Presentation by Ronan Barry (chairman of the Executive Committee and Board Member, Confederation of European Community cigarette Manufacturers (CECCM)) on the occasion of the EESC hearing on Manufacture, presentation and sale of tobacco and related products (Brussels, 19 Feb 2013)

1. The Review of the Tobacco
Product Directive
Assessment and Impacts
CECCM
EESC Hearing
19.02.2013
.
1.

2. Outline
Introduction
Objectives of the Commission proposal and
assessment if proposed measures achieve stated
objectives
Expected economic and social impacts of the proposal
What this proposal means for consumers
What this proposal means for business in general
2.

3. Introduction
The position of CECCM member companies:
o Minors should not smoke or be encouraged or permitted to smoke
o CECCM companies compete only for the business of adult smokers
The claimed objectives of the Commission:
o Functioning of the internal market
o Public health
The measures in the proposal:
o Prohibition of products (menthol and slims for example)
o Very severe restrictions on packaging and labelling, affecting trademarks, patents
and design rights
o Ban on innovation (anti-competitive and anti-consumer)
o Track and Trace requirement, complicating internationally agreed standard
3.

4. Objectives of the Commission proposal and assessment if proposed
measures achieve stated objectives: Improvement of the Internal
Market
The proposal will not improve the functioning of the internal market, it introduces
rather than removes barriers to trade.
IA claims purpose of proposal is to “remove obstacles to cross border trade and
ensure level playing field for manufacturers”
The opposite is in fact achieved as the proposal installs trade barriers
o Product bans prohibit rather than promote free movement
o Removal of differences between products/ packages disables non-price competition
o Many SME’s will not survive new complexity and implementation costs
From internal market perspective, proposal is a retrograde step vs TPD1
o Encourages diverging MS rules (e.g. vague provisions in Art 12 on brand elements and
colours will be subject to different national interpretations)
o Enables Member States to depart from TPD and removes the free movement clause
that was in TPD1 (ref Art 24 of proposal)
The proposal fails to achieve internal market objective and unnecessarily
increases the overall regulatory burden
4.

5. Objectives of the Commission proposal and assessment if proposed
measures achieve stated objectives: Improvement of Public Health
The proposal will not improve public health nor will it reduce youth smoking
initiation
Commission Impact Assessment assumes proposal will reduce smoking by 2%
(1.5% of which is from the 75% pictorials): the evidence contradicts this
assumption
US Court of Appeal finds “not a shred of evidence” for enlarged health warnings
and finds studies relied upon as “speculative”
Commission own consultant: No difference between 50% and 75% (yet COM IA
claims no less stringent measure available)
Available studies contradict relationship between menthol and smoking initiation
and cessation
Available studies demonstrate that most smokers find conventional format to be
the most attractive and no studies link slim cigarettes or pack formats to the
decision to start or stop smoking
Why does the proposal make it harder for smokers to switch to products deemed
5.
by health experts to be less harmful than cigarettes?

6. Expected economic and social impacts of the proposal
Impact of product bans imposed on millions of smokers
o Big opportunity for smugglers and other criminal elements
o Consequent losses for governments, retailers and broader value chain
o Consequent job losses in growing and manufacturing in the EU
How the homogenization of products affect economic actors
o Pressure for down trading will affect market value
o Unfair competitive advantage to the black market
o Loss of revenues for governments, retailers and broader value chain
6.

7. What this proposal means for consumers
The proposal is contrary to the interests of consumers
Consumer choice will be removed from the legal market but will continue to
exist on the illegal market
Consumers will be exposed to unregulated product on the black market
Public health experts claim that products like e-cigarettes and snus are
substantially less harmful vs cigarettes
o The proposal maintains and extends the ban on snus
o The proposal marginalises e-cigarettes, making them less available
o The proposal stifles further innovations
7.

8. What this proposal means for business in general
The proposal sets dangerous precedents for other businesses:
Deprivation of property without compensation or justification
o What does this mean for the standard of property protection in the EU?
o What does it mean for the ability of the EU to defend export interests abroad?
Smart regulation principles disregarded
o 85,000 responses, mostly against, but widely ignored
o 12 aspects of the proposal never submitted to consultation, 3 explicitly
excluded from the 2010 consultation
o Little regard for the need to produce evidence, even in the context of major
infringements of fundamental rights (no reference in IA to the evidence
provided by the tobacco manufacturers)
The ease with which the Commission’s own commitments to good
practice were set aside is of general concern to the business community
8.