Session III.

Tobacco Industry Interference with Tobacco Control (2 hours)

Session Objectives: At the end of the session, the participants should be able to: State the legal definition of TI interference Identify and discuss the various TI Tactics Diagnose the vulnerability of their agency to TI interference Relate past experiences of the agency of TI and Deepen their advocacy to resist TI Interference and be clarified of misleading beliefs of tobacco marketing strategies

Agenda:
This session will expose the tobacco industry's strategies that block the implementation of health policies of the government. Accounts of TI interference in the Philippines will be presented as proof that it is real and it is happening; and to make the participants realize their agency's vulnerability to interference. The participants are expected to relate to the cases particularly those who can draw from their own experiences. A. TI Interference Definition (10 minutes) Participants are provided with the legal definition of TI interference and the motives behind it. B. Identifying TI Tactics (50 minutes) A full spectrum of TI tactics documented in the Philippines, Australia and other neighboring countries are presented in this part of the seminar. It shows how the industry pushes for philanthropic initiatives in effort to make itself relevant. It also shows how the industry conducts itself in misleading the public, influencing high-level government officials, lobbying against legislation relative to tobacco control and intimidating through legal and economic threats. C. Actual Cases of TI in Government (1 hour) To given an idea of how TI interference occurs, the Session will present actual cases as documented by advocacy partners such as the SEATCA and HealthJustice. The cases covered are those prior and after the issuance of the 1

JMC. This is to caution and give the participants an idea of how interference happens.

Activities/ Notes:
A. TI Interference Definition (10 minutes) 1. Discuss the legal definition of tobacco industry interference. Tobacco Industry Interference refers to a broad array of tactics and strategies used by the tobacco industry to interfere with the setting and implementing of tobacco control measures (i.e., lobbying, giving gifts/donations to government officials and employees). 2. Elaborate and give examples to give the participants a working definition of TI interference. Focus on the motives behind the interference. B. Identifying TI Tactics 1. Using SEATCA's publication, the Tobacco Industry Interference in Health Policy in South East Asian Countries1 , lead the discussion of the various tactics employed by tobacco companies to derail the implementation of tobacco control policies in the Philippines. How Does the Tobacco Industry Influence Tobacco Control Policies and Derail Effective Regulation? Depending on the circumstances, the industry has been known to use any one of the following methods or a combination of them. It is very versatile, largely depending on how much a government is receptive to the industry and engages with it. However, due to the sensitive nature of the information and lack of disclosure, it is often hard to obtain evidence for this kind of information. The industrys tactics to undermine and subvert tobacco control policy include: Interfering with FCTC ratification and / or implementation Requesting to be part of any national or sub-national tobacco control task force or committee Promoting voluntary regulation in the place of legislation
SEATCA, Tobacco Industry Interference in Health Policy in South East Asian Countries (Bangkok, Thailand, February, 2009), pp.3 -11
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Drafting and distributing industry-friendly sample legislation Submitting position papers/letters/comments to policy makers that directly oppose stringent measures or offer diluted tobacco-friendly alternatives to them Conducting a public misinformation campaign related to any stringent tobacco control measure through news items, ads, posters Threatening to sue the government or a government official or institution Challenging government timelines for implementing laws (e.g. seeking an extension of deadlines for compliance of legislation), or exploiting legal loopholes Providing incentives to government officials and politicians to take a pro-industry position Hiring former prominent government officials or appointing them to be tobacco industry spokespersons, liaison officers, board members, etc. Citing trade or economic issues as an excuse for why a health (tobacco control) measure cannot be adopted Using a third party or front group (farmers, retailers, hoteliers, academicians, youth groups, etc.) to oppose tobacco control or public health initiatives Gaining favor by funding government non-tobacco-related health initiatives(e.g. nutrition, malaria, disaster relief, etc.) Promoting and funding youth smoking prevention programs Conducting other corporate social responsibility activities (e.g. scholarships, educational, art or sport programs, environmental initiatives, research programs, etc.) Organizing study tours abroad for members of parliament or government officials Organizing study tours for journalists

Industry Is the Problem, Not A Stakeholder In Public Health Since 2003, as set forth in Section 29 of Republic Act 9211 (Tobacco Regulation Act 2003), the Philippine Tobacco Institute (PTI) and the National Tobacco Administration (NTA) sit as members of the Inter-Agency Committee-Tobacco (IACT) tasked with the laws implementation. This is because Section 29 of the law requires a tobacco industry representative as a member of the IACT. Because the IACT has the exclusive power and function to administer and implement the provisions of RA 9211, this enables PTI to interfere in decision-making despite their obvious conflict of interest. This inclusion of a tobacco industry representative in the IACT has been 3

