It has for the first time admitted to having nearly $30 million invested in tobacco companies. The figures were provided in an answer to a budget estimates question asked by the Greens NSW MP John Kaye.

The NSW Treasury Corporation, known as TCorp, has at least $28.7 million invested through two trusts, the NSW Treasurer, Mike Baird, revealed.

For months, the government has refused to answer questions about its tobacco investments, which are managed by independent fund managers.

Mr Baird, and the NSW Minister for Health, Jillian Skinner, both said on Tuesday the government would review its investment in tobacco companies, and give a decision by the end of the year.

The chief executive of Action on Smoking and Health Australia, Anne Jones, said it was hypocritical for the government to allow tobacco investments when they could be easily screened out.

The director of the Public Health Advocacy Institute, Mike Daube, said he was appalled government money was invested in tobacco companies, particularly as tobacco control programs had had their funding cut in recent years.

“It is unacceptable. Sixty years after we learnt of the dangers of smoking, one million Australians have died because they smoke, and the state government shouldn’t be profiting from that,” he said. “They should take their investment out of tobacco and put it into tobacco control.”

Dr Kaye said the government could no longer hide behind the excuse of fund managers controlling investments.

He said Mr Baird had only provided him with data for two of 12 trusts.

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John Seffrin, chief executive of the American Cancer Society, issued this warning while speaking at a high-level forum of the world’s 100 leading cancer experts gathered in the Swiss resort of Lugano.

They said governments must do far more than they have done to control the global tobacco industry, either by raising cigarette prices dramatically, outlawing tobacco marketing or by taxing the multinational profits of the big cigarette firms.

According to scientists, smoking kills more than half of all smokers, mostly from cancer, and yet despite it being the single biggest avoidable risk of premature death, there are about 30 million new smokers a year.

They said that if the current trends continue – with cigarette companies targeting the non-smoking populations of the developing world – then hundreds of millions of people will be dying of cancer in the second half of this century.

Some of the experts attending the World Oncology Forum went further by calling for an outright ban on cigarettes and for the tobacco industry to be treated as a terrorist movement for the way it targets new markets with a product that it knows to be deadly when used as intended.

“We have a major global industry producing a product that is lethal to at least half the people who use it. It will kill, if current trends continue, a billion people this century,” the Independentquoted Dr Seffrin as saying.

“It killed 100 million in the last century and we thought that was outrageous, but this will be the biggest public health disaster in the history of the world, bar none. It all could be avoided if we could prevent the terroristic tactics of the tobacco industry in marketing its products to children.

“There is a purposeful intent to market a product that they know full well will harm their customers and over time will kill more than half of them. The industry needs to be reined in and regulated,” he said.

Worldwide, tobacco causes about 22 percent of cancer deaths each year, killing some 1.7 million people, with almost 1 million of them dying from lung cancer. Yet the numbers of new smokers among the young is rising faster than the numbers giving up.

The latest study into the health effects of smoking, which was published in The Lancet and involved 1.3 million women, showed that tobacco is even more dangerous than previously supposed but the benefits of giving up smoking are greater than expected.

Sir Richard Peto of Oxford University, a co-author of the Million Women study who worked closely with Sir Richard Doll, is also the scientist who first calculated how many people this century will die from tobacco-induced cancers.

“We have about 30 million new smokers a year in the world. On present patterns, most of them are not going to stop, and if they don’t stop, and if half of them die from it, then that means more than 10 million a year will die – that’s 100 million a decade in the second half of the century,” Professor Peto said.

“So this century we’re going to see something like a billion deaths from smoking if we carry on as we are. In Europe we have about 1.3 million premature deaths per year now, of which about 0.3 million are deaths by tobacco. There’s nothing else as big as that.

“If you put all causes together, you wouldn’t get a total that’s half of that caused by tobacco, and tobacco kills more people by cancer than other diseases. Smoking is still the most important cause of cancer… If you smoke a few cigarettes a day, it will be the most dangerous thing you do,” he added

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Li, set to succeed Wen Jiabao as premier early next year, could boost his reputation as a populist leader and deflect criticism from rivals if his younger brother, Li Keming, is transferred from his position as deputy director at China’s State Tobacco Monopoly Administration, Cheng Li, a Brookings senior fellow, wrote in a report. He said Li Keming’s prominent role in the agency that runs the world’s biggest tobacco company may have set back efforts to control tobacco in the country.

Public opinion in China is becoming more important on social issues including health, environmental protection and food safety, Brookings’s Li said today. China has more than 300 million smokers, and at least 1.2 million die from smoking- related diseases each year, a figure set to rise to 2 million a year by 2020, according to the report, released two weeks before China begins a once-a-decade leadership transition.

