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February, 2012:

Philip Morris turns to Kraft as general counsel resigns

21 February 2012 | By Yun Kriegler

International cigarette and tobacco company Philip Morris International has appointed Kraft Foods general counsel Marc Firestone to head its legal department as current general counsel David Bernick resigns.

Firestone has been the executive vice president, corporate and legal affairs and general counsel of Kraft Foods since 2006. During his tenure, he oversaw the US food conglomerate’s £11.5bn takeover of British chocolate maker Cadbury in 2010 (19 January 2010).

It will not be the first time that Firestone has held a position at Philip Morris. He joined the tobacco giant in 1988 and assumed various senior roles, including senior vice president and general counsel, prior to joining Kraft Foods in 2003.

Kraft Foods has named Gerhad Pleuhs as Firestone’s replacement, effective from April. Pleuhs currently serves as deputy general counsel at Kraft.

A recent filing by Philip Morris to the US Securities and Exchange Commission (SEC) showed that Bernick recently informed the company of his intention to resign effective from 30 June 2012.

PMI’s CEO Louis Camilleri stated in an internal announcement: “I regret to inform you that David has concluded that his ambitions would be best served by pursuing other attractive avenues available to him.

“I wish to take this opportunity to both acknowledge David’s accomplishments and thank him wholeheartedly for the significant value he has brought to Philip Morris since he joined us in March 2010. His contributions to the function he leads and to numerous Philip Morris strategic priorities, not least of which included the invaluable insights and creative work on our Next Generation Products, will endure for years to come.”

Prior to joining Philip Morris in March 2010, Bernick was a partner at Kirkland & Ellis, where he served for 31 years and was a member of the firm’s management committee for over 15 years.

The document also indicated that Bernick will receive CHF4.1m (£2.8m) as his annual incentive compensation award for 2011. In addition, he will receive a payment of CHF1.45m (£1m) for agreeing to not compete with the company for 12 months.

gardens ban ‘would help smokers quit’

21 Feb 2012

Banning smoking in pub gardens would cut cigarette use by discouraging people who only light up when they drink, according to research.

Campaigners said that a ban on smoking outside bars and pubs could improve public health, and described people who smoke on patios and pavements as “anti-social”.

Most “social smokers”, who only reach for a cigarette while on a night out, support the idea of extending smoking ban legislation to cover such areas, according to academics.

Ash, the anti-smoking campaign group, said the idea of an outdoor ban would be worth investigating if evidence emerges that it can help occasional smokers.

Their comments came after researchers at the Otago University in New Zealand found 12 out of 13 “social smokers” that they interviewed strongly supported extending anti-smoking legislation.

The interviewees said that although smoking and drinking went “hand in hand”, they considered themselves non-smokers because they only lit up on nights out.

The academics, writing in the journal Tobacco Control, concluded that introducing a policy of smoke-free bars would help social smokers quit by “changing the environment that facilitates it”.

Martin Dockrell, of Ash, said there was currently no evidence available that banning smoking in pubs’ and bars’ outside areas reduced social smoking.

However, he noted: “In New York there are plans to limit smoking in some outdoor places.

“It will be interesting to see if it has any effect on occasional smokers.”

Paul Barlett, a councillor in Stony Stratford near Milton Keynes, who is trying to get the town to go smoke-free, said: “Whatever we can do to discourage smoking has to be encouraged.

“If there was a move to stop smoking outside bars and in pub garden I would support it.”

He argued those who lit up in such spaces were being “anti-social”, particularly if there were children about.

Jean King, Cancer Research UK’s director of tobacco control, said: “This small study highlights some interesting points about what triggers some social smokers to light up.

“Given that a quarter of all cancer deaths are due to tobacco, Cancer Research UK believes one key measure that would reduce the attractiveness of smoking would be to remove all branding and colourful designs on packs.

“This would reduce the appeal of tobacco to young people and increase the impact of health warnings on the packs.”

Dame Helena Shovelton, chief executive of the British Lung Foundation said: “The BLF could consider supporting this call for legislation but more research needs to be done to find out if it would make a difference to people’s smoking behaviour.”

