Showing papers by "Jeff Collin published in 2007"

"The law was actually drafted by us but the Government is to be congratulated on its wise actions": British American Tobacco and public policy in Kenya.

Abstract: Background and objective: British American Tobacco (BAT) has historically enjoyed a monopoly position in Kenya. Analysis of recent tobacco control debates and a case study of BAT’s response to the emergence of competition in Kenya are used to explore the company’s ability to shape public policy and its treatment of tobacco farmers. Design: Analysis of internal industry documents from BAT’s Guildford depository, other relevant data and interviews with key informants. Results: BAT enjoys extensive high-level political connections in Kenya, including close relationships with successive Kenyan presidents. Such links seems to have been used to influence public policy. Health legislation has been diluted and delayed, and when a competitor emerged in the market, BAT used its contacts to have the government pass legislation drafted by BAT that compelled farmers to sell tobacco to BAT rather than to its competitor. BAT was already paying farmers less than any other African leaf-growing company, and the legislation entrenched poor pay and a quasi-feudal relationship. BAT’s public relation’s response to the threat of competition and the ministers’ public statements extolling the economic importance of tobacco growing suggest that BAT has manipulated tobacco farming as a political issue. Conclusions: The extent of BAT’s influence over public policy is consistent with the observations that, despite ratifying the Framework Convention on Tobacco Control, progress in implementing tobacco control measures in Kenya has been limited. The benefits of tobacco farming seem to be deliberately exaggerated, and an analysis of its true cost benefits is urgently needed. Tobacco farmers must be protected against BAT’s predatory practices and fully informed about its activities to help them have an informed role in policy debates. As image, particularly around the importance of tobacco farming, seems key to BAT’s ability to influence policy, the truth about its treatment of farmers must be publicised.

Transnational tobacco company influence on tax policy during privatization of a state monopoly: British American Tobacco and Uzbekistan.

Abstract: Objectives. The International Monetary Fund encourages privatization of state-owned tobacco industries. Privatization tends to lower cigarette prices, which encourages consumption. This could be countered with effective tax policies. We explored how investment by British American Tobacco (BAT) influenced tax policy in Uzbekistan during privatization there. Methods. We obtained internal documents from BAT and analyzed them using a hermeneutic process to create a chronology of events. Results. BAT thoroughly redesigned the tobacco taxation system in Uzbekistan. It secured (1) a reduction of approximately 50% in the excise tax on cigarettes, (2) an excise system to benefit its brands and disadvantage those of its competitors (particularly Philip Morris), and (3) a tax stamp system from which it hoped to be exempted, because this would likely facilitate its established practice of cigarette smuggling and further its competitive advantage.. Conclusions. Privatization can endanger effective tobacco excise policies. The International Monetary Fund should review its approach to privatization and differentiate the privatization of an industry whose product kills from privatization of other industries.

Thailand—lighting up a dark market: British American tobacco, sports sponsorship and the circumvention of legislation

Abstract: Objective: To examine how British American Tobacco (BAT) used sports sponsorship to circumvent restrictions on tobacco promotion in Thailand, both a key emerging market and a world leader in tobacco control. Method: Analysis of previously confidential BAT company documents. Results: Since its inception in 1987, BAT’s sports sponsorship programme in Thailand has been politically sensitive and legally ambiguous. Given Thailand’s ban on imported cigarettes, early events provided promotional support to smuggled brands. BAT’s funding of local badminton, snooker, football and cricket tournaments generated substantial media coverage for its brands. After the General Agreement on Trade and Tariffs decision that obliged Thailand to open its cigarette market to imports, Thailand’s 1992 tobacco control legislation established one of the world’s most restrictive marketing environments. BAT’s sponsorship strategy shifted to rallying and motorbike racing, using broadcasts of regional competitions to undermine national regulations. BAT sought to dominate individual sports and to shape media coverage to maximise brand awareness. An adversarial approach was adopted, testing the limits of legality and requiring active enforcement to secure compliance with legislation. Conclusions: The documents show the opportunities offered by sports sponsorship to tobacco companies amid increasing advertising restrictions. Before the 1992 tobacco control legislation, sponsored events in Thailand promoted international brands by combining global and local imagery. The subsequent strategy of “regionalisation as defensibility” reflected the capacity of international sport to transcend domestic restrictions. These transnational effects may be effectively dealt with via the Framework Convention on Tobacco Control, but will require the negotiation of a specific protocol.

The invisible hand: how British American Tobacco precluded competition in Uzbekistan.

Abstract: Background: Tobacco industry documents provide a unique opportunity to explore the role transnational corporations (TNCs) played in shaping the poor outcomes of privatisation in the former Soviet Union (FSU). This paper examines British American Tobacco's (BAT's) business conduct in Uzbekistan where large-scale smuggling of BAT's cigarettes, BAT's reversal of tobacco control legislation and its human rights abuses of tobacco farmers have been documented previously. This paper focuses, instead, on BAT's attitude to competition, compares BAT's conduct with international standards and assesses its influence on the privatisation process. Methods: Analysis of BAT documents released through litigation. Results: BAT secured sole negotiator status precluding the Uzbekistan government from initiating discussions with other parties. Recognising that a competitive tender would greatly increase the cost of investment, BAT went to great lengths to avoid one, ultimately securing President Karimov's support and negotiating a monopoly position in a closed deal. It simultaneously secured exclusion from the monopolies committee, ensuring freedom to set prices, on the basis of a spurious argument that competition would exist from imports. Other anticompetitive moves comprised including all three plants in the deal despite intending to close down two, exclusive dealing and implementing measures designed to prevent market entry by competitors. BAT also secured a large number of exemptions and privileges that further reduced the government's revenue both on a one-off and ongoing basis. Conclusions: BAT's corporate misbehaviour included a wide number of anticompetitive practices, contravened Organisation of Economic Cooperation and Development's and BAT's own business standards on competition and restricted revenue arising from privatisation. This suggests that TNCs have contributed to the failure of privatisation in the FSU. Conducting open tenders and using enforceable codes to regulate corporate conduct would help deal with some of the problems identified.