| Latest Duty Free Tobacco Campaign Documents | | Available on submission of a login and a password. Please contact us with the contact form below. | |
|
|
The Industry’s Campaign to Retain Duty Free Tobacco Sales
|
|
|
In May 2003, The World Health Organization (WHO) adopted the Framework Convention for Tobacco Control (FCTC) which came into force in February 2005 after the required 40 minimum countries had signed and ratified it. The FCTC requires countries to impose further restrictions on the sale, promotion and movement of tobacco products. Article 6 of the FCTC states that each Party ‘should adopt or maintain, as appropriate, measures which may include:
b) Prohibiting or restricting as appropriate, sales to and/or importations by international travellers of tax- and duty-free tobacco products.’
To date none of the 150 countries that have ratified the FCTC have decided to ban duty free tobacco sales. The tobacco category for the duty free industry is a key penetration driver and the ETRC, therefore, continues to defend the industry’s ability to sell duty free products.
While the duty free industry does not contest the underlying objectives of tobacco control regulation from a public health perspective, it is however concerned about the choice of measures by which these objectives are intended to be achieved.
In this context, adherence to the principles of Good Regulation is particularly important as they require policy solutions to be clear, proportionate to the perceived risk, efficient in terms of maintaining competitiveness while satisfying consumers and the trade and meeting the legitimate goals of regulators.
Appropriate and sustainable regulation should be based on the following considerations:
Effectiveness: There is no evidence that a ban on duty free would significantly reduce overall consumption of tobacco products, especially given the fact that it represents less than 1% of worldwide tobacco sales.
Proportionality: Current regulations applicable to duty free tobacco products are adequate – including regulation requiring health warnings on cigarette packs, advertising restrictions, etc. A ban on duty free would be a disproportionate measure.
Appropriateness: A ban on the duty free sale of tobacco products would not be the best method of improving public health and welfare. We are unaware of any conclusive evidence to suggest this.
Duty free retail is a highly regulated industry, and both legislation and tobacco manufacturers’ own voluntary initiatives have made duty free today an unlikely source of smuggled goods or contraband merchandise.
Duty free retailers do not sell to minors and therefore duty free tobacco sales are highly unlikely to contribute to youth smoking.
International trade and tourism:
o Duty free retail is firmly rooted in established international law and custom, including a number of international conventions facilitating the movement of travellers and promoting tourism. It is based on national policies not to tax exported items extraterritorially;
o Duty free retail provides important financial support to the transportation infrastructure of many nations;
o Abolishing duty free tobacco sales will negatively impact the turnover of other product categories due to the importance of tobacco as a penetration driver for duty free retail outlets. The reduction in turnover will be greater than simply that lost from duty free tobacco sales.
Banning duty free tobacco sales would potentially infringe the right of freedom to conduct business. For example, Article 16 of the Charter of Fundamental Rights of the European Union recognises the freedom to conduct business in accordance with Community law and national laws and practices.
A ban on duty free tobacco sale is not an obligation of the WHO’s FCTC. Prohibition of duty free sales of tobacco products will not have any effect in helping to accomplish the goals of the WHO in reducing overall consumption of tobacco products.
Finally, it is important for the industry to recognise that if a product is indiscriminately eliminated from the duty free sector, despite the fact that its removal will not achieve broader objectives, then other products may be subject to the same treatment.
(Although Philip Morris International, a member of the ETRC, opposes a ban on duty free sales of cigarettes, it does not join in this statement.)
| |
| |
|
