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March 5th, 2015:

Up in smoke: our researchers debunk Big Tobacco’s arguments against standardised packaging

Tobacco manufacturers argue that plain packaging would have unintended negative consequences in the UK. Our research exposes their misinformation.

A crime wave fuelled by smuggling and a death sentence for small businesses — these are just some of the claims made by tobacco manufacturers in their campaign to keep standardised cigarette packaging out of the UK.

Early results from Australia, which introduced the policy in 2012, have linked standardised packaging with a sustained increase in calls to Quitline, a reduction in pack appeal and a reduction in display of cigarette packs by smokers. This hasn’t stopped tobacco companies arguing that plain packs will be nothing but trouble, even when their own numbers don’t add up.

Our Tobacco Control Research Group (TCRG) has repeatedly exposed the misinformation used by tobacco companies, lobbyists and astroturfing organisations. These are three popular arguments from the tobacco industry, and how our researchers debunked them.

Myth #1: “Plain packaging will lead to increased tobacco smuggling”

One of the most common arguments from the industry is that plain packaging will make it easier for smugglers to make counterfeit cigarettes. Tobacco companies claim that this smuggling boom would benefit organised crime and that additional income would finance prostitution, arms trafficking and terrorism. Dramatic videos produced by British American Tobacco showed the introduction of plain packaging leading to car bombs exploding on the high street and gangster shootouts amidst shipping containers.

The reality is very different. The TCRG has exposed how the industry exaggerates the extent of tobacco smuggling by commissioning surveys whose methodology and validity remain uncertain, misquoting government data and planting misleading stories in the media.

The group’s findings are supported by independent data from the Australian Borders and Customs Agency showing that plain packaging has not impacted the illegal trade of cigarettes.

Smuggling cigarettes isn’t just for organised crime — tobacco companies have even been linked to smuggling their own products in order to dodge taxes and regulations. In 2000, tobacco company Philip Morris International (PMI) was sued by the European Commission for smuggling cigarettes into the EU. As part of the $1.25 billion settlement, PMI agreed to produce an annual report called Project Star about illicit tobacco in the European Union.

The 2010 Project Star report concluded that 64.2 billion contraband and counterfeit cigarettes had been trafficked in the EU that year — a rise of 3.1 billion since 2009. Our researchers evaluated the report and found it was misleading, concluding that “its publication serves the interests of PMI over those of the EU and its member states.” They showed how the report overestimated the prevalence of contraband cigarettes and relied too heavily on their own ‘empty pack’ surveys, which weren’t independently verified.

The ‘empty pack’ surveys can identify which cigarettes are domestic and which have come from abroad, but they’re unable to distinguish whether foreign cigarettes have been smuggled into the country or imported legally. The timing and location of the surveys can also skew the results dramatically — surveys in Germany over-represented border regions and locations near American military bases, where foreign cigarettes were significantly more likely to be found.

Myth #2: “Plain packaging would put independent shops out of business”

In their response to the UK’s consultation on plain packaging in 2012, British American Tobacco highlighted fears from the Tobacco Retailers Alliance that plain packaging would endanger small businesses: “For many of you, tobacco sales make up around a third of turnover, sometimes more. … During the busy times, such as the morning rush, there is a real risk that customers who have to wait will go to supermarkets and larger shops, which have more staff and therefore shorter transaction times.”

Similarly, Imperial Tobacco cited a study commissioned by the Alliance of Australian Retailers which concluded that “retailing times would be adversely affected if standardised packaging were introduced by an additional 15 to 45 seconds per transaction and that the effect would be particularly significant for smaller retailers”.

But the Tobacco Retailers Alliance and the Alliance of Australian Retailers were both created and funded by tobacco companies — a fact which the companies failed to mention in their submission.

Our researchers reviewed 74 pieces of evidence on illicit and economic impacts of standardised packaging cited by tobacco companies in their submissions to the 2012 consultation. They found that the companies had failed to cite any independent, peer-reviewed evidence which supported their arguments.

