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How to measure the black market for cigarettes

Popular methods include surveys, statistical analysis and rooting through rubbish

http://www.economist.com/blogs/economist-explains/2017/06/economist-explains-4

LAST month Britain joined a growing number of countries in which cigarettes can only be sold in plain packs. Tobacco companies claim that the move will boost the sales of contraband cigarettes by making them trickier to spot. There is one way to tell whether this actually happens: track how black-market sales change. But how can such sales be measured?

There are about a dozen ways to do it, of which three are the most commonly used, says Hana Ross of the University of Cape Town. The first is a comparison of the number of cigarettes sold legally (from records on cigarette taxes paid) with the number of cigarettes consumed (which is calculated from surveys asking people how much they smoke). The gap between the two figures is the estimated share of the black market. The second commonly used method is to ask smokers where they have bought cigarettes and how much they have paid; smokers might also be asked to show the most recent pack they have bought. A price lower than that of legally sold brands suggests a contraband sale; some smokers openly admit that they have bought contraband cigarettes, or show a telltale pack.

The third method is to look at discarded cigarette packs and count up each that looks like a black-market purchase, for instance by missing its tax sticker or displaying a brand that is not officially registered. Discarded packs can be collected from vendors who sell cigarettes by the stick, from litter in the streets, or by rummaging through rubbish bins or the hauls of refuse-collection trucks. (“We dress them as if they are going into space”, says Ms Ross about the recruits who rummage through the heaps.)

Each of these methods has its weakness. Smokers may, for example, be reluctant to mention purchases of cigarettes they know to be contraband. They may also claim to smoke less than they actually do (especially if researchers come round soon after a major anti-smoking campaign). Ideally, multiple methods should be applied to get a better estimate of the total black-market sales. And trends over time are best measured by applying the same method. Such studies are conducted in a growing number of countries. Just because a sale occurs in the shadows does not mean it is impossible to cast a smouldering light on it.

Centre wants to stub out airport tobacco shops

Welcome move: The Ministry also ordered that tobacco shops are not located to smoking rooms. In a significant move to discourage smoking at airports, the Union Health Ministry has written to the Airports Authority of India (AAI) Chairman, the Union Ministry of Civil Aviation Secretary, and CEOs of Chhatrapati Shivaji International Airport, Indira Gandhi International Airport and Rajiv Gandhi International Airport to ensure that tobacco shops at airports are not located near smoking rooms. Punishable offence Besides tobacco shops at airports displaying signage stating that “sale of tobacco products to a person below the age of 18 years is a punishable offence”, they shouldn’t sell non-tobacco products, the letter adds. In the May 26 letter, the Health Ministry brought to the notice of the AAI and the Civil Aviation Ministry that provisions of the Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act (COTPA), 2003, were being violated at airports by shops selling cigarettes and other tobacco products. These shops, in contravention of provisions of COTPA, display tobacco advertisements and are located just outside smoking rooms or in food courts, thus facilitating tobacco use among non-smokers, especially children. ‘No signage displayed’ The letter highlighted that certain tobacco products are also sold at shops selling souvenirs, food articles, books and comics, thus enabling easy access to non-smokers, especially children, to these shops and tobacco products. These shops also do not display the signage stating that “sale of tobacco products to a person below the age of 18 years is a punishable offence”. An anti-tobacco activist said, “The Health Ministry had earlier issued a notification banning the use of hookah in any smoking area or space provided for smoking.

https://www.nyoooz.com/news/delhi/831807/centre-wants-to-stub-out-airport-tobacco-shops/

It had also directed owners, proprietors, managers, supervisors or in-charges of affairs of the hotel, restaurant or airports shall display at the entrance of smoking areas or spaces a board of minimum size of 60×30 cm with a white background the messages — “Tobacco Smoking is Harmful To Your Health and The Health of Non-Smokers” and “Entry of Person Below The Age of Eighteen Years Is Prohibited” — in English and an Indian language in black colour.”. . .

Hong Kong Customs seizes suspected illicit cigarettes

Hong Kong Customs yesterday (June 2) seized about 1.5 million suspected illicit cigarettes with an estimated market value of about $4.1 million and a duty potential of about $2.9 million at Man Kam To Control Point.

http://www.info.gov.hk/gia/general/201706/03/P2017060200961.htm

Customs officers intercepted an incoming truck declared to contain cloth at Man Kam To Control Point yesterday. After inspection, Customs officers found about 1.5 million suspected illicit cigarettes inside 156 carton boxes. A male driver, aged 52, was arrested and the truck has been detained for further investigation. Investigation is ongoing.

