Category: Featured

  • Fines and Jail for Undeclared Manufacture

    Fines and Jail for Undeclared Manufacture

    Image: MasterSergeant | Adobe Stock

    A Belgian court handed out fines and prison sentences to several companies and individuals for undeclared cigarette manufacturing, reports The Brussels Times.

    The illegal cigarettes were manufactured and stored in a warehouse in Gosselies that was placed under surveillance in 2022. Another warehouse was discovered in a furniture factory in Anderlecht.

    A truck carrying 16 pallets of undeclared cigarettes manufactured in Belgium was checked near Jabbeke.

    The company running the Gosselies manufacturing was fined €36,710,000 ($39,580,338), and its head was also fined that amount as well as receiving a one-year prison sentence.

    Another company was fined €36,710,000 along with a suspended prison sentence for the amount exceeding €36,600,000. All manufacturing and transport equipment was confiscated.

    The other accused were fined €36,710,000 and received suspended prison sentences of six months, nine months and two years for the amount exceeding €36,600,000.

  • Reynolds Releases Harm Reduction Paper

    Reynolds Releases Harm Reduction Paper

    Image: New Africa | Adobe Stock

    Reynolds American Inc., the BAT Group’s U.S. subsidiary, released its inaugural white paper, “Tobacco Harm Reduction: Creating A Better Tomorrow for Public Health in America,” reports PR Newswire. This is the first in a series of white papers aimed at raising awareness on tobacco harm reduction (THR) as a public health strategy that encourages adult smokers who are uninterested in quitting tobacco altogether to migrate to noncombustible product alternatives.

    The goal of the Reynolds’ white paper series is to highlight the progress of THR, address the challenges and have dialogue on the path forward.

    “THR has the potential to bring about one of the greatest public health achievements of our time,” said Priscilla Samuel, executive vice president of scientific research and development. “We hope the information presented in this white paper will spark renewed conversation on THR among all stakeholders, including regulators and policymakers, which could lead to effective regulation and access to noncombustible product alternatives for adult smokers who are uninterested in quitting.”

  • STG Announces Annual Meeting

    STG Announces Annual Meeting

    Image: MarekPhotoDesign.com | Adobe Stock

    Scandinavian Tobacco Group’s annual general meeting will be held Thursday, April 13, 2023, at 4:30 p.m. (CEST) at the office of Kromann Reumert, Sundkrogsgade 5, 2100 Copenhagen.

    Instead of attending in person, shareholders have the opportunity to follow the general meeting via live webcast transmission on the Investor Portal (available at http://investor.st-group.com). The general meeting and the webcast will commence on April 13, 2023, at 4:30 p.m. (CEST).

  • Universal Recognized as Supplier Engagement Leader

    Universal Recognized as Supplier Engagement Leader

    Image: pauchi | Adobe Stock

    Universal Corp. has been recognized as a 2022 Supplier Engagement Leader by CDP, a nonprofit charity that runs a global disclosure system for investors, companies, cities, states and regions to manage their environmental impacts. This is the second straight year Universal has earned this recognition. The CDP’s Supplier Engagement Rating system independently evaluates how effectively companies are engaging their suppliers on climate change, using the CDP’s annual climate change questionnaire that covers governance, targets, scope 3 emissions and value chain engagement. The top 8 percent of assessed companies were selected as 2022 Supplier Engagement Leaders.

    “We are honored to once again be recognized by CDP as a Supplier Engagement Leader,” said George C. Freeman III, Universal’s chairman, president and CEO. “At Universal, we work in partnership with our suppliers to reinforce the sustainability of our supply chains and meet our climate change goals. Universal is committed to setting high standards of social and environmental performance.”

  • RAI Workforce Down 11 Percent in 2022

    RAI Workforce Down 11 Percent in 2022

    Photo: RAI

    Reynolds American Inc. reduced its workforce by 10.7 percent, reports the Winston-Salem Journal, citing the 2022 annual report from parent company British American Tobacco.

    In July 2017, BAT purchased the 57.8 percent of Reynolds it did not already own for $54.5 billion. Legacy Reynolds shareholders own 19 percent of BAT.

    Reynolds had 4,921 U.S. employees in 2020 and 4,789 employees in 2021, according to the company’s annual reports.

