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NEWS ANALYSIS: Cuba fumes at Australia’s tobacco rules

AUSTRALIA and Cuba: one is a robust democracy with a free-trade agenda and the other a one-party state where the government sets prices and rations food.

But that has not deterred Cuban ambassador to Australia Pedro Monson Barata from accusing Canberra of ignoring trademark protection and trampling on free trade.

New tobacco retailing rules that from December next year stand to spoil the sales of Cuban cigars in Australia sparked Mr Barata’s tirade.

Infinitely more worrisome than a dig from Havana is a high court challenge to the world-first public health initiative from Philip Morris International , which owns Marlboro and six more of the world’s top 15 cigarette brands.

Philip Morris complains that "plain packaging turns tobacco products into a commodity, robbing Philip Morris Ltd of its ability to differentiate its products from competitor brands."

A year from now, tobacco products must come in plain green packets. Logos and other brand imagery will be banished. Covering most of the packet will be graphic warnings of the health hazards of smoking.

The new rules are aimed at cigarette smokers, and cigar smokers — a minuscule sector of the market — are set to become collateral damage.

"I don’t know whether I’ll still be here next year," said Ray Battistella of Cigarworld Australia . Mr Battistella’s emporium on Queensland’s Gold Coast is a sight to behold. The temperature is kept at 18° -20° C year-round and the humidity at 70%-75% . More than 380 brands are on display, not only from Cuba but from Nicaragua and elsewhere.

According to the regulations, the tins, tubes and wooden boxes would have to be covered in plain paper. The bands on individual cigars would have to be snipped off or concealed.

"What it means is that customers who buy a selection wouldn’t know what they were smoking in a month’s time," Mr Battistella said. "We’re not going to know what’s what."

Smoking has been under attack in Australia for nearly 100 years. High taxes, advertising bans and restricted sales have reduced smoking rates to among the world’s lowest . The industry’s response to the new rules is being watched by Europe, Canada and New Zealand, where similar legislation could be promulgated.

Melbourne retailer Alexanders Cigar Merchants is trusting that the government will exempt the high-end cigar market from proscriptions intended for cigarettes. "I don’t believe we’re going to get to that point," said Danny Alexander . "We’ve dozens, hundreds, of different brands ," he said.

"We could repackage them but why would the customer bother?"

The big complaint from cigar sellers is that the new regulations are just one more reason for Australians to circumvent local retailers and order their smokes from overseas websites.

"They come straight to your door, and there are no warnings on them," said Mr Alexander. Sapa-DPA

Wednesday, December 21, 2011

Source: Business Day

NEWS ANALYSIS: Cuba fumes at Australia’s tobacco rules