Image source: SavoryCrowdad/CC BY-SA 4.0

Key Points

• India is a country located in South Asia, part of the World Health Organization’s South-East Asia Region.
• It had a population in 2022 of 1.42 billion. Amongst those aged 15+, tobacco use prevalence is 28.6%.
• Smoking prevalence in India is 10.7%. However, the most popular form of tobacco in India is smokeless tobacco, with use prevalence of 21.4%.
• India ratified the WHO Framework Convention on Tobacco Control in 2004, and the Protocol to Eliminate Illicit Trade in Tobacco Products in 2018.
• The Indian cigarette market is dominated by four companies, which together accounted for 98% of sales in 2022. ITC Limited holds by far the largest market share, at over 73%.
• The tobacco industry has deployed a wide range of tactics in India in recent years, including mobilisation of front groups and third parties; litigation against tobacco control measures such as graphic health warnings; and corporate social responsibility, including in partnership with government.

Since the early 2000s, India has made significant progress in tobacco control, introducing a comprehensive tobacco control law in 2004, reducing the affordability of tobacco products, and introducing graphic health warnings (GHWs) consistent with best practice worldwide.¹² However, major challenges persist. The wide range of tobacco products available in India makes regulation and enforcement particularly complicated. The Indian state is also a major shareholder of ITC Limited, which has by far the largest share of the Indian market. This means that the government has an interest in socio-economic issues – such as ensuring the welfare of farmers and manual labourers working in the Indian tobacco industry, and protection of exports – as well as in public health.³

India remains the world’s second largest consumer, producer and exporter of tobacco.⁴⁵

Tobacco Use in India

In 2022, the population of India was 1.42 billion.⁶ In the 2016-17 Global Adult Tobacco Survey (GATS), approximately 29% of the population aged 15+ reported current tobacco use – over 42% of males, and over 14% of females.²⁷ This means that in absolute numbers, there were almost 267 million tobacco users in India aged 15 and over.⁴ In the 2019 Global Youth Tobacco Survey (GYTS), amongst adolescents aged from 13 to 15, 8.5% reported using some form of tobacco – nearly 10% of males, and over 7% of females.²⁸

Amongst India’s smokers, the most popular product was not factory-made cigarettes but bidis: cigarettes rolled by hand in a dried leaf of the tendu tree. 7.7% of Indian adults reported smoking bidis, compared to 4% who smoked cigarettes.⁷

However, the most popular tobacco product in India overall is smokeless tobacco (SLT). More than 21% of Indians aged 15 and over reported being SLT users, compared to less than 11% who smoked, whether cigarettes, bidis, or both.²⁷ SLT use is also significant amongst women and girls: nearly 13% of females aged 15 and over were SLT users, compared to 2% who smoked.²⁷ The majority of female tobacco users in low- and middle-income countries (LMICs) are SLT users in India and Bangladesh.⁹ However, amongst adolescent tobacco users, smoking is more common than SLT use. Over 7% of adolescents reported current smoking, compared to just over 4% who were SLT users.²⁸

India has the second highest number of oral cancer cases globally, accounting for a third of the total.¹⁰ More than 90% of India’s oral cancer cases are caused by tobacco use and of these, more than half are caused by SLT.¹¹ The poor and less educated are worst affected, with much higher SLT use prevalence amongst these sections of the population.¹¹ There were also over a million deaths attributable to smoking in 2019, accounting for nearly 11% of all mortality in India that year.¹²

A 2020 study put the economic cost of all illness and death attributable to tobacco use between 2017 and 2018 for those over 35 years of age at US$27.5 billion.¹³ Smoking accounted for 74% of this cost; smokeless tobacco 26%.¹³ Direct medical costs alone amounted to 5.3% of all health expenditure.¹³ However, the excise tax revenue from tobacco the previous year was just 12.2% of its economic cost.¹³ In simple terms, the economic burden of tobacco use is more than eight times the value of revenue the Indian government receives in excise from tobacco products.¹³ This economic burden accounts for over 1% of India’s GDP.¹³

Tobacco in India

Market share and leading brands

The Indian cigarette market is dominated by four companies:  ITC Limited, Godfrey Phillips India Limited (GPI), VST Industries Ltd., and Philip Morris International (PMI), which together accounted for 98% of sales in 2022.¹⁴

India banned foreign direct investment in tobacco manufacturing in 2010, which means that the transnational tobacco companies (TTCs) can only access the Indian market via shareholdings and licensing agreements with local producers.¹⁵¹⁶

ITC Limited

ITC Limited (formerly India Tobacco Company Limited), dominates the Indian tobacco market, with a share of over 73% in 2022.¹⁴ Its largest shareholder is British American Tobacco (BAT), which held just under 30% of shares until March 2024.¹⁷¹⁸ The Indian state is also a major shareholder, via various state-owned insurance corporations and investment portfolios.¹⁸ Its products include India’s three bestselling brands of cigarettes: Gold Flake, Wills and Scissors.¹⁹

In a presentation to investors in June 2023, BAT CEO Tadeu Marroco stressed the importance of the company retaining at least a 25% shareholding in ITC, given that this provides BAT with seats on the ITC board and the right to veto company resolutions.²⁰ Marroco also highlighted the potential of the vast Indian market in terms of newer nicotine and tobacco products, particularly oral products such as nicotine pouches.²⁰ In March 2024, BAT reduced its holdings in ITC to 25.5%.²¹For more details see ITC Limited.

Godfrey Phillips India Limited (GPI)

GPI had a market share of almost 10% in 2022, the second largest after ITC.¹⁴ PMI is the second-largest shareholder with a stake of just over 25%.²² Major brands include Four Square, Cavenders and Tipper.¹⁹

VST Industries Ltd

VST, formerly Vazir Sultan Tobacco Company, had a market share of over 9% in 2022, the third largest.¹⁴ With a stake of over 32%, BAT is its largest shareholder.²³ Its major brands include Total, Charms and Charminar.¹⁹

TTCs’ licensing agreements

PMI has a licensing agreement with GPI, under which GPI manufactures and sells the brands Marlboro and Red & White in India, though PMI retains brand ownership internationally.¹⁴¹⁹²⁴ This gives PMI a 5.4% market share from a global ownership perspective.¹⁴ Similarly, ITC manufactures and sells the brands Berkeley and Benson & Hedges in India, though Japan Tobacco International and British American Tobacco are the global owners, respectively.¹⁴¹⁹ Both companies have a market share of less than 2%.¹⁴

• For more information on the tobacco industry in India, please see the Tobacco Supply Chain Database.

Smokeless tobacco and bidis

The Indian smokeless tobacco industry is based largely on small scale, rural production, for which accurate data is not available.²⁵ Local manufacturers account for significant segments of the market in several regions of India.²⁵ Similarly, bidi production depends largely on small home-based manufacturing operations and accurate data is not available.²⁵

At the national level, the biggest companies in the chewing tobacco/gutkha (see section “Undermining the gutkha ban”) market are believed to be Dhariwal Industries, Dharampal Satyapal (DS Group) and Som Sugandh Industries, which together accounted for around a quarter of sales in 2010.²⁵ There is also interest from the big cigarette companies in smokeless tobacco; Godfrey Phillips launched its own range of chewing products in 2010.²⁶ A 2021 paper found that 93% of SLT products bought in India were non-compliant with packaging regulations: either they did not have graphic health warnings, or the warnings were too small.²⁷

Tobacco farming

India is the world’s second biggest tobacco producer after China, producing over 766,000 tonnes of leaf in 2020.²⁸ This accounts for 9% of all global production.⁵ Though tobacco production in India has increased significantly in recent decades – from 438,500 tonnes in 1980 – it has fallen slightly from a high of 830,000 tonnes in 2011.²⁹

Child labour

Indian bidis feature on the U.S. Department of Labor’s 2022 List of Goods Produced by Child Labor or Forced Labor.³⁰ While information on child labour in the bidi industry is not widely available, a study published in 2009 found that more than 1.7 million children worked rolling bidis in India.³¹ This disproportionately affects girls, who are often drawn into the industry to support their families. Bidi rollers may work 10 to 14-hour days to produce over 1,000 bidis, in what a BBC report from 2012 described as “slave-like working conditions”.³¹

Tobacco and the economy

India is the world’s second largest exporter of tobacco leaf, after Brazil.⁵ According to UN Comtrade, India exported nearly US$816 million in raw tobacco in 2022, compared to nearly $21 million in imports.³²³³ Export figures for 2021-2022 from the Indian Brand Equity Foundation (IBEF) – a trust established by the Indian Department of Commerce – were slightly higher, at US$842 million.⁵

India exports tobacco to more than 115 countries around the world, the biggest recipient of which is Belgium, which accounts for around 18% of India’s total tobacco exports. Other major export destinations for Indian tobacco include the United Arab Emirates, Singapore and the United States.⁵

India is also a major net exporter of cigarettes. According to UN Comtrade, it exported over US$100 million in cigarettes in 2022, compared to nearly $26 million in imports.³⁴³⁵

According to IBEF, the tobacco industry in India employs about 36 million people in farming, processing, manufacturing and export activities.⁵

Illicit trade

The Tobacco Institute of India, an industry body established by ITC, GPI and VST in 1992, puts the scale of the illicit tobacco trade at a quarter of the market.³⁶ However, independent studies put that figure much lower, at around 3% to 6%.³⁷ This makes illicit trade in India relatively small by global standards.³⁸ A 2018 study, which found that 2.73% of the empty cigarette packs collected in India were illicit, noted significant differences across the country.³⁹ Areas with greater illicit trade penetration are often targeted by studies funded by the tobacco industry to exaggerate overall levels of illicit trade.⁴⁰

Studies have also cast doubt on industry claims that tobacco tax increases have led to expansion of illicit trade. For example, according to ITC, tax increases during the period 2012 to 2017 resulted in rapid growth of illicit trade, making India the fourth largest illicit market globally.⁴¹ However, a study published in 2020 by experts from the WHO and the Indian government put the illicit cigarette trade at 6% of the market in 2016-17 – an increase of just 0.9% from 2009-10.³⁸

Similarly, a joint report published in 2017 by the accountancy firm KPMG and the Federation of Indian Chambers of Commerce and Industry (FICCI) argued that illicit trade – driven in part by higher taxes on cigarettes – was providing funds for terrorism and organized crime.⁴² However, both ITC and GPI are members of FICCI, which has a history of opposing tobacco control measures in India (see Influencing policy: graphic health warnings). Similarly, KPMG has strong ties with the tobacco industry going back decades, and its work on illicit trade has been strongly criticised elsewhere. Critics argue that KPMG’s research has exaggerated the scale of illicit trade and has been used to oppose tobacco control regulations such as plain packaging.

• For more information, please see STOP’s database of Tobacco Industry Allies.

Tobacco and the environment

A 2018 study estimated that in order to produce 100 billion cigarettes, nearly 67,500 tonnes of CO₂ equivalent were emitted in India in 2010 – the equivalent of 14,544 petrol-powered vehicles driven for a year.⁴³⁴⁴ The industry has also been a major cause of deforestation: it is estimated that 680 square kilometres of scrub forest were destroyed and degraded for tobacco curing and the manufacture of cigarettes and other smoking consumables between 1962 and 2002.⁴⁵

A 2022 study estimated that 170,000 tonnes of waste is produced by the packaging of tobacco products annually in India, two-thirds of which correspond to smokeless tobacco (SLT) products.⁴⁶ Analysis of segregated waste revealed that 73,500 tonnes of plastic, 6,100 tonnes of foil and 1,350 tonnes of used filters are discharged annually into the environment.⁴⁶ Cleaning up this waste costs Indian taxpayers roughly US$766 million every year.⁴⁷

• For more information on the tobacco industry in India, please see the Tobacco Supply Chain Database.

Roadmap to Tobacco Control

India was the eighth country to ratify the WHO Framework Convention on Tobacco Control (WHO FCTC) in 2004.⁴⁸ It ratified the Protocol to Eliminate Illicit Trade in Tobacco Products in 2018.⁴⁹⁵⁰

The Cigarettes and Other Tobacco Products Act (COTPA), passed in 2003, is the main comprehensive tobacco control law in India. Amongst other provisions, it banned smoking in most public places, prohibited the advertising of cigarettes and other tobacco products, and banned sales to anyone under the age of 18.⁵¹ Since then, a number of rules have been introduced to aid implementation of COTPA and provide definitions.¹ In 2007-08, the government launched the National Tobacco Control Programme (NTCP), which aimed to reinforce COTPA and facilitate implementation of the tobacco control strategies contained within the WHO FCTC.⁵²

In 2020, an amendment to COTPA was drafted by the Ministry of Health.⁵³ Aiming to further strengthen the original legislation and boost compliance with WHO FCTC, it will abolish designated smoking areas, prohibit the sale of individual cigarettes (single sticks), and raise the legal age required for purchase of tobacco products from 18 to 21.⁵³⁵⁴ However, as of September 2023, this amendment has yet to become law.

Citing concerns about the health impacts of vaping on young people, the Indian government introduced a ban on electronic cigarettes in 2019. The law prohibits the production, manufacture, import, export, transport, sale, distribution, storage and advertisement of e-cigarettes.¹⁵⁵ Though their use remains rare in India as of 2023, the law closes off a huge potential market for e-cigarette companies.⁵⁶

For more details, please see the following websites:

• Legislation by country – India, Tobacco Control Laws, Campaign for Tobacco Free Kids
• India, WHO FCTC Implementation Database, WHO FCTC Secretariat
• Country profile – India, World Health Organization, WHO report on the global tobacco epidemic 2021

Tobacco Industry Interference in India

Tobacco industry tactics in India include mobilisation of front groups and third parties; litigation against tobacco control measures, such as graphic health warnings; and corporate social responsibility, including in partnership with government.

