Tobacco Strategy Review Team
The eiSlith meeting of the team set up to review
the strategies for the
Croup's To;iacco activities was held on 7th
k?ril.19&7.
Present: 11r. ?. Slneehy, 'Ir. G.L. Dennis, :!r.
3.P. Garraway,
Ar. ?.j. `icketts, !!r. ?,ruell, :1r. D.L. Slobom,
Dr. R. Salter (Secretar-!)-
T*Iha revised v;-rsicn cf rne ~iniices of the
me~~tin; held on 22nd October
l9 iG, ~;Iiicn aa~.' bee-. -,n 23'zd 7;Airuary,
were a6reed.
2. It as ncc2-! z~llc:-
(-.t) IAT.,). -3 ia!:zr _'n zsie year
r-!cr)T,-_3eniin-., the
Lev.:!! oLT ;:ioul.~ bc cz fundamental
nzzoazz:i =2 t;1i~:.-,ta3tt.-, :io~ -- c,:~st. of
t!il:i tionc. sbould ~>e
to ot:zer :ji-L7stin:; I_-:a_--co -d 4,-iatil.
Yhe Chair-_,an 7i-7ort2~i ti.--- htr :.ial wrltten
to I:nasco ve7arding
their su-zesr_~ chat -ote 2F~orz s'.:ould be
appiled to 'projects
aine~ at identL.-:.iir, and aliminaring all
potentially
har-mful ccnsz_':.;,!-it-, fron ci~:arettes. He
had reiteratad the
:'Iis .~;.Is -lot t3 ~a t.-,z -zast eftective
.:ay to pro:.~!-_-- and, i-,: jo-1- lead to a
camazln,z diss-'nation of ~,U; ra3ourc2s.
(c) '.,r. LE-,'n-, anao~;:-a,-ed to
L., 'A.;.,.L.~-.ca oiii:.'cations
oi TL)-.)accu- c:.-.aL iich DRAP
had carri--i L~ur n-i 12" zo i~~enc_;;fi -able
imnrov,!mencs.
-.".Ie C,.air-.an cna: t--r~ a-; inv-i-3tic;atioti
of t.-.e na-!-, ::.~ -.:-2 FiIL-:. ln_~axed r-n a
conput.!r-~.-In.- :;yscam t'l-ey rai3hc be
required fcr 'Lscov4r~ in J~ li:!~acion. T:ili
st-l", had
confin--d c-..z ra,~viir--!nz: ~juc, _,;inc,~
t,,',i as lar--el~ for Zrown
'4111laci-n. cos: ~4oul,: t;,e c*nir-ect to the-
(e) :ir. ~)rac!L re-rce,! ti-.ac it "ad ueciliaa
not to pursue the
noss.,jilltv rif icauiri.-ii, A'2-t as a routQ Lor
obtaining the filter
:1 r. Bruell repor-_-?, :.*.a: ;or: i~
rczzc.'ir.-, ti) instal .3 l,'K:k?,/hour
APEX facilici at --outhamapton ac P cost of
Furcher evaluation -)- potential savins ~hicli
could lie obtained
throu-,h this process -iowad rhac it shculJ :;iv-3
:i varv _,ood return on
in~astment and woull: sho, si-;nificanc
1r.-provements camparud vith
D 11:7 -
it was noted that .'%.nacil had :!ecidt~('. co
subscri'be to the davelopmenc
but Ioasco had not ~gree,~ E-3 contribut-
It was agreed that --ruell should clarify jhether,
tailzinL; into
account the -ID a.;ree-~ent, it is more
advanta;eous to transfer the Ln
expertise on a lumn sum or a rovalc7 ?ayment
lasis. B ATCu. should C)
31 S0 make it clear to I=asco t1hL cer=s under
whiei the tectinolu.-y
N-)
could be transferr3d for use in Cana--
C:)
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BATCo document for Province of British Columbia 25
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4. .!r. Bruell renarred rhac it was iatended to
close the 3erlin DIET
;lant and to supply Cermany from Corby.
It was agreed that ~!r. Bruell and :ir. Llicketts
would consider whether
the ~erli. plant clul-I be soll' to Zouza Cruz.
5. 1!r. Slobom presented the prali-2inary
rec-endations, of tae tea. set
up to consi-ler options for European Hanufacturing
Rationalisacion.
it ;as noted that it was 4-tendea to close
AhrensourZ; and that
followi:~;:, thte closure! of rh2 7,lazx 'a
lierlin, HB uanufaczurn was
lik.ely to be transfarrr!oi to this sita,
t'iere:--y -aining the fiscal
!:cne-:z of jerif- --r. it ',as noce.~. rnat snag;
-ufaczure
,as Also to ), -_ransf!rr~-4 L,)
It -,as j,,ree,' t%at z:-~ c-,tion for !~rus5els
vould be to
close tne Pri,ary '-: .-o r'r-",n rianuiacture For
their
`.'.zescic _r'_t. It Azi a~rL-u t1idc zi-
feasil)_'llcy of transfer:-4n.-
-1- - -
-lar- -an,:zncture t: I-ATC7 be in,,e-3t,-*.-ated
in 7:ore lietail.
