Submission by Imperial Tobacco Australia Limited (PDF 600 KB)

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Incentives in the form of rebates are similarly a legitimate way for manufacturers in any industry to secure ranging of their products in retail locations. This form of activity rewards hard working retailers and encourages them to continue stocking our brands for adult consumers who wish to purchase them. Promotional activity involving retailers has no direct impact on whether people choose to smoke, but does impact on legitimate competition. The purpose of legal activities involving retailers are directed to ensure that a range of products at a range of prices are available to be purchased at a range of retail outlets by adult smokers. As such, ITA believes that any regulation of this activity will have no health outcomes but will simply limit legitimate business competition and consumer choice. 5.3 Action Item 6.5.8 & 6.5.9 We believe that trade incentive programs reward the legitimate activities of retailers in working hard to earn profits and to sell products they believe provide consumers with high levels of satisfaction. We are a responsible, legitimate business selling a legal consumer product. Trade incentives are an ordinary part of professional working relationships with the trade and are a normal and legitimate part of any commercial business. These measures will reduce and distort competition and reduce legitimate retailer income. We are committed to selling our product responsibly and trade programs neither impact on nor offer incentives for consumers. We note that the inclusion of tobacco products in retailer shopper loyalty or reward programs, as described on page 34 of the consultation paper, does not encourage consumers to purchase more (or any) tobacco products but rewards them only for loyalty to a particular retailer when purchasing the tobacco that they would otherwise obtain. In fact, most States have already expressly legislated against this type of scheme. ITA has no major concerns with this provision, except to note that this may place an impost on a number of smaller retailers who operate these schemes where they do exist. Such schemes are generally managed through the retailer‟s point of sale system which allocates points based on overall purchases. In these cases there will be a need to modify or change the software in order to exclude cigarettes from the scheme. This will be costly and difficult process for smaller retailers. 5.4 Action Item 6.5.10 ITA continues to seek participation in constructive and effective dialogue with regulatory authorities and to work with them to develop proportionate and workable regulations. We are a responsible and legitimate business selling a legal product. Where regulation has the potential to affect a legal business, that business deserves to be recognised as a valid stakeholder. We believe that FCTC Article 5.3 represents an opportunity to further improve the transparency, inclusiveness and integrity of regulatory processes, which will be beneficial to both the regulators and all stakeholders. 8
5.5 Action Item 6.5.11 ITA does not seek to have its products used in entertainment media, nor does it directly provide its products for such use. We believe that this is an area that should be left to the discretion of the director or producer. The creative sector should not be regulated in such a manner and artistic independence should remain. 6 PART 6.6 Priority Area 6: Considering Further Regulation of the Contents, Product Disclosure and Supply of Tobacco Products and Non Therapeutic Nicotine Delivery Systems ITA believes that current state and federal government regulation of the ingredients which may be included in tobacco products is adequate. ITA complies fully with all such regulations. The article cited in the submission in support of the statement, “Additives such as sugar, honey, liquorice and cocoa are used to enhance the “taste” of tobacco smoke to make the product more desirable to smokers especially those experimenting with tobacco” was written in 1999 and is out of step with Australian legislation. Further, it is a document prepared by the anti-tobacco lobby, not an independent scientific paper and contains numerous unverified assertions and should be weighted accordingly. Since 2008, many Australian state and territories have banned fruit and confectionery flavoured cigarettes or flavours, which prevents such additives being used. In compliance with this regime, ITA does not market confectionery flavoured tobacco products, or novelty tobacco products. Further, ITA does not add anything to its products to make it more difficult to stop smoking, to make our products attractive to children or to increase the level or change the chemical form of nicotine in tobacco smoke. However, to ensure the proper functioning of a market economy, legitimate tobacco companies have the right to fair competition by developing and differentiating their products to support adult consumer choice. Detailed listing of the ingredients contained in cigarettes would be of little importance to the average consumer who has no detailed knowledge of chemistry. However, disclosure may result in trade secrets being revealed to competitors, including those who trade in illicit tobacco products. Were the government to require detailed mandatory disclosure of ingredients in cigarettes, ITA would strongly urge the government to protect the commercially sensitive information from being released to the public. Legislative measures must meet accepted principles of better regulation; that is based on objective evidence, be targeted and proportionate. We note that in Australia the industry voluntarily submits an ingredients disclosure annually to the Department of Health and Ageing. This information is available to the public on the Department‟s website. ITA draws attention to the DoHA January 2009, Public Health Value of Disclosed Cigarette ingredients & Emissions Data (2009 Report). The 2009 Report concluded that “it is unlikely that the health of Australian has been directly promoted or protected through making information about the ingredients and emissions available to the public under the 9
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Submission by Imperial Tobacco Australia Limited (PDF 600 KB)

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