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JT group goes to court over Ireland’s plain packs law

| April 1, 2015

The Japan Tobacco group has initiated a High Court action against the Irish government aimed at blocking the requirement that cigarettes should be sold in standardized packs, according to a story in The Irish Times.

Last month, Ireland’s President Michael D. Higgins signed into law legislation under which cigarette manufacturers will be required, from May 2016, to produce cigarettes for the Irish market in standardized packaging. From May 2017 only cigarettes in standardized packaging will be allowed to be sold on the Irish market.

Ireland is the second country after Australia to bring in such legislation. In Australia, standardized packaging has been a requirement since December 2012.

The Irish arm of Japan Tobacco, JTI Ireland, is reportedly challenging the legislation on grounds of competence. The group is expected to argue that the state had no right to enact the legislation because it went further than the provisions of a European Union directive.

The Minister for Children Dr. James Reilly, who championed the legislation, indicated previously that the government was preparing for a legal challenge.

Asked about the action, Reilly said the government would defend it robustly in the firm belief that the law was in the best interests of the health and welfare of the public, especially children.

Price-hit cigarette sales recovering in South Korea

| April 1, 2015

Cigarette sales in South Korea, which plummeted in January after a tax-led price hike at the beginning of the year, slowed their downward trend in March, according to a story in The Korea Herald.

According to data compiled by a local convenience-store chain, cigarette sales during the third week of March were down by 15.1 percent on those of the same period of 2014.

In January, sales were down by 40.3 percent year-on-year and in February they were down by 22.4 percent year-on-year.

Cigarette prices increased on January 1 by 80 percent; or about WON2,000 per pack.

Just how much can be read into these figures is hard to say. A convenience store official was quoted as saying that it was usual for cigarette sales to fall in January and February after people made New Year resolutions to stop smoking.

And it was usual also for sales to start to revive in March as more people quit their resolutions to quit.

While the government has been claiming that the price rise was aimed at increasing health awareness and reducing South Korea’s relatively high smoking rates, some policy watchers say the move came as the government expected a tax-revenue shortfall because of a delay in the country’s economic recovery, which had coincided with an expansion in welfare payments.

Cambodia urged to bring in graphic health warnings

| April 1, 2015

Health experts have thrown their weight behind a provision in Cambodia’s draft tobacco-control law that would require graphic health warnings to cover ‘half the face’ of cigarette packs sold in the country, according to a story in The Phnom Penh Post.

According to the World Health Organization, Cambodia is the only ASEAN country that has not passed smoking legislation.

The graphic health warning provision is included in article 10 of the law, which was first drafted in 2003.

The WHO is calling on the government to enact the legislation with haste.

The law is expected to be discussed at the National Assembly towards the end of this month.

Little home-grown data linking smoking and cancer

| April 1, 2015

India has little independent evidence to link cigarettes and cancer, according to a statement apparently made by the BJP (Bharatiya Janata Party) MP Dilip Kumar Gandhi during a New Delhi Television report.

“Does this [smoking] cause cancer or does [it] not? What are the impacts? We have never done our own survey,” he reportedly said.

The MP is the head of a committee that last month recommended that further discussions take place in respect of a government proposal to require health warnings covering 85 percent of cigarette packs.

Tobacco companies had been told late last year that the starting date for the new warnings would be April 1 this year.

It is up to the government to decide whether to accept the parliamentary panel’s recommendation for further discussions, but activists say the missed deadline does not bode well.

“This is just a front for the tobacco industry; it’s going to affect the bottom line of companies and that’s the smoke screen they have put up,” said Bhavna Mukhopadhyay, executive director of the Voluntary Health Association of India.

“In a country like ours, where a large section of the population cannot read or write and more users are coming on board, pictorial warnings are the need of the hour,” she said.

Meanwhile, plans to increase the minimum tobacco purchase age to 25 have not progressed either.

Thai smokers leading the way in sporting activities

| March 31, 2015

The retail prices of cigarettes and alcoholic beverages increased by about two percent in Thailand after the imposition on Friday of a new sports tax, according to a story in the Bangkok Post.

Manufacturers of these products – or, rather, consumers of these products – are required to make contributions to the new sports fund on top of excise tax and contributions to two other funds.

They currently pay three billion baht a year to the Thai Health Promotion Foundation and two billion baht to ThaiPBS, the public television operator modelled on the UK’s BBC.

The two percent sports tax is calculated on the excise tax the manufacturers pass on each year; and, based on the latest figures, the sports tax will bring in about three billion baht a year.

Meanwhile, the Education Ministry is pushing for a fund to promote learning, to which consumers, through the manufacturers, will be required to contribute another 1.5 percent or 2-3 billion baht a year.

Rumor of FTC merger meeting feeds rumor mill

| March 31, 2015

A pivotal meeting between US federal regulators and representatives of Reynolds American and Lorillard is expected to take place this week, according to a story by Richard Craver for the Winston-Salem Journal citing a Wall Street Journal report.

The meeting with Federal Trade Commission (FTC) members could be the last step toward a decision on Reynolds’ $27.4 billion offer for Lorillard, which was announced on July 15 and which the two companies believe will close by June 30.

However, some analysts believe it could be a negative sign that the FTC board wants or needs another meeting at this stage, and they have put the odds of the deal’s being approved at 50-50.

Meanwhile, Wells Fargo Securities analyst Bonnie Herzog, who has projected an FTC decision as early as April, on Monday confirmed her belief that there was a 90 percent chance the deal would be approved.

“We believe the market’s negative reaction to these meetings is unjustified based on our industry sources that are telling us these meetings are completely normal and should be viewed as positive,” Herzog was quoted as saying.

“Further, our industry sources reiterated that absolutely no part of the FTC’s review process has been hostile.”

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