Smuggling is a serious offence. Under the Import and Export Ordinance, any person found guilty of importing or exporting unmanifested cargo is liable to a maximum fine of $2 million and imprisonment for seven years.

Members of the public may report any suspected illicit cigarette activities to the Customs 24-hour hotline 2545 6182.

Ends/Saturday, June 3, 2017
Issued at HKT 15:30

WHO China launches smoke-free campaign targeting youth

The World Health Organization (WHO) started a “smoke-free generation” media campaign in Beijing Thursday targeting young Chinese.

http://www.china.org.cn/china/2017-06/03/content_40957899.htm

China is in the grip of a national tobacco epidemic, and children are most susceptible with cigarettes portrayed as fashionable and alluring in popular culture, said Bernhard Schwartlander, WHO Representative in China at the launch event.

According to WHO, over half of Chinese adult men smoke, two thirds of whom started as young adults. By 2014, 72.9 percent Chinese students had been exposed to secondhand smoke.

“There is nothing cool about smoking, but there is something empowering about choosing to live a healthy, smoke-free life,” said Schwartlander.

Since China ratified the WHO Framework Convention on Tobacco Control in 2005, the country has made a number of tobacco control efforts, including banning tobacco advertisements, increasing tobacco taxes and putting forward regional smoking bans.

As of 2016, 18 cities, including Beijing, Shanghai and Shenzhen, had implemented regional smoking bans.

China has set a target to reduce the smoking rate among people aged 15 and older to 20 percent by 2030 from the current 27.7 percent, according to the “Healthy China 2030″ blueprint issued by the central authorities last October.

Philip Morris ‘tobacco sticks’ court prosecution postponed

The heat has come on tobacco company Philip Morris for importing and selling “tobacco sticks”.

http://www.stuff.co.nz/business/industries/93268568/Philip-Morris-tobacco-sticks-court-prosecution-postponed

The company is facing two charges brought by the Ministry of Health over the sticks, called Heets.

The charges were to be called in the Wellington District Court on Friday but at the last minute they were adjourned by agreement until September 7.

That date was for a case review hearing, an indication that the company would plead not guilty although it appeared no pleas were entered.

The ministry said it considered Heets fell into a category of tobacco products for oral use, other than smoking, and so were banned under the Smoke-Free Environments Act.

Heets were described as tobacco sticks heated in an electronic device, rather than being burned like a normal cigarette.

Through a code-protected invitation-only website, the company was marketing its IQOS smokeless electronic devices, which heated the sticks to release the nicotine.

In March the company said it was confident the way it was doing business was legal.

General manager for Philip Morris New Zealand, Jason Erickson, said they complied with all sections of the Smoke-Free Environments Act.

“We are currently making our IQOS device and Heets available to registered adult smokers on a website. If requested, we will provide a demonstration on how to use the IQOS device, which as the Ministry of Health has acknowledged, is a consumer electronics product.”

The two charges the company faced had a maximum $10,000 penalty.

Three men jailed over illegal tobacco factory

Three men have been jailed for a total of 16 years for a £17m tax fraud after an illegal tobacco factory was discovered.

http://forecourttrader.co.uk/news/fullstory.php/aid/13410/Three_men_jailed_over_illegal_tobacco_factory.html

HM Revenue and Customs (HMRC) officers found that a Poland-based criminal network used several sites in the North West and Essex to process raw tobacco into illegal tobacco products in an attempt to evade excise duty and VAT.

During the investigation, HMRC seized tobacco in Preston, Lancashire, in 2013 followed by arrests and more seizures of tobacco and manufacturing equipment the following year in Bury, Greater Manchester; Blackburn, Lancashire; and Halsted, Essex.

One of the men, Robert Zduniak, fled during the trial but was convicted and jailed for eight years in his absence at Manchester Crown Court on Friday. His co-conspirators, Hubert Jankowski, and Lukasz Pawelec, were each jailed for four years.

Pawelec had also tried to flee but was caught at Doncaster Airport and remanded for the remainder of the trial.

In April 2014, HMRC raided a farm in Essex, as well as four premises near Bury and another in Blackburn. They seized around three tonnes of raw tobacco that was in the process of being converted into counterfeit hand rolling tobacco (HRT), £15,000 in cash, chemicals, counterfeit packaging and tobacco packing machinery. The tobacco processing plant in Essex was dismantled immediately by HMRC.

HMRC linked the 2014 seizures and the jailed men to a further eight tonnes of tobacco valued around £1.8m in evaded duty and tax that was seized in Preston in 2013.

Further enquiries by HMRC established that the gang had imported more than 100 tonnes of raw tobacco mislabelled as ‘furniture’ into the UK, from the Czech Republic, over a 15-month period. If converted into counterfeit hand rolling tobacco this represents a potential tax loss of £17m.