“In all these areas, I think leaders should set examples,” Brookings’s Li said in an interview. “Particularly now that many countries, including Russia and India, are paying more attention to public health issues.”

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Philip Morris Norge suffered what some local legal experts called a “crushing defeat,” however, when the Oslo City Court (Oslo Tingrett) upheld the state law. The court ruled that the ban on exposure of tobacco products (now kept out of site for consumers who must ask for them) did not hinder trade and  would be legitimate even if it did.

A spokesman for Philip Morris Norge refused to say why the company had decided not to appeal the city court ruling, calling its analysis of the ruling “internal information.”

A state prosecutor told newspaper Dagens Næringsliv (DN) that the state was “very well satisfied” with the outcome of the court case. He thinks the ruling can have consequences outside Norway’s borders as well, since it was the first test in the European economic area of the legality of such a ban on tobacco display, and other countries have evaluated imposing similar bans.

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The website, www.tobacco.money.com, also encourages lawmakers and legislative candidates in Oklahoma to sign a pledge to not accept campaign contributions, meals or other gifts from any tobacco company political action committee or from any registered lobbyist for a tobacco company or tobacco trade association.

Dr. Robert McCaffree, co-director of the Oklahoma Tobacco Research Center, said a clear correlation exists between tobacco industry contributions and the suppression or opposition of legislation intended to reduce tobacco use in the state.

Since 2006, state legislators now in office have accepted $242,719 in campaign contributions, meals and other gifts from tobacco lobbyists and tobacco company political action committees, according to the website. Nine representatives and 11 senators have accepted at least $3,000.

The website’s author, Doug Matheny, is the former director of tobacco prevention at the state Health Department; he retired in February 2011 after 28 years of service. “For decades, we’ve watched tobacco lobbyists manage to kill bills they oppose and pass bills they support,” he said.

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“The tobacco industry is seeing a major return on its investment in Oklahoma’s political system,” said Robert McCaffree, MD, Co-Director of the Oklahoma Tobacco Research Center. “There’s a clear correlation between tobacco industry contributions and the suppression or opposition of legislation intended to reduce tobacco use in our state, particularly among legislators accepting campaign contributions from tobacco company PAC’s.”

Since 2006, Oklahoma state legislators now in office have accepted $242,719 in campaign contributions, meals and other gifts from current tobacco lobbyists and tobacco company PAC’s. Separately, over $50,000 has been accepted by various statewide House or Senate election committees. The highest total amount taken since 2006 by any individual representative is $6,298 and by any individual senator is $11,239. Nine representatives and 11 senators have accepted a total of $3,000 or more.

“The more light we can shine on industry efforts to stop meaningful tobacco prevention measures, the less effective those efforts will be,” says Laurent Huber, executive director of Action on Smoking & Health (ASH). A national leader in the fight on tobacco, ASH is focused this election year on political contributions. “Oklahoma’s website is a model we hope to help replicate in all states, said Huber.”

According to the Oklahoma Ethics Commission, there are 11 individuals currently registered to lobby the Oklahoma legislature on behalf of tobacco companies or tobacco industry trade associations. The tobacco lobbyists and listings of their clients are shown on the website.

“For decades, we’ve watched tobacco lobbyists manage to kill bills they oppose and pass bills they support,” said Doug Matheny, the website’s author. “Even if it never influenced legislation, money distributed by tobacco lobbyists should be refused as a matter of principle. Accepting money or gifts from representatives of an industry that addicts young people to deadly products is inconsistent with Oklahoma values. Most tobacco lobbyists in Oklahoma take direct orders from companies that federal courts recently found guilty of racketeering.” Matheny is the former director of tobacco prevention at the Oklahoma State Department of Health. He retired in February 2011 after 28 years of service.

“Speaking on behalf of physicians now starting practices in Oklahoma, our legislators need to take a stand for health,” said Chris Sudduth, MD, MPH of Tulsa. Dr. Sudduth is Chair of the Oklahoma State Medical Association Resident and Fellow Section. “These powerful tobacco lobbyists and their money should be rejected. Business as usual must change.”

