Tag: FITA

Is it time to quit smoking

News: Government must consult stakeholders before future tobacco bans.

The Fair-Trade Independent Tobacco Association (Fita) has dropped its case against government over the tobacco sales ban.

In terms of the settlement reached this week, Cooperative Governance and Traditional Affairs Minister Nkosazana Dlamini-Zuma had agreed to follow a public participation process before reinstating the ban, if at all in the future.

“Any invitation to or announcement of a consultation process will be issued publicly. Fita and any other interested parties would then be free to participate in that process,”

“Any future decision regarding the prohibition of the sale of tobacco and related products, if any, shall be taken in accordance with the law and the requirements of legality.”

The parties have agreed to pay their own costs  both in the high court.

Tobacco Ban: Which smokers are paying the most, and least, for lockdown cigarettes

SA smokers hankering for a puff during lockdown have been paying through the nose for their habit, with prices soaring by an average of 250%, TimesLive reported.

This pegs one box of 20 cigarettes at as much as R114, with black market prices rising significantly with the extension of the tobacco ban during level 3 of the national lockdown.

The study, conducted by the University of Cape Town’s research unit on the economics of excisable products, found that Capetonian smokers were hardest hit.

There are substantial differences in the price increase between the provinces.

  • The Western Cape recorded a 379% spike,
  • the Northern Cape at 367% and
  • Eastern Cape at 281% have experienced the largest increases,” the report reads.
  • Prices in Gauteng rose 152% compared to prices before lockdown.
  • Following on was Mpumalanga with 141%.
  • The cigarettes in Limpopo were the cheapest, with prices rising by 123%.

The study found that before the lockdown, nearly 80% of smokers surveyed enjoyed cigarette brands produced by multinational companies like British American Tobacco, Philip Morris International, Japan Tobacco International and Imperial Tobacco.

“By early May this percentage had decreased to 38% and by early June 2020 to 18%,” the report found.

Local tobacco producers had stolen significant market share during the lockdown, with Gold Leaf Tobacco and controversial Carnilinx making up 26% and 14% of the preferred brands while cigarettes have been outlawed.

“None of the top 10 cigarette brands that were most purchased by our survey respondents, pre-lockdown are in the top 10 list of cigarette brands purchased during the lockdown.”

Researchers noted that the Fair-Trade Independent Tobacco Association’s (Fita) court case to have the sales ban lifted was “ironic”.

“This because their members have benefited disproportionately from the sales ban. They have greatly increased their share of the market within our sample and sold their cigarettes at hugely inflated prices.

“The extraordinary profits likely earned during the lockdown 4 period will allow them to oppose tobacco control reforms more effectively in future. For example, they could engage in legal battles with the government over the Control of Tobacco Products and Electronic Delivery Systems Bill or Track and Trace systems,” the study found.

“Being able to produce cigarettes legally for the export market, but not able to sell cigarettes in SA, has created a loophole and an incentive to sell illegally in the very lucrative local market. Manufacturers will find it difficult to resist this temptation, especially because so many companies are selling cigarettes, despite the sales ban.

“Given the tobacco industry’s long record of involvement in illicit trade, it is likely that they will divert cigarettes, ostensibly destined for the export market, to the local market.

“The multinationals have been the biggest losers during the lockdown period,” the report reads.

Most of those who had quit smoking during the lockdown did so because of price gauging, and not because of concerns over their health.

“We predict that, once the sales ban is lifted, there will be a price war, in which the multinationals will aim to get some of their market share back and the non-multinational companies will aim to hold on to their markets.”

This could see cigarette prices plummet, a move which would be detrimental to public health.

Instead of imposing a sales ban to prevent people from smoking cigarettes, the government would have been able to achieve a similar outcome by substantially increasing the excise tax. Most smokers that have quit smoking during lockdown did not quit because of health concerns or because they wanted to follow the government’s regulations, but because the illegal market that was created by the lockdown made cigarettes unaffordable.”

Cigarette Ban: Pretoria high court to hear FITA’s application for appeal next week

The North Gauteng High Court on Thursday said it would hear the Fair-Trade Independent Tobacco Association’s (FITA) application for leave to appeal the dismissal of its challenge to South Africa’s ongoing ban on cigarette sales, next week.

The matter has been set down for July 15, FITA’s chairman, Sinenhlanhla Mnguni, said.

On June 26, a full bench of the high court dismissed the challenge brought by the association against the ban, which was extended indefinitely by Cooperative Governance Minister Nkosazana Dlamini Zuma in April, with costs.

FITA has asked for urgent leave to appeal directly to the Supreme Court of Appeal and is challenging last month’s ruling in full, including the cost order.

We’ve just received confirmation from the Gauteng Division of the High Court in Pretoria that our application for leave to appeal the ruling of 26 June 2020 dismissing our cigarette ban challenge will be heard on the 15th of July 2020,”said Sinen Mguni, chairperson of FITA,

It should, FITA said in application papers, have found the test was whether something was “absolutely necessary”.

The court also erred in its application of the rationality test, which goes towards whether imposing a ban on cigarette sales was rationally linked to the purpose for which the government promulgated regulations in terms of section 27 of the act.

The court held that rationality was not a particularly stringent test and it had been satisfied by Dlamini Zuma in her reasoning for prohibiting the sale of tobacco products.

“The question before the Court is rather, having regard to the  evidence considered and relied on by the minister, could it be said that there is enough to conclude that the prohibition placed on the sale of tobacco products is  justified?” the judges held.

“In our view the answer is clearly in the affirmative.”

Lawyers for the minister argued that, based on the available scientific research, the government imposed the ban to prevent hospitals being overrun with smokers who presented with severe Covid-19 symptoms.

FITA disputed the scientific evidence and has done so again in its application for leave to appeal, but argued that to a large extent it was irrelevant because the rational foundation for the minister’s actions fell away unless it was proven that people had stopped smoking en masse as a result of the prohibition on cigarettes.

“The court erred in not finding that the ban in the regulations is based on  the fundamental false premise that if a certain number of people are  prevented from gaining access to cigarettes and tobacco products for a  limited period of time they will cease to be ‘smokers’,” the association said.

The ban is also being challenged by British American Tobacco SA. Their case will be heard in the Western Cape High Court in early August. It is estimated the ban has cost the fragile South African economy billions of rands a month and boosted the illegal cigarette trade.

 

Source: African News Agency

Lockdown: FITA lodges leave to appeal ruling that kept cigarettes banned

The Fair Trade Independent Tobacco Association has lodged an application for leave to appeal a court ruling that dismissed its challenge to overturn the state’s ban on the sale of cigarettes.

Its application was submitted in the High Court in Pretoria on Friday.

Last month the same court dismissed FITA’s initial challenge to overturn the ban on the sale of tobacco and cigarettes. These have been banned since the start of the lockdown in late March.

Cigarette companies have argued that the ban led to hundreds of millions of rands in lost sales while contributing to the growth of an illicit tobacco market.

The state has defended the ban is necessary for health reasons.

In its application for leave to appeal, FITA argues that the court made a number of errors in its reading of the Disaster Management Act, among other points

 

Source: News24

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