However, Simon Clark, director of the smokers’ lobby group Forest, said: “This study can’t be taken seriously: it’s based on just 13 people.

“Aside from that, the smoking ban was brought in allegedly to protect bar workers. Banning smoking outdoors would have nothing to do with that.

“I would also query that social smoking, having the odd cigarette, is an unhealthy activity.”

Anti-smoking campaigners are keen to extend the ban on smoking in public places.

Last November the British Medical Association called for a law to ban smoking in private cars, arguing there was strong evidence that it could be dangerous to others in the vehicle.

The Welsh Government is looking at the idea, as well as another to ban smoking in children’s playgrounds

Outdoor dining smoking ban for NSW

Smoking bans are to be put in place at playgrounds, public transport stops, entrances to public buildings and sports ground s in NSW. Source: AdelaideNow

ANTI-tobacco laws just got tougher in NSW with bans to be put in place at playgrounds, public transport stops,entrances to public buildings and sports grounds, with outdoor dining to follow.

Health Minister Jillian Skinner announced today that while the public smoking bans will be put in place as soon as they pass through parliament, possibly within a couple of months, the commercial outdoor dining areas will not be introduced until 2015.

Currently some council areas have some of these smoking bans in place but the new tobacco reforms – as part of NSW Tobacco Strategy 2012-17 – will now be uniform across the state.

“The aim of this is to reduce the number of people who are smoking and to reduce the exposure to people, particularly children and families of third-party tobacco smoke,” Ms Skinner said.

The NSW Heart Foundation backed the reforms.

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“This is an historic moment in our State’s history and one that will help to protect the thousands of people in NSW who don’t smoke,” NSW Heart Foundation CEO Tony Thirlwell said.

“There is no safe level of exposure to second hand smoke evidence shows that a non-smokers exposure to second-hand smoke can result in up to a 30 percent increase in risk of heart disease,” he said.

India: Tobacco is Eating Your Baby Alive (English)

New unit to target cigarette smugglers

15-strong team to focus on door-to-door deliveries by gangs, and online sales

Clifford Lo 
Feb 20, 2012

Smuggling gangs who deliver illicit cigarettes door to door to order are the target of a new customs unit, which will also monitor those trying to sell cigarettes online.

The 15-strong team will tackle gangs who deliver fliers with price lists for different brands and mobile phone contact numbers. The cigarettes sell for between one-fifth and half the usual retail price as smokers seek cheaper options after a 41.5 per cent increase in the tobacco tax came into force last year.

The unit, which starts work in April and will have an annual budget of more than HK$4 million, was set up in response to a shortage of manpower on the anti-illicit cigarette investigation team that was set up in 2003.

The older unit will focus on finding illegal cigarettes as they are imported or stored.

“We foresee that phone-ordering services for illicit cigarettes will continue and the new unit can strengthen our action to fight the illegal trade,” said Superintendent Kong Shui-wing, deputy head of customs’ revenue and general investigation bureau.

He said undercover efforts were becoming more difficult because gangs were taking more precautions after customs officers stepped up efforts to tackle contraband cigarettes last year.

The crackdown resulted in the seizure of 106 million illicit cigarettes worth about HK$250 million, the largest seizure since 2008 and up about 40 per cent on the 2010 figure.

But traffickers “have reacted to the crackdowns and become more alert to our undercover operations”, Kong said, with many using prepaid phone cards and changing their contact numbers regularly to avoid detection.

“To avoid being caught, they have ways of screening new customers to ensure the potential clients are not undercover agents. They will ask more questions over the phone, observe and check out where they live before doing business.”

The gangs are particularly active in public housing estates in Tin Shui Wai and Sheung Shui. Complaints about telephone sales were the subject of more than 1,000 of the 2,792 complaints relating to illicit cigarettes received by the Customs and Excise Department last year.

The customs team would also look at the sale of cigarettes through internet chat rooms, Kong said.

He said customs officers were monitoring websites, but undercover officers posing as buyers had found only a handful of such cases in the past two years.

