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Looking for swift resolution of plain packs dispute

| December 2, 2014

The Dominican Republic is hoping that its dispute with Australia over standardized tobacco-products packaging will be resolved by the World Trade Organization (WTO) before such policies spread to other countries.

Since December 1, 2012, Australia has required that all tobacco products be sold in packaging designed on behalf of the previous Labor government to be as ugly as is possible. Packs are hugely dominated by graphic health warnings, are otherwise a standard olive color, have no logos or other design features, and have brand and variant names in a standardized font and position.

‘By stripping our brands and trademarks from packaging, the policy precludes our tobacco producers from differentiating their premium products from competitors in the marketplace, which has been extremely detrimental to our industry,’ said Dr. Katrina Naut, the Dominican Republic’s director general of foreign trade in a press statement issued through GlobeNewswire. ‘It is our hope that this case will be swiftly resolved at the WTO before other countries consider similar policies that have no impact on public health goals while at the same time putting the livelihood of our economy at risk.’

According to information published by the Tobacco Institute of the Dominican Republic, tobacco export revenues represent 7.5 percent of the Dominican Republic’s total exports. The country’s tobacco production chain generates around 110,000 direct jobs and supports about 350,000 people. The Dominican Republic is the biggest exporter of cigars.

‘By preventing tobacco products from using their trademarks and geographical indications, these measures have driven the Australian tobacco market towards commoditization and illicit trade,’ the press statement said. ‘Moreover, they have failed to contribute to reducing smoking in Australia.’

The statement went on to describe how Dominican producers had made enormous investments – including in intellectual property – to turn the Dominican Republic from a simple tobacco leaf exporter into one of the world’s leading premium tobacco products exporters. ‘This is a significant achievement for a small developing economy and has contributed to its economic growth,’ it said.

‘With plain packaging, this great development success is put at risk as our producers can no longer signal their premium quality to tobacco consumers.’

The statement said that Ukraine, Honduras, Indonesia and Cuba were challenging the Australian policy. And it said that because of the impact that the outcome of these disputes would have on intellectual property protection for a wide range of consumer goods, a record number of WTO members (35 countries and the EU) were observers of the disputes.

Move to oust smokers from Sydney’s ‘premier’ space

| December 2, 2014

The council of the City of Sydney, Australia, is due to vote on a proposal to make Martin Place – described as the city’s ‘premier civic open space’ – smoke-free for a 12-month trial starting early next year.

And, according to a story by Jim O’Rourke for The Daily Telegraph, further restrictions could follow. “If it is successful I would look at a motion to expand the ban to Pitt St Mall,” councillor Christine Forster, who put forward the Martin Place proposal, was quoted as saying.

Smoke-free outdoor areas already exist in Martin Place under state law. People cannot smoke within 4 m of an entrance to a public building.

And from July such a restriction will apply to hotels, clubs, restaurants and cafés.

If the council accepts the Martin Place proposal it will allocate a full-time ‘ranger’ to police the rule.

Korea’s retailers face prison for ‘bulk’ cigarette sales

| December 2, 2014

The South Korean government was forced on Monday to threaten draconian action against tobacco retailers that might be tempted to sell large numbers of cigarettes ahead of a tax-led January 1 price hike, according to a story in The Korea Times.

The government said it would crack down on stores selling tobacco ‘in bulk’ this month. Proprietors caught selling large volumes of cigarettes would face up to two years in prison or a WON50 million ($45,000) fine.

The market faces a turbulent time with prices rising by up to 87 percent. In the first increase in 10 years, cigarette prices are set to rise by WON2,000 ($1.80) per pack to between about WON4,300 and WON5,000 per pack.

Sales have surged during the past two months since the Health Ministry released in September its plans to raise tobacco prices.

The Trade Ministry was quoted as saying that tobacco sales rose by 12.1 percent and 5.9 percent in September and October respectively, compared with sales during the same months of last year.

And since the country’s two main parties reached an agreement on Friday to raise prices, tobacco sales at GS25, Korea’s largest convenience store chain, have risen by 25.2 percent from those of the previous week.

According to the National Assembly Budget Office, the price hike will bring in WON5 trillion in tax revenue, which is almost double the government’s estimate of WON2.8 trillion.

But some observers have accused the government of lowering its own estimate to avoid criticism that it was saddling low- and middle-income earners with more taxes.

“Low-income earners have little more than tobacco for enjoyment compared to the high-income groups, who have more resources,” said Yoo Jong-il, an economics professor at the Korea Development Institute School. “The price hike would therefore place a bigger price on them, without having too much of an impact on their health or cigarette consumption.”

Record broken at London auction of rare cigars

| December 2, 2014

A record £554,125 – including fees – was raised at last night’s C.Gars winter 2014 cigar auction at Boisdale Belgravia in London, the UK.

“Lot 317, the highly desirable Cubatabaco 1492 humidor containing 50 1992 Cuban cigars, went for £26,500,” said managing director Mitchell Orchant.

“The second highest hammer price was £16,200 for Lot 339, the Romeo y Julieta Coronations de Luxe pre-embargo Havanas.’

Bidders were said to have flown in from America, Asia and mainland Europe to attend the auction.

The next C.Gars auction will be online in February.

Vector declares quarterly dividend

| December 2, 2014

The Vector Group yesterday declared a regular quarterly cash dividend on its common stock of $0.40 per share.

The dividend will be payable on December 30 to shareholders of record as of December 12.

The Vector Group is a holding company that, among other interests, indirectly owns the Liggett Group, Vector Tobacco and Zoom E-Cigs.

Britain’s smokers under 20 percent of population

| December 1, 2014

The incidence of smoking among Great Britain’s adult (16 years of age or older) population fell from 20 percent during 2012 to 19 percent last year, according to a recently-released report from the Office for National Statistics (ONS).

The incidence of smoking among men was unchanged at 22 percent, but the proportion of women smokers fell from 19 percent during 2012 to 17 percent last year.

Great Britain has seen a long-term, gradual decline in smoking with the overall incidence having fallen from 46 percent during 1974.

According to the ONS, not only have fewer people been taking up smoking, but more smokers have been quitting.

The proportion of adult cigarette smokers is highest among unemployed people, people working in routine and manual occupations and those with lower educational qualifications: all factors associated with poverty.

But unmarried people are almost twice as likely as are married people to be cigarette smokers.

Meanwhile, the ONS said that electronic cigarettes were almost exclusively used by smokers and ex-smokers. ‘Almost none of those who had never smoked cigarettes were e-cigarette users,’ it said.

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