Delaying rollout of larger graphic health warnings

In October 2014, the Indian Ministry of Health and Family Welfare announced its intention to increase the area covered by graphic health warnings (GHWs) on tobacco products, from 40% to 85%.⁵⁷ GHWs are a well-established, evidence-based and cost-effective measure of reducing tobacco use.⁵⁸ They may also be particularly effective in India, given both the country’s linguistic diversity and its literacy rate (as of 2018, over a quarter of the population was unable to read or write).⁵⁹⁶⁰

The tobacco industry deployed various tactics in an attempt to block this legislation. These included mobilising third parties and front groups, spreading misleading information, and submitting more than 30 legal challenges in state-level courts throughout India.⁶¹⁶²

Third parties and front groups which mobilised against the legislation included the following:

• The All India Bidi Federation
• The Tobacco Institute of India
• The Confederation of Indian Industry (CII)
• The Federation of Indian Chambers of Commerce and Industry (FICCI)
• The Associated Chambers of Commerce and Industry of India (ASSOCHAM)
• The Federation of All India Farmer Associations (FAIFA)
• The Retailers Association of India (RAI)
• The International Tobacco Growers Association (ITGA)

These groups wrote letters to and met with policy makers, launched campaigns in the media against the proposal, and filed legal challenges.⁶¹⁶²

For example, FAIFA bought full-page advertisements in leading national newspapers, claiming that larger GHWs would be detrimental to the livelihoods of tobacco farmers and fuel the illicit trade.⁶¹⁶³ FAIFA, CII and FICCI all wrote letters to the Minister of Health, J.P. Nadda, echoing these arguments.⁶⁴⁶⁵ The Tobacco Institute of India filed a legal challenge against the government in the High Court of Karnataka.⁶⁶ Finally, ASSOCHAM addressed a communiqué to the government, stating that the GHWs would endanger the livelihoods of more than 45 million people and lead to a flood of illicit imports.⁶⁷

These industry strategies succeeded in delaying the rollout of the 85% GHWs for a year, from April 2015 until April 2016.⁶⁸ However, the legal challenges continued even after implementation. In 2017, the High Court of Karnataka ruled that India should revert to the pre-2016 40% warnings. This decision was overruled in 2018 by the Indian Supreme Court and the 85% warnings have remained in force ever since.⁶²

The eventual introduction of the 85% GHWs saw India jump from 136^th to third position in the global ranking for size of health warnings on tobacco products.⁶⁹

Undermining the gutkha ban

Gutkha, one of India’s most popular smokeless tobacco (SLT) products, is a mix of crushed Areca nut (a well-known risk factor for several cancers even when consumed without tobacco), with tobacco, catechu, paraffin, slaked lime and flavourings.⁷⁰⁷¹ Highly addictive and very cheap, gutkha is popular amongst women and young people.⁷²

Since 2012, there have been state-level bans throughout the country in an attempt to reduce its prevalence, but it remains widely available.⁷³⁷⁴ Producers have found ways to circumvent the bans, such as by packaging and selling the constituent ingredients of gutkha separately.⁷⁴⁷⁵

In the state of Tamil Nadu, gutkha remained widely available despite being banned in 2013.⁷⁶⁷⁷ In 2016, officials from India’s Income Tax Department discovered details of a series of suspected bribes worth nearly US$6 million made by leading manufacturer MDM to public officials, allegedly to facilitate the storage, transport and sale of gutkha.⁶¹⁷⁶⁷⁸

Alleged recipients of bribes included a government minister, police officers and senior civil servants.⁷⁹ In November 2022, after four years of investigations in three states, India’s Central Bureau of Investigation filed charges against 21 individuals.⁷⁹⁷⁶

Corporate social responsibility: partnerships with government

Tobacco companies often use corporate social responsibility (CSR) initiatives to enhance their public image and corporate reputation.

In the implementation guidelines for Article 5.3 of the WHO FCTC, the WHO states that these activities fall within its definition of tobacco advertising, promotion and sponsorship – and should therefore not be endorsed by Parties to the treaty.⁸⁰ However, in India, under the Companies Act 2013, all large corporations are required to spend at least 2% of their average net profit in the previous three years on CSR.⁸¹ This helps to legitimise tobacco industry CSR, as companies argue they are only fulfilling their legal duties.³In its sustainability reporting, ITC states that its CSR initiatives fall within the scope of the 2013 legislation.⁸²

ITC has contributed frequently to government programmes and has worked with government institutions.³ For example, in 2017, ITC contributed to a fund set up by the Indian government to attract funding from corporations and private donors for the provision of sanitation and clean drinking water; and to the Clean Ganga Fund, established by the government to rehabilitate the River Ganges.⁸² In his speech to shareholders at the 2017 AGM, the then ITC CEO cited several public-private partnerships with state governments in India on water management projects, stating that they aligned with a national programme which aimed to expand irrigation coverage and improve efficiency of water use.⁸³⁸⁴

This type of public-private CSR was particularly widespread during the COVID-19 pandemic. In total, between March and June 2020, the Indian tobacco industry contributed around US$36.7 million in donations to various government funds, both at federal and state level.⁸¹ The industry also partnered with other stakeholders, including NGOs, other private sector actors and even popular Bollywood singers. ITC was the biggest cash and in-kind contributor.⁸¹⁸⁵

Corporate trademarks were widely visible during these CSR activities, and the initiatives were publicised in leading newspapers and by senior politicians.⁸¹⁸⁶⁸⁷

• For more on tobacco industry activity during the pandemic, please see the COVID-19 Tobacco Tactics page and the COVID-19 monitoring database.

Relevant Links

• Global Adult Tobacco Survey GATS 2 India 2016-17, Tata Institute of Social Sciences (TISS), Mumbai and Ministry of Health and Family Welfare, Government of India
• Report on Tobacco Industry Interference in India – Case Studies, S. Goel, S. Sekhar Kar, Resource Centre for Tobacco Control
• Interference by Big Tobacco and Affiliates in Tobacco Control in South Asia, Institute of Public Health Bengaluru and the International Union Against Tuberculosis and Lung Disease
• Crooked Nine: Nine Ways the Tobacco Industry Undermines Health Policy, Vital Strategies
• National Report: The Environmental Burden of Tobacco Products Wastes in India. Tobacco Use Makes You Ugly, Your Habitat Uglier, SPH AIIMS Jodhpur, ICMR-NICPR, The Union

Tobacco Tactics Resources

• Associated Chambers of Commerce and Industry of India (ASSOCHAM)
• Federation of Indian Chambers of Commerce and Industry (FICCI)
• ITC Limited

TCRG Research

• Advancing whole-of-government approaches to tobacco control: Article 5.3 and the challenge of policy coordination in Bangladesh, Ethiopia, India and Uganda. R.A. Barry, S.M. Abdullah, A. Chugh, S. Hirpa, P. Kumar, D. Male, R. Ralston, T. Wagner-Rizvi, J. Collin, Tobacco Control 2022;31:s46-s52.
• Institutional tensions, corporate social responsibility and district-level governance of tobacco industry interference: analysing challenges in local implementation of Article 5.3 measures in Karnataka, India. P. Kumar, R.A. Barry, M.M. Kulkarni, V.G. Kamath, R. Ralston, J. Collin, Tobacco Control 2022;31:s26-s32.
• Developing more detailed taxonomies of tobacco industry political activity in low-income and middle-income countries: qualitative evidence from eight countries, B.K. Matthes, K. Lauber, M. Zatoński, L. Robertson, A.B. Gilmore, BMJ Global Health 2021;6:e004096.

For a comprehensive list of all TCRG publications, including research that evaluates the impact of public health policy, go to TCRG publications.

References

The post India Country Profile appeared first on TobaccoTactics.

British American Tobacco (BAT) was established in 1902 when the Imperial Tobacco Company and the American Tobacco Company formed a new joint venture.⁸⁸⁸⁹ Headquartered in London in the United Kingdom (UK), its businesses operate in all regions of the world.⁹⁰ It operates as Reynolds American Inc. (RAI) in the US, after acquiring the company in 2017, and retains the name Imperial Tobacco in Canada (note that the UK based company Imperial Tobacco is now known as Imperial Brands). BAT is the second largest international tobacco company in the world (based on number of cigarettes sold), after Philip Morris International (PMI).⁹¹ This is excluding the Chinese National Tobacco Corporation (CNTC), with which BAT has a joint venture.⁸⁸⁹²⁹³

According to Euromonitor International, in 2020, BAT held just over 12.2% of the total global cigarette market (by retail volume, including China, figures rounded).⁹³⁹⁴ In June 2020, it reported total revenue of nearly UK£12.3 billion (US$16.5 billion), with 90% of its earnings coming from cigarettes and other conventional products.⁹⁴

Popular BAT cigarette brands include Dunhill, Kent, Lucky Strike, Pall Mall, Rothmans and Camel.⁹⁵ BAT also has a range of newer tobacco and nicotine products, including e-cigarettes (also known as electronic nicotine delivery systems, or ENDS) and heated tobacco products (see below for details). However, as BAT states “combustible cigarettes remain the largest global tobacco category”.⁹⁶

Acquisitions and Interests

BAT owned 42.2% of RAI shares from 2004 to 2017.⁸⁸ In January 2017, BAT announced that it had agreed to acquire the remaining 57.8% stake.⁹⁷ This acquisition was completed by July 2017.⁸⁸⁹⁸

In 2019, BAT held international interests with two other tobacco companies:⁹⁹¹⁰⁰

• ITC Private Limited (formerly known as the Indian Tobacco Company Private Limited): In 1985, BAT and ITC set up a joint venture in Nepal, the Surya Nepal Private Limited (Surya Nepal).¹⁰¹¹⁰² BAT owns 29.7% of ITC shares.¹⁰³¹⁰⁴ According to media reports, BAT unsuccessfully attempted to increase its stake in ITC on several occasions.^105106107
• China National Tobacco Corporation (CNTC): in August 2013, BAT and CNTC established a joint venture named CTBAT, which is headquartered in Hong Kong.⁹²

In 1961, BAT diversified into paper, cosmetics and food industries. It also entered the retail industry, acquiring Argos and Saks Fifth Avenue in the UK and US, respectively. In the late 1980s, BAT moved into the insurance industry, acquiring Eagle Star, Allied Dunbar and Farmer’s Group in the UK. However, in the late 1990s BAT industries divested its non-tobacco business.⁸⁸ Further historical background information can be found here.⁸⁹

In the 2000s, the company once again diversified, this time into non-cigarette tobacco and nicotine products. BAT founded and wholly owns the Nicoventures group of companies. Nicoventures Ltd was set up as a division of BAT in 2011, originally dedicated to the production of licensed nicotine products.¹⁰⁸¹⁰⁹ A new holding company was set up in 2012, and from 2014 two subsidiaries focussed on different types of product:

• Nicoventures Trading Ltd – until 2014 named CN Creative, a company acquired by BAT in 2012. By 2014, this company was focussed on unlicensed products, including e-cigarettes.¹¹⁰
• Nicovations Ltd – in 2014, Nicoventures Ltd changed its name to Nicovations Ltd.¹¹¹ This company’s focus remained licenced (or “regulatory approved”) inhaled nicotine products, including, for example, products licenced by the UK Medicines and Healthcare products Regulatory Agency (MHRA).¹⁰⁸ BAT had plans to develop a nicotine inhaler named Voke in a collaboration with the company Kind Consumer Limited, a project which was abandoned in January 2017.¹¹²¹¹³ By early 2018, the Nicovations website was no longer available, the company listed no employees and its only business activity was the leasing of equipment ¹¹⁴

Two further related subsidiaries were registered in the UK: Nicoventures U.S. Ltd (2015) and Nicoventures Retail (UK) Ltd (2016/17).

• BAT also owns Fiedler & Lundgren, a Swedish company which produces snus. See below for more on BAT’s non-cigarette products

In 2020, as part of its “transformation” agenda, BAT set up a new investment arm called Btomorrow Ventures.¹¹⁵ See below for details.

In January 2022, BAT announced the creation of biotech investment company KBio Holdings Limited (KBio) to “leverage the existing and extensive plant-based technology capabilities of BAT and Kentucky BioProcessing Inc”.¹¹⁶. For more information see Tobacco Companies Investments in Pharmaceutical Products and NRT.

Employees and Board Members: Past and Present

In May 2023, BAT announced that Chief Executive Officer (CEO) Jack Bowles was stepping down with immediate effect.¹¹⁷ Bowles had been appointed CEO in April 2019, succeeding Nicandro Durante.¹¹⁸

Bowles was replaced by Tadeu Marroco, previously BAT Group Finance Director.¹¹⁷

In October 2020, BAT announced that Richard Burrows would be stepping down as Chairman after the 2021 AGM.¹¹⁹ He would be replaced by Luc Jobin, who has a long history in the tobacco industry.¹²⁰ Jobin held senior roles at Imperial Tobacco Canada from 1998 to 2005 and was Non-Executive Director of RAI before it was acquired by BAT, after which he became Non-Executive Director of BAT.¹²⁰

A current list of BAT’s Board of Directors can be found on the BAT website.

Other persons that currently work for, or have previously been employed with, the company:
Jeffries Briginshaw |  Jeannie Cameron (see JCIC International) | Kenneth Clarke | Mark Cobben | David Crow |  David Fell | Ann Godbehere | Giovanni Giordano | Andrew Gray | Tomas Hammargren | Robert Lerwill | Jean-Marc Lévy | Adrian Marshall | Des Naughton | Christine Morin-Postel | Gerard Murphy | Shabanji Opukah | David O’Reilly | Kieran Poynter | Michael Prideaux | Anthony Ruys | Nicholas Scheele | Karen de Segundo | Naresh Sethi | Ben Stevens | Kingsley Wheaton | Neil Withington

Affiliations

Memberships and Partnerships

In 2019, BAT disclosed it was a member of the following associations:¹²¹
The American Chamber of Commerce to the European Union | British Chamber of Commerce in Belgium | BusinessEurope | Centre for European Policy Studies (CEPS) | Confederation of British Industry | Confederation of European Community Cigarette Manufacturers (CECCM; now Tobacco Europe) | European Cigar Manufacturers Association (ECMA) | European Smoking Tobacco Association (ESTA) | Institute of Economic Affairs | International Chamber of Commerce (ICC) UK | International Trademark Association (INTA) | ICC Business Action to Stop Counterfeiting and Piracy (BASCAP) |  Kangaroo Group|

According to BAT’s previous entries on the EU register it has also been a member of: ¹²² American European Community Association | European Policy Centre | European Risk Forum | Ad Hoc Council (The European Government Business Relations Council) | European Smokeless Tobacco Council (ESTOC) | The Mentor Group |

BAT is a member of the following trade and business associations: Association of Convenience Stores (UK) | UK Tobacco Manufacturers’ Association (TMA) | UK Vaping Industry Association (UKVIA) | Tobaksproducenterne (Tobacco Manufacturers Denmark)¹²³ | Scottish Grocers’ Federation |

It has previously been a member of the following:
Czech Association for Branded Products | European Travel Retail Confederation | Federation of Wholesale Distributors | MARQUES | Scottish Wholesale Association | Tobacco Industry Platform (TIP) | Transatlantic Business Dialogue | UniteUnite |

BAT is also a founding member of the industry-funded Eliminating Child Labour in Tobacco Growing Foundation (ECLT).¹²⁴ From 2002 to 2018, ECLT had a partnership with the International Labour Organization (ILO), a United Nations (UN) agency, focussed on issues related to labour such as international labour standards, social protection and unemployment.¹²⁵
See below for more on BAT’s CSR activity relating to child labour.

