Category: Featured

  • U.K.: Local Authorities Ban Outdoor Smoking

    U.K.: Local Authorities Ban Outdoor Smoking

    Photo: Tobacco Reporter archive

    Local authorities in England have started banning smoking in pavement pubs, cafes and restaurants as the government seeks to make England smoke-free in less than a decade, reports The Guardian.

    The rise of outdoor eating during the Covid-19 pandemic has drawn renewed attention to outdoor smoking. A ban on smoking in public places indoors was credited with a big drop in tobacco use in the U.K. Health advocates worry that allowing smoking in outdoor cafes will renormalize the use of cigarettes after a meal or with a drink.

    Last summer, lawmakers failed to push through an amendment to legislation in the House of Lords to make pavements smoke-free.

    Now, Northumberland county council, Durham, North Tyneside, Newcastle and the City of Manchester have all banned smoking on stretches of the pavement where bars, restaurants and cafes are licensed to put out tables. Oxfordshire is also planning to ban smoking from outdoor restaurants.

    Deborah Arnott, the chief executive of Action on Smoking and Health, said the pavement bans were popular with most customers. “Our surveys show that two-thirds of the public want areas outside pubs and cafes to be smoke-free,” she said.

    The paternalists’ argument that we must stop people smoking because it is deadlier than Covid is as specious and illogical as the lockdown skeptics’ counterclaim that the government should do nothing about Covid because it hasn’t banned smoking.

    Pro-smoking groups say local authorities should not interfere. “It’s no business of local councils if adults choose to smoke, and if they smoke outside during working hours, that’s a matter for them and their employer not the council,” Simon Clark, director of Forest, wrote in a statement.

    England’s chief medical officer, Chris Whitty, has warned that the impact of tobacco is worse than Covid. Smoking had probably killed more people than Covid in the same period, he said. Generally, tobacco is estimated to kill 90,000 people a year in the U.K.

    Ireland, too, is reportedly considering a proposal that would eliminate “smoking areas” from outdoor public places such as pubs, offices and parks. “The Irish Heart Foundation has written to government urging that smoking is prohibited in all outdoor areas of pubs and restaurants as Covid-19 restrictions are lifted,” said Irish Heart Foundation Head of Advocacy Chris Macey.

    “We are also campaigning for outdoor smoking bans in parks, playgrounds, college campuses and state-run facilities to safeguard health and further denormalize smoking.”

    Christopher Snowdon, the head of lifestyle economics at the Institute of Economic Affairs, said the moves to ban outdoor smoking demonstrate “the warped judgment of public health officialdom.”

    “The paternalists’ argument that we must stop people smoking because it is deadlier than Covid is as specious and illogical as the lockdown skeptics’ counterclaim that the government should do nothing about Covid because it hasn’t banned smoking. Both willfully ignore the issue of infection, which is what turns a health problem into a public health problem,” he wrote in The Telegraph.

    “Battered by lockdowns, the hospitality industry is unlikely to welcome a policy that encourages its customers to stay at home,” Snowdon added.

  • BAT Scrutinized for Links to Belarus Factory

    BAT Scrutinized for Links to Belarus Factory

    Photo: Tobacco Reporter archive

    BAT has come under scrutiny in the U.K. for its links to the Neman Tobacco Factory in Belarus, reports Inews

    The state-owned Neman Tobacco Factory in Grodno carries out production for BAT, making products such as Rothmans and Pall Mall for its domestic market.

    Around 10 percent of the 5.5 billion cigarettes sold illegally each year in the U.K. are estimated to have come from Belarus. Experts claim most are made at the Neman factory.

    Recent police seizures of smuggled stock in the U.K. included illicit packets bearing Neman logos and Belarusian health warnings.

    According to Olaf, the EU-wide counter-fraud organization, Belarus is one of the main source countries for cigarettes smuggled into the EU.