questioned repeatedly by tobacco control advocates. In 2008, there were also reports that Philip Morris Philippines Manufacturing Inc. (PMPMI) requested to be involved in the meetings of the Legazpi City Anti-smoking Committee. Diluting Governments Efforts To weaken strong tobacco control laws, the industry is known to draft and distribute tobacco-friendly sample legislation to the government as a readyto-adopt alternative. In 2006, the Philippine Tobacco Institute (PTI), of which PMI is a member, requested for a 4-month delay in compliance with the law mandating a change in pack warning placement in July that year. In 2008, JTI and PTI (representing PMPMI, and local companies: Fortune, Mighty, and La Suerte) presented position papers and made presentations in public hearings at the lower and upper houses of Philippine Congress in order to oppose the graphic health warning bills. Japan Tobacco International (JTI), through its counsel, even submitted proposed specific amendments to the graphic health warning bill filed. A Philippine Congressman representing a tobacco growing district, in response to the tobacco industrys request, sent a letter to the Department of the Interior and Local Governments (DILG) to interpret the Outdoor Ad Ban provision to broaden exemptions for the tobacco industry. This letter was used to seek an intervention from the DILG to order local government officials to refrain from indiscriminately implementing the advertising ban. The confusing message of the DILG resulted in local governments being hesitant in implementing the outdoor tobacco advertising ban. In the Philippines the tobacco industrys dooms day tactics to oppose the introduction of graphic health warning (GHW) measures included an unfounded prediction of potential economic collapse and devastation of the tobacco farmers. Besides maintaining close contact with policy makers to soften their antitobacco stance, the industry also involves third parties to exert pressure and champion its cause. It is to reinforce an impression on the lawmakers that indeed farmers, retailers, restaurateurs and others named by the industry are going to be badly affected. In 2008, Congressmen of the major tobacco producing provinces used tobacco farming concerns to oppose a graphic health warning bill during legislative committee hearings and meetings in the Philippines. 4

Mission Misinformation: How It Is Done The industry is known to misinform the public and the government with half-truths and lies over the years. One of the better known deceptions is the use of descriptors such as light and mild which have been known to mislead smokers into thinking that such light, mild, and low tar cigarettes are less harmful to health than regular cigarettes. Scientific evidence has proven that there is no health benefit to smoking light, mild, and low tar cigarettes and that smoking such cigarettes carries the same risk of lung cancer, heart attacks and other tobacco-caused disease as regular cigarettes. In 2006 in the Philippines, despite not meeting the compliance deadline set by law, PMPMI issued a sworn statement that they had not committed any violation of RA 9211s health warning provision when in fact, the legal mandate and deadline for compliance is clear under the law. In supporting its argument, PMPMI used a personal (neither legal nor official) opinion given by the Secretary of Health in an ambush phone patch interview as evidence in their favour. The following year, after a lower court ruled in their favour, Fortune Tobacco issued numerous misleading press statements regarding the interpretation of RA 9211s outdoor advertising ban provisions, based on a decision that is not final. PTI also issued statements that they are complying with the law. Then in 2008, PMPMI sent official statements to the media announcing that they are complying with the law with regard to their sponsorship of the Eraserheads concert and that it does not involve a violation of the mass media advertising ban. PMPMI later withdrew sponsorship after the Department of Health threatened legal prosecution. Threat: See You In Court While ASEAN governments may hesitate to file suits against the tobacco industry, the industry on the other hand commonly uses threats of court action to protect its profits. However, such threats are seldom executed because a good relationship with the government is important. To date the industry in the Philippines is perhaps the boldest in the Southeast Asian region to actually take the government to court. In 2007, for example, PTI challenged the IACT in court regarding the definition in RA9211 of outdoor advertising at points-of-sale.

In 2008, a Quezon City councilor who allegedly owns a bar that has PM advertising, submitted a pro-industry amendment to the Outdoor Advertising Ban City Ordinance that has the effect of allowing outdoor tobacco ads practically in every place where cigarettes are sold.11

Stretching the Timeline: Implementation Can Wait In 2006, the Philippine Tobacco Institute and its members including PMPMI, BAT, and JTI requested a 4-month postponement/delay of implementation of the RA9211 deadline that required the industry to print 30% text warnings on the front of tobacco packages despite knowing about the deadline 3 years before.

Lack of Transparency: Closed Door Deals In June 2008, Congressmen from the tobacco-growing region of the Philippines were mobilized by the tobacco industry to oppose the Graphic Health Warning bill at the Technical Working Group meeting under the Lower House Health Committee.