BAT has also provided financial support to:
Alliance of Australian Retailers | Anti-Counterfeiting Group | All-Party Parliamentary Corporate Responsibility Group (APCRG) | All-Party Parliamentary Corporate Governance Group (APPCGG) | Business in the Community (UK) | Benkert | Business Action for Africa¹²⁶ |  Commonwealth Business Council | Conference Board¹²⁷ | Consumer Choice Center | European Council on Research, Development and Innovation¹²⁸ | European Science and Environment Forum | Forest | Forum for EU/US Legal-Economic Affairs | Global Reporting Initiative  | Institute of Business Ethics | International Tax and Investment Center  | International Tobacco Growers Association | The Common Sense Alliance  | Rural Shops Alliance  | VNO-NCW

Consultancies

In 2019, the following businesses listed BAT as a client:
Business Platform Europe¹²⁹ | EUK Consulting | EUTOP Brussels SPRL¹³⁰ | Red Flag

Other companies that have provided services for BAT include: Bernstein Public Policy¹³¹ | BXL Consulting | Bureau Veritas¹³² | Clifford Chance | Corporate Responsibility Consulting (CRC) | Crosby Textor Group | Edelman | FTI Consulting | Goddard Global | Hume Brophy | Instinctif Partners  | Kantar | Morris and Chapman¹³² | Pappas & Associates ¹³³ | Simply Europe¹³⁴ | Weber Shandwick (see also Priti Patel)

Individuals that have consulted for BAT include: Axel Gietz | Delon Human | Peter Lee | John Luik | Carl V Phillips | Riccardo Polosa | Francis Roe

Think Tanks

The following think tanks have a history of being funded by BAT:
Centre for European Reform | Centre for Policy Studies | Chatham House | European Policy Centre | European Science and Environment Forum | Fraser Institute Free Market Foundation | Institute for Competitiveness (I-Com)| Institute of Economic Affairs | Institute of Public Affairs | Niagara Institute (See John Luik)

Controversial Marketing Strategies

Targeting Youth

Although BAT has stated that it is “committed to carry out youth smoking prevention”, the company has been accused of targeting youth in their marketing activities.¹³⁵¹³⁶

Some of the countries where the company has been accused of such tactics, include: Argentina¹³⁷, Brazil,¹³⁵ Ethiopia,¹³⁸ Malawi,¹³⁹ Mauritius,¹³⁹ Nigeria,¹³⁹ Sri Lanka, and Uganda.

Targeting Women and Girls

Women, who smoke less than men globally, are a key demographic for tobacco companies.¹⁴⁰ Tobacco companies have identified packaging and brand design as important ways to appeal to women.

Large transnational tobacco companies have launched female-targeted brands. For example, in April 2011, BAT introduced Vogue Perle, described as “the UK’s first demi-slim cigarette”.¹⁴¹ BAT defended itself against claims it “downplayed” the health risks associated with smoking in favour of the “trappings of style, supermodels and staying slim”.¹⁴²

Read more on our page Targeting Women and Girls.

Funding Education programmes

In 2011, BAT’s introduction of cigarettes targeted at women coincided with the revelation that the company was funding scholarships for four Afghan girls at Durham University. The university was criticised for accepting a GB£125,000 donation from BAT.¹⁴³

The tobacco industry also attempts to enhance its reputation, and gain legitimacy, by funding universities. In 2000, Nottingham University came under scrutiny for its decision to accepts GB£3.8 million from BAT to establish an International Centre for Corporate Social Responsibility.^144145146

BAT has also funded education organisations and programmes as part of its CSR relating to child labour. For example, in 2001 BAT launched the “Our Florece” programme (meaning blossom) in Mexico, to set up and equip centres near tobacco growing farms providing migrant labourers’ children with access to education and health services.¹⁴⁷

Read more on our page CSR: Education, and below for BAT’s other CSR activity.

Tactics to Subvert Tobacco Control Campaigns and Policies

Using British Diplomats to Lobby Foreign Governments on its Behalf

There have been several instances of senior UK diplomats lobbying governments on behalf of BAT in low and middle income countries (LMICs), including Bangladesh, Panama and Venezuela.

For more information, go to UK Diplomats Lobbying on Behalf of BAT.

Intimidating Governments with Litigation or Threat of Litigation

BAT has legally challenged the following tobacco control measures in the respective countries:

• Health Warnings/Plain Packaging in Australia (also see Plain Packaging in Australia and Australia: Trademark Claims), Namibia, Kenya, Sri Lanka, UK, and Scotland.¹⁴⁸
• The Display Ban in the UK.
• The Tobacco Products Directive in the European Union (also see Legal Challenges).
• The Uganda Tobacco Control Bill 2014.
• The Kenya Tobacco Control Bill 2017, and 2014 regulations.

Fabricating Support through Front Groups

In May 2012, the Tobacco Control Research Group asked BAT to reveal the British-based think tanks it had funded during the previous five years, as well as those it had funded that were active in the plain packaging debate.

The company replied:

“British American Tobacco is happy to support those who believe in the same things we do – whether that be retailers against display bans or farmers against being forced out of growing tobacco;

* Our support may be financial support, or resources in kind;

* We do not tell these bodies what to say or how to spend the money;

* Many of the bodies, in particular the retailers, feel deeply patronised at the suggestion they are merely industry stooges.”¹⁴⁹

In May 2013, in response to questions asked at the company’s Annual General Meeting by health advocacy Action on Smoking and Health, the company disclosed that it funded:¹⁵⁰ FOREST, The Common Sense Alliance, Rural Shops Alliance, Scottish Wholesalers Alliance, Tobacco Manufacturers’ Association, and Tobacco Retailers’ Alliance

Also see: BAT Funded Lobbying Against Plain Packaging, The Plain Pack Group, Australia: Campaigning Websites, Australia: International Lobbying,  Digital Coding & Tracking Association (DCTA)

• A list of tobacco industry allies can be found on the STOP website.

For more examples of BAT working through third parties, see the section below on its efforts to undermine illicit trade policy.

Corporate Social Responsibility (CSR) Initiatives

After its rebrand in 2020, BAT’s website prominently featured its “socially responsible” practices: “Our companies and our people ensure they are managed as responsibly as possible – from the crop in the fields through to the consumer”.¹⁵¹ TCRG research has revealed how the underlying motivation of BAT’s CSR and stakeholder management activities is to promote their corporate image, neutralise opposition and influence policy.¹⁵² Others have documented similar evidence, including in Malaysia¹⁵³ and Malawi.¹⁵⁴

CSR in Bangladesh

BAT Bangladesh (BATB) has close connections to government in the country due to its strategic CSR donations. BATB runs several programmes targeted at the environment, including reforestation, with the Bangladeshi Department for Agricultural Extension.¹⁵⁵

Another BATB run programme, the Prerona Foundation, states that its goal is to “promote economic inclusion of marginalised communities, women empowerment and youth development through skills enhancement programmes”, and that its work is shaped by the United Nation’s Sustainable Development Goals (SDGs).¹⁵⁶ Managing Director of BATB, Shezad Munim, stated that the Prerona Foundation was created to increase the scope of BATBs CSR activities.¹⁵⁷ In 2020, during the Covid-19 pandemic, the foundation introduced its own brand of hand sanitiser, reportedly distributing at least 100 000 units to different influential administrative bodies, law enforcement agencies and government institutions.¹⁵⁸¹⁵⁹

BATB has also provided direct donations to the government’s Welfare Fund, administered by the Ministry of Labour and Employment.¹⁶⁰ These CSR programmes afford BATB access to influential government officials (Image 1). Between 2014 and 2017, BAT received five exemptions from the country’s labour law in clear violation of FCTC Article 5.3 Guideline 7.1, which prevents government from giving privileges or benefits to tobacco companies for simply running their business.¹⁶¹

Image 1: BAT Bangladesh employees handing over a cheque to State Minister for Labour and Employment Begum Mannujan Sufian in the conference room at the Secretariat in September 2020. (Source: United News of Bangladesh)

BAT’s assertions also do not line up with its business practices. Apart from evading labour laws in Bangladesh, the company faces a lawsuit over its alleged use of child labour¹⁶² and stands accused of using bribery to undermine tobacco control legislation and weaken competition in Africa.¹⁶³

• More on way the industry, including BAT, uses environmental reporting and CSR programmes to greenwash its business practices can be found on Greenwashing. A general overview of industry CSR techniques is on the CSR Strategy page.
• You can read more about BAT’s rebrand and how it aligns with its newer products strategy on Newer Nicotine and Tobacco Products: British American Tobacco.

Influencing Science and Scientists

Documents in the Truth Tobacco Industry Documents collection, an archive of previously secret tobacco industry documents, reveal BAT’s efforts to mislead the public on the science of smoking and disease. In 1958, BAT scientists, alongside other industry scientists, understood that smoking caused lung cancer. BAT’s public denial of this fact continued into the 1980’s, when, according to an internal BAT memo, it changed direction, to acknowledge “the probability that smoking is harmful to a small percentage of heavy smokers”.¹⁶⁴

Documents from the 1970s show BAT scientists had confirmed that second-hand smoke, also known as environmental tobacco smoke (ETS), was harmful. However, in public, BAT lawyers denied the harm, saying: “the question is not really one of a health hazard but perhaps more of an annoyance”.¹⁶⁵ To distract from health concerns such as ETS, in the late 1980s BAT discussed the need for a public relations (PR) and political campaign focussed on protecting smokers’ rights.¹⁶⁶ It also funded research into ‘sick buildings’, to promote the idea that building design was responsible for ill health rather than ETS. A review of the Truth Tobacco documents covering the period 1985 – 1995 concluded that “At times scientists seemed to be acting more like public relations specialists than scientists.”¹⁶⁷

On the science of addiction, the Truth Tobacco documents show that scientists working for BAT, and its subsidiary Brown and Williamson, concluded in the early 1960s that nicotine was addictive. Despite this, in 1994, the CEO of Brown and Williamson, testified before the US Congress alongside the CEOs of Philip Morris and RJ Reynolds (later acquired by BAT). Each said: “I believe nicotine is not addictive.”¹⁶⁸

To prevent the release of further scientific documents in the 1980s, lawyers advised BAT not to conduct research in countries where legal action might be taken against the company.¹⁶⁹

In Europe in the 1990s, BAT worked to secure the right for the tobacco industry to be consulted on any tobacco policy informed by science, allowing tobacco companies to self-police, despite the clear conflict of interest.¹⁷⁰

• For more information see the pages on: Influencing Science

Involvement in the illicit tobacco trade

Like other transnational tobacco companies, BAT has a long history of facilitating tobacco smuggling. For example, internal BAT documents from the 1980s and 1990s revealed that in Africa, BAT used the smuggling of its own products as a business strategy to achieve a range of objectives including: gaining access to emerging markets, gaining leverage in negotiating with governments, competing for market share and circumventing local import restrictions.¹⁷¹

In September 2000, BAT faced action by the Departments (States) of Colombia which alleged that it committed violations of racketeering laws: “…arising from its involvement in organized crime in pursuit of a massive, ongoing smuggling scheme”.¹⁷²¹⁷³

In 2008, BAT subsidiary Imperial Tobacco Canada pleaded guilty to customs charges related to cigarette smuggling.

In 2010, BAT signed a cooperation agreement with the European Union (European Control Association, EUCA) and its member states to help tackle illicit tobacco trade. BAT agreed to pay the EU US$200 million over 20 years.  “In return, the manufacturers are released from any civil claims arising out of past conduct relating to illicit trade”, a UK government press release pointed out.¹⁷⁴

In 2014, HM Revenue & Customs (HMRC) fined BAT for oversupplying the Belgian market- a practice which can facilitate the smuggling of products across borders.¹⁷⁵

In 2021, BAT stated it “had agreed to dispose of” its subsidiary in Iran.¹⁷⁶ It did not provide further detail on the reasons for its departure from a country in which it held the second largest market share,¹⁷⁷ and generated approximately UK£170 million in revenue and UK£60 million in profit in 2020.¹⁷⁸ In April 2023, following a criminal investigation by US authorities, BAT agreed to pay penalties exceeding US$629 million to resolve charges of bank fraud and sanctions violations charges in North Korea, another country facing international sanctions.¹⁷⁹ In a press release, BAT stated in response that “adhering to rigorous compliance and ethics standards has been, and remains, a top priority”.¹⁸⁰ In 2023 TCRG published research on BAT’s activities in Iran.¹⁸¹ Using internal BAT documents covering 2000-2014, the paper – through the case study of Iran – tests the credibility of BAT’s claim to adhere to compliance and ethics standards. It points to BAT’s potential involvement in illicit tobacco trade, and explains how BAT’s extensive engagement with government authorities to tackle illicit trade focused primarily on reputational and commercial purposes, at the expense of controlling its own supply chain.¹⁸¹

• For more details see BAT Involvement in Tobacco Smuggling

Efforts to undermine policy to address illicit tobacco trade

Previous TCRG research has outlined how tobacco companies, including BAT, have attempted to interfere with the implementation of tracking and tracing implementation. This included using front groups (such as the Digital Coding and Tracking Association) to promote their own ineffective and inefficient technology, formerly knowns as Codentify (now the Inexto Suite). In Kenya in 2012, BAT unsuccessfully tried to influence a track and trace tender outcome in favour of the Codentify system through the use of a third party, Fracturecode.Internal industry documents indicate that Fracturecode was closely linked to BAT. For more details, see our page, Kenya- BAT’s Tactics to Influence Track and Trace Tender.

In 2016 the European Union (EU) ran a public consultation for the European Union’s track and track system. TCRG research (published in October 2020) found that the tobacco industry lobbied extensively for the EU to adopt a system controlled by the industry. Transnational tobacco company’s interests were repeatedly represented through consultation submissions by multiple trade associations, which were not always transparent about their membership. .¹⁸²  For more details see Track and Trace.

Limiting Its Tax Bills

TCRG research published in March 2020 found that “Very little profit based taxation has been paid in the UK [by tobacco companies] despite high levels of reported profits, both in the domestic market and globally.”¹⁸³ While BAT has a relatively small share of the UK tobacco market (less than 10%), the company made hundreds of millions estimated profit in the UK and hundreds of billions globally. However, since 2010 it has paid virtually no UK corporation tax (effectively 0%) despite paying 20-30% in other countries.¹⁸³

An investigation by journalists from the Investigative Desk and TCRG researchers, found that BAT uses “aggressive tax planning” strategies to reduce the amount of tax it pays.¹⁸⁴¹⁸⁵

Analysis of BAT company reports between 2010 and 2019, found that BAT (and the other main transnational tobacco companies, PMI, JTI and Imperial) use several methods to avoid or lower their tax bills:¹⁸⁴

• Shifting dividends – for example, each year BAT shifts around €1 billion in dividends via Belgium, paying tax at less than 1 percent.
• Group relief – losses from interest paid on internal loans lead to group tax relief, meaning BAT paid almost no UK corporation tax.
• Notional interest deduction – €3.5 billion in assets were held in holding companies in Belgium, helping BAT to deduct several millions in notional (fictitious) interest between 2010-2017.
• Profit shifting via intra-firm transactions – for example, BAT Korea Manufacturing Ltd in South Korea sold its cigarettes – on paper – to Rothmans Far East, another BAT subsidiary. The cigarettes were then re-sold back to BAT Korea Ltd at a much higher price. By this method BAT moved an average of €98m of Korean profits to the Netherlands.

BAT was able to reduce its tax bill by an estimated £760 million over 10 years.¹⁸⁴ While seen as morally wrong by many, or at least socially undesirable, tax avoidance is not illegal; it is sometimes referred to as ‘tax planning’, whereas tax evasion is a crime. However BAT’s activities do not even appear to be in the spirit of its own code of business conduct.¹⁸⁶. BAT states that it “complies with all applicable tax legislation and regulations in the countries where we operate”.¹⁸⁷ However, as of November 2020, BAT had been, or was still, involved in tax disputes in multiple countries: Netherlands (the largest claim,€1.2 billion), Brazil, South Korea and Egypt.¹⁸⁴ In September 2019, the European Commission announced an investigation into tax avoidance by 39 multinational companies, including BAT.¹⁸⁴¹⁸⁸

You can read more about the tobacco industry and taxation on our page, Price and Tax.