    There is no suggestion BAT is aware of any illicit trade, and the firm said it has “strong controls” to stop its products entering the black market.

    “We are satisfied that BAT Belarus applies all the relevant BAT group policies and procedures with regard to combating illicit trade to ensure that products manufactured by GTF Neman under BAT Group’s trademarks are consumed in the Republic of Belarus,” a BAT spokesperson was quoted as saying by Inews.

    Critics have questioned whether BAT should be maintaining ties with Belarus, which has violently cracked down on protests following a rigged election in August 2020.

    “It is outrageous that a major British company continues to have a close relationship with a Belarusian plant, which is 100 percent owned by a Lukashenko regime that tortures its own people,” said a spokesperson for the pro-democracy group Nadzeya-UK.

  • Egypt Amends Invitation for Tobacco Bid

    Egypt Amends Invitation for Tobacco Bid

    Authorities in Egypt have issued an amended invitation for tobacco companies to bid for a license to manufacture cigarettes, according to Reuters. The amended invitation follows complaints that the terms of the license previously offered were too narrow.

    The state-controlled Eastern Co. currently holds a 70 percent market share, and this new bid for license could end the company’s monopoly.

    Under the amended terms, the winning bidder would produce 1 billion cigarettes per year as opposed to 15 billion cigarettes per year. The updated terms also removed a rule stating any other licenses would not be offered after the tender for a decade.

    The deadline for the amended bid is Aug. 1.

  • Imperial Cleared of Anti-competition Charges

    Imperial Cleared of Anti-competition Charges

    Photo: Taco Tuinstra

    The Supreme Court of Ukraine has thrown out a UAH460 million ($16.83 million) fine imposed by the Antimonopoly Committee of Ukraine (AMCU) on Imperial Tobacco Ukraine and Imperial Tobacco Production Ukraine for alleged anticompetitive behavior, reports the Kyiv Post.

    In October 2019, the Antimonopoly Committee fined the local affiliates of Philip Morris International, British American Tobacco, Japan Tobacco and Imperial Brands along with Tedis Ukraine. Concerted actions by the tobacco companies had unlawfully left Ukraine with only one cigarette distributor, Tedis, the AMCU maintained.

    Imperial appealed to the Commercial Court of Kyiv, which ruled in favor of the AMCU. On July 21, 2020, the company paid the full fine to prevent the imposition of additional penalties and to avoid further pressure on the company’s operations by the AMCU.

    After an appeal to the Northern Commercial Court of Appeal was also rebuffed, Imperial turned to the Supreme Court, which has now found in its favor.

    In a Ukrainian-language press release, Imperial Tobacco Ukraine CEO Rastislav Cernak said the ruling was an encouraging sign for all foreign investors in Ukraine.

    “Our company has always acted completely transparently and decently, advocating fair and honest competition, observing all antimonopoly laws not only in Ukrainian legislation but also the principles of protecting economic competition laid down in EU legislation,” he was quoted as saying.

    Earlier, Ukrainian courts threw out the AMCU fines against British American Tobacco and Tedis.

    Imperial Tobacco Ukraine manufactures cigarettes in Kyiv. About 50 percent of its products are exported to 20 markets, including Armenia, the United Arab Emirates and the United States.

  • India: ITC Shares Fall With Covid Restrictions

    India: ITC Shares Fall With Covid Restrictions

    Photo: Seemanta Dutta | Dreamstime.com

    Shares of ITC fell nearly 3 percent after the company warned that lockdown restrictions could cause supply chain disruptions soon, according to Reuters.

    ITC’s statement came as its cigarette business barely staged a recovery from last year’s lockdown, according to Reuters. March quarter revenue rose 14 percent to INR58.50 billion ($799.1 million). Cigarette volumes were short of pre-Covid-19 levels toward the end of the year.

    “ITC’s cigarette division posted a strong outperformance versus peers during the year, indicating market share gains. However, fresh restrictions in urban and rural markets may delay cigarette volume recovery going ahead,” the Reuters article states.