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Top Recipients of Tobacco Lobby Money in the Oklahoma House of Representatives*

Top Recipients of Tobacco Lobby Money in the Oklahoma Senate*

* Since January 1, 2006

Health & Economic Impact of Tobacco in Oklahoma*

• Number one cause of preventable disease and premature death, killing an estimated 6,000 Oklahomans each year.
• For every person who dies from tobacco use, another 20 are suffering with at least one serious tobacco-caused disease.
• The vast majority of tobacco users become addicted as young people. If current trends continue, an estimated 87,000 Oklahoma youth alive today will ultimately die early from smoking.
• Most current tobacco users in Oklahoma want to quit and have tried many times.
• Every pack of cigarettes sold costs Oklahoma’s economy an estimated $7.62 in medical expenses and lost productivity caused by premature death and disease.

Federal Racketeering Conviction of Major Tobacco Companies*

• On August 17, 2006, Philip Morris, Altria, R.J. Reynolds, Brown and Williamson, Lorillard, American Tobacco, and British American Tobacco Company were found guilty in U.S. District Court of racketeering and conducting a conspiracy. The decision noted that they have not ceased engaging in unlawful activity and that “their continuing conduct misleads consumers in order to maximize Defendants revenues by recruiting new smokers (the majority of whom are under the age of 18), preventing current smokers from quitting, and thereby sustaining the industry.”
• On May 22, 2009, a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit issued a unanimous opinion upholding the District Court judgment.
• On June 28, 2010, the U.S. Supreme Court declined to hear appeals in the case, thereby allowing the federal racketeering conviction to stand.

ABOUT TOBACCOMONEY.COM

The purpose of tobaccomoney.com is to help expose and eliminate the influence of the tobacco industry in the Oklahoma State Legislature through public awareness and by encouraging the refusal of all campaign contributions and gifts from all registered tobacco lobbyists and tobacco company PAC’s. No disrespect towards any individual person is intended. The databases on the website are compiled using information available to the public from the Oklahoma Ethics Commission. For more information, please contact Doug Matheny at contact@tobaccomoney.com or 405-474-8381.

Philip Morris Australia, now known as Philip Morris Asia, will argue the treaty prevents Australia from depriving a Hong Kong entity of its investments or subjecting it to ”measures having effect equivalent to such deprivation”. Which it does, with a caveat. As a party to the treaty, Australia is permitted to deprive a Hong Kong company of its investments so long as it does so ”under due process of law for a public purpose related to the internal needs of that party on a non-discriminatory basis”. So Australia ought to be in the clear.

But the almost comic attempt to get mileage out of the treaty (moving from Australia to Hong Kong in order to complain that it was being discriminated against because it was from Hong Kong) masks a broader, more serious attempt to turn trade treaties into instruments that allow corporations to sue governments.

The World Trade Organisation allows no such thing. Its disputes settlement procedure allows a nation to haul another nation before a disputes settlements panel, but not corporations to do so.

That could be why on Friday it will be Ukraine that will ask the WTO to set up a panel to hear its plain-packaging dispute with Australia rather than a tobacco company. There’s a suspicion that Ukraine is acting on behalf of a tobacco company, perhaps fuelled by its ranking on the Transparency International Corruption Perceptions Index (at the corrupt end of the scale, sandwiched between Russia and Zimbabwe) and by the fact that it has next to no tobacco trade with Australia.

The dispute will take four months to hear. With appeals, it could take up to 14 months. But it won’t unduly trouble Australia. A member of the WTO rather than a corporation will be taking action, it will have to show clearly how Australia’s plain packs law offends against WTO rules (which allow non-discriminatory measures that benefit health) and because Ukraine’s national interests are not at stake it is likely to run out of enthusiasm before Australia does.

Big Tobacco, and fellow travellers in surprising places, want much more. They want what is known as an Investor State Dispute Settlement Mechanism. They want it in order to allow them to drag Australia and other sovereign governments before specially constituted international courts.

They don’t usually put it that bluntly. Here’s how Philip Morris International put it in a briefing note for the US trade representative negotiating the so-called Trans-Pacific Partnership with 11 nations including Australia: ”Philip Morris International considers the availability of an investor-state dispute settlement mechanism – including the right for investors to submit disputes to independent international tribunals – a vital aspect of protecting its foreign investments.”

It is clear what Philip Morris is getting at. Four of the 30 paragraphs in the briefing note seen by BusinessDay complain about Australia’s plain-packaging law. As it happens, the US trade representative is unable to do the bidding of Philip Morris. US law prevents federal agencies from promoting the sale of tobacco overseas. But the trade representative is willing to do the bidding of other corporations that would like to sue foreign governments in supranational courts.

In fact in all but one of the 13 free trade agreements negotiated by the US, its representatives have managed to insert such a clause. The exception is the free trade agreement with Australia. Although criticised at the time for giving too much away to the United States in return for very little, on the question of an outside Investor State Dispute Settlement Mechanism the Howard government stood firm.