Behtr Pakistan Campaign

BAT has also developed PR campaigns to support its goals to reduce its tax bill. The Behtr Pakistan campaign was launched in 2021 and states that it aims to “to create awareness about tax collection in Pakistan, identify effective solutions to enhance tax collection and make the country progress”. The campaign represents itself as a “nationwide public service, national interest initiative” but was created by Pakistan Tobacco Company Limited, a subsidiary of British American Tobacco.¹⁸⁹ Behtr Pakistan uses arguments regularly used by the industry, stating that increased taxes in the tobacco sector have resulted in an increase in illicit trade.¹⁹⁰

Accusations of Corruption and Bribery in Africa

From 2017 to 2021, BAT was under investigation by the UK Serious Fraud Office (SFO) after allegations of corruption and bribery in Africa.^163191192193In January 2021 the SFO announced it was closing the investigation saying: “The evidence in this case did not meet the evidential test for prosecution as defined in the Code for Crown Prosecutors.”¹⁹⁴

Further accusations followed in 2021. Read The BAT Files, which detail how BAT bought influence, interfered with tobacco control measures, and undermined its competitors across the continent.

BAT has consistently denied the allegations.¹⁹⁵

Newer Nicotine and Tobacco Products

As the harms from conventional products have become better understood, and tobacco control measures have been put in place, the cigarette market – from which tobacco companies make most of their profits – has started to shrink. To secure the industry’s longer-term future, transnational tobacco companies (TTCs) have invested in, developed and marketed various newer nicotine and tobacco products.¹⁹⁶  BAT also has an interest in new cannabis products (see below).

In March 2020, BAT rebranded its corporate website with the tagline “A Better Tomorrow”, which was originally registered by Nicoventures and used to promote BAT’s newer products. However, in 2020, over 90% of BAT’s revenue still came from cigarettes and other conventional tobacco products.⁹⁴ It also stated that its revenue growth since 2019 “was driven by combustibles”.⁹⁴

To read more about BAT’s products and strategy, including its 2020 rebrand, visit our page Newer Nicotine and Tobacco Products: British American Tobacco.

BAT Expansion “Beyond Nicotine”

BAT has been accused of “health washing” its reputation by connecting itself to wellness products while continuing to sell tobacco products: there are concerns that the ‘health halo’ from wellness products could normalise its brand. The health claims of many wellness products in general have been described as ‘baseless’ but make good sales due to effective marketing.¹⁹⁷

Btomorrow Ventures

In 2020, BAT set up a new investment unit called Btomorrow Ventures.¹⁹⁸ As part of a “transformation”, BAT announced plans to go “beyond nicotine”.¹⁹⁹ The new division invited investment in areas ranging from “BioTech & Science, Technology, Wellbeing & Stimulation to Environmental Social Governance”.¹¹⁵²⁰⁰ BAT launched a dedicated website in July 2021 and invited companies to pitch for investment to help “accelerate this transformation”, specifically those relating to “digital transformation” and the “sustainability agenda” (see Greenwashing).¹¹⁵²⁰¹

• BAT’s current investments can be found on the BTomorrow Ventures website

The Waterstreet Collective

In April 2022, The Waterstreet Collective, a company wholly owned by BAT, was registered at UK Companies House.²⁰² for “the development, procurement, marketing and sale of wellbeing and stimulation products and associated accessories”.²⁰³. Its Ryde drinks are made in the US and have been marketed in Canada and Australia.²⁰⁴²⁰⁵ Free samples were handed out to Australian university students without BAT’s ownership being disclosed to the students or the university, or on the product packaging.¹⁹⁷ As of January 2024, The Waterstreet Collective LinkedIn Profile states that it “partners” with Btomorrow Ventures.²⁰⁶

• For more information see pages on Tobacco Companies Investments in Pharmaceutical Products and NRT and Cannabis

TobaccoTactics Resources

• The BAT Files
• British American Tobacco in Africa: A History of Double Standards.
• UK Diplomats Lobbying on Behalf of BAT
• BAT Involvement in Tobacco Smuggling
• Imperial Tobacco Canada: Involvement in Cigarette Smuggling
• Kenya- BAT’s Tactics to Undermine the Tobacco Control Regulations
• Kenya- BAT’s Tactics to Influence Track and Trace Tender
• Newer Nicotine and Tobacco Products: British American Tobacco

Relevant Link

• British American Tobacco company website
• Btomorrow Ventures website

TCRG Research

• “Unlawful Bribes?”: A documentary analysis showing British American Tobacco’s use of payments to secure policy and competitive advantage in Africa,  R.R. Jackson, A. Rowell, A.B. Gilmore, 13 September 2021, UCSF: Center for Tobacco Control Research and Education. Available from: escholarship.org/uc/item/4qs8m106
• The Limits of Corporate Social Responsibility: Techniques of Neutralization, Stakeholder Management and Political CSR, G. Fooks, A. Gilmore, J. Collin et al, Journal of Business Ethics, 2013, 112:283. doi:10.1007/s10551-012-1250-5
• “Working the System”—British American Tobacco’s Influence on the European Union Treaty and Its Implications for Policy: An Analysis of Internal Tobacco Industry Documents, K.E. Smith, G. Fooks, J. Collin, et al, PLoS Med, 2010; 7(1): e1000202, doi: 10.1371/journal.pmed.1000202
• Trade policy, health and corporate influence: British American Tobacco and China’s accession to the World Trade Organization, C. Holden, K. Lee, A. Gilmore et al, International Journal of Health Services, 2010, 40: 421-441, doi:10.2190%2FHS.40.3.c
•  The invisible hand: how British American Tobacco precluded competition in Uzbekistan, A.B. Gilmore, M. McKee, J. Collin, Tobacco Control, 2007; 16:239-247, doi: 10.1136/tc.2006.017129
• “The law was actually drafted by us but the Government is to be congratulated on its wise actions”: British American Tobacco and public policy in Kenya, P. Patel, J. Collin, A.B. Gilmore Tobacco Control, 2007; 16:e1, doi:10.1136/tc.2006.016071
• British American Tobacco’s erosion of health legislation in Uzbekistan, A.B. Gilmore, J. Collin, M. McKee, BMJ, 2006; 332-355, doi:10.1136/bmj.332.7537.355

For a comprehensive list of all TCRG publications, including TCRG research that evaluates the impact of public health policy, go to TCRG publications.

References

The post British American Tobacco appeared first on TobaccoTactics.

Latin America and the Caribbean is composed of 33 countries, covering the territory from Mexico to Argentina, including the Caribbean islands.²¹⁰ The region includes some of the countries with the highest population in the world, such as Mexico and Brazil. In 2018, the total population for the region was more than 641 million people, according to World Bank statistics.

Despite its economic growth and being a “biodiversity superpower”²¹¹, one of the main challenges faced by Latin America and the Caribbean remains the high levels of economic inequality.²¹² According to a report from the United Nations Development Programme, the richest 10% in the region have a higher share of salary than in any other region (37%) and the poorest 40% receive the smallest share (13%). This equates to one of the highest levels of inequality in the world.²¹³

Smoking in the Latin American and Caribbean Region

Smoking prevalence in the region has been reduced in the last few decades as a result of the regional tobacco control efforts. The Pan-American Health Organization, which is the Americas regional office of the World Health Organization (WHO), estimates that “between 2007 and 2015, the prevalence of tobacco smoking dropped from 22.1% to 17.4%, a greater drop than that recorded globally”.²¹⁴ This trend is expected to continue, with the region being the “only WHO region expected to achieve a 30% relative reduction in the prevalence of current tobacco use by 2025.”²¹⁴

Despite the achievements on tobacco control, according to the Tobacco Atlas, “nearly 70 million smokers in Latin America are at risk of tobacco-related deaths and diseases”²¹⁵.  Bolivia and Chile have the highest smoking prevalence in the region, with 40% and 38.7%, respectively, followed by Cuba with 35.9%, Suriname with 26.2%, and Argentina with 22.5%. In contrast Ecuador (7.4%) and Panama (6.6%) have the lowest prevalence in the region. ²¹⁶

A gender perspective on smoking in the region

Men have a higher consumption rate compared to women, despite the tobacco industry’s long term efforts to target women in its marketing and advertising strategies.²¹⁷ Even so, Latin America and the Caribbean are ranked second by the WHO, regarding higher rates of female tobacco consumption, following Europe.²¹⁷ Chile, Uruguay, and Argentina have the highest rates of consumption among women (see the graph showing tobacco consumption in the general population by gender and country, with data in blue being for men and data in orange for women). ²¹⁸

Figure 1: Smoking prevalence in LAC region. (Source: Organization of American States, smoking prevalence²¹⁸)

Tobacco use among youth (10- to 15-year-olds) in the region

Jamaica has the highest rate in youth consumption in the region, with 28.7%, followed by Colombia with 22% and Chile with 19.7%. Brazil has the lowest rate of tobacco consumption amongst the youth, as a result of the efforts of the country to introduce tobacco control measures as advertising ban, health warnings, and flavouring ban ²¹⁷.

Most countries in the region have a strict ban on the sale of tobacco products to minors, however, there is evidence to suggest tobacco use initiation starts between 10-13 years old, with those in Caribbean countries starting to smoke at a younger age on average than the rest of the region.²¹⁷

Figure 2: Tobacco and heated tobacco consumption in LAC region (Source: reproduction based on data from PAHO, 2007-2017)²¹⁷

The consumption of newer nitcotine and tobacco products among the young population has increased in the region. However, conventional cigarette remains the highest consumed tobacco product. The following graph shows the consumption of tobacco products and next-generation products, by country. Jamaica also leads the consumption of next-generation products, followed by Dominica and Saint Vincent and the Grenadines. ²¹⁷

Tobacco production in the Latin American and Caribbean Region

Several countries in the region are major tobacco leaves growers and suppliers at a global level. Brazil has 75% of the regional tobacco production, followed by Argentina, Colombia, Guatemala, and Cuba representing 18.4% of the production collectively. However, the area of land dedicated to tobacco farming in the region has decreased from 668,890 hectares in 2006 to 556,372 hectares of land in 2014.²¹⁹

Brazil is the second-largest tobacco-growing country in the world, after China.²²⁰ Tobacco farming in Latin America represents almost 16% of the global production. Moreover, the cultivated area in the region reaches 13.55% of the global land dedicated to tobacco farming worldwide ²²¹ Central American countries such as Nicaragua, Cuba, Dominican Republic, and Honduras are the main global producers of cigars. ²²²

Who dominates the market?

The tobacco products that destroy so many people’s lives are the result of the activities of a number of companies around the world. The Tobacco Supply Chain Database enables tobacco control researchers and advocates to understand what the supply chain is, where it is located and who is involved. For more information, access the database here.

The tobacco market in Latin America and the Caribbean is dominated by Philip Morris International (PMI) and British American Tobacco (BAT). In the 1990s, BAT had 60% of the tobacco market, with PMI making up the majority of the remaining 40%, and some minor presence from Japan International Tobacco in Bolivia.²²³ However, in the late 2000s, Philip Morris started buying local manufacturers and tobacco brands. ²²⁴

Since 2015, British American Tobacco and Philip Morris International control the tobacco market in Latin America and the Caribbean, with BAT controlling 51.4% of the market. ²²⁵. In 2018, the company shares of cigarettes in Latin America showed BAT with 40.0% and PMI with a very close 39.5%, as shown in the following graph:

Figure 3: Company shares of cigarettes in Latin America (Source: Euromonitor 2020²²⁶)

The most popular brand of cigarettes in the region in 2018 was Marlboro, by Philip Morris International, followed by Pall Mall, produced by the British American Tobacco. The following graph illustrates the brand shares of cigarettes in Latin America:

Figure 4: Brand shares of cigarettes in Latin America (Source: Euromonitor 2020²²⁷)

Table 1. Countries with most sold cigarette brand owned by international and multinational companies, in the most populated countries of Latin America and the Caribbean

Links to the government

Latin America and the Caribbean has been a leader on tobacco control at the global level for decades. ^{237 238} The region has a world-renowned reputation for its tobacco control efforts, including the design and implementation of effective evidence-based policies. As a consequence, the tobacco industry has attempted numerous times to undermine those efforts. As described by regional tobacco control experts: “The tobacco industry, with enormous resources and possibilities, is on high alert and giving a fierce and intelligent fight. What is visible, at least in the Americas Region, is that they continue to rely on the old tactics (albeit more aggressively): lobbying directly, especially in finance ministries and also at higher levels of government, to oppose tobacco tax increases, advertising bans or neutral packaging.”²¹⁷

Latin American and Caribbean government representatives have long recognised the pressures they are under from the tobacco industry. An expert committee from the Pan-American Health Organization was convened in the year 2000 to evaluate the industry interference in the region. ²³⁹

In 2010, PAHO convened a meeting for Ministers of Health to discuss the issue. Delegates pledged to counteract efforts by the tobacco industry or its allies.²³⁹ After this meeting, the Executive Council of PAHO met in October 2010, to keep discussing the industry interference through lobbying of decision-makers, threatening litigation and influencing the political discussion around tobacco regulation in the region.