    Limited lockdowns were reintroduced following surges in Covid-19 infections in April and May. Analysts at Prabhudas Lilladher stated that the lockdowns are only “temporary hiccups,” according to Reuters, and they expect the first quarter to pick up.

  • FITA Complains About Loose Cigarette Sales

    FITA Complains About Loose Cigarette Sales

    Photo: Tobacco Reporter archive

    The Fair-Trade Independent Tobacco Association (FITA) has filed a criminal complaint with the South African Police Service against British American Tobacco South Africa (BATSA) for violating the Tobacco Products Control Act 83 of 1993 and the Customs and Excise Act 91 of 1964.

    “On or about May 28, 2021, we received information that BATSA and certain retail stores in and around the greater Johannesburg area were contravening provisions of inter alia the Tobacco Products Control Act and the Customs and Excise Act by selling loose cigarettes and giving and/or gifting to the consumer ZAR5 [$0.36] worth of mobile telephone airtime vouchers together with a small rectangular metallic box, which holds up to three loose cigarettes, branded with one of the many BATSA brands,” the organization wrote on its website.

    FITA “conducted test purchases” to confirm the alleged sales and states that it has “photographs and video footage depicting the promotional material and packaging for the sale of loose cigarettes.”

    Selling loose cigarettes and gifting promotional material like the boxes and phone cards is prohibited in South Africa.

  • Opposition to Investor Dispute Settlements

    Opposition to Investor Dispute Settlements

    Photo: AA+W

    Opposition is growing to investor-state dispute settlement (ISDS) provisions in trade deals, according to a report in The Guardian.

    ISDS began when former colonies became independent and provided compensation to companies if their assets were expropriated. But the system has developed concepts that allow corporations to seek compensation by claiming that regulatory changes reduce the value of their investment and/or that they were not fairly consulted about the change.

    Philip Morris famously used the ISDS provision of the Australia-Hong Kong investment after Australia’s High Court in 2012 held that Australia’s plain cigarette packaging laws were legal and did not constitute an unjust confiscation of trademarks and intellectual property.

    In 2015, the tribunal decided that the plaintiff was not a Hong Kong company and had moved ownership of its Australian operations to Hong Kong only to take advantage of the ISDS provision. While prevailing in the case, Australia spent nearly AUD24 million ($18.59 million) to defeat the challenge and only half of this was recovered. Critics say poor countries lack the resources to defend themselves against ISDS challenges.

    There are now 1,104 known ISDS cases, with increasing numbers against health and environment laws, including laws to address climate change and to protect Indigenous rights.

    Community opposition has pressured increasing numbers of governments to reject ISDS. The 27 EU member states have terminated ISDS arrangements between themselves, and ISDS has been excluded from current talks for the EU-Australia free trade agreement. The U.S. and Canada have excluded ISDS cases against each other from the revised North America free trade agreement, known as the United States-Mexico-Canada Agreement.

    More recently, strong community campaigns resulted in exclusion of ISDS from the Regional Comprehensive Economic Partnership signed in November 2020 between Australia, New Zealand, China, Japan, South Korea and the 10 ASEAN nations.

    Despite such moves, ISDS provisions are not on their way out quite yet. For example, the British trade minister has confirmed to The Guardian that corporate rights to sue governments are being discussed in the final negotiations for the Australia-U.K. free trade agreement.

  • Italy Scrutinizes BAT Social Media Activities

    Italy Scrutinizes BAT Social Media Activities

    Photo: Panuwat D

    The Italian Competition Authority has launched an inquiry into BAT’s social media activities, reports Market Watch.

    According to the regulator, three Italian influencers who had a commercial agreement with BAT Italia posted content related to BAT’s Glo Hyper tobacco-heating device without disclaiming the promotional nature of the posts.

    The antitrust section of Italy’s financial crime investigation unit reportedly carried out an inspection at BAT’s offices on May 27.