    The workforce is down 22.3 percent from about 5,500 on Dec. 31, 2016, when Reynolds published its last corporate annual report.

    In March 2021, Reynolds announced its largest workforce reduction in a decade—350 full-time positions—as part of consolidating more of its manufacturing production into the Tobaccoville plant. The consolidation began in April and will take through 2024 to complete.

    BAT’s overall workforce decreased by 5.9 percent to 77,951.

    In January, BAT announced a major restructuring of its global operations. As part of the plan, the company will reduce the number of regions from four to three, and the number of business units from 16 to 12.

    After the restructuring, the company’s regions will be USA (RAI), Americas & Europe (AME) and Asia Pacific, Middle East & Africa (APMEA)

  • Court Won’t Hear At-Home Smoking Ban Challenge

    Court Won’t Hear At-Home Smoking Ban Challenge

    Photo: marjan4782

    The U.S. Supreme Court on March 20 declined to hear a challenge to the federal government’s ban on smoking in public housing, reports Law360.

    A New York group advocating for residents’ right to smoke in their apartments, sued the U.S. Department of Housing and Urban Development (HUD) for imposing the ban in 2016. The no-smoking rule applies within public housing apartments and in common areas, as well as within 25 feet outside apartment buildings.

    NYC CLASH argued the ban violates tenants’ rights to due process and against unconstitutional seizures.

    In August 2022, the D.C. circuit upheld the ban, arguing the 1937 Housing Act gave HUD the power to regulate smoking to improve air quality and maintain “safe and habitable” living quarters.

    NYC CLASH’s founder Audrey Silk said his group’s legal challenge was about more than just tobacco smoking. “It is about the right to be left alone in your private home to use a legal product and by keeping government in check,” she said. “So the more ominous question now is ‘what’s next?’”

  • Vape Tax Collections Less than Envisioned

    Vape Tax Collections Less than Envisioned

    Photo: Fitri Ridzuan

    The total tax revenue collected by U.S. states and local governments from the vaping sector remains only a fraction of that extracted from traditional tobacco products, according to a new report published by KBRA.

    Vaping devices have gained popularity in recent years, largely due to health concerns around traditional cigarettes, smoking cessation initiatives and rising youth consumption. U.S. product sales for e-cigarettes are estimated at $7.4 billion annually. Capitalizing on this trend, many states and local governments have implemented taxes on these tobacco alternatives.

    Despite high expectations, the total tax revenue from these products remains small relative to tobacco taxes—and even smaller as a percentage of budget. This KBRA report provides an overview of the e-cigarette/vape market, examines different forms of taxation by state, and assesses the limitations of these taxes in bolstering state budgets, as well as the possibility for future federal regulation.

    Key findings of the report include:

    • While the number of states that have implemented e-cigarette and vape device taxes has grown, these tax revenues represent only a small fraction of the traditional cigarette market size. Vaping tax collections still contribute a negligible percentage of current governmental revenues for U.S. states.
    • Taxation methods vary among states and localities due to the uniqueness of vaping and tobacco alternative products.
    • While a vapor excise tax regime could provide additional sources of revenue for states and localities, there are concerns surrounding states relying on these revenues as long-term solutions to close their budget gaps.
    • Increased federal regulations on vapor products, as well as the implementation of a federal excise tax, are probable in the years to come, which could potentially curb usage and associated tax revenue collections at the state level.

     

  • Republic Awarded $2.3 Million

    Republic Awarded $2.3 Million

    Federal jurors in Atlanta awarded Republic Brands $2.3 million in statutory damages in a case about counterfeit tobacco rolling papers.

    The company had accused Star Importers & Wholesalers and ZCell & Novelties of selling fake versions of its Top and Job rolling papers in the United States. Amin S. Hudda and Samadali Lakhani, the respective owners of the distribution companies, will also be held personally responsible for the counterfeiting activities.

    According to Law360, the jury found that Republic hadn’t proven that the wholesalers willfully bought and sold fake rolling papers bearing Top and Job trademarks.

    Had the jurors found the companies’ infringement willful, each could have faced up to $18 million in statutory damages under the Lanham Act, as well as treble damages under federal law.