Aznar lobbying for PMI in Chile and Peru

A tactic that the industry often uses in the region is hiring high-level lobbyists to influence government officials. Such is the case of José María Aznar, the former Spanish Prime Minister and President.²⁴⁰ Since 2018, it has been widely reported by the international media that Aznar has taken a position as a lobbyist for PMI in Latin America. ^241242243

Chile

According to public records from the Government of Chile, Aznar met with the Chilean Minister of Finance, Felipe Larrain Bascuñan, and the Chief of Staff of the Ministry of Finance, Francisco Matte Risopatrón, on 8 May 2018.²⁴⁴ The next day, on 9 May 2018, as stated in the public records, Chilean Minister Felipe Larrain Bascuñan met for an hour with several lobbyists from different multinational corporations, including two lobbyists for PMI.²⁴⁵

Peru

In January 2019, the Congress of the Republic of Peru, began discussions on stricter tobacco product regulations, including a ban on tobacco advertising.²⁴⁶ At the same time, a group of congress representatives from Fuerza Popular, one of the main right-wing parties of Peru, submitted the 3833 bills ²⁴⁷ to replace the current tobacco control law 27805 with less restrictive regulations. These proposed amendments would allow the introduction of e-cigarettes (also known as electronic delivery systems, or ENDS) in Peru.²⁴⁸

Several newspapers and media outlets reported that Aznar travelled to Peru, in February 2019 on a similar mission to the one in Chile, lobbying for the tobacco industry.^{249 250} Allegedly, Aznar made an appointment to meet with the Minister of Health but did not attend this meeting in the end. ²⁵⁰

Montepaz lobbies for change to the law in Uruguay

On 2 September 2022, President Luis Lacalle Pou signed a decree to modify Uruguay’s plain packaging law. It would have reintroduced soft cigarette packs; removed the requirements for the inside of the pack to be plain white in colour and for packs to be lined with metallic foil; and abolished the prohibition on logos or branding on the cigarettes themselves.²⁵¹ Lacalle Pou argued the reforms were necessary to fight illicit trade, and said that the decree was a response to a request from Montepaz, Uruguay’s largest tobacco company:²⁵²

“Is this to benefit the company Montepaz? No, it was a chewing gum factory who asked for it!” he said sarcastically, adding: “Who manufactures cigarettes in Uruguay? Montepaz. Who was it who asked the Ministry of Industry for this change? Montepaz. Now, if anyone believes that we just bow to pressure, they don’t know us, that’s disrespectful.”²⁵³

In February 2020, following publication of the 2019 election campaign finances by the Uruguayan Electoral Court, the newspaper El Observador reported that Montepaz had donated around $13,000 to the campaign of Lacalle Pou and his running mate Beatriz Argimón.²⁵⁴ In local currency, the amount reported is 552,180 pesos, as per the published document.²⁵⁵ In September 2022, following the decision to modify the plain packaging law, The Tobacco Epidemic Research Centre (CIET), a Uruguayan NGO, highlighted that political contributions by tobacco companies are illegal under both the WHO FCTC and Uruguayan law.²⁵⁶

It also emerged that in April 2022, Montepaz had hosted Nicolás Martinelli, then an advisor to President Lacalle Pou, at company headquarters. Martinelli published photos of the visit on his Instagram, alongside comments publicising Montepaz’s creation of employment.²⁵⁷

In October 2022, responding to an appeal by the Uruguayan Tobacco Control Society, the courts suspended the decree, on the grounds that it violated the right of children and adolescents to protection from inducement to tobacco use.²⁵⁸

Roadmap to tobacco control

Latin America has had an important role in the negotiations on global tobacco control policies. An example is the WHO FCTC negotiations and diplomatic processes, where the region was represented by Brazil. The Brazilian ambassadors were chosen to be the two first consecutive chairs of the intergovernmental negotiations. Chile also stood out, by later becoming chair of the negotiations towards the Protocol to Eliminate Illicit Trade in Tobacco Products. ²⁵⁹ Latin American leadership on tobacco control has also been shown by the important roles carried out by Latin American women in the Framework Convention on Tobacco Control Secretariat. Dr. Vera Luiza da Costa e Silva from Brazil was head of the WHO FCTC Secretariat for six years (2014-2020). Additionally, the former PAHO Tobacco control diplomat from Uruguay, Dr Adriana Blanco, was appointed in 2019 as the new head of the Secretariat until 2024. ²⁶⁰

In the road to achieving tobacco control in the region, civil society has also had an important role and continues to do so. Beatriz Champagne, Latin-American tobacco control expert, argues that “Civil society has been the engine that has permitted many of the accomplishments seen in tobacco control in Latin America and the Caribbean. However, as civil society efforts frequently involve work behind the scenes, results may merge with those of other institutions and might be not recognized”²⁶¹

Framework Convention on Tobacco Control and MPOWER in Latin America and the Caribbean

Most countries in the region have signed and ratified the WHO FCTC, as the following map illustrates. The exceptions are Argentina, Cuba, Haiti and the Dominican Republic. The most recent countries to ratify the Convention from the region are El Salvador and St. Vincent and the Grenadines, in 2014 and 2011 respectively. ²⁶²

Figure 5: FCTC parties in Latin America and Caribbean region. (Source: TobaccoTactics own production)

In terms of implementation of the WHO FCTC and the MPOWER program of six policies designed to reduce the global tobacco epidemic, the following progress has been achieved by 2019. Out of the 19 signatories’ countries that have provided data to PAHO:

• 13 countries are implementing and complying with article 8 on protection from exposure to tobacco smoke ²⁶³
• 13 countries are implementing and complying with article 11 on health communication and packaging regulations for tobacco products. ²⁶³
• 13 countries are implementing policies recommended by WHO in MPOWER on warning people about the dangers of tobacco. ²⁶³
• seven countries (Brazil, Chile, Costa Rica, Ecuador, Panama, Peru, and Uruguay) are implementing recommendations by WHO in MPOWER on monitoring tobacco use and prevention policies²⁶³
•  Only four countries (Brazil, Colombia, Panama, and Uruguay) are implementing and complying with article 13 on tobacco advertising, promotion, and sponsorship. ²⁶³
• Only four countries (Argentina, Brazil, Chile, and Colombia) are implementing and complying with a 75% or higher tax to tobacco products. ²⁶³
• Only four countries (Brazil, Colombia, Panama, and Uruguay) are implementing recommendations by WHO in MPOWER on enforcing bans on tobacco advertising, promotion and sponsorship ²⁶³
• Only three countries (Brazil, El Salvador, and Mexico) are implementing recommendations by WHO in MPOWER on offering help to quit tobacco use²⁶³

Even though these results might not be achieving the goals set by the region to reduce the global tobacco epidemic, the scenario has improved remarkably in the last 20 years, especially with implantation of the FCTC. The difference between the implementation levels in the region between 1999 and 2019, is substantial.

The map illustrates the status of tobacco control policies implementation in Latin American and Caribbean countries in 2019, from right to left in the map, on Protection from exposure to tobacco smoke (art.8), Packaging and labelling of Tobacco Products (art. 11) and ban of tobacco advertising, promotion, and sponsorship (art.13). In red, the countries that have not implemented the different articles and in yellow and green the countries that are on the path to implementation.

Figure 6: Adherence to WHO FCTC articles in the Americas. (Source: reproduction from data provided by Adriana Blanco, PAHO, 2019²⁶³)

As can be observed, the scenario has improved drastically despite the tobacco industry efforts to prevent regulations to pass in the region. Some successful cases of preventing tobacco industry to interference in the discussions and passing of tobacco regulations are:

• the case of Panama in 2008, which was the first Latin American country to instate advertising, promotion and sponsorship ban, complying with the WHO FCTC recommendations. BAT and PMI tried in three different legal stances, to counter these effective measures. The Panamanian Supreme Court ruled in favour on the Ministry of Health and the health prevention measures, supporting the country´s efforts to end the tobacco use epidemic²⁶⁴
•  the case of Guatemala in 2008, when the country was able to prevent the interference of the tobacco industry during the passing of the national law towards the implementation of 100% smoke-free environments. As reported by the InterAmerican Heart Foundation, “The Supreme Court dismissed the public action for unconstitutionality filed by the tobacco industry through the Chamber of Commerce with the objective of preventing the adoption of such measure” ²⁶⁵
•  the case of Honduras in 2010, where during the debates towards the Special Tobacco Control Act 2010, the National Congress decided not to allow the participation of tobacco industry representatives. The Congress acted, despite the persistent request of the Honduran Council of Private Corporations and other congressional representatives.  Honduran law explicitly prohibits “all interference from commercial or other vested interests of the tobacco industry”.²⁶⁵
• the case of Peru in 2010, during discussion of the tobacco control bill at the parliamentary commissions, where the participation of representatives of the tobacco industry was not allowed. The industry interference was prevented mainly thanks to an active engagement of the tobacco control civil society. ²⁶⁵
• the case of Brazil in 2019,  where the Office of the Attorney-General of Brazil filed a lawsuit at the Federal Court of Rio Grande do Sul against the big tobacco corporations in Brazil and their parent companies abroad, “to seek recovery of healthcare costs related to the treatment of tobacco-induced diseases. The claim covers costs generated in the Brazilian healthcare system for the treatment of patients suffering from 26 diseases linked to the consumption of tobacco products and exposure to tobacco smoke, and foresees proportional compensation for future spending, and collective moral damages, as a consequence of the tobacco public health burden.²⁶⁶

Industry interference

Challenging legislation

The tobacco industry has a history of challenging legislation, tobacco control programmes and regulation that affects its sales. It does through this direct lobbying, using third parties and legal threats.

Research conducted by PAHO in the region²⁶⁷ shows that one of the key tactics that the industry often uses is to offer “self-regulation” deals, that involve the drafting of their regulations for the Latin American and Caribbean countries. According to PAHO: “The industry’s legislative  proposals,  like its voluntary codes,  typically  contain  minor  concessions  that  the industry  believes  will  not  significantly  impact  tobacco sales,  and  are  intended  solely  to  build  corporate  image and, most importantly, block or at least delay meaningful regulation.”²⁶⁷

An historical record of this tactic is illustrated in a quote obtained from the leaked industry documents about Nicaragua in 1992, when the Central American country was trying to pass tobacco regulations. This message came from TANIC, one of BAT´s subsidiaries in Nicaragua: “Experience elsewhere has shown that it is desirable to be ahead of the game and try to contain legislation rather than repair damage after the event. … TANIC must be in a position to influence … legislation to protect or promote its interests.”²⁶⁷

In the region, several cases serve as example of how the industry seeks to undermine public health efforts via this tactic:

Tobacco tax raise in Colombia

In 2015, the price of cigarettes in Colombia was one of the lowest in the region, at approximately US$2 per 20 cigarette pack. According to data from the Ministry of Health of Colombia, “The direct cost to the Colombian health system attributable to smoking for the same year was over US$ 1 billion equivalent to 0.6% of the Gross Domestic Product.” ²⁶⁸. Colombia, Party to the Framework Convention on Tobacco Control, decided to move towards the implementation of the WHO´s recommendation of at least 75% tax of retail price of tobacco products.²⁶⁹ Colombia´s government decided to increase progressively, starting from their baseline of 49.4%.²⁷⁰

Implementation of the 2016 tobacco tax reform placed Colombia as a regional leader in tobacco control. In the first year of implementation it helped reduce the number of smokers by close to 400,000 while increasing tobacco tax revenues by 46%.²⁷¹With more than 32,000 people dying from the tobacco-caused disease in Colombia every year²⁷² it is vital to protect and sustain the tax. Philip Morris International, the leading seller of cigarettes in Colombia, has a long history of aggressive opposition to tobacco control measures. For more information, see the Tobacco Tactics web page on Philip Morris International.

In 2019 PMI campaigned to intimidate policymakers, infiltrate the policy process and undermine Colombian legislation. For example, PMI blamed factory closures on tobacco control measures,²⁷³ co-opted anti-smuggling programs,²⁷⁴ and attempted to discredit the success of the tobacco tax at a congressional hearing.²⁷⁵ Its dubious claims linking increased tobacco tax to increased illicit trade purposefully ignored the fiscal and public health benefits gained, as supported by independent investigations in Colombia ²⁷⁶²⁷⁷and by the World Bank ²⁷⁸

Interference in newer products regulations in Chile

Electronic cigarette consumption in Chile has grown from 3.6% in 2014 to 6.5% in 2016 amongst those aged 12-65. ²⁷⁹ The highest prevalence of electronic cigarette consumption has been consistently observed in younger age groups (15-24 years) particularly in area around the capital Santiago where the consumption of electronic cigarettes among those aged 13-15 years was 12.1% in 2016.²⁸⁰

The Institute of Public Health regulates e-cigarettes as a pharmacological product. The National Agency of Medicines, as the governing body of the certification of medicines in Chile, authorized some of these products to be marketed as pharmaceutical products, when it could have been regulated by existing regulations on tobacco.²⁸¹ In September 2019, a new bill was sent to Parliament proposing to regulate e-cigarettes and heated tobacco products as tobacco products. Under this proposed bill, these newer would be regulated by the tobacco law enacted in 2013, resulting in a ban on advertising and promotion, the sale to minors, and smoking or vaping in enclosed spaces and they would need to include health warnings like conventional cigarettes. ²⁸² However, the discussions around this bill were delayed due to the political complications that the country faced at the end of 2019.

Standardised packaging: Uruguay vs Philip Morris

Uruguay has some of the most progressive tobacco control policies in the world. In October 2017, Uruguayan President Tabare Vázquez announced that his government would introduce plain packaging legislation, becoming the seventh country to do so, following Australia, UK, Ireland, France, Norway, and Hungary.²⁸³²⁸⁴

In February 2010, PMI (represented by law firm LALIVE) challenged Uruguay using the World Bank’s International Center for Settlement of Investment Disputes. It sought damages under the Switzerland-Uruguay Bilateral Investment Treaty (BIT) for tobacco control regulations.²⁸⁵²⁸⁶

The company claimed that Uruguay’s regulatory measures violated the investment protection agreement signed in 1991 between Uruguay and Switzerland, where PMI is headquartered.²⁸⁷ PMI claimed that the case was about trademark protection and called the design of some of the six health warning messages “repulsive and shocking”. It said: “We do not oppose the use of graphic health warnings but believe that images should accurately depict the health effects of smoking… We have a powerful case, and in the absence of any change to these excessive regulations we will continue with our claim.” ²⁸⁸

In July 2016 The World Bank’s Court dismissed all claims that Uruguay had breached the 1991 BIT, stating that Uruguay had “the right to continue its anti-cigarette campaign”, and ordered the company to reimburse the state’s legal expenses.²⁸⁹

Uruguay is not the only country that has been taken to court by the tobacco industry over tobacco control measures. For an overview of some of the tobacco industry’s legal challenges across the world, go to Tobacco Tactics page on Legal Claims.

Influencing science

The tobacco industry has a long history of influencing the scientific debate on smoking and health. Tens of thousands of internal industry documents, released through litigation, reveal that the industry knew for decades that its products caused cancer and were highly addictive and yet it refused to acknowledge this publicly. The tobacco industry continues to influence the science around smoking and tobacco in an effort to frustrate regulation and protect profits.

Latin America and the Caribbean have not been exempted from the influence of these tobacco industry tactics. Tobacco control researchers from the region have been pressured by the tobacco industry not to publish their results and to alter the content of their research findings. The Pan-American Health Organization (PAHO) published a report on tobacco industry influencing science in 2002, going over thousands of leaked documents from the tobacco industry, mainly from British American Tobacco and Philip Morris International. The report revealed that the tobacco industry had hired scientists across the region seeking to distort scientific findings linking passive exposure to cigarette smoke with serious disease. Furthermore, the tobacco industry failed to disclose any connection or involvement with these scientists and researchers. ²⁹⁰

One historical example was the Environmental Tobacco Smoke (ETS) consultancy program, described as “the core industry strategy to undermine efforts to reduce second-hand exposure, was jointly financed by PM and British American Tobacco, and coordinated by the Washington, D.C. law firm of Covington and Burling.” ²⁶⁷ This program began as a global strategy in 1987, hiring experts from other countries to work in Latin America. Later, in 1991, Latin American experts from Argentina, Brazil, Chile, Costa Rica, Ecuador, Guatemala and Venezuela, were hired for this program.²⁶⁷

Information uncovered from the leaked documents analysed by PAHO in this report had quotes from the industry said:

“Unlike many other regional ETS consultant programs sponsored by the industry, the Latin project was initiated in anticipation, rather than in reaction to, the full-force arrival of the ETS issue to Central and South America… Critical to the success of the Latin Project is the generation and promotion of solid scientific data not only concerning ETS specifically but also concerning the full range of potential indoor and outdoor air contaminants. This approach encourages government agencies and media in Central and South America both to resist pressure from anti-smoking groups and to assign ETS its proper place among the many potential indoor and outdoor air contaminants found in these regions.”²⁶⁷

Further examples are the PMI Impact funded projects in Argentina, Paraguay and Brazil,  which, as describe in the PMI website, seek to develop models on illicit trade in the triple-border area, as well as in Central American countries as Honduras and El Salvador. ²⁹¹

The industry has always pushed for its funded projects to be perceived as “independent”. The leaked documents uncovered in PAHO´s report show that fabricating independency of these research centres is part of the industry´s strategies. A quote from a BAT executive in Costa Rica, regarding the collaboration program between BAT and PMI to influence science in the region, says : “I cannot stress strongly enough the absolute necessity for the industry to have no direct contact with these scientists [the consultants] that are part of the program. … If one scientist in the group is perceived by anyone to be associated with the industry, then we run the risk, by association, of this happening for the rest of the group and the whole exercise will become pointless. All contact, as previously explained, must be carried out through Covington & Burling.”²⁶⁷

The region still faces many challenges in identifying industry-funded data, uncovering the academic and scientific organizations collaborating with the industry and countering the pressure on tobacco control researchers aiming at publishing evidence-based papers and reports.

