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November, 2014:

BAT fined GBP 650,000 by HMRC

17 Nov 2014.

Tax officials levied a GBP 650,000 (EUR 813,000) fine against British American Tobacco (BAT) for oversupplying a low-priced market outside the UK, a practise which encourages smuggling, the Observer reported.

It was the first time HM Revenue and Customs fined a tobacco company for shipping volumes in excess of reasonable legal demand of that market, although HMRC is monitoring other manufacturers, according to the newspaper. BAT allegedly oversupplied low-priced Belgium with fine-cut tobacco, some of which was returned to the UK as untaxed illicit product. BAT plans to appeal the ruling, the newspaper said.

Draft regulations seeks first nationwide ban on smoking at indoor public spaces

25 November, 2014

Zhuang Pinghui

National regulation, if adopted, would be huge step forward to honour pledge to WHO

The government is seeking public opinion on the first nationwide smoking ban in public spaces, which if implemented would be a big step towards honouring an international commitment to reduce tobacco use.

The Ordinance on Restricting Smoking in Public Spaces, released for public consultation yesterday by the State Council, bans smoking at all indoor, and some outdoor, public spaces.

Yang Gonghuan, a professor at the Institute of Basic Medical Sciences at the Chinese Academy of Medical Sciences and former director of the National Office of Tobacco Control, welcomed the move.

“I am very pleased with the articles of the ordinance, even if it might be a transitional one to higher-level legislation on a smoking ban in indoor public spaces. Let’s hope these articles will stay when the ordinance is officially issued,” Yang said.

She said China was the world’s largest cigarette manufacturer and consumer, with more than 300 million smokers. Some 740 million people, including 180 million children, are affected by second-hand smoke.

The ordinance, if adopted, would be the closest Beijing has come to meeting its pledge to create a tobacco-free indoor environment under the World Health Organisation’s Framework Convention on Tobacco Control.

China ratified the convention in 2005 but missed the deadline to honour it in 2011.

The draft regulations stop short of full legislation and a tobacco control law has yet to appear on the agenda of the National People’s Congress. But Yang said it would be good enough if the State Council’s ordinance were issued and well implemented.

The draft law requires tobacco manufacturers to print verbal health warnings and graphics that cover at least half the packaging. Such warnings are not required at present.

All kinds of tobacco advertising, promotion and sponsorship would be prohibited, according to the draft, a far cry from the situation today that even allows schools to be named after tobacco companies.

Tobacco control advocates had lobbied the NPC for years without success to pass tobacco-control laws to enable the country to honour its pledge to the WHO anti-smoking convention. Several cities have passed such legislation individually.

E-cigarettes contain 10 times the carcinogens of regular tobacco – study

Electronic cigarettes contain up to 10 times more cancer-causing substances than regular tobacco, according to the latest study by Japanese scientists. A team of researchers from the Japanese Health Ministry examined the vapor, finding carcinogens like formaldehyde and acetaldehyde. The former was found in quantities exceeding traditional cigarettes by 10 times.

“Especially when the… wire (which vaporizes the liquid) gets overheated, higher amounts of those harmful substances seemed to be produced,” researcher Naoki Kunugita said. Kunugita wanted to raise awareness about the fact that “some makers are selling such products for dual use (with tobacco) or as a gateway for young people” to start a smoking habit. E-cigarettes are largely represented as a safe way of smoking, not harmful to one’s health. The report was submitted on Thursday by Kunugita and his team at the National Institute of Public Health, AFP reported. Japan’s Health Ministry stated that it is examining the results to develop ways to regulate e-cigarettes. The researchers analyzed several kinds of e-cigarette fluid, using a special ‘puffing’ machine that inhaled 10 of 15 puffs of vapor.

E-cigarettes work by heating flavored liquid, which often contains nicotine, and creating a vapor.