Smoking concerns may prompt ban on SIC investment in tobacco firms

– –

Concern about the number of Shetlanders still smoking themselves to death may prompt Shetland Islands Council to stop investing funds in tobacco companies. The move could cost around £390,000 a year in lost income but some councillors believe it is a price worth paying.

An attempt to boycott Imperial Tobacco and British Allied Tobacco was made at yesterday’s meeting of the executive committee, led by Betty Fullerton, the former NHS Shetland chairwoman. But the committee was told that the decision was one which only the whole council can make.

However, the chance to act will arise in the next few weeks when the council sits down to review its investment policies. It will not be an easy decision to make, given that spending plans have already been agreed for using the £390,000 tobacco gains and any political decision to wilfully cut council income during financial hard times may anger many in the community.

Councillor Jonathan Wills was concerned about how much the “tobacco epidemic” was costing the council in lost working time. And, with one Shetlander a week dying from tobacco-related illness, according to his figures, he wondered how making money from tobacco sat with the council’s corporate policy on a healthier and fairer Shetland.

He said if the local authority continues profiting from what is essentially the sale of drugs it should perhaps also turn the empty Craigielea home into a brothel because that would be a money-spinner too.

Mrs Fullerton said there was no safe level of tobacco consumption and it bore a cost for the council in sickness and time for employees to smoke.

A loss of £390,000 would be acceptable, she said, because it would help save the country money and the council. Alternative ways of investing council funds might even perform as well as tobacco shares, she said.

She won support from councillor Caroline Miller who said the effect of tobacco use on families was “absolutely horrendous”.

But councillor Alastair Cooper felt he had to point out that disinvesting itself of tobacco shares did not mean people in Shetland would smoke any less. “We’re kidding ourselves if we’re saying that,” he told the meeting. It would be more effective to put some of the profits into persuading council staff to give up.

Councillor Gary Robinson had his doubts too, predicting that in a few years’ time there will be a pronouncement that people should stop drinking alcohol too. What would the council invest in, he asked, if everyone got to ban their pet dislikes?

Councillor Robert Henderson said ceasing tobacco investments was “not going to make the slightest difference in Shetland whatsoever”.

The issue of ethical investment of funds for profit has cropped up many times over the years, usually at meetings of Shetland Charitable Trust. Despite hours of passionate debate absolutely nothing has changed.

Yesterday’s debate was prompted by a report into three different scenarios which would help the council avoid its funds being used for dodgy purposes, such as the manufacture of arms and torture implements, nuclear weapons and exploitative mining.

The first scenario looked at the example set in Norway where the £370 billion government pension fund – one of the biggest retirement funds in the world – ensures that funds are not invested in 54 excluded companies. Interestingly one of them, Serco, is a bidder to take over the NorthLink shipping contract for Shetland and Orkney.

Only six of the companies feature on the UK Stock Market and boycotting them over the past 10 years would have cost the council around £1.4 million a year in lost income, according to council treasury accountant Colin Bain.

The second scenario involved boycotting the two UK Stock Market-listed tobacco companies, resulting in around £390,000 a year less to the council. Shares in tobacco often do better than general shares in the Stock Market, despite the decline of smoking in the West.

The third scenario featured the FTSE for Good index, which measures the performance of UK companies which have globally recognised high standards of corporate responsibility. It excludes tobacco, nuclear power and the arms industries.

If the council had been adhering to that investment system it could have cost it around £1.28 million a year in lost income.

Acting head of finance Hazel Sutherland warned that the council had set a budget based on achieving a 4.5 per cent return on its investments so any changes to the policy could result in a shortfall and therefore a budgeting problem for the local authority.

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2012 Report on the future of Philip Morris in Asia

2012 Report on the future of Philip Morris in Asia

Translation: Growth = Death and Suffering inflicted for profit – Never mind the kids they are our future.