It t7as a3r2ed that no 1~urttnr acti,.)r should
~'-e raken t;u Liver::ool
pending 2.,-.;,1e:-entacicn of Lhe So,,champcon
rationalisation and
clarification of t,~e !on.,
,er cerm prosneccs for Ducy Fret~.
6. It was t:iat Leaf buying '~a rar-_'onaiisj
(~orl'.-'Itle and
,;r. rruell as aske-_~ to rrenare appropriace
-iroposals for chis. The
G
-.a.' sc;i-e 8nou. Lc to ensu-c tnr
: r::an su~;,;eszed z-.,it a c all Leaf
for Europe as bou::nc c 1i
7. BARCLAY, t:-., Chalz-7.,t, s-ii- ~:-c i: ;as.
tais uas
positione,j as a ire:-_uL ranr in a foz--.-. iere
ft co.1a be proL'uzadi
1-11.1"J.,oc,11y as '11. la, ;:,Illvary Dr-uct.
it -,aL; autec cnat FAi_!_;:) :Iorri--- sa~
larclay as a na:ur thr2ic and were
li'.ely tu use ever-:; ~1-aans puszl;.~!~ to
cu:-.-_ac t.-,,- Irand. 1,owever, it
had '.)een s,:z_-.este,.i t:iat cldis cc~i~ '-.?
:-v;;rit.~:~-.~.~s since, providing
that %AT were succ-essZul io rebuttin 't tile
attac:~s, the controversy
could actucilly 'oavE! e ~en-zficial eff2cr in
brand
a-araness.
8. It -4as noted tnit iarcla-, hat .2~eaa
reiaunc~iea in cie US i At n
'lus and a~reid rati-i., au::!'jers. "esu.Lts
froia t'.,.,2 re~.ions where the
product hac 'ceen lju-,cnt!,i .3ht,", zz-4tn'Is.
3. :!r. Bruell r,.!portac' continuin-. :;c,,LL
r-!s.ics for narclay froo the
European =r.~ets. 1r. Hurope, zhe pruduct vas
still bauu,i on the
ori,-inal Actron filzar an,.! ~.'as no orc3sure tz
clan.;e at present.
10. It was agr3ed that Eurther c;;nsi'jorat on
shoul-_; be -,,i-:an to t:,,e
possibilities for licencin., the product. It -az
noted t4ac iota the
Frencn and Izalian noijpolias ',id :,ivar. a
ne-;L1tivz_- rev"onse to an
initial approach. !:u-..,evQr, it was uu,~;ested
tiiaz the Spanish and
Portu.-ese =unopolis at,;ht t3e approached and
also Uallaiiers in rhe U.(.
Rothmans was also considered as a possibilLtZ but
tias rejected on the
basis of uncurtainti-is about the future odnership
of tne cuapany.
The Chair~an reiteraced the imporcunc, of ensuring
that the brand LTI
ratiler than the filter was licLnced. Also Lhat
t:-.L- licence should be (Z)
for the latest technolo3y in order that the brand
could be correctly
positioned in the -rket.
... co
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BATCo document for Province of BritiSh Columbia 25
October 1999


11. it was notad chat Souza Cruz -ere still
interested in Barclay and had
now developed an acceptable blend for use in the
product. However,
they did not have the equipment to produce
Acrron-Plus filters and
WOUI(j pceFar to launch ith an ordina:-,- Ac:ron
filter.
Zhe C*hzir-3an a:,:pressed disappoiat-etic the
slow rate oZ Progress in
Brazil and a:;ain repeated :;ie for t1i._- product
to be unequivocally
positioned ac the :cp of the nar'-,c.
V-12 c,lairman also --7,cacaL, :'-.- t- c:!,:nlop
a worldwide strategy for
Uarclav lnc!Udin~; -C~ --ar7-ar:~ is c:,! iLd-:1a!
ZaLt where the brand had
been tinier Przacl- fro7i :'on,; %on.; -.;era
progress had
.!2 .."11 -)r,ell ;-at further
1-1 T~,.e. C!ia_grian zarl- --julc3 Z1:07--,
t'.,,c US re,gional tests of
CAPRI era very ~_,ncuura.,in~ ia_,-Z!:i anzat', or
forecast.
