Blog - Tobacco Reporter

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

FEELM Recognized at UKVIA Event

Smoore’s atomization technology platform, FEELM, won an award for innovation and was commended for its sustainability initiatives during the U.K. Vaping Industry Association’s (UKVIA) industry forum on Nov. 18.

The Best Innovation in the Vaping Industry award recognizes FEELM’s breakthrough technologies, including its ceramic coil disposable pod solution, FEELM Max.

Among other improvements, FEELM Max offers more puffs than other coil technologies with the same e-liquid volume. Its constant output control and flavor lock technologies ensure a high degree of flavor consistency while preventing dry burning. FEELM also established multiple laboratories to help clients comply with stringent industry regulations, including those issued by the U.S. Food and Drug Administration.

The UKVIA Sustainable Vaping commendation recognized FEELM’s accomplishments in sustainable advanced technologies, responsible marketing and environmental stewardship. In 2019, FEELM created a groundbreaking environmentally friendly disposable electronic atomization device, for example. This year, FEELM developed an environmentally friendly zero nicotine e-atomization device.

Recently, the company committed to achieving carbon neutrality by 2050, and its automated factory has adopted an energy management system to decrease carbon emissions while increasing energy efficiency.

“We are delighted to have won the innovation award and been commended in the sustainability category, and we are honored by the recognition the UKVIA has given us,” said FEELM Europe Division Director Echo Liu.

“A number of leading vaping brands are driven by FEELM, and our vaping devices loaded with our atomizer technology are now being exported to over 50 countries and regions.

“FEELM can only realize its corporate vision—’atomization makes life better’—by being sustainable and creating value for society. Every day we move a step closer to this goal by creating sustainable advanced technologies and products, using responsible marketing, and embracing a greener future.”

November 21, 2022

European Support for Smoke-Free Technology

Smoke-free technologies should complement the EU’s existing tobacco control measures, according to participants in a survey commissioned by Philip Morris International, according to Eureporter.

Carried out Nov. 10–15 by Povaddo and presented in Brussels on Nov. 17, the poll surveyed 13,000 adults spread over 13 European countries.

Among the participants, 73 percent said that industries should be incentivized to develop innovative products that are better for consumers and the environment. Sixty-nine percent said interested adult smokers should be encouraged to switch to scientifically substantiated, smoke-free alternatives by taxing these products at rates that are lower than cigarettes but high enough to deter youth and nonsmokers. Additionally, six in 10 respondents agreed that government endorsement of innovative tobacco products would have a positive impact on smokers.

“We know the potential to do better for adult smokers exists, as several member states have carried out similar policy approaches in, among others, energy, cars and alcohol,” said PMI Senior Vice President for External Affairs Gregoire Verdeaux during the presentation of the survey results.

“Pragmatic policies have the power to improve people’s lives, incentivizing companies to innovate for the better and provide equitable access to technological advances, especially in a time of economic instability.”

Povaddo Research President William Stewart said he hoped the results would encourage EU and national authorities to assess the results of current policies and consider other approaches, including “sensible regulation and taxation, while creating an environment that fosters innovations.”

November 21, 2022

Engineer 3D-Prints Cigarette Machine

A packaging machinery engineer has built a cigarette machine relying partly on 3D printing.

According to Hackaday, creating the machine required overcoming several mechanical challenges, including a sticky raw material (tobacco) and fragile paper tubes.

Controlled by an Arduino and driven by an AF Motorshield V1, the device contains solenoid-powered tappers and a stepper-driven revolver mechanism to put the empty papers into just the right place.

According to the designer, who goes by the screenname Fraens, building the machine required extensive testing. “A lot of power is needed to press the tobacco,” Fraens wrote on YouTube. “I achieve this through a knee lever construction. An IGUS steep thread spindle is used to drive the press.”

November 21, 2022

Hong Kong Poised to Hike Cigarette Taxes

Hong Kong authorities are likely to announce a steep rise in the price of cigarettes next year, reports The Standard.

In an attempt to cut smoking prevalence to 7.8 percent by 2025 from 10.2 percent today, the special administrative region wants to increase the price of a pack of cigarettes to HKD100 ($12.82) from HKD59, Hong Kong Council on Smoking and Health chairman Henry Tong Sau-chai said.

Raising the tobacco tax is the most effective way to achieve the goal, according to Tong, who noted that the tax rate has not been adjusted substantially over the decade.

The council is also proposing a “tobacco endgame,” a strategy that would include a ban on cigarette sales to people born after 2009.

Last year, a similar measure was adopted by New Zealand to create a smoke-free generation by prohibiting people born in or after 2009 from ever buying cigarettes.

Tong said the year 2009 was chosen because people born that year would turn 18 in 2027—the last year of the current government’s term.

Critics have warned that the council’s proposals will encourage smokers to buy their cigarettes on the black market. The government, they said, should instead work on combating illicit cigarettes and adopt a rational tobacco tax strategy.

November 21, 2022

Tobacco Damaged by Fake Chemicals

At least 400 ha of irrigated tobacco have been damaged in Zimbabwe after farmers applied counterfeit chemicals to their crop, reports The Sunday Mail.

Following reports of abnormally growing tobacco plants in October, plant health service officers determined that some farmers had used chlorpyrifos, a hazardous pesticide that is banned for use on tobacco and many other crops, according to the Tobacco Industry and Marketing Board (TIMB).

Remarkably, the symptoms on the affected crops are typically associated with 2,4D-related herbicide damage rather than the use of chlorpyrifos, according to TIMB director for research and extension services Susan Dimbi, who warned farmers against using unregistered agrochemicals.