Nearly half the evidence cited was financially linked with at least one tobacco company, but the vast majority of these conflicts of interest were not declared in their submissions to the Department of Health.

Researchers concluded that “any data produced by industry on the illicit tobacco trade, or on those with whom it has a financial relationship, should be treated with extreme caution.”

Myth #3: “There’s no evidence or research that shows plain packaging would reduce smoking”

Despite a wealth of consistent peer-reviewed research and the independent Chantler review, which found that plain packaging is highly likely to reduce the appeal of smoking, tobacco companies keep arguing against this. But the evidence they submitted to the UK’s 2012 consultation on standardised packaging doesn’t stand up.

The TCRG investigated tobacco companies’ critiques of the evidence for plain packaging and found that they misrepresented the evidence base for standardised packaging by misquoting and using a ‘mimicked’ form of scientific critique.

Researchers also analysed 77 items of evidence submitted by four tobacco companies intended to prove that standardised packaging wouldn’t work.

Their analysis found that only 17 out of the 77 items actually addressed the impact of standardised packaging. Of these 17, 14 were industry-funded, and none had been published in peer-reviewed journals. Our researchers submitted these findings to the Chantler review.

In the article, our researchers said: “The transnational tobacco companies have maintained that advertising and promotional material — including packaging — stimulate only brand switching among current smokers. Yet, overwhelming evidence from the tobacco industry’s own marketing documents suggests this claim is highly disingenuous.”

Perhaps unsurprisingly, the industry did not submit its own internal material about the effectiveness of packaging as a marketing tool. But at a Philip Morris conference in 1994, marketer Mark Hulit made its importance clear:

“Our final communication vehicle with our smoker is the pack itself. In the absence of any other marketing messages, our packaging — comprised of the trademark, our design, color and information — is the sole communicator of our brand essence.

“Put another way — when you don’t have anything else — our packaging is our marketing.”

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800,000 contraband cigarettes worth HK$2.2 million found in fake air compressors

A HK$2.2 million consignment of contraband cigarettes from the mainland has been found hidden in fake air compressors after customs officers intercepted a cross-border lorry at Man Kam To control point, a senior Customs official said on Thursday.

The 49 bogus items looked like the genuine machines and each had power switch buttons and a pressure-reading meter on the casing, according to Superintendent Cecilia Yeung Kai-fei of Customs’ revenue and general investigation bureau.

However, she said: “The buttons were manufactured in a slipshod way. The pressure-reading meter was just glued on the metal casing and its indicator could not move.”

She added: “Inside the shell, no electrical parts were found, but it was filled with packets of cigarettes.”

The discovery was made on Tuesday when customs officers intercepted a Hong Kong-bound lorry for inspection at Man Kam To control point.

The 49 fake machines were hidden among 148 boxes of assorted cargo on board the lorry, according to the Customs and Excise Department.

Each fake, about 60cm tall, was filled with about 80 packets of contraband cigarettes.

Yeung said about 800,000 illicit cigarettes were sized in the operation and the haul had an estimated street value of HK$2.2 million with a duty potential of HK$1.5 million.

“We believe the consignment was for local consumption,” she said.

Officers arrested the Hong Kong driver, 39, and impounded his vehicle.

This afternoon, the man was still being held for questioning and had not been charged.

Under the Import and Export Ordinance, the maximum penalty for smuggling is seven years’ imprisonment and a HK$2 million fine.

Similar concealment methods were uncovered about 12 months ago when customs officers seized HK$2.7 million worth of contraband cigarettes hidden in fake air compressors and arrested two men in Tsing Yi.

Yeung said smugglers used different concealment methods and smuggling routes to evade detection. “We will enhance inspection at various control points to tackle such illegal activities,” she said.

Last year, customs officers confiscated 32.2 million illicit cigarettes in 19 significant smuggling cases. In 2013, there were 25 cases and 39.3 million contraband cigarettes seized. Each operation involved more than 500,000 cigarettes.

