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French MPs vote down ‘automatic’ tax increase

| December 11, 2014

Cigarette prices in France will remain unchanged in the new year after MPs voted to throw out a planned 30 cent tax rise, according to a story in The Connexion.

The change of heart by the National Assembly came after intense lobbying by tobacconists and manufacturers.

The automatic tax rise had been due to come into force on January 1 but has now been struck out by an amendment to the law.

It means the cheapest pack of 20 cigarettes will stay at €6.50, with more expensive brands retailing at about €7.00.

Socialist MP Razzy Hammadi said that if the increase had been applied it would have widened the price gap between French cigarettes and those in neighbouring EU states, which would have encouraged more smokers to buy abroad.

Further €60 million for Iggesund mill investments

| December 11, 2014

The board of the Holmen Group, which includes Iggesund Paperboard, yesterday gave the green light for investments totalling €60 million in Iggesund’s mills at Iggesund, Sweden and Workington, England.

At Iggesund, the investments will be aimed at eliminating bottlenecks in pulp production so it can be increased from the current 370,000 tonnes to 420,000 tonnes annually. The board mill, meanwhile, aims to increase capacity by 10 percent without investments.

“After we brought the new recovery boiler on line and developed our purification systems for both air and water, the mill now has unused potential in both the pulp and board mill, which we can activate,” said Olov Winblad von Walter, director of the Iggesund mill. “This is exciting because we are taking yet another step towards being one of the world’s leaders in mill technology with the lowest environmental impact. This move also further reinforces our competitiveness in the form of lower variable costs.”

The investment at Workington will increase the mill’s paperboard production capacity from the current 200,000 tonnes to 220,000 tonnes annually. Iggesund says that this investment will make the mill a leader in folding box board technology because it will provide the funds to rebuild the paperboard machine’s press section, an upgrade that will increase product quality. The rebuild will be completed by June 2016.

“We are experiencing strong demand for our improved Incada, not least because European converters regard it as the paperboard with the best runnability for applications involving mass-market consumer products,” said Ulf Löfgren, managing director of the Workington mill. “In that situation of course it is positive that we can increase our capacity so more people can benefit from Incada’s advantages.”

And Arvid Sundblad, vice president sales and marketing at Iggesund, said the company saw no difficulty in increasing Incada’s presence in Europe. “Our market share has been limited by our capacity,” he said. “The planned capacity increase combined with Incada’s recognised quality and our service gives us an excellent position.”

Over a five-year period Iggesund Paperboard had invested strongly in strengthening its competitiveness via lower energy costs, while simultaneously minimising its use of fossil fuels, Iggesund said in a press note. ‘A total of €361 million has been used for this purpose in both Workington and Iggesund. The investments announced now are more focused on increasing production.’

“We have reduced our environmental impact and also taken control of our energy costs,” Sundblad said. “We are well equipped to face tougher competition in the paperboard market but above all with regard to other types of packaging material. Our strategy is organic growth, and for Workington this is the first step in that direction. The announced investments will give us an excellent market position in terms of both product quality and capacity.”

Camilleri to serve as PMI retiree chairman

| December 11, 2014

The board of directors of Philip Morris International yesterday declared a regular quarterly dividend of $1.00 per common share, payable on January 9 to stockholders of record as of December 24.

The ex-dividend date is December 22.

Meanwhile, PMI said that the chairman of the board, Louis C. Camilleri, would retire from employment with the company on December 31, from which time he would serve as a non-employee chairman.

In this capacity, Camilleri would continue unchanged his role of facilitating communication between the board and management, assisting the CEO in matters of long-term business strategy, and presiding at shareholder and board meetings.

PMI said Camilleri’s retirement would not affect his leadership role as chairman and that his pension benefits would be preserved at present levels, which would otherwise have been reduced under the company’s pension formula.

Altria declares dividend

| December 11, 2014

Altria said yesterday that its board of directors had declared a regular quarterly dividend of $0.52 per common share, payable on January 9 to shareholders of record as of December 24.

The ex-dividend date is December 22.

ECLT members commit to fighting child labor

| December 10, 2014

Members of the Eliminating Child Labor in Tobacco Growing Foundation  signed a Pledge of Commitment and Minimum Requirements on combating child labor.

As part of the pledge, ECLT members commit to work collaboratively with the relevant local, national, regional and international stakeholders to progressively eliminate all forms of child labor from the tobacco supply chain

The pledge states, “ECLT Foundation Board Members respect and recognize the principles and rights enshrined in the International Labor Organization (ILO) Conventions and Recommendations on child labor.”

The members’ aim to align their actions with the UN Guiding Principles on Business and Human Rights. The organization wants to address the complex child labor problem holistically and throughout the members’ respective tobacco-sourcing supply chains.

The International Tobacco Growers Association (ITGA) joins in the pledge and commits to raising awareness as part of its membership to the ECLT.

The International Labour Organization said, “We welcome the adoption of the pledge by ECLT members and hope that it will result in greater and ever more coherent efforts to end child labor in all its forms in tobacco growing communities worldwide.”

Save the Children Switzerland noted, “The ECLT member pledge is a key drive towards ensuring children are removed from child labor, and ensuring the tobacco industry holds itself accountable for a minimal set of provisions throughout its supply chain.”

Snus cooler labeling abuse allegations rebutted by SM

| December 10, 2014

Swedish Match says it will defend itself vigorously against an allegation that it abused is dominant position on the Swedish Market when implementing a uniform labeling system for snus coolers.

In a note posted on its website, SM said the Swedish Competition Authority had conducted an investigation regarding a uniform labelling system for snus coolers owned by Swedish Match and placed in retail outlets.

‘On December 9, 2014, the Competition Authority submitted a lawsuit to the Stockholm district court,’ it said.

‘In its submission, the Competition Authority alleges that Swedish Match, when implementing the labelling system, has abused a dominant position on the Swedish snus market in breach of the competition legislation.

‘Swedish Match does not agree with this allegation and will defend the case vigorously.’

SM went on to explain that standardized labels were widely used for different consumer goods categories on the Swedish market in order to create an orderly and transparent category presentation.

‘Swedish Match implemented its labelling system for the same purpose,’ the note said. ‘The labelling system applied uniformly to Swedish Match’s own products and to products of other manufacturers.

‘The implementation of the labelling system started at the end of 2012, but it was shortly thereafter withdrawn.

‘Swedish Match is of the opinion that the labelling system did not impact sales of other manufacturers, complies with market standards and that the Swedish Competition Authority has based its opinion on false assumptions about the purpose of the labelling system.’

The Competition Authority is seeking penalties of SEK38 million (about US$5 million).


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