  • RLX Technology Reports ‘Solid’ First Quarter

    RLX Technology Reports ‘Solid’ First Quarter

    Photo: RLX Technology

    RLX Technology today announced its unaudited financial results for the first quarter ended March 31, 2021. Net revenues were RMB2.4 billion ($366.1 million), up 48.2 percent from RMB1.62 billion in the fourth quarter of 2020. Gross margin was 46 percent compared to 42.9 percent in the fourth quarter of 2020. GAAP net loss was RMB267 million compared with RMB236.7 million in the 2020 fourth quarter. Non-GAAP net income was RMB610.5 million, representing an increase of 45.6 percent from RMB419.3 million in the fourth quarter of 2020.

    “2021 began on a solid note, with strong growth in key performance metrics of our business,” said Ying (“Kate”) Wang, co-founder, chair of the board of directors and CEO of RLX Technology, in a press note. “Specifically, our expansion in distribution network fueled a strong sequential growth, further demonstrating sustained user demand for our e-vapor product portfolio.”

    “As the go-to brand of e-vapor products in China, we remain dedicated to investing in deepening our scientific research, improving our technology and product development, expanding our distribution network and retail outlets as well as enhancing supply chain and production capabilities.

    “In the first quarter, we opened our Quality Lab to further strengthen our quality assurance and control capabilities and started developing our second and third exclusive production plants to enhance our production capabilities. We believe we are well positioned to further capture the growth potential in the e-vapor industry in China,” Wang concluded.

    We remain dedicated to investing in deepening our scientific research, improving our technology and product development, expanding our distribution network and retail outlets as well as enhancing supply chain and production capabilities.

    “Our robust results in the first quarter of 2021 exemplify our strong capabilities in meeting user demands for reliable, innovative and trustworthy products,” said Chao Lu, chief financial officer who joined the company in February. “Building on rapid revenue growth and continued efforts in improving operating leverage, our gross margin and non-GAAP net margin have remained steady in the first quarter. We will continue to pursue user value creation by enhancing our suite of product offerings and strengthening our brand leadership in the market.”

    For the second quarter of 2021, RLX Technology expects net revenues to exceed RMB2.85 billion and expects non-GAAP net income to exceed RMB720 million. The company’s expected GAAP net income will include share-based compensation expenses, which depend on the company’s share price. The company currently also expects gross margin to remain steady.

  • KT&G Recognized for Innovation

    KT&G Recognized for Innovation

    Chi-Bum Oh, senior managing director at KT&G Corp (left) accepts the Prime Minister’s Commendation on May 31. (Photo: KT&G)

    KT&G was awarded the Prime Minister’s Commendation on May 31 in recognition of its contribution to the development of national industry at the 56th Invention Day commemoration ceremony.

    Hosted by the Korean Intellectual Property Office and organized by the Korea Invention Promotion Association, the event rewards individuals and organizations that have contributed to the promotion of inventions in South Korea.

    This year, KT&G was recognized for its contribution to protecting national industrial technology and for the development of the intellectual property system through its unique technology development and job invention promotion policy.

    KT&G CEO Baek Bok In, who took office in 2015, has emphasized the importance of technology in the tobacco industry and focused on securing intellectual property. In 2016, KT&G established a special division for intellectual property. It has also expanded its employee proprietary information and inventions agreement for researchers to encourage patent applications.

    In 2018, KT&G built its own computer system to effectively manage the company’s intellectual property rights. As a result of these and other actions, KT&G’s patent applications rose from 43 in 2016 to 1,203 in 2020.

    “Last year, our researcher received the Prime Minister’s Commendation at the 55th Invention Day ceremony, but not stopping there, KT&G’s technological capabilities were recognized once again this year,” said Chi-Bum Oh, senior managing director at KT&G, in a statement. “In the future, we will focus on technological innovation and the management of intellectual property rights to enhance corporate value.”