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April, 2007

Essentra

Belarus
Agreement may open market for Russian cigarettes
Minsk — Beginning April 1, the Belarusian market might be opened for unlimited import of cigarettes produced in Russia. Canceling the quotas on cigarette import to Belarus is one of the conditions of the Moscow-Minsk bilateral agreement that was to be signed on March 1. However, import quotas is just one of the barriers preventing the sales of Russian cigarettes in Belarus from rising.

Belarus has had quotas on cigarette import since 1997. Since 2001, it has been allowed to import only cigarettes costing over 26 cents per pack. In 2002, 4.103 bn cigarettes were imported to Belarus, 3 bn in 2003, 3.6 bn in 2004, and 3.07 bn in 2005. Setting the quota for 2006, the Belarusian government said it will be 1.5 bn cigarettes, with the total amount of market being 18 bn.

Tobacco companies say the lifting of quotas will be good for business. However, it does not guarantee the free import of cigarettes to Belarus, since there exist other restrictions. For instance, every importer of cigarettes has to obtain a license in the country’s trade ministry. Yet, Russia’s Ministry of Economic Development and Trade said that it “regards such licenses as administrative obstacles for trade” and promised to “insist that they are cancelled.”


Bulgaria
Tobacco museum to be established
Gotse Delchev — A museum of tobacco will be established in the town of Gotse Delchev in southwestern Bulgaria. 

The idea is a joint project of the local municipality and a Greek municipality, reported the mayor of Gotse Delchev, Vladimir Moskov.

The site of a former tobacco store will be used for the purpose.

The museum will present the history, traditions, and manners of cultivation of tobacco in the years of tobacco production in Bulgaria as a traditional trade branch.


France
EU takes France to court over cigarettes
Paris — The EU took France to court to try and overturn minimum French retail prices for cigarettes.

It said a fixed price limit only benefits manufacturers by safeguarding their profit margins and breaks EU law because it distorts the market.

“The setting, by the public authorities, of such prices inevitably has the effect of limiting the freedom of producers and importers to determine their selling prices,” it said.

If the government wanted to prevent people smoking, it would be better off increasing the tax it charges on tobacco, the European Commission said.

The EU backed off similar legal action against Belgium when it responded to a July 2006 EU request and brought its law in line with European rules.

The European Court of Justice can force France to change national law and ultimately impose fines.


Indonesia
Ad campaign pokes fun at police
Jakarta — Police are threatening to sue cigarette manufacturer PT Djarum for a nationwide advertising campaign — appearing on billboards, TV, and in magazines — that pokes fun at officers dozing on the job.

“The force is a state institution that deserves respect,” police spokesman Maj. Gen. Sisno Adiwinoto said in an Associated Press report.

The ad is a visual and linguistic pun on the phrase “sleeping policemen,” which in Indonesia is a term used for speed bumps. It features a road sign warning motorists of bumps, amended to read “Be careful, the police are snoozing.”

Adiwinoto claimed that Djarum had agreed to withdraw the ads, one of which is spread across a billboard yards from police headquarters. But Adiwinoto said police were “still discussing whether we need to take legal action or just send them a strong warning.”

Djarum, which makes a popular brand of clove cigarettes, was not available for comment.


United Kingdom
Counterfeit fight going high-tech?
London — Anti-counterfeit technology will be introduced on cigarette packets in the UK within the next six months, with speculation mounting that this could involve the use of RFID (radio frequency identification) technology.

The government has agreed to the use of a “covert security mark” on cigarette packets. Small hand-held readers will be used by customs staff to authenticate cigarettes, according to the Tobacco Manufacturers’ Association (TMA).

But HM Revenue & Customs (HMRC) and the TMA are remaining tight-lipped about the exact nature of the technology, even though several newspaper reports have suggested that RFID tags will be used.

An HMRC spokesman said: “It’s still a work in progress — a decision hasn’t been made yet.”


Tobacco International - April, 2007
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