  • Asia Remains PM’s Key Growth Driver In 2012 And BeyondBased on an in-depth, bottom up analysis that we performed late last year, we continue to believe PM’s business in Asia is the company’s most valuable asset and is potentially worth $75B or $42 per share. We continue to expect PM’s profits in Asia could double to $10B by 2020. We maintain our Outperform rating on PM shares and it remains our top stock pick for 2012. Please see our original, detailed report on Asia published on 12/16/11 which includes an analysis of key fundamental drivers for each market in Asia, including demographics, economic growth, regulatory trends, cigarette price and consumption trends, and social attitudes toward cigarette consumption.
  • Individual Country Models Suggest Significant Growth Opportunity – We’ve updated our initial country P&L’s for PM’s top 5 markets in Asia and have included them in this report.
  • Indonesia Will Likely Drive The Majority Of PM’s Asian Growth – Our analysis suggests Indonesia is PM’s top market opportunity, as a combination of favorable demographics, economic fundamentals and competitive dynamics should allow PM’s profits in Indonesia to almost quadruple to $5.2 billion by 2020, at that point representing more than 50% of PM’s total Asia segment OCI. We feel Indonesia’s potential earnings power is misunderstood by the market.
  • Japan Is Highly Profitable, But Has Limited Growth Prospects – Japan has long been among the most profitable cigarette markets in the world. We estimate that Japan represented about 46% of PM’s Asia segment profit in 2011, with approximately 57% margin. Although comps will likely be challenging in 2012, we expect OCI to modestly increase, aided by a stronger yen.
  • China Could Be A Game Changer For PM – The real upside potential for PM in China lies in the company’s opportunity to exploit potential strategic alternatives for CNTC. We think of China as a call option on the stock.
  • The Philippines, Korea, And Australia Are Important Markets – Opportunity in the Philippines’ and Korea stems from the movement toward premium products. Australia is likely a challenging, but profitable market.

Download PDF : 2012 PM Asia Business – A Land of Opportunity

Download PDF : 2012 PM Asia In-Depth Analysis Detailed Report

Tobacco added in to the cocktail mix | Life and style |

18 Feb 2012

The cocktails I’ve come to try tonight are made using Perique Tobacco
Liqueur produced by scientist come craft-distiller, Ted Breaux, who makes
the spirit in France using distilled Louisiana Perique – one of the
rarest and strongest tobaccos in the world.

“It’s made in roughly the same way as gin is,” says Ted. “But instead of
using juniper berries we use tobacco. The concept was to take an
immensely powerful substance and then to reduce it through distillation
into something very subtle but full of flavour.”

Smoking ban expected by Beijing

Smoking ban expected by Beijing

Updated: 2012-02-16 16:58

By Cao Yin and Zheng Xin (China Daily)

BEIJING – A ban on smoking will be written into the capital’s municipal regulations as the city increases its anti-smoking efforts.

Measures banning smoking are on the legislative agenda and the government is expected to pass the regulations, Zhang Yin, director of the legal office from the Beijing Municipal People’s Congress, told China Daily at the top legislature 2012 working conference.

Although there is a smoking ban in public places, it has not been well enforced, Zhang said. The new regulations are expected strengthen enforcement, he said.

“Smoking is a serious problem that the public has complained about. We must figure out how to enforce a smoking ban,” Zhang said. “What we are doing now is to integrate all our research on this and develop the groundwork for lawmakers to write the regulations,” he added.

He did not disclose any specifics or details on what the regulations would say, or a timeline for when they will be passed.

As the biggest tobacco producer and consumer in the world, China has more than 300 million smokers, and 740 million are exposed to the second hand smoke. Some 1.2 million Chinese die from tobacco-related diseases every year, according to Vice-Minister of Health Huang Jiefu.

In a survey of some 40,000 students nationwide conducted by the Chinese Association on Tobacco Control, 15.8 percent of the high school students smoke and 22.5 percent say they want to try smoking.

“Smoking has become quite prevalent among students,” said association spokesman Suo Chao. “Twelve to 14 year-olds are especially vulnerable.”

According to the World Health Organization, there are 1.25 billion smokers worldwide. Six million die from tobacco-related diseases every year, and the figure will soar to 8 million in 2030 if the trend continues at this pace.