Industry Appointment: Having Influential Personalities on its Board The industry engages personalities of influence into their companies as directors or similar decision-makers so that they can persuade government policy makers through their established networks and influence. In the Philippines, former Congressman Salacnib Baterina has been a counsel for PTI since 2007. Another prominent figure, Antonio Abaya, a retired army general, has been the president of Fortune Tobacco, for more than 20 years. Lucio Tan, a prominent businessman owning an estimated 300 companies is the owner of Fortune Tobacco. Lucio Tan is believed to have a close relationship with retired members of the judiciary, some of whom are rumoured to be retained as consultants in some of his businesses. These rumors became more pronounced when Tan was acquitted in a tobacco tax evasion case. In the meantime, JTI has hired a prominent law firm a leading lobby group of government agents. Senate and Congress staff in the Philippines have noticed the frequent visits of lawyers from this firm in the Senate and Congress Offices in relation to the pending GHW bill. An Associate of the 6

firm that has very recently left the firm went on to become special consultant to two Senators for opposing the GHW. Violation: Caveat Emptor (Let the Buyer Beware) In the Philippines, child vendors (formerly known as jump boys) sell small items including loose cigarettes to make a living. In an internal industry document of Philip Morris employment of these kids have been described as an accepted practice. Corporate Social Responsibility: The Way to Buy Goodwill Tobacco companies sponsor community activities and projects that are associated with the poor. However no amount of community work can exonerate an industry peddling a product that is addictive, causes diseases, and brings early death. Between 1994 and 2007, PMPMI held its PM Philippines Arts Awards and in 2007 and 2008, it introduced the Bright Leaf Agriculture Journalism Awards. Recent contribution to schools also manifested in the form of donation of three Toyota Corollas by PMPMI to support the Department of Educations Adopt-a-School Programme 2008 by PMPMI through its affiliate, Philippine Band of Mercy (PBM). Fortune Tobacco Corp. also donated to the Adopt-a-School programme. In 2007, while continuing to promote its cancer-causing products, PMPMI ironically presented a cheque to a cancer group based in Bantangas where its manufacturing plant is located. During that same year, many press releases were issued by PMPMI when it opened a Regional Warehouse in Subic Bay Freeport Zone. The story highlighted to boost the Philippine economy and failed to mention the addiction and deaths its products cause. To facilitate its public relations effort, reporters were invited to tour the PMPMI factory and subsequently a late evening documentary on a major television network featured the plant tour. 2. As an alternative, ASH's Guide to Identifying TI Interference may also be used which is summarized below: Most TI tactics can be categorised under five main industry goals reinventing the image, influencing friends in high places, astro-turfing or using third parties posing as grass roots front groups, intimidation and TAPS - tobacco advertising,promotion and sponsorship. There are numerous examples and case studies to draw upon but examples below have 7

been chosen to illustrate the most recent tactics occurring in Australias dark market. Reinventing the Image through public relations, funding researches in universities and other CSR activities Influencing friends in high places for political support and lobbying, for enhancing its image, promoting weaker agreements instead of legislation, claiming failure of tobacco control policies in other countries Astro-turfing: using third parties and funding front groups and think tanks Intimidation through litigation, legal and economic threats, illicit trade threats and using international trade treaties. Tobacco advertising in point-of-sale, sports and entertainment, packaging, internet and films. Other suggested references: World Health Organization, Tobacco Industry Interference. Switzerland, 2008 ASH Australia, Countering Tobacco Tactics: A Guide to Identifying, Monitoring and Preventing Tobacco Industry Interference in Public Health. Anne Jones and Stafford Sanders, Australia, 2010, pp. 8 to 18

As synthesis, the facilitator asks the group to play a Reverse Charade. A member of the group picks a word about TI interference strategy and acts out while the group members try to guess the word. Each group will be given 1 minute to guess. Other groups may steal. The group with the highest points win and gets 5 points. The group with the second highest points gets 3 points.

C. Actual Cases of TI in government before and after the issuance of the JMC (1 hour) 1. Present the past and recent TI interference documented and compiled by various advocacy partners: 1.1 Documented Incidents of Tobacco Industry Interference by the HealthJustice Inc.

a. DAR Cavite In February 23, 2012, the Provincial Office of the Department of Agrarian Reform (DAR) in Cavite announced that the Palangue agrarian reform cooperative in the municipality of Naic has received Four Hundred Thousand Pesos (P400,000.00) worth of financial support from the Philip Morris Fortune Tobacco Corporation (PMFTC). Provincial Agrarian Reform Officer (PARO) Cynthia Lapid said the financial help was given to sustain the cooperatives vegetable trading, loan assistance, mini-grocery and selling other products such as liquefied petroleum gas (LPG) and other farm supplies. Although the recipient of PMFTCs financial support was a non-government cooperative, the involvement of DAR Cavite in awarding the same is an unnecessary interaction with a tobacco company. Under the Department of Health (DOH) and Civil Service Commissions (CSC) Joint Memorandum Circular No. 2010-01 (JMC 2010-01), public officials and employees shall interact with the tobacco industry only when strictly necessary for the latters effective regulation, supervision or control. All other interactions, such as facilitating a financial grant from a tobacco company to a nongovernmental cooperative, falls under the category of an unnecessary interaction, which is prohibited under the JMC 2010-01. Moreover, DAR Cavites participation with PMFTCs financial aid program created an impression of a governmental partnership or collaboration with PMFTC, which is also prohibited under the JMC 2010-01. Source: http://www.dar.gov.ph/index.php?option=com_content&view=article&id= 256:farmers-cooperative-in-cavite-receives-financial-support-fromprivate-corporation-dar&catid=65:latest-news&Itemid=239