Political contributions to political parties in Latin America

Another tactic that the tobacco industry uses in Latin America and the Caribbean, is lobbying decision-makers through financial political contributions to political parties. PMI has been making these financial political contributions to political parties in Latin America for years. ²⁹²

Since 2010, Philip Morris International official records show that this tobacco company has contributed to:

• Dominican Republic political parties in 2016: US$ 66,803 in 2016 ²⁹³
• El Salvador political parties in 2015: US$ 10,000 ²⁹⁴
• Brazil political parties in 2014: US$ 520,059 ²⁹⁵
• El Salvador political parties in 2012: US$ 9,000 ²⁹⁶
• Dominican Republic parties in 2011: US$ 4,887 ²⁹⁷
• Brazil political parties in 2010: US$ 567,860 ²⁹⁸

British American Tobacco does not declare political contributions to political parties in the region, however, it does contribute extensively in the United States and Europe. ²⁹⁹

The challenges ahead for the region are directly influenced by the constant pressure that the governments experience by the tobacco industry and its tactics.

Tobacco Tactics Resources

• Philip Morris International
• British American Tobacco
• Influencing Science
• Challenging Legislation
• Legal claims
• Chile-Country profile
• Plain packaging: Uruguay vs Philip Morris

References

The post Latin America and Caribbean Region appeared first on TobaccoTactics.

Philip Morris International (PMI) is the largest tobacco company in the world (excluding the Chinese National Tobacco Corporation).³⁰² The company is headquartered in New York in the United States (US), but also based operationally in Lausanne, Switzerland and Hong Kong. According to the Associated Press, Altria decided to separate Philip Morris USA and its international operations in order to “clear the international tobacco business from the legal and regulatory constraints facing its domestic counterpart, Philip Morris USA”.³⁰³

In 2018, PMI and its subsidiaries sold its products in over 180 markets, selling cigarettes, other tobacco products and newer nicotine and tobacco products. The company reported in 2019 that it held 28.4% of the global market for cigarette and heated tobacco products (HTPS) excluding the US and China.³⁰⁴ The company owned six of the top 15 international cigarette brands in 2018. Its global cigarette brands are Marlboro (the world’s bestselling international brand), Merit, Parliament, Virginian S, L&M, Philip Morris, Bond Street, Chesterfield, Lark, Muratti, Next and Red & White. The company reported owning a market share of at least 15% or over in 100 countries in 2018, although in the UK PMI held only fourth position for cigarette market share behind Imperial Tobacco, Japan Tobacco International (JTI) and British American Tobacco (BAT).³⁰⁵

According to Euromonitor International, PMI’s global share of the cigarette market (by retail volume) was under 14% in 2018, and fell to 12% in 2020 (figures rounded). ³⁰⁶

On 27 August 2019, global news outlets reported that PMI and Altria were considering a merger to reunite the brands that had split in 2007.^307308309 However the merger was called off the next month, in response to news that the FDA was considering a ban on flavoured e-cigarettes.³¹⁰³¹¹ On March 21, 2018, PMI acquired Tabacalera Costarricense, S.A. and Mediola y Compañía, S.A. for USD$95 million, which sell Derby, Marlboro and L&M cigarettes in Costa Rica.³⁰⁴

Employees or Board Members: Past and Present

Jacek Olczak was appointed the Chief Executive Officer of PMI in May 2021.³¹² Previously he was the company’s Chief Operating Officer. He succeeded André Calantzopoulos who was appointed Executive Chairman of the Board. The previous chairman Louis C. Camilleri, stepped down in Decemer 2020. A full list of the company’s leadership team can be accessed at PMI’s website. Other persons that currently work for, or have previously been employed with, the company:

Massimo Andolina | Chris Argent | Drago Azinovic | Emmanuel Babeau | Werner Barth | Charles Bendotti | Frank de Rooij | Frederic de Wilde | Suzanne Rich Folsom | Stacey Kennedy | Martin King | Michael Kunst | Andreas Kurali | Bin Li | Marco Mariotti | Mario Massroli | Deepak Mishra | Silke Muenster | John O’Mullane | Paul Riley | Marian Salzman | Gregoire Verdeaux | Michael Voegele | Stefano Volpetti | Jerry Whitson |  Martin J. Barrington | David Bernick | Bertrand Bonvin | Harold Brown | Patrick Brunel | Mathis Cabiallavetta | Louis C. Camilleri | Andrew Cave | Herman Cheung | Kevin Click | Marc S. Firestone | John Dudley Fishburn | Jon Huenemann | Even Hurwitz | Jennifer Li | Graham Mackay | Sergio Marchionne | Kate Marley | Kalpana Morparia | Jim Mortensen | Lucio A. Noto | Matteo Pellegrini | Robert B. Polet | Ashok Rammohan | Carlos Slim Helú | Julie Soderlund | Hermann Waldemer | Stephen M. Wolf | Miroslaw Zielinski

Affiliations

Memberships

In 2019, PMI declared membership of the following organisations on the European Transparency Register:³¹³

The American Chamber of Commerce to the European Union | American European Community Association (AECA) | American Chamber of Commerce of Lithuania | Ass. Industrial Portuguesa (AIP) | Business Europe | Centromarca | CEOE | Czech Association Branded Goods | Czech Foodstuff Chamber | Economiesuisse | Estonian Chamber of Commerce | European Communities Trademark Association (ECTA) | European Policy Centre (EPC) | Kangaroo Group | Latvian Chamber of Commerce | Latvian Traders Association | Lithuanian Confederation of Industrialists | MARQUES | Spanish Tobacco Roundtable | VBO-FBE

PMI had previously listed memberships of: International Trademark Association (INTA) | The Trans-Atlantic Business Council (TABC) | | European Risk Forum | European Smokeless Tobacco Council (ESTOC) | British Chamber of Commerce | Public Affairs Council | APRAM | LES France | AmCham Germany | Bund fur Lebensmittelrecht & Lebensmittelkunde | Europaischer Wirtschaftssenat (EWS) | Wirtschaftsbeirat der Union e.V. | American Chamber of Commerce of Estonia | American Lithuanian Business Council | Lithuanian Confederation of Industrialists | Investors’ Forum | AmCham Spain | Unindustria (Confindustria) | Consumer Packaging Alliance | British Brands Group | Foodstuff Chamber The company is also a donor to the Eliminating Child Labour in Tobacco Growing Foundation (ECLT), alongside BAT, Imperial Brands, JTI and Swedish Match, among others.³¹⁴

In May 2015, ECLT and the International Labour Organization (ILO) entered into an agreement to develop global guidance on occupational health and safety with regards to child labour in the tobacco industry.³¹⁵ PMI was a member of the Confederation of European Community Cigarette Manufacturers (CECCM), but left in 2006 following a dispute with other members.³¹⁶

Consultancies

PMI has worked with numerous Public Relations (PR) and law consultancies:

• In 2020 and 2021 PMI released white papers and held events on public trust in science in partnership with the Industry Transformation Coalition.
• In January 2020, PMI released a white paper entitled “Unsmoke Your Mind: Pragmatic Answers to Tough Questions for a Smoke-Free Future”. The company enlisted the consulting firm Povaddo, which works across public affairs, strategy and research,³¹⁷ to conduct an opinion-based survey of smokers across 14 countries.³¹⁸ The report was heavily criticised in The Lancet medical journal (see below)³¹⁹ who pointed out that its findings were based on a “self-funded online survey”.³¹⁹ In July 2020, PMI published another white paper called “In Support of the Primacy of Science”, which was also based on online surveys conducted by Povaddo, on the public’s views on science.³²⁰³²¹ In March 2021 PMI released the results of a third online survey, conducted by Povaddo in 20 countries, on public attitudes to newer nicotine and tobacco products and collaboration between governments and tobacco companies.³²² Povaddo has conducted previous research for PMI.³²³
• In December 2019, researchers and academic institutions received invitations from the consulting firm, Handshake, to commission research on behalf of PMI on how companies navigate corporate transformation.³²⁴
• In 2016, Philip Morris UK was a client of London-based PR and communications company Instinctif Partners.
• That same year, media also linked Brussels-based PR company Pantarhei Advisors to Philip Morris.
• In 2014, UK-based Media Intelligence Partners was PMI’s media contact during Sir Cyril Chantler’s plain packaging review.
• In 2014, German PR company Communications & Network Consulting AG (CNC) listed Philip Morris as a client on the EU Transparency Register.
• In that same year, Luxembourg-based Felula SA, a one-person consultancy run by Serge Estgen, listed PMI as its client on the EU Transparency Register.
• In 2013, Edinburgh-based Halogen Communications supported PMI’s opposition to Scotland’s plans to introduce Plain Packaging.
• In 2012 and 2013, PMI worked with London-based PR and media company Pepper Public Affairs on PMI’s Anti-Plain Packaging Media Campaign.
• In 2012, the UK branch of Crosby Textor Group, helped PMI oppose Plain packaging in the UK.
• Law firm Clifford Chance has a history of lobbying for PMI in the UK and European Union (EU). In 2009, the firm submitted anonymous Freedom of Information requests to a UK university on behalf of the tobacco company, and in 2011 and 2012 Clifford Chance’s Michel Petite lobbied on the EU Tobacco Products Directive.
• From 2009 to 2011 PR company Gardant Communications worked for Philip Morris UK. In 2009, the PR company supported Philip Morris’ PR Campaign Against the Display Ban and was involved in Philip Morris’ Regulatory Litigation Action Plan Against the Display Ban.
• APCO Associates‘ collaboration with PMI goes back to the 1990s when it helped the company set up the European Science and Environment Forum. More recently, it was involved in Philip Morris’ PR Campaign Against the Display Ban.
• London-based PR company INHouse Communications also played a part in Philip Morris’ PR Campaign Against the Display Ban.
• Ogilvy Group‘s collaboration with Philip Morris goes back to the 1950s when it ran one of its advertising campaigns.
• José María Aznar, the former Spanish Prime Minister (see below)

Controversial Marketing Strategies

Since its controversial “Be Marlboro: Targeting the World’s Biggest Brand at Youth” campaign in 2014, PMI have been accused on multiple occasions of targeting their products at young people. On its website, PMI says that it is “committed to doing our part to help prevent children from smoking or using nicotine products”. ³²⁵ It further states that its “marketing complies with all applicable laws and regulations, and we have robust internal policies and procedures in place so that all our marketing and advertising activities are directed only toward adult smokers”.³²⁵ Despite these assurances, PMI has been accused of, and fined for, running marketing campaigns that target young people. For more information see Be Marlboro: Targeting the World’s Biggest Brand at Youth. PMI has increasingly used social media to market its newer products, including e-cigarettes (also known as electronic nicotine delivery systems, or ENDS) and heated tobacco products.

• For more information on PMI’s newer, including IQOS, visit Newer Nicotine and Tobacco Products: Philip Morris International and Heated Tobacco Products: Philip Morris International.

In December 2023 The Times newspaper highlighted PMI’s role in third party campaigns promoting e-cigarettes in the UK.³²⁶ For more information visit the Foundation for a Smoke-Free World page.

Complicity in Tobacco Smuggling

PMI portrays itself publicly as a victim of illicit tobacco trade, with the company reporting that tobacco smuggling results in “considerable financial losses” and “damage” to manufacturers’ brands.³²⁷ To help tackle illicit trade, PMI launched a funding initiative called PMI IMPACT in 2016, worth US$100m and aimed at bringing together “organisations that fight illegal trade and related crimes, enabling them to implement solutions”.³²⁸³²⁹ In its first call for proposals in 2016, PMI asked for “projects that have an impact on illegal trade and related crimes in the European Union…”³³⁰ The second call, made in 2017, expanded the areas of focus to include the Middle East, North Africa, South and Central America and South and Southeast Asia.³³¹ For more information, visit our page on PMI IMPACT. In contrast to the company’s public persona of being part of the smuggling solution, evidence shows that the company was, in fact, part of the problem. In 2000, the European Commission (backed by a majority of EU member states) started court proceedings in the US Courts against PMI and other tobacco companies for its complicity in tobacco smuggling. The Commission claimed that the tobacco companies “boosted their profits in the past by deliberately oversupplying some countries so that their product could be smuggled into the EU”, costing the EU millions of euros in lost tax and customs revenue.³³²³³³ PMI and the Commission settled their dispute in 2004, when the company agreed to pay the Commission £675m to fund anti-smuggling activities.³³⁴ The two Parties signed an Anti-Counterfeit and Anti-Contraband Cooperation Agreement,³³⁵ referred to by the company as Project Star. As part of this agreement, PMI commissioned KPMG to measure annually the size of the legal, contraband and counterfeit markets for tobacco products in each EU Member States. Project Star’s methodology and data have been strongly criticised for lack of transparency, overestimating illicit cigarette levels in some European countries, and serving PMI’s interests over those of the EU and its member states.³³⁶

Tactics to Subvert Tobacco Control Campaigns and Policies

PMI has strongly opposed tobacco control legislation and regulations across the world, including plain packaging in Australia and the UK, the EU Tobacco Products Directive (TPD), and tobacco control decrees in Uruguay. The company has used a variety of strategies and tactics to influence tobacco control policies and subvert existing regulations.

