the past two years. It also asked PMI and other cigarette companies for clarification.
“Not only do we abide by all applicable regulations, we also apply stringent and consistent global policies, standards and good manufacturing practices with respect to the machinery, ingredients, safety and quality for all our products, across all our facilities,” PMI said in a statement.
“There has been no change to the ingredients, manufacturing processes, quality and taste of tobacco relating to our products in the Saudi market before and after the implementation of the plain packaging regulation mandated by the SFDA.”
PMI cigarettes sold in Saudi Arabia are manufactured in Germany, Poland and Turkey.
December 24, 2019
‘Health shortchanged’
U.S. states will spend less than 3 percent of their tobacco revenues on programs to prevent children from using tobacco and help smokers quit this year (fiscal 2020), according to a report released Dec. 19 by a coalition of public health organizations.
Of the $27.2 billion in tobacco tax and Master Settlement Agreement income anticipated this year, states will spend only $739.7 million on anti-tobacco measures.
While this is a small increase from last year, it is less than a quarter (22.4 percent) of the total funding recommended by the Centers for Disease Control and Prevention (CDC). No state currently funds its tobacco prevention and cessation programs at CDC-recommended levels and only six states provide half the recommended amount.
This year marks the 21st anniversary of the landmark legal settlement between 46 states and the major tobacco companies, which, along with individual settlements with four other states, required the companies to pay more than $246 billion over time as compensation for tobacco-related health care costs.
The report, “Broken Promises to Our Children: A State-by-State Look at the 1998 Tobacco Settlement,” was released by the Campaign for Tobacco-Free Kids, American Cancer Society-Cancer Action Network, American Heart Association, American Lung Association, Americans for Nonsmokers’ Rights, Robert Wood Johnson Foundation and Truth Initiative.
December 24, 2019
‘Tobacco 21’ Signed into Law

Photo: David Mark from Pixabay
U.S. President Donald Trump has signed into law a bill raising the federal age requirement for tobacco and vapor product purchases to 21 from 18.
The Food and Drug Administration has 180 days to update its regulations and the new rules will go into effect 90 days after that.
A bill to raise the legal age to buy tobacco was introduced earlier this year by Senate Majority Leader Mitch McConnell and Virginia Senator Tim Kaine and was combined with another bipartisan bill on the issue to become part of a massive spending package.
Proponents of the legislation argue that most underage teens who use tobacco get it from older friends. An estimated 90 percent of smokers start before age 18.
Delaying access to cigarettes is expected to produce major downstream health benefits, with one government-funded report estimating nearly 250,000 fewer deaths due to tobacco over several decades.
More than 34 million adults in the U.S., or about 13.7 percent of the population, smoke cigarettes, according to the Centers for Disease Control.
While the number of smokers has decline steadily in recent years, the number of underage nicotine users has increased along with the rising popularity of e-cigarettes.
Youth tobacco use has been a point of discussion in Washington as the prevalence of e-cigarette use and vaping among teenagers seemed to skyrocket.
Altria Group and Juul Labs were among the biggest supporters of the measure, blanketing Capitol Hill with lobbyists and advertisements touting their support for a national “Tobacco 21” law.
Health groups criticized their efforts as a tactic to forestall measures that would be more damaging to the tobacco and vapor business, such as banning flavored nicotine juices.
“Altria and Juul clearly support this in order to argue that no other action is necessary,” said Matthew Myers of the Campaign for Tobacco-Free Kids.
The legislation leaves unchanged a requirement that adverting be targeted to people who are at least 18, according to Stanton Glantz, director of the Center for Tobacco Research Control & Education at the University of California in San Francisco.
December 23, 2019
RELX Presents Technology to Deter Minors
E-cigarette manufacturer RELX Technology has launched Project Sunflower, a system designed to prevent minors from accessing to tobacco products.
Project Sunflower uses ID and facial recognition technologies to ensure that only adults are able to purchase products in RELX’s China stores. Minors are not allowed to enter RELX stores, and new in-store face-scanning cameras will send alerts to RELX store staff if a suspected minor enters the store. Any suspected minor that is not able to present legal, valid identification that proves he or she is an adult will be asked to leave the RELX store.