    The case marks Republic Brands’ latest victory in its fight against brand piracy. Over the past two years, the company obtained judgments against four wholesale companies operating in Georgia and their respective owners, personally, for engaging in illegal infringing activities and selling counterfeit goods, according to Adams and Reese, which represented Republic Brands.  

    In 2022, Republic won an $11 million judgement against another Georgia wholesaler and its owner.

     

  • Kaival Appoints New Board Members

    Kaival Appoints New Board Members

    Kaival Brands Innovations Group, the distributor of Bidi Vapor products, has appointed Barry Hopkins, David Worner and Mark Thoenes to its board of directors.

    The appointments coincide with the retirement of Paul Reuter as chairman of Kaival Brands’ board of directors. Existing independent directors Roger Brooks and George Chaung will continue to serve on Kaival Brand’s board.

    “We are excited to welcome new independent directors Barry Hopkins and David Worner to our board,” said Kaival President and Chief Operating Officer Eric Mosser in a statement. “With their combined backgrounds and expertise as established senior executive leaders within the tobacco and public company accounting and finance sectors, we believe they will make an immediate impact on our company as we execute on both current and future growth initiatives.”

    “I am also excited to announce that Mark Thoenes, our interim chief financial officer, has also joined our board. In his current role, Mark has proven invaluable in assisting with key decisions as our company navigated an exceptionally difficult regulatory environment. Finally, on behalf of our board and company, we would like to thank Paul Reuter for his service to our board and shareholders through several milestone moments. We wish him the best in retirement.”

    Hopkins brings decades of senior executive experience within the traditional tobacco vape and CBD spaces. He spent most of his decades-long career primarily in senior sales and marketing roles for Turning Point Brands and Altria.

    Worner brings a diverse combination of finance, fundraising, mergers and acquisitions, technical accounting and operational experience gained over nearly 20 years. He is currently the CEO and founder of GrowthPath Partners, a transactional accounting and advisory firm.

    Thoenes has more than 35 years of diverse financial and operational leadership. He has been a licensed Certified Public Accountant since 1984 and began his career with Ernst & Young Global Limited. For the past eleven years, Thoenes has been the President of MLT Consulting Services, LLC, a full-service business/financial consulting firm.

  • FDA Updates Nicotine Definition in Docs

    FDA Updates Nicotine Definition in Docs

    Image: Tobacco Reporter archive

    The U.S. Food and Drug Administration has updated its definition of “tobacco products” to include nontobacco nicotine products.

    In response to the increase of nontobacco nicotine in popular tobacco products, Congress passed a federal law that went into effect on April 14, 2022, granting the FDA authority to regulate tobacco products containing nicotine from any source, including synthetic nicotine. This new law extended the tobacco product requirements in the Federal Food, Drug and Cosmetic Act to manufacturers, importers, retailers and distributors of nontobacco nicotine products. Previously, the FDA’s tobacco product authority only extended to tobacco products that contain nicotine made or derived from tobacco.

    Under this legislation, the definition of “tobacco product” in the FDA’s regulations and guidances has been considered to be amended since April 14, 2022. The FDA has now issued two notices in the Federal Register updating the definition of “tobacco product” in its existing regulations and guidances.

    In addition, the agency has also posted the following nine revised guidances to the FDA’s website: Civil Money Penalties and No-Tobacco-Sale Orders for Tobacco Retailers (Revised); Determination of the Period Covered by a No-Tobacco-Sale Order and Compliance With an Order (Revised); Further Amendments to General Regulations of the Food and Drug Administration to Incorporate Tobacco Products (Revised); Interpretation of and Compliance Policy for Certain Label Requirement; Applicability of Certain Federal Food, Drug and Cosmetic Act Requirements to Vape Shops (Revised); Listing of Ingredients in Tobacco Products (Revised); Premarket Tobacco Product Applications for Electronic Nicotine-Delivery Systems (Revised); The Prohibition of Distributing Free Samples of Tobacco Products (Revised); FDA Deems Certain Tobacco Products Subject to FDA Authority, Sales and Distribution Restrictions, and Health Warning Requirements for Packages and Advertisements (Revised); and Demonstrating the Substantial Equivalence of a New Tobacco Product: Responses to Frequently Asked Questions (Edition 3).