Since they appeared in 2003, invented by a Chinese pharmacist in Beijing, their use has skyrocketed into a market worth about $3 billion. Bloomberg Industries say sales of e-cigarettes will exceed those of traditional cigarettes by 2047. Japan, like many other countries, doesn’t regulate electronic cigarettes, so they can easily be bought online, but are not available in shops sometimes. In August, the World Health Organization urged the governments to prohibit the sale of electronic cigarettes to minors, saying the devices represent a “serious threat” to unborn babies and young people. The WHO also called to ban e-cigarettes in indoor spaces. A month later, France introduced a ban on smoking electronic cigarettes in schools, on public transport, and in enclosed workplaces. E-cigarettes have just been banned in Punjab, India, in an attempt to curb smoking, especially in educational institutions. Earlier this year, US health authorities said that the number of young people who have tried e-cigarettes tripled from 2011 to 2013.

Health experts optimistic over anti-smoking law

26 November, 2014

Zhuang Pinghui

Public health experts are optimistic that the mainland’s draft tobacco-control regulation has a good chance of curbing smoking if properly implemented.

The draft regulation, published by the Legislative Affairs Office of the State Council, proposes banning smoking in all indoor public areas – and certain outdoor ones, near hospitals and kindergartens, for example.

It also calls for all tobacco advertising, promotion and sponsorship to be banned, while graphic and verbal health warnings must take up at least half the outside of a cigarette pack.

The draft details specific government agencies that will handle offences in different areas and lists penalties for offenders.

Individuals smoking in forbidden areas will be fined between 50 yuan (HK$63) and 500 yuan and businesses face fines of up to 30,000 yuan or even the revocation of their business licences.

Smoking will not be permitted to be shown in movies or television shows, and scenes of actors lighting up could also attract 30,000 yuan fines.

“We can safely say the draft has thoroughly adopted the most important articles of the World Health Organisation’s Framework Convention on Tobacco Control,” said Yang Jie, a researcher at the office of tobacco control at the Centres for Disease Control and Prevention.

China ratified the convention in 2005 but has failed to introduce a complete smoking ban in indoor public areas, as required.

The issue now is whether the mainland will water down the rules in the final law, and how well it will be implemented.

The lobbying power of the state-owned tobacco monopoly is significant – tobacco sales contributed between 7 per cent and 10 per cent of the country’s tax revenue over the past decade.

“There are some articles in the law that the tobacco companies might oppose during the consultation period. We will send our opinions. We expect there will be some wrangling with the industry,” Yang said.

“As for implementation, the best chance of making it effective is to involve multiple government agencies.”

Smoking is common across the mainland, even in hospitals and government offices. The former health ministry issued its own ban on smoking in indoor public areas but it was poorly implemented. Several cities have introduced their own smoking bans, with some enforced by a dozen or more agencies while others are policed by only a few.

Yang researched 10 cities and found that regulations involving multiple agencies had the best chance of working as long as they had to report to a central office.

Shenzhen, for example, did not hand out a single fine under previous smoking rules, yet had issued more than 300,000 yuan in fines since March when a tougher regulation came into effect.

Wu Yiqun, deputy director of the think tank Research Centre for Health Development, said the law’s articles included details of implementation and accountability. “I am very optimistic,” he said. Both Yang and Wu agreed the State Council’s proposed regulations would help control tobacco use even without a more senior law passed by the NPC, which could take years.

India plans to restrict cigarette sales to those aged at least 25

27 November, 2014

Expert panel proposes cigarette sales be restricted to those aged at least 25, the highest in the world, and that trade in single sticks be banned

Health campaigners have welcomed India’s unprecedented plans to raise the age for tobacco purchases to 25 and ban unpackaged cigarette sales, calling them a major step towards stopping nearly one million tobacco-related deaths a year.

India, with a population of 1.2 billion, would have the world’s highest minimum legal age for buying cigarettes if plans to increase the limit from 18 to 25 were implemented.

The plans, proposed by an expert panel, were announced by health minister J.P. Nadda in parliament on Tuesday and will need final approval by Prime Minister Narendra Modi’s cabinet as well as parliament before becoming law.

“This is a very welcome move by the government,” Binoy Mathew, spokesman for the non-profit Voluntary Health Association of India, said. “It’s going to act as a huge deterrent, especially for students and youngsters.”

