How to tame Big Tobacco

Friday, 31 August 2018 16:19
Steven Lind

Steven Lind is a Brussels based analyst and consultant.

It’s been described as “one of the tobacco industry’s greatest scams,” which is a bold claim when you consider the allegations it’s faced in the past.
New studies suggest that the leading players in the cigarette market are not only facilitating tobacco smuggling; they are attempting to control the very system designed to prevent it. As participants in the World Health Organization’s ground-breaking agreement on tobacco control prepare for a key meeting, these worrying reports send a clear message: neither the public nor European decision makers should allow Big Tobacco to regulate itself.

The twin studies were published by the Tobacco Control Research Group (TCRG) at the University of Bath, which recently joined a new $20 million grant to scrutinize the industry. Its findings, based partly on a trove of leaked documents, are damning. The authors claim that some of the world’s largest tobacco companies are trying to crowbar their way into the EU’s ‘track and trace’ system, a requirement of the WHO’s Illicit Trade Protocol (ITP) which is designed to close the €11 billion black hole caused by tobacco smuggling across the continent.

The protocol, which recently came into force under the WHO’s Framework Convention on Tobacco Control (FCTC), was preceded by several high-profile court cases accusing the tobacco industry of facilitating smuggling. Unsurprisingly, the document forbids the industry from having any involvement in track and trace systems. But the TCRG authors claim the ‘big four’ tobacco firms have joined forces in a concerted campaign to push their own such system, which was developed by Philip Morris International and originally called Codentify. They say the manufacturers are using third parties and ‘front groups’ to, as one leaked document put it, “sell the system to governments,” backed up by false claims that the system is independent.

The authors also claim that Big Tobacco has mounted a sustained PR effort to overestimate the volume of illicit trade, including paying for inaccurate data which smeared smaller competitors. As recently as 2016, they say, Philip Morris pledged $100 million for this purpose. Yet they found that beneath the PR spin, the industry remains heavily involved in its own smuggling problem: research suggests that two-thirds of the illicit cigarette market is made up of the manufacturers’ own stocks. This merely echoes the long-standing concerns of critics that major manufacturers are flooding the market to avoid high tobacco duties, while pinning the blame elsewhere.

Clandestine meetings

Indeed, these studies only reflect what many observers have said for years: that Big Tobacco is using its money and influence to prevent effective regulation of the tobacco industry, and that the EU is not doing enough to stop it.

For instance, previous studies, also based on leaked documents, have shown that industry lobbyists held several clandestine meetings with EU officials during the redrafting of the bloc’s Tobacco Products Directive between 2009 and 2014, despite guidance forbidding parties from allowing such influence. Researchers claim that the directive was watered down significantly during the drafting process, with key measures such as a ban on novelty tobacco flavors being removed.

The EU’s track and trace system, which comes into effect for cigarettes and rolling tobacco next year, is supposed to prise the tobacco industry’s hands off the cookie jar once and for all. But to the horror of campaign groups such as the European Network for Smoking Prevention (ENSP), Brussels appears to have bowed to the lobbyists’ pressure: it has proposed a mixed governance model for the tobacco market, under which the industry will be responsible for applying the unique identifier codes to packaging and storing the data, as well as selecting many of the technology providers the system requires. The European Commission has even decided that a technology provider can receive up to 20% of its revenue from the industry and still be deemed ‘independent’. No wonder some MEPs have urged their colleagues to veto the proposals.

Knock-on effect

But the EU’s apparent inability to cut ties with Big Tobacco could have major consequences elsewhere in the world. Indeed, the tobacco industry will no doubt hope that governments in the developing world will follow Brussels’ lead and adopt their own traceability systems, using the EU’s template as a guide. In fact, the TCRG authors claim that British American Tobacco has already begun meddling in Kenya’s plans for track and trace, again using a front company to mask its intentions.

If anything, the tobacco industry will have even more incentive to meddle in the developing world than it does in Europe. After all, 80% of the world’s one billion smokers now live in low and middle-income countries. The manufacturers have certainly been happy to flood these markets with advertising: a study from the WHO found that there are over 80 times more tobacco advertisements in poorer countries than their affluent counterparts, and much of the advertising is targeted at children and young people. If the industry is happy to push their product onto children, they’ll have little reservation in hampering anti-smuggling efforts.

The EU’s new traceability initiative, and its potential implications for other continents, will undoubtedly be discussed at the Eighth Session of the Conference of the Parties (COP8), a biannual event bringing together the global partners in the FCTC, as well as at the first session of the Meeting of the Parties (MOP1) immediately thereafter. This year, signatories will focus on key actions for the next five years; given that cigarette smuggling rates are soaring and track and trace is a global requirement under ITP, this would be an obvious place to start.

Thankfully, the recent TCRG reports will be a prescient warning to COP delegates that the industry is anything but a partner in these upcoming efforts. If anything, they are only the most recent reminder that, despite some nice marketing sound bites like Philip Morris’s Campaign for a Smoke-Free World, the industry is still up to its old tricks. Big Tobacco has been allowed to police itself for too long: now it’s time to kick the fox out of the henhouse once and for all. 

By Steven Lind
Google Plus