Funding Pro-Tobacco Research and Discrediting Independent Evidence

In response to plain packaging proposals in the UK, PMI funded research, expert opinion and public relations activities which supported its position. One of the people that PMI funded for this purpose was Will O’Reilly, a former Detective Chief Inspector with the London Metropolitan Police. O’Reilly was appointed as a PMI consultant in 2011,³³⁷ conducting undercover test purchases of illicit tobacco and publicising his findings in UK regional press.³³⁸ One of PMI’s arguments to oppose plain packaging was that the public health measure would lead to an increase in illicit tobacco, including counterfeited plain packs. For background on, and a critique of, this argument, go to Countering Industry Arguments Against Plain Packaging: It will Lead to Increased Smuggling. O’Reilly’s test purchases appear to have enabled PMI to secure significant press coverage of its data on illicit tobacco.³³⁹ In March 2019, Euromonitor International, a market research organisation, received funding through two PMI initiatives: the Foundation for a Smoke-Free World and PMI IMPACT.^340341342 Examples of other organisations and individuals that have received funding from PMI to produce research or expert opinions or critiques of independent evidence, in order to oppose tobacco control legislation are: Deloitte | KPMG | Transcrime | Roy Morgan Research | Ashok Kaul | Michael Wolf | Populus | Centre for Economics and Business Research³⁴³³⁴⁴ | Compass Lexecon³⁴⁵ | Rupert Darwall³⁴⁶ | James Heckman³⁴⁷ | Lord Hoffman³⁴⁸ | Alfred Kuss³⁴⁹ | Lalive ³⁵⁰ | LECG^351352353 | London Economics | Povaddo³²³| SKIM Consumer Research³⁵⁴

• To see a list of all organisations funded through PMI’s Foundation for a Smoke-Free World (FSFW), visit our pages on the FSFW’s Centres of Excellence and grantees.
• For more information on the tobacco industry’s use of research to undermine legitimate independent evidence see: Plain Packaging in the UK: Tobacco Industry Funded Research, Expert Opinion and Public Relations.

Using Freedom of Information Requests to Acquire Public Health Research Data

Freedom of Information (FOI) requests are one strategy that the tobacco industry uses to undermine tobacco control legislation, often covertly using third parties.³⁵⁵ In 2009, and again in 2011, PMI sent Freedom of Information requests to Stirling University (UK) requesting access to a wide range of data from its research on teenage smoking. PMI alleged that it wanted “to understand more about the research project conducted by the University of Stirling on plain packaging for cigarettes”.³⁵⁶ The FOI requests were eventually dropped. For more information on these FOI requests, and an explanation on how these requests impacted the University of Stirling, go to our page FOI: Stirling University.

Fabricating Support through Front Groups

PMI has used front groups to oppose tobacco control measures. Front Groups are organisations that purport to serve a public interest, while actually serving the interests of another party (in this case the tobacco industry), and often obscuring the connection between them. In Australia, leaked private documents revealed that the supposed anti-plain packaging retailer grass roots movement, the Alliance of Australian Retailers was set up by tobacco companies and that the Director of Corporate Affairs Philip Morris Australia, Chris Argent, played a critical role in its day-to-day operations.^357358359

• For more information on this front group, and Philip Morris Australia’s involvement, visit the Alliance of Australian Retailers page.
• For more information on front groups funded and/or organised by PMI and other tobacco companies, see the list on the Expose Tobacco website.

Lobbying of Decision Makers

Article 5.3 of the The World Health Organization Framework Convention on Tobacco Control (WHO FCTC) explicitly aims to reduce industry influence in public health policymaking by obliging parties to protect their health policies from tobacco industry interests and interference.³⁶⁰ Yet tobacco industry representatives, and third-parties regularly attempt to influence public health policymaking in the industry’s favour. This section details some of these incidents involving PMI and the response of the governments and the global health community.

EU

PMI reported that it spent between €1,250,000 and €1,499,999 in 2019 lobbying EU institutions, employing only 2 fulltime equivalent staff in its Brussels office.³¹³ If this data is correct, it suggests that PMI relied heavily on external lobbying firms. A 2013 leaked internal PMI document revealed that the company had 161 lobbyists working to undermine the revision of the EU Tobacco Products Directive (TPD).³⁶¹ The objective of PMI’s campaign was to either “push” (i.e. amend) or “delay” the TPD proposal, and “block” any so-called “extreme policy options” like the proposed point of sales display ban and plain packaging.³⁶²

• For more information on PMI’s campaign to undermine the TPD, go to EU Tobacco Products Directive Revision and PMI Mobilised Support from Retailers.

UK

The leaked internal PMI documents from 2013 also revealed the extent of a multi-faceted campaign against Plain Packaging in the UK, including a detailed media campaign using dozens of third parties (both individuals and organisations) to promote its arguments against the policy. The documents also included a detailed political analysis of potential routes of influence for the tobacco company (Image 1).³³⁷

One third party appointed in November 2011 to help PMI oppose the plain packaging proposal was the Crosby Textor Group. This appointment led to a conflict of interest scandal, given that Lynton Crosby co-Director of the Crosby Textor Group, was also the political election strategist for the UK’s Conservative Party, which was in power in the UK. David Cameron, then Prime Minister, insisted that Crosby never lobbied him about plain packaging. ³⁶³³⁶⁴ Despite a lack of evidence that Crosby lobbied the Prime Minister and Health Minister on plain packaging, documents released under FOI legislation, obtained by the University of Bath Tobacco Control Research Group, show that Crosby lobbied the UK Government on plain packaging via Lord Marland, the then Parliamentary Under Secretary of State for Intellectual Property, to oppose plain packaging. For more information on this lobbying scandal, go to Lynton Crosby’s page.

• For more detail on PMI’s attempts to undermine plain packaging proposals in the UK, visit: PMI Mobilised Support from Retailers | PMI’s Anti-Plain Packaging Lobbying Campaign | PMI’s Anti-Plain Packaging Media Campaign | PMI’s “Illicit Trade” Anti-Plain Packaging Campaign
• For information on the tobacco industry’s tactics to undermine this tobacco control measures, visit our pages on: Plain Packaging in the UK: Tobacco Company Opposition | Plain Packaging in the UK: Tobacco Industry Funded Research, Expert Opinion and Public Relations | Plain Packaging in the UK: Tobacco Industry Built Alliances | Plain Packaging in the UK: Tobacco Industry Funded Third Party Campaigns
• PMI also opposed the tobacco product display ban gradually introduced in the UK from 2012. More information on PMI’s tactics to stop this measure, see: Philip Morris’ PR Campaign Against the Display Ban

Australia

Australia has one of the least hospitable regulatory environments for the tobacco industry, having passed regulations banning advertising since 1976, a point of sale ban in 2011, and a plain packaging law in 2012. It also has regulation in place to prevent the sale of nicotine products, including e-cigarettes and HTPs.³⁶⁵

The industry has not, however, given up on attempting to market its products and lobby decision makers across the country. In a 2019 article, the Sydney Morning Herald reported that Tammy Chan, Managing Director of PMI Australia, New Zealand and the Pacific wrote letters to health organisations urging them to enter into a “dialogue” on PMI’s “smoke-free” vision in the lead up to a parliamentary select committee meeting on the impact of e-cigarettes on “personal choice”.³⁶⁶

In March 2019, PMI was accused of “subliminal advertising” in its sponsorship of the Ferrari Formula One team during the Australian Gran Prix in Melbourne. PMI has been accused of attempting to evade advertising bans by sponsoring motorsports teams.

• For more information see Motorsport Sponsorship

Latin America

José María Aznar, the former Prime Minister of Spain, has been widely reported by media outlets as having taken up a position as a lobbyist for PMI in Latin America.^240367368369

• For more information on his meetings with public officials in Chile and Peru, as well as his history of association with the tobacco industry while in office, see our page on José María Aznar.

Intimidating Governments with Litigation or Threat of Litigation

PMI has legally challenged tobacco control regulations across the globe, including:

• Comprehensive No Smoking Ordinance (2010 and 2016) and Tobacco-Free Generation Ordinance (2016) in Balanga, Philippines. A front group for the world’s biggest tobacco companies, including PMI, called the Philippine Tobacco institute (PTI) sued the city of Balanga in August 2017 over the Comprehensive No Smoking Ordinance, which it argued was “arbitrary and oppressive” and cost PMI USD$420,000 a month in lost sales. In July 2018, regional courts ruled in PTI’s favour, noting that although the city’s tobacco control efforts were “commendable”, they were also unconstitutional. PTI launched another lawsuit in May 2018 to challenge the constitutionality of the city’s Tobacco-Free Generation Ordinance.³⁶⁶
• The Cigarettes and Other Tobacco Products (Packaging and Labelling) Second Amendment Rules, 2018 text and pictorial health warnings law in India. PMI affiliate Godfrey Phillips India sought a stay of implementation of new legislation requiring health warnings to increase to cover 85% of the surface of cigarette packaging, from the High Court of Karnataka in Bangalore, India. The Court rejected the request for stay in August 2018. The legality of the Rules themselves was at the time pending in the Supreme Court.³⁷¹
• The May 20, 2016 Decree plain packaging law in France. In December 2016, the Conseil d’Etat (the Council of State, the highest administrative jurisdiction in France) dismissed a six-part legal challenge jointly brought against the plain packaging law by JTI, Philip Morris France, BAT France, a tobacco paper manufacturer and The National Confederation of Tobacco Retailers of France (Confédération Nationale des Buralistes de France).³⁷²
• In 2013, the mayor of Popayán, a city in southwestern Colombia, issued a decree prohibiting tobacco sales within 500 metres of schools, libraries and health institutions. Following heavy lobbying from Coltabaco, a Philip Morris affiliate, the radius was decreased to 200 metres. Coltabaco sued Popayán in March 2015, arguing that a mayoral decree was insufficient to effect legitimate regulation. Coltabaco won its lawsuit in September 2015.³⁷³
• The Standardised Packaging of Tobacco Products Regulations 2015 (UK). Following the passage of the legislation in March 2015, PMI and others launched a legal action, which it lost in May 2016 (the day before the legislation was due to come into force).³⁷⁴³⁷⁵
• The 2014 EU Tobacco Products Directive (TPD). PMI and BAT attempted to invalidate the TPD as a whole, or various provisions within it, but this legal challenge was dismissed in the European Court of Justice in May 2016.³⁷⁶ More details can be found on the page TPD: Legal Challenges.
• The Ministry of Public Health Notice of Rules, Procedures, and Conditions for the Display of Images, Warning Statements, and Contact Channels for Smoking Cessation on Cigarette Labels of 2013 (Thailand). In July 2013, Philip Morris Thailand and Japan Tobacco International (JTI) Thailand requested a temporary injunction against an increase of picture and text health warnings from 55 to 85 percent of the front and back of cigarette warnings. Though their request was initially granted in August 2013 in the Central Administrative Court of Thailand, the injunction was reversed in May 2014 by the Supreme Administrative Court following appeal by the government. PMI and JTI ultimately withdrew their legal challenge.³⁷⁷
• Following heavy criticism of its “Be Marboro” campaign worldwide (see below), Germany banned PMI from displaying “Be Marlboro” advertising in the country. A German court overturned the ban in 2015, stating that the wording of the advertisements did not explicitly target younger than legal age smokers.³⁷⁸
• National Systems of Health Oversight RDC No. 14/2012 Brazil. The Brazil Health Regulatory Agency’s (ANVISA) resolution No. 14 banned tobacco additives and flavours. The National Confederation of Industry (Confederação Nacional da Indústria) challenged the ban as an unconstitutional use of regulatory power. In February 2018, the highest court in Brazil, the Supreme Federal Tribunal, upheld the 2012 ban and reaffirmed the right of ANVISA to regulate tobacco products.³⁷⁹
• The Tobacco Plain Packaging Act 2011 (Australia). PMI fiercely opposed the legislation, fearing that it might set a global precedent. The company fought this legislation unsuccessfully on three fronts:
  • World Trade Organization (WTO) challenge: In 2014, PMI supported a request by the Dominican Republic government before the WTO Dispute Settlement Body, alleging that Australia’s plain packaging laws breach the WTO’s General Agreement on Tariffs and Trade (GATT), Agreement on Technical Barriers to Trade (TBT) and agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).³⁸⁰ Similar requests were submitted by Ukraine, Cuba, Indonesia and Honduras, and furthermore, a record number of more than 40 WTO members joined the dispute as third parties.³⁸¹
  • Constitutional challenge: In March 2012, PMI supported a claim made by British American Tobacco (BAT) in December 2011 before the Australian High Court that plain packaging was in breach of the Australian constitution.³⁸² On 15 August 2012, the Hight Court ruled that plain packaging was not in breach with the Australian constitution as there had been no acquisition of property as alleged by the tobacco companies.³⁸¹
  • Bilateral Investment challenge: In 2011, PMI started legal proceedings against the Australian government for allegedly violating the terms of The Australia – Hong Kong Bilateral Investment Treaty.³⁸³ In December 2015, The Permanent Court of Arbitration issued a unanimous decision that it had no jurisdiction to hear the claim. For more information on all three claims go to Australia: Challenging Legislation.
• Executive Decree No. 611 passed on 3 June 2010 in Panamá. Philip Morris Panamá joined onto a claim of unconstitutionality brought by British American Tobacco (BAT) against a ban on tobacco advertising, promotion and sponsorship (TAPS) and tobacco product display at the point of sale. BAT Panama claimed the ban violated freedom of expression and property rights, among others. The Supreme Court ruled in May 2014 against BAT, noting that, among other things, freedom of expression could be restricted in order to protect public health.³⁸⁴
• 2010 Amendment to the 1973 Act relating to the Prevention of the Harmful Effects of Tobacco (the Tobacco Control Act) in Norway. The Norwegian display ban on tobacco products came into effect on 1 January 2010 after an amendment was passed by the government in favour of the prohibition of visible tobacco products, smoking accessories and vending machines of tobacco products. PMI unsuccessfully challenged the ban as imposing a barrier to trade; the Oslo District court ruled in favour of the display ban in September 2012.³⁸⁵
• Ordinance 514, dated 18 August 2008, and Decree 287/009 dated 15 June 2009 (Uruguay). PMI unsuccessfully challenged the Uruguayan Tobacco Control Act which included a mandate for 80% health warnings on tobacco packets. The case was decided in favour of public health in 2017.³⁸⁶ PMI brought its claim under the Switzerland-Uruguay Bilateral Investment Treaty at the World Bank’s International Center for Settlement of Investment Disputes. The tribunal ruled in favour of Uruguay in July 2016.³⁸⁷

Newer Nicotine and Tobacco Products

As the harms from conventional products have become better understood, and tobacco control measures have been put in place, the cigarette market – from which tobacco companies make most of their profits – has started to shrink. To secure the industry’s longer-term future, transnational tobacco companies (TTCs) have invested in, developed and marketed various newer nicotine and tobacco products.¹⁹⁶  

In January 2017, PMI issued a press release which stated that the company intended to move its business away from conventional tobacco products entirely (see Image 2).³⁸⁸ The company’s much publicised vision for a “smoke-free” future is one in which PMI plays a central role in “[providing] better alternatives to smoking for those who don’t quit”.³⁰⁴ Integral to this vision was the release of IQOS in 2014. By 2016, PMI was the market leader in heated tobacco products (HTPs), accounting for over 99% of the global HTP market.³⁷⁰ By 2018, PMI’s share of the global HTP market had fallen to around 80%.³⁷⁰³⁸⁹ PMI reported that by the end of 2019, IQOS was available in 52 markets, including the United States (US), and a number of lower income countries.³⁹⁰

• For more information on IQOS and PMI’s newer products see Newer Nicotine and Tobacco Products: Philip Morris International and Heated Tobacco Products: Philip Morris International.
• See also PMI’s Promotion of IQOS Using the FDA’s 2020 Modified Risk Tobacco Product (MRTP) Order

In April 2019, a life insurance company Reviti was launched. Registered in the UK at Companies House, Reviti is a wholly owned subsidiary of PMI.³⁹¹³⁹² The London-based company specialises in offering policies to smokers, with discounts for those who reduce or switch to PMI’s newer products.³⁹³

In May 2022, PMI made an offer of US$16 billion deal to acquire Swedish Match, a manufacturer of snus and nicotine pouches, as well as chewing tobacco, snuff and cigars.³⁹⁴³⁹⁵ Swedish Match had planned to sell its cigar business but these plans were put on hold in March 2022.³⁹⁶ PMI CEO Jacek Olczak said of the deal: “An important aspect of this proposed combination is the opportunity in the U.S., which is the world’s largest market for smoke-free products.”³⁹⁷PMI is also hoping to significantly increase its market share of newer nicotine products in Europe and Asia.³⁹⁸ 

As of 28 November 2022, PMI had acquired over 90% of Swedish Match, gaining control of the company and enabling it to buy the remaining shares and take Swedish Match off the stock market.³⁹⁹⁴⁰⁰

• For details see Swedish Match

Tobacco companies, including PMI, also invest in therapeutic products, such as nicotine lozenges, gum and inhalers. More information can be found on this page: Tobacco Company Investments in Pharmaceutical & NRT Products

“Smoke-Free” Campaigns

PMI has run various “smoke-free” campaigns promoting its newer products, including “Hold My Light” (UK); “Unsmoke Your World” (global); “It’s Time” (targeting policy makers); and “Futuro sin Humo” (in Mexico).