fince cne i~itlal '-ave ~)czn eva_1-.;atz,', c
rsi-.er- n bill - iven
ic F,
to tic,., t.,.e ;-.an,i .,.-: -t I)F! on this will
14. :1r. Slooo,i prLsent~t,i 1 p.-,er possible
o.,cions Zor i7urchasing
che sli.~ir2s 1:i Skandinavisk not :ic-: Cy
It was noce:1 thac t7.e pros..)ecrs ro7 c'ie
'_ibacro lousiness and tli~_
poteatial .iL~e OE t.-., ~.,,ci that it would
di-icult to 3t ~lurcal~se ,alL-z -ic;, -.;ere
likely to
An ad.-litional cons~:rjlrit tiai t-3t
:iar;~:ic.!~ers 'ia.. ~i ri,-ht
o a :Z: ~~IrE rude available
..o,e,er, :as _:t___! f2l~ t:; :cr~: :,ile c-- the
project to
f.r'-ulat.2 a c."!. :.c -).-tc tC, L.:t~ otler
shareholders
sinca, even if th-.!, r~!'~ecct~d t.-._7s, 'it!
inter,2st i:: acaulsition would
.-ia-,e !)een si-7nalle-
It -was notea t.lac t;~,!r;, ccqla :~e
consf~era"L~ a,ivarit_-,C-3 to involvins
3 ATIC in any arran:_-Lnt to purz~ase tt:e
s'iar_is zinc it was agreed that
. Slobom, and :,r. ioull
'it. : cjns-cr furt"licr, wit.i BATIC, 'now
a transfer Lnvolvi.-.. ui.-,hz scructur~-'.
It was also noted t.,ot, Z*irsc -r2,_:E!rencz!
%;ouLi be for a
cish offer, or.rers of -I.N.7 InLluscriLs' shares
~.ruld alt;o '~c
consiaered.
.1 r. SIODUM was asked --L) irafc prcc?csals to
cna s4aretiolders,
for approval by the C?C.
13. 11e,;arding oc!ier pot-itial tt)r expansion,
It
noted that:-
(a) Both Crown & Williamson and 3ATCo. were
continuing to make
substantial pro3ress In Japan with sales in 1567
well ahead
of 1936. LF1
CZ)
-'%ports from Hong Kong inco China -jere Alpo
improvin6 and r%j
Kent was ahead of :iarlboro becauua of sales into
Canton, where it U-1
had been traditionally SLron3- __4
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BATCo document for Province of BritiSh Columbia 25
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- 4 -
(c) Following further evaluation, it had been
decided not to pursue
posslible investment opportunities in Greece.
Turkey -.;as s-tti a.; a :;ood prospect. although
progress had been delayed due to the sickness of
-..ie Pri=e
Mniscer anc. t'-e prLoccupatlon witli We dispuce
with
Greece in t.-.c Ae;;ean.
(e) :t was ioteol ::iat Ar. --ruell intended
di-scussir, ZATIL; how
r2-:irasentat-1~,:i -_'n Italy --c '- Liproved.
16. '!r. 'Ir---11 rcD~;rra~ :-a: it c~,.aC C.-Z
7_'L!Z~:7~e3-1 GO=isSion
a Tax Harmonisation in '.:a-,,.
1 : .,as t1iaie ~rcnosals -,ulc ~'e ar. ad
- _~ 3 7 ~-
c a:: ~,C I ; I L S ( -~ ~; ).: e r 7-:,-1 1 e
:"A7Co- i -.zrer che li'-:217 11:1TIacc Of
--:,is ta;~ -.;a:s r.-.at :hfs sauubi '--a
circulazed to the
,ca-n enuars-
T~.a vic!,.: o.*: tne t2aj set co c-~rsider %inac
prtposals should put
fcrwar~ "As that .1 tar,et tD bill for zmuld :~2
ad valorem
Pl.s 1, Z"~'s :"'r If I- sl~.__l i-
c.ns'~erac_;- is ;~efn -,en -
t- to,, this vi, -1 put
.L)r-.;ard most ~f_f~c:_'vel;-
17. 1: -4.- --c *: -, :i~L -.:~ c.., Conference on
Zpidemiology
;3 s zilso '-i: i !arac~o!-. :i.' 1 ~2 ;t!- it tne
CAC X
e -! t L., 1:3 1 C "2 r t take a
=ore positive stance agairist the anci-smoking
lobby.
.:-. - --c. in Canada, ii'~oiv t-!, cne iealth
:!--nister will be inzr-.)Jucin,~ nore. ji'Ciin
c*.-,.--- nt::ct nonch,
further fr2ttcin Ce.) j.;-rcllii~ ;.0_acc'j
.)rz)';ucts.
2 D. :*-.. Ricketts ro.jur::22 cia: -,as 'jpial
iatz~luc2,_' in I-razil
requirln~-, warning notices c-~ je ott ci;aricce
pac.*.s.
!;owever, !)ecause ef zn,! ota~_-r pressures on
che 6razilian, Covernment,
n.Li' 4!17 E0 la" until
c,i,-:; otad a
ar t:-~
~S/UJA
22 nd April 1937
Ln
c0
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BATCo document for Province of British Columbia 25
October 1999