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MEPs declare ‘war’ on tobacco companies

A cross-party working group has been set up in the European parliament to counter the growing influence of tobacco companies.

The group was put together by S&D deputy Gilles Pargneaux, who is a vice-chair of parliament’s environment, public health and food safety committee, at the behest of Paris councillor Pauline Delpech, who has been campaigning against the tobacco industry in France.

Pargneaux pointed out that “currently six million deaths worldwide are linked to smoking, including 700,000 in Europe – this is equivalent to the population of a city the size of Frankfurt”. He added that this amounts to “1900 deaths a day” and that “by 2030, tobacco could cause up to eight million deaths a year”.

Outlining the working group’s priorities, he said, “our main focus is to make sure the tobacco products directive is implemented in all member states”. The new rules were adopted by parliament in March last year, and include banning flavoured cigarettes, tougher measures for eCigarettes and more health warnings on cigarette packaging.

The Frenchman added that the group would be looking at “combating contraband, counterfeiting and cross-border shopping”.

Additionally, he called for the enforcement of “article 5.3 of the world health organisation’s framework convention on tobacco control”. This rule “requires all parties, when setting and implementing their public health policies with respect to tobacco control, to act to protect these policies from commercial and other vested interests of the tobacco industry in accordance with national law”.

Pargneaux accused tobacco companies of “spending a lot of money to keep tribunals off their back” and said, “we know that by going after these firms, we are unlikely to make many friends”.

“Every day, every second, someone dies because of tobacco, and every second, the main tobacco companies continue to churn out profits of up to €7bn” – Fabio Massimo Castaldo

He also insisted that this new working group “is not here to engage in anti-smoking politics”.

However, not all members of the group went along with this rhetoric, with ALDE deputy Robert Rochefort saying that he was staunchly opposed to smoking.

The French MEP, who is a vice-chair of parliament’s internal market and consumer protection committee, commented that “the tobacco lobby is certainly one of the most powerful in the world”, explaining that “it has evolved and learned to negotiate”.

José Bové, a member of parliament’s Greens/EFA group, accused the tobacco industry of “shopping around Europe without anyone getting in the way – this is an extremely serious threat to democracy”.

He was especially critical of the European anti-fraud office (Olaf), saying cigarette companies had “received an unbelievable amount of support” from the organisation.

According to the French deputy, this was proven by “the John Dalli case”. John Dalli was European health and consumer policy commissioner from 2010 but 2012, but was forced to resign after one of his associates was accused of requesting over €60m from Swedish snus producer Swedish Match, in exchange for the commissioner’s help changing tobacco regulations. Dalli has always denied any knowledge of the alleged bribery.

Bové claimed that Olaf director general Giovanni Kessler “covered up investigations into the matter”.

Kessler was not the only European official to come under fire, with Belgian MEP Bart Staes accusing “budget and human resources commissioner Kristalina Georgieva, or perhaps members of her staff and even Olaf representatives [of] entering into secret negotiations with tobacco manufacturers” to come up with a new agreement.

The commission currently has a deal with the four main tobacco companies (Philip Morris International, Japan Tobacco, British American Tobacco and Imperial Tobacco Limited) whereby they pay a collective total of €1.9bn to the EU and taking steps to prevent the illegal trade of cigarettes.

EFDD MEP Fabio Massimo Castaldo highlighted that “every day, every second, someone dies because of tobacco, and every second, the main tobacco companies continue to churn out profits of up to €7bn”.
He underlined, “we are at war – and I am not afraid of using that word – with tobacco companies, both for medical and ethical reasons”.

Seeking to take the working group into yet another direction, his fellow group member, Eleonora Evi, said that the new set-up should be “part of a larger battle against lobbies in general”.

About the author
Julie Levy-Abegnoli is a journalist and editorial assistant for the Parliament Magazine