• For details see: Philip Morris International: “Smoke-Free” campaigns

Participation in Global Platforms to Rehabilitate Image

PMI has attempted to gain access to many high-level international events as a means of “rehabilitating its image and securing influence over global institutions and policy elites”. Since January 2019, PMI presence has been documented at:³⁷⁰

January 2019

• World Economic Forum (WEF; Davos, Switzerland): PMI launched its first “white paper” to coincide with WEF. Though it was not an invited guest, PMI held a side-event co-hosted by the Wall Street Journal, and sponsored the Davos Playbook, Politico’s daily newsletter distributed to attendees.

June 2019

• (Group of 20) G20 Summit (Osaka, Japan): PMI took out a two-page advertisement in The Japan Times promoting its corporate transformation and reiterating the need for dialogue between decision-makers and industry.
• Cannes Lions International Film Festival of Creativity (Cannes, France): PMI attended Cannes to talk about newer tobacco products and potentially recruit celebrity activists to its cause.⁴⁰¹ In addition, PMI had its own schedule of events, hosted by actress Rose McGowan and rapper Wycliff Jean. It also spoke in the festival’s Good Track stream alongside organisations including Greenpeace and UN Women. The decision to include PMI on the Good Track was heavily criticised in the light of “the ethics of proclaiming a smoke-free philosophy while continuing to sell billions of cigarettes a year”.⁴⁰²⁴⁰³

October 2019

• United Nations General Assembly (UNGA; New York City, USA): Though barred from participating directly in the UNGA, PMI hosted a parallel event at Concordia, a high-level event to foster partnerships between businesses, governments and UN agencies. In attendance were officials from the UN’s World Food Program, the UN Foundation and the World Bank as well as PMI’s Vice President of Global Partnerships and Cooperation, who spoke at the event. Bob Eccles, a paid PMI advisor, spoke at the UNGA during a side event on Exclusion and Engagement in Sustainable Investing.

TobaccoTactics Resources

• PMI Mobilised Support from Retailers
• PMI’s Anti-Plain Packaging Lobbying Campaign
• PMI’s Anti-PP Media Campaign
• PMI’s “Illicit Trade” Anti-Plain Packaging Campaign
• PMI IMPACT
• Philip Morris vs the Government of Uruguay
• Philip Morris’ PR Campaign Against the Display Ban
• Philip Morris’ Regulatory Litigation Action Plan Against the Display Ban
• Philip Morris’ Marlboro Brand Architecture
• Codentify
• Motorsport Sponsorship
• Digital Coding & Tracking Association (DCTA)
• Foundation for a Smoke-Free World
• Foundation for a Smoke-Free World: How it Frames Itself for a detailed analysis of the ways in which the Foundation portrays itself and those who oppose the Foundation, plus the counter evidence to these portrayals
• Foundation for a Smoke-Free World People
• Foundation for a Smoke-Free World Grantees
• Foundation for a Smoke-Free World Centres of Excellence
• Newer Nicotine and Tobacco Products: Philip Morris International
• Heated Tobacco Products: Philip Morris International

Relevant Links

• Read the STOP report: Addiction At Any Cost: The Truth About Philip Morris International
• Philip Morris International company website
• Cancer Council Australia’s Critiques of KPMG Australia illicit tobacco trade reports
• Foundation for a Smoke-Free World website
• PMI Impact website

TCRG Research

• The Philip Morris-funded Foundation for a Smoke-Free World: tax return sheds light on funding activities, T. Legg, S. Peeters, P. Chamberlain, A. Gilmore, The Lancet, 2019, 393(10190):2487-2488
• The revision of the 2014 European tobacco products directive: an analysis of the tobacco industry’s attempts to ‘break the health silo’, S. Peeters, H. Costa, D Stuckler, M. McKee, A. Gilmore, Tobacco Control, 2016, 25(1):108-117
• ‘It will harm business and increase illicit trade’: an evaluation of the relevance, quality and transparency of evidence submitted by transnational tobacco companies to the UK consultation on standardised packaging 2012, K. Evans-Reeves, J. Hatchard, A. Gilmore, Tobacco Control, 2015, 24(e2):e168-e177
• Illicit trade, tobacco industry-funded studies and policy influence in the EU and UK, G, Fooks, S. Peeters, K. Evans-Reeves, Tobacco Control, 2014, 23(1):81-83
• Transnational tobacco company interests in smokeless tobacco in Europe: Analysis of internal industry documents and contemporary industry materials, S. Peeters, A. Gilmore, PLoS Medicine, 2013, 10(9):1001506
• Towards a greater understanding of the illicit tobacco trade in Europe: a review of the PMI funded ‘Project Star’ report, A. Gilmore, A. Rowell, S. Gallus, A. Lugo, L. Joossens, M. Sims, 2013, Tobacco Control, doi:10.1136/tobaccocontrol-2013-051240

For a comprehensive list of all TCRG publications, including research that evaluates the impact of public health policy, go to the Bath TCRG’s list of publications.

References

The post Philip Morris International appeared first on TobaccoTactics.

Tobacco Industry Use of Evidence to Oppose Policy

The tobacco industry’s attempts to deny the evidence, even when evidence exists, is a tactic aimed at influencing public opinion. Placing this argument in the public domain creates a level of doubt which permeates even when credible evidence is presented to the contrary. This tactic has been used to oppose earlier policies (such as advertising bans and smoke-free legislation) which were strongly associated with positive health outcomes and reductions in health inequalities.^{412413414415416417418419 420421}
Insisting on real world evidence before regulating, as the tobacco industry has argued in the case of plain packaging,⁴¹¹ would effectively place a block on all new laws likely to promote public health and welfare, irrespective of advances in scientific knowledge.
In opposing plain packaging, the tobacco industry has used the principles and processes (public consultations and impact assessments) of Better Regulation to support its argument that there is insufficient evidence to support the implementation of the policy.⁴²² Better Regulation was lobbied for by the industry and requires risks, costs and benefits to be weighed against one another before new regulatory burdens are placed on businesses. ^423424425

Flawed Tobacco Industry Evidence

Australia – Critique of Tobacco Industry Graphic Health Warnings Research

A report by Deloitte (2011), commissioned by BAT, suggested that health warnings on cigarette packets had not been successful in reducing cigarette consumption and therefore plain packaging was unlikely to be effective.⁴²⁶ However, Cancer Council Victoria (Australia) reviewed the analyses forming the basis of this conclusion and found the methodology weak in several respects.⁴²⁷ For instance, Deloitte made an error in their analysis by starting it in 1990, whereas health warnings were introduced in 1987. In addition to this error, the data used were not actually consumption data but rather duty paid shipment volumes. It has been reported that duty paid does not necessarily amount to consumption because in some years cigarettes are over-produced and surplus is often kept in storage until needed.⁴²⁸ Looking only at BAT brands, Deloitte concluded that volumes did not decline any more steeply than normal. However, when data on all duty paid tobacco products was assessed, Cancer Council Victoria reported that excise and customs duty declined more than would be predicted following the introduction of health warnings.⁴²⁷

UK – Critiques of Industry Evidence that Plain Packaging Will Not Work

Peer-reviewed research has shown how global tobacco companies commissioned, cited and critiqued evidence as part of a campaign to prevent the introduction of plain packaging for their products in the UK.^411429430431
Tobacco companies used this strategy to argue that plain packaging “won’t work”. Evidence to support this claim was promoted through the media and in submissions to government.
This strategy was examined in a series of peer-reviewed research papers, which highlighted the misleading nature of tobacco companies’ evidence on plain packaging, emphasising that:

• Tobacco companies cited evidence that did not directly consider plain packaging to argue that regulation “won’t work”;⁴¹¹
• Evidential critiques commissioned by tobacco companies used misleading techniques to discredit public health research on plain packaging;⁴²⁹
• Quoted statistics on illicit tobacco were over-estimated to exaggerate the risks of the policy.⁴³⁰⁴³¹

The Importance of Branding and Packaging to the Tobacco Industry

Despite the tobacco industry’s claims that plain packaging will not work because packaging is not important to marketing, internal industry documents show how important tobacco branding is, with innovations (packaging and product) leading to a 10% increase in market share for BAT in 2011.⁴³² Internal industry documents reveal a long held understanding by the tobacco industry that cigarette packets and tobacco pouches represent mobile advertisements. One Rothmans document from 1982, for example, stated that the company was:

“very aware that every customer carries the Rothmans logo, on the package, with him or her all the time. That package comes out many times a day, and every time it is seen makes a personal comment about the person who carries and shows it.”⁴³³

In 1994, Philip Morris said:

“In the absence of any other marketing messages, our packaging — comprised of the trademark, our design, color sic 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.”⁴³⁴

The tobacco industry claims that cigarette packaging has no bearing on people’s smoking behaviour, however advertising works for every other industry. The tobacco industry has long argued that tobacco advertising is aimed at building brand loyalty, not trying to persuade young people to smoke or smokers to continue and not quit. However, others within the advertising industry have disputed this categorically.
Advertising executive Emerson Foote, former Chairman of the Board of McCann-Erickson, which handled $20 million in tobacco account sales, argued that:

“The cigarette industry has been artfully maintaining that cigarette advertising has nothing to do with total sales. This is complete and utter nonsense. I am always amused by the suggestion that advertising, a function that has been shown to increase consumption of virtually every other product, somehow miraculously fails to work for tobacco products.”⁴³⁵

In 2004, BAT acknowledged packaging innovations as the reason for the increased success of their Dunhill brand: “In Australia and Taiwan, the continued success of the new packaging led to increased volumes of 7 per cent and 20 per cent respectively”.⁴³⁶

Global – Pre-Implementation Evidence For Plain Packaging

Prior to the implementation of plain packaging in Australia a large volume of peer-reviewed research supported the measure. The research showed that when branding is removed from tobacco packaging, health warnings are more salient⁴³⁷⁴³⁸ packs appear less attractive and of a lower quality, and there is less confusion about the relative harm from different brands, e.g. Marlboro gold packs are viewed as less harmful than Marlboro red packs.⁴²⁷⁴³⁷ Furthermore, a number of studies evaluated in a systematic review for the UK Department of Health found that cigarette packaging influences children and is an important consideration in children’s smoking behaviour.⁴³⁷ A few examples of studies included in the systematic review are:

• A study of school children in Canada and the US found that the majority of children, when asked, would prefer to take home a branded rather than a plain cigarette pack as the plain pack was “ugly” and “boring”.^439440441
• A Scottish study found that amongst 10-17 year olds, plain cigarette packs were seen by the majority as “unattractive”, “uncool” and “a pack you would not like to be seen with”.⁴⁴²

Prior to the implementation of the policy in the UK and Ireland, two plain packaging evidence reviews by both the UK (the Chantler Review), and Irish Governments (the Hammond Review) concluded that that this population-scale measure is likely to be effective in reducing youth uptake of smoking. For example, in the UK, Sir Cyril Chantler’s review concluded that:

“Having reviewed the evidence it is in my view highly likely that standardised packaging would serve to reduce the rate of children taking up smoking and implausible that it would increase the consumption of tobacco. I am persuaded that branded packaging plays an important role in encouraging young people to smoke and in consolidating the habit irrespective of the intentions of the industry. Although I have not seen evidence that allows me to quantify the size of the likely impact of standardised packaging, I am satisfied that the body of evidence shows that standardised packaging, in conjunction with the current tobacco control regime, is very likely to lead to a modest but important reduction over time on the uptake and prevalence of smoking and thus have a positive impact on public health.”⁴⁴³

While the Hammond Review, commissioned by the Irish Government, concluded:

“The evidence indicates that tobacco packaging is a critically important form of tobacco promotion, particularly in jurisdictions with comprehensive advertising and marketing restrictions, such as Ireland. The evidence indicates that plain packaging reduces false beliefs about the risks of smoking, increases the efficacy of health warnings, reduces consumer appeal among youth and young adults, and may promote smoking cessation among established smokers.
Overall, there is very strong evidence that plain packaging would be effective in regards to four of Ireland’s specific policy objectives:

• Prevent non-smokers including children and young people from starting to smoke;
• Encourage, motivate and support current smokers to quit;
• Reduce recidivism rates among those who have quit;
• Limit the societal impacts of smoking and protect society, especially those under 18 years, from the marketing practices of the tobacco industry.”⁴⁴⁴

Australia – Early Evidence that Plain Packaging Works

Following the introduction of plain packaging in Australia in December 2012, calls to Quitline increased,⁴⁴⁵ individual pack display decreased,⁴⁴⁶ cigarette sales fell 3.4%,⁴⁴⁷ there was no increase in transaction times, no defection to larger stores to make tobacco purchases, and no impact on the illicit trade.^448449450
These early policy outcomes contradicted the claims made by tobacco companies in the UK, and complement the Tobacco Control Research Group’s research, which has raised serious questions about the trustworthiness and scientific value of tobacco companies’ arguments that plain packaging “won’t work”.

Australia – Evidence from the Post-Implementation Tobacco Plain Packaging Evaluation

In order to monitor the outcomes of the 2011 Tobacco Plain Packaging Act, in 2012 the Australian Department of Health commissioned a National Monthly Tobacco Plain Packaging Tracking Survey of the early effects of plain packaging on adolescents. Findings were reported in several studies published in a special issue of Tobacco Control. A Post-Implementation Review of Tobacco Plain Packaging was also published in 2016.

Results of Australia’s National Monthly Tobacco Plain Packaging Tracking Survey

Four hundred smokers and recent quitters were surveyed every four weeks between April 2012 and March 2014, with a follow up survey in May 2014. Post-implementation plain packaging legislation:

• Reduced appeal of packs⁴⁵¹;
• Increased health warning effectiveness;
• Corrected some misperceptions of harms;
• Increased rates of quitting cognitions and quit attempts.⁴⁵²

Evaluation of the Effects of Plain Packaging on Australian Adolescents