RELX customers will also need to verify their age through a facial recognition process that matches the customer’s face with the photo on the customer’s Chinese Resident Identity Card. This process is to ensure that the person in the store is using their own valid identification and not attempting to impersonate an adult.
RELX is also launching RELX smart vending machines using the same facial recognition technology to prevent underage access.
The company plans to install Project Sunflower cameras and facial recognition systems in more than 100 shops in the next three months and aims to expand the system to cover all RELX Stores in China by July 2020.
RELX is currently developing a tracking system that connects customers, product bar codes and shop locations. Once the system is complete, RELX will be able to trace a product to its point of sale if a minor is found to be in possession of a RELX product.
“We are committed to ensuring that our products do not end up in the hands of minors. Project Sunflower is testament to our commitment to utilizing the latest advancements in technology to strengthen the prevention of minors from accessing our vapor products, ”said Kate Wang, CEO of RELX.
December 23, 2019
Layoffs in Shenzhen
China’s e-cigarette industry has laid off around 50,000 people, or roughly 10 percent of its workforce, since October, according to the Electronic Cigarette Industry Committee.
The decline comes in the wake of tightening regulations in the United States and China, along with heightened media scrutiny of the sector worldwide.
One manager at a brand that launched this year said sales dropped 60 percent after China banned online sales of vapor products in November.
Approximately 90 percent of the world’s e-cigarettes are manufactured in the southern Chinese city of Shenzhen, where the vapor industry employs about half a million people.
December 23, 2019
Perry joins NDC
John Perry has joined NDC Technologies as vice president of sales and marketing. In his role, Perry will be responsible for leading NDC’s global sales organization, executing the company’s go-to-market strategy and accelerating pipeline growth across the company’s key vertical markets.
“John brings a wealth of experience and knowledge to our executive leadership team and we are looking forward to him playing a key role in driving our marketing and sales growth activities,” said Marti Nyman, president of NDC Technologies.
“I am honored to join the NDC team and help to build on a solid foundation developed over the years,” said Perry. “This is an exciting and outstanding opportunity to play an important role in accelerating the company’s growth and further deepening our customer relationships and worldwide market position.”
Perry takes from Randy Luffman, who joined NDC in 2012 and is retiring from the company.
December 23, 2019
‘Tobacco 21’ becomes law
U.S. President Donald Trump has signed into law a bill raising the federal age requirement for tobacco and vapor product purchases to 21 from 18.
The Food and Drug Administration has 180 days to update its regulations and the new rules will go into effect 90 days after that.
A bill to raise the legal age to buy tobacco was introduced earlier this year by Senate Majority Leader Mitch McConnell and Virginia Senator Tim Kaine and was combined with another bipartisan bill on the issue to become part of a massive spending package.
Proponents of the legislation argue that most underage teens who use tobacco get it from older friends. An estimated 90 percent of smokers start before age 18.
Delaying access to cigarettes is expected to produce major downstream health benefits, with one government-funded report estimating nearly 250,000 fewer deaths due to tobacco over several decades.
More than 34 million adults in the U.S., or about 13.7 percent of the population, smoke cigarettes, according to the Centers for Disease Control.
While the number of smokers has decline steadily in recent years, the number of underage nicotine users has increased along with the rising popularity of e-cigarettes.
Youth tobacco use has been a point of discussion in Washington as the prevalence of e-cigarette use and vaping among teenagers seemed to skyrocket.
Altria Group and Juul Labs were among the biggest supporters of the measure, blanketing Capitol Hill with lobbyists and advertisements touting their support for a national “Tobacco 21” law.
Health groups criticized their efforts as a tactic to forestall measures that would be more damaging to the tobacco and vapor business, such as banning flavored nicotine juices.
“Altria and Juul clearly support this in order to argue that no other action is necessary,” said Matthew Myers of the Campaign for Tobacco-Free Kids.
The legislation leaves unchanged a requirement that adverting be targeted to people who are at least 18, according to Stanton Glantz, director of the Center for Tobacco Research Control & Education at the University of California in San Francisco.
December 23, 2019