b. Marikina Local Government

In December 27, 2012, Chris Nelson (left), president of Philip Morris Fortune Tobacco Corp. Inc. (PMFTC), and Marikina City Mayor Del de Guzman handed out emergency packs 9

to victims of typhoon Pablo in Barangay Nangka, as part of the activities under the Embrace projects. Embrace, in partnership with the American Chamber Foundation and the local government of Marikina, aims to provide victims with first-aid kit, sleeping mat, whistle, and towel, reusable drinking bottle, two kilos of rice, and flashlight during disasters. Embrace embodies the wide-ranging corporate social responsibility (CSR) programs of PMFTC that target communities where PMFTC has manufacturing plants, and communities in tobacco-growing regions of the country. Marikina is home to Fortune Tobacco Corporations largest tobacco manufacturing facility. Although the local government of Marikina did not receive any monetary contribution from PMFTC, its participation in the latters CSR activities constitutes an unnecessary interaction with the tobacco industry, which is prohibited undder the JMC 2010-01. This involvement with PMFTCs CSR activities created a perceived partnership between the tobacco industry and Marikina local government, which it should correct pursuant to the provisions of the JMC 2010-01. Source: Malaya, December 27, 2012 issue c. Subic Bay Metropolitan Authority On March 26, 2012, Philip Morris International (PMI) started a medicine supply program for the indigenous Ayta tribe living within the Subic Bay Freeport, turning over the first batch of medicines worth P125,000.00 for the Ayta tribe through the Subic Bay Metropolitan Authority (SBMA) which undertakes community development projects at the Pastolan Ayta village. In the photograph isSBMA Chairman Roberto Garcia (second from right), who received the medicine donations on behalf of the Ayta tribesmen from Atty. Wilma Eisma, local regulatory affairs and community relations manager of Philip Morris Philippines Manufacturing, Inc. (PMPMI). With them are SBMA public relations manager Armina Belleza-Llamas, and SBMA public health and safety manager Dr. Solomon Jacalne. Garcia noted that, Philip Morris, along with the Air21, has always been a partner of the SBMA in its many community service projects that seek to expand health and educational assistance to the communities around the Subic Bay Freeport. In this scenario, PMFTC gave medical assistance to an Ayta community, and coursed such assistance through a government agency, SBMA.This is an 10

unnecessary interaction with the tobacco industry, which is prohibited under JMC 201001.Further, the statement of the SBMA Chairman, describing Philip Morris as a partner, and the publication of the medical assistance given, created the perception of a partnership between SBMA and Philip Morris, which is also prohibited and must be corrected pursuant to the JMC. Source: http://www.sbma.com/index.php?module=pag emaster&PAGE_user_op=view_page&PAGE_id=276

1. 2 Provide other examples of Tobacco Industry Interference based on the FCTC Article 5.3 Toolkit of SEATCA and HealthJustice To illustrate further, here are some of the tobacco industrys more common tactics to undermine tobacco control activities and fight tobacco industry regulation. Early in 2009, the Philippines Bureau of Internal Revenue awarded a Billionaires Club Award to Philip Morris as one of the highest taxpayers. Many other businesses have received the award, but only Philip Morriss award was widely publicized. This created a perception of partnership with the government.

In April 2009, Philip Morris and the Department of Environment and Natural Resources (DENR) of the Philippines signed a Declaration of Mutual Cooperation where Philip Morris donated trashcans with ashtrays to DENR for use in public places. Studies suggest that the presence of ashtrays encourage or remind people of smoking. Ironically, DENR is the agency in charge of implementing the Clean Air Act, which bans smoking in all indoor spaces.

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In early 2009, Philip Morris approached the Philippines Bureau of Customs to sign a Memorandum of Agreement with the company regarding counterfeit cigarettes. At that time, negotiations were ongoing for a Protocol on Illicit Trade of Tobacco Products, where governments had been asked to send representatives from the customs and law enforcement offices. Around this time, PhilipMorris also offered their security marking system for possible adoption by the Philippine government.

2. As you report, ask the participants to recall and reflect if their agencies have had similar interaction with the TI. 1 or 2 participants may be asked to share with the group their past experiences. 3. At appropriate points, ask the participants to diagnose how vulnerable their agencies are to interference and make them take note of this for the action planning exercise in the afternoon.

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