Yikhum village bans sale/use of tobacco

After successfully enforcing the ban on use and sale of tobacco products and alcohol within the for about 5 years, Yikhum Village under Wokha district has been recognized and formally declared as ‘Tobacco Free Village’ by the District Tobacco Control Cell (DTCC) under the National Tobacco Control Programme on May 31 on the occasion of World No Tobacco Day at Wokha Town. This was informed through a press note by Yikhum Village Council chairman, Robin Kithan.

http://www.nagalandpost.com/ChannelNews/State/StateNews.aspx?news=TkVXUzEwMDExNTU0OQ%3D%3D

“Seriously considering the fatal menace of the use of hazardous elements, the Village council with the mandate of the general public imposed a total ban henceforth,” the note stated. Therefore, anyone found selling/using openly the banned substances including alcohol within the village shall be fined Rs. 1000 (seller) and Rs. 200 (user), along with “stringent punitive” actions.

Hampshire County Council slammed after £80 million pumped into British American Tobacco

CIVIC chiefs have been slammed after pumping £81 million into a tobacco company.

http://www.dailyecho.co.uk/News/15323523.Council_slammed_after_funds_pumped_into_tobacco_firm/

Hampshire County Council’s pension fund has invested the money into one of the biggest tobacco companies in the world, British American Tobacco (BAT).

The council top the list of UK authorities who have investments in tobacco.

However, some of the world’s largest investment organisations have called for UK authorities to pull out of tobacco investments.

One big name to sell its tobacco shares is the French insurance giant Axa.

The UK Sustainable Investment and Finance Association (UKSIF), said it was ‘silly’ for one part of the council to be trying to promote health while the pension fund was, indirectly, promoting smoking.

Simon Howard, chief executive of UKSIF said: “Many local authorities now have responsibility for tobacco control and smoking cessation activities.

“If Hampshire is one of the local authorities which has responsibility for stopping smoking then it also seems silly for their pension fund to own tobacco shares. They are perfectly able to sell these shares.”

The county council currently manage a pension fund of £5,213 million on behalf of more than 300 employers and public bodies, and around 155,000 current and former staff.

Defending their actions, a spokesperson from the authority said: “Social, environmental and ethical considerations are taken into account when assessing the financial potential and suitability of investments.

“The independent pension fund has a fiduciary duty, by law, to invest fund monies to achieve the best possible financial return.”

Pension fund panel and board member, Councillor Bruce Tennent (pictured), said the council couldn’t be an organisation that puts ethics above financial return.

Cllr Tennent, who has been on the board for seven years, said: “Yes, ethical considerations are taken into account.

“There are break-downs in high and low-risk investments and ethical and non-ethical investments. We can’t be a board who puts ethics above monetary interests.”

BAT has its UK base in Southampton and employs 1,200 at its Millbrook site which is its global centre for research and development department and is also home to IT, finance, and distribution departments.

The firm has been in the city for more than a century but ceased cigarette manufacture here more than a decade ago. However, it employs more staff now than at any time ins recent history.

BAT declined to comment on the issue and referred the Daily Echo to The Tobacco Manufacturers Association, who said the industry was a sound investment.

Giles Roca, director general of the organisation, said: “Fund managers are free and indeed required to make the best financial decisions for their investors.

“Many commentators would point to the tobacco industry’s strong financial performance in recent years as a reason why its shares are considered an attractive buy for pension funds.”

While acknowledging the need for the county council to get the best deal for their pensioners, public health charity Action on Smoking and Health (ASH) said that pension fund boards had to think seriously about balancing financial obligations with health promotions.

Director of policy, Hazel Cheeseman, said: “Increasingly fund managers around the world are seeing tobacco as neither acceptable nor sustainable.

“Over the long term we ask funds to think seriously about how they balance both their financial obligations and the obligations local councils have to promote health.”

This week the World Health Organization (WHO) called on governments to implement strong tobacco control measures as part of its

WHO director general Dr Margaret Chan said: “By taking robust tobacco control measures, governments can safeguard their countries’ futures by protecting tobacco users and non-users from these deadly products, generating revenues to fund health services.”

When asked to comment, several local and national cancer charities declined to do so.