The Gillard government is standing firm, too. The multinational nature of large Australian corporations means it would effectively be giving them (but not our citizens) an international right of appeal against laws approved by the High Court.

The US is unlikely to give up. It already has such a clause in its agreements with Canada, Chile, Mexico, Singapore and Peru – five of the nations that would form part of the Trans-Pacific Partnership.

Its best hope would be that a new Abbott government saw things differently. It would, if it succumbed to lobbying from Australia’s own Chamber of Commerce and Industry. ACCI is lobbying hard, putting out a statement this month headed crudely: ”Australian Foreign Investment Requires Right to Sue Foreign Governments”.

It says its ”campaign” is backed by the International Chamber of Commerce, which is hardly surprising but also hardly a sign the backers have Australia’s interests at heart.

Julia Gillard and Trade Minister Craig Emerson are standing up to them. Will Tony Abbott?

By Peter Martin

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The 2-1 decision by the court in Washington, D.C., contradicts another appeals court’s ruling in a similar case earlier this year, setting up the possibility the U.S. Supreme Court will weigh in on the dispute.

The court’s majority in the latest ruling found the label requirement from the U.S. Food and Drug Administration violated corporate speech rights.

“This case raises novel questions about the scope of the government’s authority to force the manufacturer of a product to go beyond making purely factual and accurate commercial disclosures and undermine its own economic interest — in this case, by making ‘every single pack of cigarettes in the country mini billboard’ for the government’s anti-smoking message,” wrote Judge Janice Rogers Brown of the U.S. Court of Appeals for the District of Columbia Circuit.

The FDA “has not provided a shred of evidence” showing that the graphic labels would reduce smoking, Brown added.

Five tobacco companies representing most of the major cigarette makers in the United States challenged the FDA rules: Reynolds American Inc, Lorillard Inc; Commonwealth Brands Inc, which is owned by Britain’s Imperial Tobacco Group Plc; Liggett Group LLC and Santa Fe Natural Tobacco Co Inc.

The FDA has argued the images of rotting teeth and diseased lungs are accurate and necessary to warn consumers — especially teenagers — about the risks of smoking.

The health agency said on Friday that it does not comment on possible, pending or ongoing litigation. The U.S. Department of Justice, which argued the case for the FDA, said it needs to review the ruling before deciding on next steps.

The Campaign for Tobacco-Free Kids, which has vigorously supported stricter cigarette laws, urged the government to appeal.

“Today’s ruling is wrong on the science and law, and it is by no means the final word on the new cigarette warnings,” said Matthew Myers, the group’s president, in a statement.

YOUTH EPIDEMIC

The Centers for Disease Control and Prevention estimates some 45 million U.S. adults smoke cigarettes, which are the leading cause of preventable death in the United States. And the World Health Organization predicts smoking could kill 8 million people each year by 2030 if governments do not do more to help people quit.

The U.S. Surgeon General warned in March that youth smoking has reached epidemic proportions, as one in four U.S. high school seniors is a regular cigarette smoker, paving the way to a lifetime of addiction.

Judge Judith Rogers, who wrote the dissenting opinion, said the FDA warnings were factual, and necessary to counter tobacco companies’ history of deceptive advertising.

“The government has an interest of paramount importance in effectively conveying information about the health risks of smoking to adolescent would-be smokers and other consumers,” she wrote.

Congress passed a law in 2009 that gave the FDA broad powers to regulate the tobacco industry, including imposing the label regulation. The law requires color warning labels big enough to cover the top 50 percent of a cigarette pack’s front and back panels, and the top 20 percent of print advertisements.

The FDA released nine new warnings in June 2011 that were meant to go into effect this September, the first change in U.S. cigarette warning labels in 25 years. Cigarette packs already carry text warnings from the U.S. Surgeon General.

The ruling against the FDA means tobacco companies will likely not have to comply with the requirements for now, given divergent court rulings.

The U.S. Appeals Court for the 6th Circuit, based in Cincinnati, upheld the bulk of the FDA’s new tobacco regulations in March, including the requirement for warning images on cigarette packs.

The difference in the two cases is that the FDA had not introduced the specific images when the companies filed the 6th Circuit suit. While the Washington suit focused on the images, the appeals court in Cincinnati addressed the larger issue of the FDA’s regulatory power.

Most countries in the European Union already carry graphic images to illustrate the health risks of smoking. Earlier this month, Australia took a further step to limit smoking advertising by banning company logos on cigarette packs, and the EU said it was considering a similar ban.

By David Ingram and Anna Yukhananov

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