Successes and new emerging challenges in tobacco control: addressing the vector

Download PDF : Successes and new emerging challenges in tobacco control. addressing the vector Ed TC 12 03

There have been momentous events in
tobacco control since the first edition of
Tobacco Control was launched in 1992.
These include increased global awareness
of the harmfulness of tobacco and the
WHO Framework Convention on Tobacco
Control (WHO FCTC).1 The WHO FCTC
represents the most momentous milestone;
it was the first treaty negotiated
under the auspices of the WHO and
entered into force in 2005. It is one of the
most rapidly embraced UN treaties and
represents a paradigm shift in developing
a regulatory strategy to address addictive
substances. In contrast to previous drug
control treaties, the WHO FCTC asserted
the importance of demand reduction
strategies as well as supply issues and thus
established a framework for an integrated
multisectoral response to a grave public
health issue.
Other major achievements include
strengthening of the international nongovernmental
movement against tobacco,
for example, continuing and expanded
world conferences on tobacco or health;
the establishment of the International
Network of Women Against Tobacco,
inaugurated about the same time as the
launch of the journal; the Framework
Convention Alliance formed in 1999;
international web-based networks on
tobacco. There has been a significant
increase in research on the effects of
tobacco and secondhand smoke, the
economic costs of tobacco and the
behaviour of the tobacco companies;
financial contributions of major international
donors have increased the levels of
funding for tobacco control efforts in lowand
middle-income countries. Other key
developments include the series of WHO
Reports on the Global Tobacco Epidemic,2
which provides an unprecedented level of
detail and roadmaps for effective solutions;
reduction in smoking prevalence
rates in many parts of the world; and the
UN summit on Noncommunicable
Diseases (NCDs) in 2011, in which the
need to address tobacco use prevalence
was highlighted as a cornerstone of NCD
interventions. That said, the past 20 years
have also brought an increasing resistance
to tobacco control measures and emerging
threats to public health by the tobacco
industry, a phenomenon requiring
a worldwide coordinated response in order
to sufficiently and effectively curb the
global tobacco epidemic.

INTRODUCTIONThere have been momentous events intobacco control since the first edition ofTobacco Control was launched in 1992.These include increased global awarenessof the harmfulness of tobacco and theWHO Framework Convention on TobaccoControl (WHO FCTC).1 The WHO FCTCrepresents the most momentous milestone;it was the first treaty negotiatedunder the auspices of the WHO andentered into force in 2005. It is one of themost rapidly embraced UN treaties andrepresents a paradigm shift in developinga regulatory strategy to address addictivesubstances. In contrast to previous drugcontrol treaties, the WHO FCTC assertedthe importance of demand reductionstrategies as well as supply issues and thusestablished a framework for an integratedmultisectoral response to a grave publichealth issue.Other major achievements includestrengthening of the international nongovernmentalmovement against tobacco,for example, continuing and expandedworld conferences on tobacco or health;the establishment of the InternationalNetwork of Women Against Tobacco,inaugurated about the same time as thelaunch of the journal; the FrameworkConvention Alliance formed in 1999;international web-based networks ontobacco. There has been a significantincrease in research on the effects oftobacco and secondhand smoke, theeconomic costs of tobacco and thebehaviour of the tobacco companies;financial contributions of major internationaldonors have increased the levels offunding for tobacco control efforts in lowandmiddle-income countries. Other keydevelopments include the series of WHOReports on the Global Tobacco Epidemic,2which provides an unprecedented level ofdetail and roadmaps for effective solutions;reduction in smoking prevalencerates in many parts of the world; and theUN summit on NoncommunicableDiseases (NCDs) in 2011, in which theneed to address tobacco use prevalencewas highlighted as a cornerstone of NCDinterventions. That said, the past 20 yearshave also brought an increasing resistanceto tobacco control measures and emergingthreats to public health by the tobaccoindustry, a phenomenon requiringa worldwide coordinated response in orderto sufficiently and effectively curb theglobal tobacco epidemic.