Health ministry caves to LDP, shelves restaurant smoking ban vow

The health ministry on Friday decided not to include a pledge to ban smoking in restaurants in its long-term policy on cancer control, yielding to pressure from the ruling Liberal Democratic Party to leave the lax regulations intact.

http://www.japantimes.co.jp/news/2017/06/02/national/science-health/health-ministry-drops-effort-ban-smoking-restaurants-amid-efforts-curb-cancer/#.WTO7rWiGOHs

The Health, Labor and Welfare Ministry will still aim to eliminate smoking in government offices and medical institutions, officials said, as it seeks to implement tighter measures to counter passive smoking before Tokyo hosts the 2020 Olympics and Paralympics.

In line with the goals of the administration of Prime Minister Shinzo Abe, the ministry will reduce the proportion of the population exposed to the risk of passive smoking to 15 percent or lower by fiscal 2022.

The ministry presented its final plan on smoking measures to a panel on Friday, with the six-year plan scheduled to start this fiscal year expected to be formally approved by the Cabinet next month.

The ministry had earlier sought to ban smoking in restaurants by 2020, exempting only small bars under the new six-year plan. But the LDP, backed by the tobacco and restaurant industries, has proposed that smoking be allowed as long as smoking and nonsmoking areas are clearly separated.

The six-year plan also aims to boost the cancer screening ratio to 50 percent and raise the ratio of suspected cancer patients who take detailed follow-up exams to 90 percent.

The ministry is also seeking revisions to the 2003 Health Promotion Law to ban smoking in public places in time for the Olympics. Currently, the law says operators must “make efforts” to curb passive smoking.

But it has not been able to introduce the revision bill to the Diet due to fierce opposition from the LDP’s pro-tobacco members. With less than a month left until the Diet closes, it is becoming increasingly difficult for Japan to ban indoor smoking before 2020.

The ministry estimates that about 15,000 people die annually in Japan from passive smoking, which is known to cause heart disease, stroke and lung cancer. With no law to ban public smoking, Japan was among the countries in the lowest-graded group out of four in the World Health Organization’s 2015 report on the global tobacco epidemic.

After the WHO and the International Olympic Committee agreed in 2010 to promote tobacco-free Olympic Games, all countries hosting the Olympics have implemented anti-tobacco regulations that include punishment, according to the ministry.

WHO urges government to control tobacco use

The World Health Organisation (WHO) has urged the government to introduce policies to control the use of tobacco because it is a leading risk factor for some serious non-communicable diseases.

The Country Representative of WHO, Dr Owen Kaluwa, who made the call suggested, for instance, the imposition of high taxes on tobacco companies to deter them from going into production.

http://www.graphic.com.gh/news/general-news/who-urges-government-to-control-tobacco-use.html

In the event of the companies paying such taxes, he said, the revenue generated should be used to finance health delivery.

He was speaking at a public forum to mark World No-Tobacco Day (WNTD) in Accra last Wednesday.

Avoid tobacco

Dr Kaluwa said globally, tobacco kills about 7.2 million people every year, over 80 per cent of whom are from low or middle-income countries.

“In Africa, about 146,000 adults aged 30 years and above die every year due to tobacco-related health diseases,” he added.

He said the use of tobacco was a leading preventable risk factor for non-communicable diseases such as cardiovascular diseases, cancer and chronic lung disease.

“Up to half of all tobacco users will die prematurely from tobacco-related causes, and on average, tobacco users lose 15 years of their lives,” he said.

Mr Kaluwa added that the growing of tobacco had affected agricultural lands in some areas.

Public education

At her turn, a Deputy Minister of Health, Mrs Tina Mensah, said adequate public education was important in dealing with the problem of tobacco use.

She reiterated the fact that tobacco use was dangerous to human health and damaging to national economic development.

“Tobacco-related illnesses and premature mortality impose direct and indirect cost to individuals and government,” she said.

She noted that tobacco production companies tried to influence the young generation to become addicted to smoking, which was a national threat.

She applauded the Food and Drugs Board (FDB) for its intervention in combating the use of tobacco by preventing tobacco companies from advertising their products.

Mrs Mensah said the ministry, for its part, would continue to support the fight against the use of tobacco in the country.

Preventive measures

Outlining some measures that had been put in place to check tobacco usage, the Chief Executive Officer (CEO) of the FDA, Mrs Delese A. Darko, mentioned the prohibition of smoking in public places, advertising prohibition and sponsorship as examples.

She added that packaging, labelling and health warnings on tobacco packages were other ways of preventing and discouraging tobacco consumers from patronising the product.

“These prohibitions have shown to be effective in reducing the demand for tobacco,” she said, adding that public sensitisation and education would, accordingly, be increased to meet the target groups.

“As we get funding, we will continue to do more to inform the public about the harmful effects of the use of tobacco,” Mrs Mensah said.

In connection with the celebration, Smoking Cessation Guidelines and a declaration on WNTD 2017 were launched.