Around 900,000 people die of tobacco-related illnesses in India each year, the second-highest number after China.

An estimated 70 per cent of cigarettes sold in India are unpackaged, equating to more than 100 billion sticks in 2012, according to market researcher Euromonitor.

Campaigners say the practice of selling single cigarettes at street stalls has pushed up smoking rates, particularly among teenagers and the poor who cannot afford a full packet.

“These people were easily buying single sticks for 10 to 15 rupees, but now they will have to shell out some 200 rupees (HK$25) for the full pack, which will not be so easy,” said Mathew.

Indians consume tobacco in several forms apart from cigarettes, including “gutka” – a cheap, mass-produced mix of tobacco, crushed areca nut and other ingredients – and hand-rolled sticks called “beedis”.

New Delhi announced last month that tobacco companies would have to stamp health warnings across 85 per cent of the surface of cigarette packets from next year.

Monica Arora, from the Public Health Foundation of India, applauded the jump in the minimum age for buying cigarettes.

“Research shows that if someone hasn’t started smoking at 21, chances of that person becoming a tobacco user drops drastically,” said Arora, director of the foundation’s tobacco control initiatives. “Ninety per cent of youth take to smoking before the age of 18 and they experiment by buying single cigarettes.

“Now they will have to buy full packs which will have pictorial warnings and they would get reminded of the dangers every time they reach out for a smoke.”

The proposed ban would badly affect companies such as ITC, India’s largest cigarette maker, which earned US$164 million from sales in 2013-14.

Arora acknowledged that enforcement of any law would be difficult and would need a community-led approach. Cigarettes are sold at small stands on most street corners.

“If you sensitise the retailers and tell them about what is illegal and that there are strict penalties, they would not want to violate the laws,” she said.

Researchers say inadequate public awareness of smoking risks, coupled with aggressive tobacco marketing, has left Asian nations with some of the world’s highest smoking rates, at a time when sustained campaigns have cut rates in the US, Australia and parts of Europe.

Big Tobacco distributes report bullying plain packaging laws

The two biggest tobacco companies in Australia have begun a campaign to undermine the nation’s plain packaging laws, ahead of a Department of Health review of the effectiveness of the regulations.

Philip Morris and British American Tobacco have briefed research and data to media outlets as “proof” plain packaging laws have failed, on the eve of their second anniversary on December 1.

Philip Morris is promoting “a new piece of independent research that finds there is no evidence that plain packaging for cigarettes is working”.

That research, emailed to media by Philip Morris, is titled “The Plain Truth about Plain Packaging: An Econometric Analysis of the Australian 2011 Tobacco Plain Packaging Act”.

One of the research authors, Professor Sinclair Davidson, is a senior fellow at the Institute of Public Affairs, a right-wing think tank that has received considerable funding from Big Tobacco over the past 10 years.

According to Philip Morris spokesman Simon Dowding, “the study was produced by respected Australian academic Professor Sinclair Davidson from RMIT, and has just been published in the Australian National University journal, Agenda”.

But it makes no mention of Professor Davidson’s association with the IPA, or the long history of tobacco funding of the organisation.

Philip Morris claims Professor Davidson’s “independent research” proves that “sales of tobacco are surging despite plain packaging”.

The IPA’s deputy executive director James Paterson said that while 25 per cent of their funding came from business donors, they had a “longstanding policy of protecting their [donors’] privacy”.

At the same time British American Tobacco is pushing data re-released by the Australian Institute of Health and Welfare showing the rate of smoking has gone up among 12-17 year olds.

Spokesman Scott McIntyre said the data showed the national smoking rate had increased in that age group by 32 per cent, rising from 2.5 per cent in 2010 to 3.4 per cent in 2013, meaning the laws’ primary objective of deterring children had failed.

But the statistics body’s head of tobacco and other drugs unit, Amber Jefferson, said the report clearly stated that the sample size was too small to be able to draw a conclusion of a spike in uptake.

