Canada Looks to Plain Packaging for Cigarettes
June 01 2016 - 6:20AM
Dow Jones News
Big tobacco was dealt another blow this week after Canada kicked
off a process to strip cigarette packs of their branding, following
similar moves by Australia and the U.K.
Canadian Health Minister Jane Philpott announced Tuesday a
public consultation on plain packaging requirements for tobacco
products. Plain packaging requires a uniform standardized color and
font on all packages an also regulates the size and shape of
products.
Over five million Canadians use tobacco, costing almost $4.4
billion in annual direct health care costs according to data from
the Government of Canada.
Plain packaging aims at diminishing the appeal of smoking to
youngsters and other potential smokers. In Canada, 85% of adult
daily smokers had smoked their first cigarette by the age of 18,
according to the government.
"I don't believe tobacco companies should be allowed to build
brand loyalty with children, for a product that could kill them,"
said Dr. Philpott. "Research shows that plain packaging of tobacco
products is an effective way to deter people from starting to smoke
and will bolster our efforts to reduce tobacco use in Canada."
The consultation will run until the end of August.
British American Tobacco PLC, Philip Morris International Inc.
and Japan Tobacco Inc. are the three largest cigarette companies in
Canada, according to data from Euromonitor.
Canada's move comes after the U.K. begun implementing plain
packaging for cigarette packs last month after a legal challenge
against the measure by tobacco companies failed. Separately, the
European Court of Justice recently upheld the 2014 Tobacco Products
Directive, which paves the way for countries to put in place
plain-packaging laws.
Australia became the first country to fully implement plain
packaging, starting in 2012.
France recently passed legislation requiring plain packaging,
with the law coming into effect last month. Ireland and Hungary
have also passed plain-packaging laws. A total of 20 countries are
looking at plain-packaging regulation, according to Wells Fargo
analyst Bonnie Herzog. The U.S.'s free-speech laws make
plain-packaging legislation all but impossible there.
Earlier this week on World No Tobacco Day, World Health
Organization Director-General Margaret Chan endorsed plain
packaging saying, "it kills the glamour."
The tobacco industry has pushed back hard, filing lawsuits in
which it claims plain packaging is ineffective.
Imperial Tobacco Canada, Canada's largest tobacco company and a
unit of British American Tobacco PLC, has lashed out at the
Canadian government, accusing it of hypocrisy by regulating tobacco
while taking steps to move ahead with legalizing marijuana.
"Announcing more tobacco regulations is an easy political win
that will generate headlines, but do nothing to further reduce
smoking rates," said Imperial Tobacco Canada's Director of
Corporate and Regulatory Affairs Eric Gagnon.
"Plain packaging is a gimmick policy that does not work, "said
Igor Dzaja, general manager of Japan Tobacco's JTI-Macdonald Corp.
unit.
By contrast, WHO and other health bodies have pointed to data
from the Australian government showing that smoking prevalence in
those aged 14 and up has fallen by 0.55 percentage points because
of packaging changes in the country.
Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com
(END) Dow Jones Newswires
June 01, 2016 06:05 ET (10:05 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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