Zimbabwean police and seed company officials have launched a campaign to crack down on counterfeit agricultural products, which are generally sold at considerably lower prices than genuine products.

November 21, 2022

Lawmakers: Tobacco Smuggling is ‘Sabotage’

The Philippine House Committee on Agriculture and Food has approved legislation that aims to declare the smuggling of raw tobacco, cigarettes, cigars and heated-tobacco products as economic sabotage, reports the Manilla Bulletin.

The bill seeks to include unprocessed and processed tobacco in the Anti-Agricultural Smuggling Act’s definition of “agricultural commodities.”

“Every revenue lost from illicit tobacco trade deprives the country of much-needed funds to support various programs of the government, especially the economic program of tobacco-producing provinces as well as general appropriations for education and other social welfare programs,” said Senior Deputy Majority Leader Sandro Marcos, principal sponsor of the bill.

According to Marcos, the tobacco industry provides livelihoods to 2.2 million Filipinos, including 516,000 farmers and workers. In 2020, it accounted for around 6 percent of tax revenue and 58 percent of sin tax revenues. From April to June 2022, production of tobacco dried leaves reached 36,038 metric tons with the Ilocos Region accounting for 24,020 metric tons, or 66 percent of the total production.

Smuggling threatens not only the livelihood of tobacco farmers but also causes the government to lose out on PHP26 billion ($452.84 million) in tax collections annually, according to Marcos.

From 2019 to January 2022, the Bureau of Customs (BOC) confiscated 87,430 illicit master cases each containing 10,000 cigarettes. The Bureau of Internal Revenue (BIR) seized 46.1 million packs of cigarettes from 2018 to 2021 and 47 million counterfeit tobacco excise tax stamps from 2018 to 2022.

The BOC estimated that the government lost PHP3.7 billion in tobacco excise taxes from 2018 to 2021.

Former Representative Jericho Nograles said the smuggled items confiscated by authorities “are only the tip of the iceberg.” He said smuggling is also a national security issue because it involves the porosity of the country’s borders.

Under the Philippines’ current law, companies or people caught in possession of untaxed tobacco products face prison terms of up to 12 years. The proposed legislation seeks to increase the maximum prison sentence to 40 years without bail. This would be on top of paying fines double the value of the seized smuggled items plus the total amount of unpaid duties and other taxes.

November 21, 2022

Virginia Tech to Study Impact Tobacco Taxes

Scientists with Virginia Tech’s Fralin Biomedical Research Institute at VTC are leading a five-year, $3.5 million study to predict the impact of tobacco taxes on health.

“Taxes are one of the most effective ways to change behavior—they make people think about their choices, including their choice to use tobacco,” said Warren Bickel, a professor at the Fralin Biomedical Research Institute and director of the institute’s Addiction Recovery Research Center, in a statement.

Funded by the National Cancer Institute of the National Institutes of Health, Bickel’s research project will forecast the impact of tobacco tax proposals in a complex experimental marketplace that continually changes with the introduction of new products, such as low-nicotine cigarettes or electronic cigarettes.

According to Virginia Tech, the work has potential to deliver research-based health policy guidance for new tobacco regulations as well as evaluate the health consequences of people’s economic choices.

“Taxes are one of the most effective ways to change behavior—they make people think about their choices, including their choice to use tobacco.”

Warren Bickel, director, Fralin Biomedical Research Institute Addiction Recovery Research Center

“Taxes can help people achieve better health by discouraging them not to smoke. If you make the product more expensive, people will use less of it. They can also leverage people to move from the most harmful tobacco products to the least harmful,” said Bickel, who is also the director of the institute’s Center for Health Behaviors Research.

He will take tobacco-related health disparities into account by investigating socioeconomic factors.

“People with low incomes have a higher prevalence of smoking, and disproportionate tax policies could have far-reaching direct and unintended effects,” said Bickel, who is also a professor of psychology in the Virginia Tech College of Science.

To get clear answers, Bickel’s approach involves the Experimental Tobacco Marketplace, an invention of the Addiction Recovery Research Center. Participants have an account and buy tobacco products to reflect their typical purchasing. Co-investigators at the Fralin Biomedical Research Institute working on the project with Bickel include Jeff Stein and Allison Tegge.

The marketplace places the mix of products, prices and specific regulations under experimental control for researchers to estimate policy impact in real-world circumstances.

In this environment, researchers can forecast the impact and health equity of tax proposals, including a proposal that equally levies taxes across all tobacco products as well as others that issue tax based on a product’s nicotine content, potential for harm or whether it has received a modified-risk designation from the Food and Drug Administration.

“We can implement policies in the experimental tobacco marketplace and provide information about the impacts on people’s tobacco purchasing,” said Bickel. “For example, if lawmakers or regulators restrict access to one product versus another, will it result in smokers making less healthy or more healthy choices? It is an ideal resource to investigate the harm reduction potential of low-nicotine cigarettes and alternative nicotine products.”

November 21, 2022

Miller to Lead 22nd’s Tobacco Business

22nd Century Group promoted John Miller to president of its tobacco business unit on Nov. 11, reports the Winston-Salem Journal, citing a Nov. 17 regulatory filing. Miller was hired by the manufacturer in May.

Miller has more than 35 years of experience in the tobacco and consumer packaged goods industries, including most recently as president and chief executive of Swisher International, which makes cigars and smokeless tobacco products.

He also worked for more than 20 years in various management positions at U.S. Smokeless Tobacco Co. through its acquisition by Altria Group Inc. in 2009.

November 21, 2022