“The results remain stable. There might appear to be a percentage point increase, but it’s not statistically significant,” she said.

Earlier in the week libertarian senator David Leyonhjelm – who receives funding from big tobacco – also held a press conference calling for a crackdown on illegal tobacco sales, which tobacco companies claim have risen since the introduction of plain packaging.

A co-ordinated assault just ahead of the review of plain packaging laws is emerging, with the Australian Retailers Association on Wednesday also labelling the laws a “waste of retailer’s time and resources”.

Executive director Russell Zimmerman cited a KPMG report which showed that illegal tobacco accounted for 14.3 per cent of all tobacco use, up from 13.5 per cent on the previous year.

Mr Zimmerman said the ARA was concerned illegal tobacco products were “swamping the market” and costing the government $1.2 billion in tobacco excise.

The tobacco giants may be getting nervous, as raw sales data obtained from Australia’s supermarkets indicates smoking rates have fallen over the past year, even though revenues are up due to higher taxes.

IRI-Aztec data, which tracks actual sales at Coles, Woolworths, IGA and Foodworks, reveals the number of cigarettes sold at supermarkets fell 2.9 per cent last financial year, suggesting that plain packaging and higher taxes are working to reduce smoking rates.

The supermarkets covered by the IRI-Aztec report account for more than 65 per cent of Australia’s $13.5 billion cigarette and tobacco market.

Scientists Say E-Cigs Contain 10 Times As Many Cancer Chemicals As Cigarettes

Tokyo (AFP) – E-cigarettes contain 10 times the level of cancer-causing agents as regular tobacco, Japanese scientists said Thursday, the latest blow to an invention once heralded as less harmful than smoking.

The electronic devices — increasingly popular around the world, particularly among young people — function by heating flavoured liquid, which often contains nicotine, into a vapour that is inhaled, much like traditional cigarettes but without the smoke.

Researchers commissioned by Japan’s Health Ministry found carcinogens such as formaldehyde and acetaldehyde in vapour produced by several types of e-cigarette liquid, a health ministry official told AFP.

Formaldehyde — a substance found in building materials and embalming fluids — was present at much higher levels than carcinogens found in the smoke from regular cigarettes, the official said.

“In one brand of e-cigarette the team found more than 10 times the level of carcinogens contained in one regular cigarette,” said researcher Naoki Kunugita, adding that the amount of formaldehyde detected varied through the course of analysis.

“Especially when the… wire (which vaporises the liquid) gets overheated, higher amounts of those harmful substances seemed to be produced.”

Kunugita and his team at the National Institute of Public Health submitted their report to the ministry on Thursday.

In common with many jurisdictions, Japan does not regulate non-nicotine e-cigarettes.

Nicotine e-cigarettes, or so-called Electronic Nicotine Delivery System (ENDS), are subjected to the country’s pharmaceutical laws, but they can be bought easily on the Internet, although they are not readily available in shops as they are in some Western countries.

“You call them e-cigarettes, but they are products totally different from regular tobacco,” the ministry official said.

“The government is now studying the possible risks associated with them, with view to looking at how they should be regulated.”

– ‘Serious threat’ –

In August, the World Health Organisation called on governments to ban the sale of e-cigarettes to minors, warning they pose a “serious threat” to unborn babies and young people.

Despite scant research on their effects, the WHO said there was enough evidence “to caution children and adolescents, pregnant women, and women of reproductive age” about e-cigarette use, due to the “potential for foetal and adolescent nicotine exposure (having) long-term consequences for brain development”.

The UN health body also said they should be banned from indoor public spaces.

US health authorities said earlier this year that the number of young people there who have tried e-cigarettes tripled from 2011 to 2013.

More than a quarter of a million young people who had never smoked a cigarette used e-cigarettes last year, the US Centers for Disease Control and Prevention said.

Supporters of e-cigarettes say the devices are a safer alternative to traditional tobacco, whose bouquet of toxic chemicals and gases can cause cancer, heart disease and strokes and are among the leading causes of death in many countries.

But opponents say the devices have only been around for a few years, and the long-term health impact from inhaling their industrial vapour is unclear.

Big tobacco companies are snapping up producers of e-cigarettes, wary of missing out on a snowballing global market worth about $3 billion.

Earlier this month, Oxford Dictionaries picked “vape”– the act of smoking an e-cigarette — as their new word of the year

E-cigarette use and intentions to smoke among 10-11-year-old never-smokers in Wales

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Impact of Australia’s introduction of tobacco plain packs on adult smokers’ pack-related perceptions and responses

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BAT fined for oversupplying tobacco in low-tax European jurisdictions

£650,000 penalty from HMRC reflects growing concern that surplus is finding its way back to the UK illicitly

Big tobacco, long accused of complicity in smuggling, is under close scrutiny as it emerges that one of the world’s largest cigarette firms has been fined for oversupplying foreign markets.

The practice of flooding low-tax foreign markets with more tobacco than they are capable of consuming has sparked concerns that much of the product is able to find its way back into the highly taxed UK without HM Revenue and Customs receiving its due share. Anti-tobacco campaigners claim such abuse of the UK tax system is rife and believe that a fine imposed on British American Tobacco (BAT) is merely the tip of the iceberg.

BAT, a FTSE 100 company that last year sold 676bn cigarettes around the world, confirmed to the Observer that it had been fined £650,000 by HMRC, a decision that it pledged to appeal against, describing it as “unjustified” and “inappropriate”.

It is the first time HMRC has acted against a tobacco company in this manner. It refused to identify the company, citing “taxpayer confidentiality”, but in response to questions from this newspaper, BAT confirmed it was the firm recently fined for oversupplying UK-manufactured handrolling tobacco to Belgium. The

HMRC spokesman said it was now looking closely at the other major UK manufacturers to check whether they were acting illegally. “Sanctions are a last resort and applied only where there is evidence that a manufacturer is failing to comply with its legal obligations,” its spokesman said. “We have recently issued a penalty to one manufacturer and are keeping all UK manufacturers under review to ensure they comply with the rules.”

HMRC has long been criticised for failing to tackle tobacco smuggling. All the companies deny wrongdoing. But official reports have confirmed there has been a large oversupply of hand-rolling tobacco into the Benelux countries from the UK. The National Audit Office recently noted: “HMRC’s latest estimate, for 2011, is that the aggregate actual supply of some brands of hand-rolling tobacco to some countries exceeded legitimate demand by 240%.”

HMRC claims that its strategy for tackling tobacco smuggling has reduced the illicit cigarette market by half and the illicit hand-rolling tobacco market by a third. In 2013-14, it seized more than 1.4bn cigarettes and 330 tonnes of hand-rolling tobacco.

But health campaigners acknowledge HMRC faces an uphill task. “Tobacco manufacturers are spending millions lobbying against plain standard packaging, claiming that it will increase counterfeiting,” said Deborah Arnott, chief executive of Action on Smoking and Health. “The real problem is that the industry isn’t doing enough to prevent its own products being smuggled. Tobacco firms have fuelled smuggling on a massive scale by deliberately oversupplying foreign markets, knowing that their products will leak back into Britain.”

A spokesman for BAT said: “There are two types of people bringing tobacco products into the UK from overseas. Smugglers who want to make illegal profits; and genuine consumers exercising their right as EU citizens to buy any product for personal use in EU countries where the prices are cheaper than the UK.

“It is impossible for tobacco companies, which sell through retailers, to identify which shoppers are legitimate and which are intending to smuggle. After all, we are a business, not a law enforcement agency.”

Arnott said there were signs that the illicit trade in tobacco was starting to increase. “This fine is only the tip of the iceberg,” she said. “It raises questions about what else the industry is up to. A new government anti-tobacco smuggling strategy is due soon and it needs to make sure that the tobacco industry is obliged to put its house in order.”

The BAT spokesman said the company had invested significant resources over many years to tackle tobacco smuggling. “We will defend ourselves vigorously against the penalty and, as such, we are appealing what we believe to be an unjustified fine.”