Copy No. STRICTLY CONFIDENTIAL TO NO. Is OF ASSOCIATED COMPANIES SMO=G AND HEALTH Develorments since March 1969 Since the document attached to Mr. D-zbscn's letter of 25th March 1969 was sent to all Yo- Is there have been certain major developments which have led us to re-examine our policy in this matter. In the U.S.A. an Act has recently, been si.Szed. by the President which makes it illegal to ad-vertise cigarettes an TV or radio after Ist Januazy -1971. In Canada the Report of the House of Commors Standing Committee on Health, Welfare and Social Affairs on Tobacco and Cigarette Smoking was published in December 1969. Despite the Canadian tobacco industry's well prepared and presented evidence at the Hearings the report was Inteasely hosti-le to the industry and recommended phased legislation which would lead to the elimination of all cigarette advertising and promotional activities within four years- It remains to be seen what legislative action the Canadian government will take. In the U.K. the Royal College of Ph.,-sicians has just published its Report on Jfiir Pollution, Thia contains only minor references to the dangers of cigarette smoking but it -will be followed i-n the autumn, of this year by a fu-11 sca-le Report b7 the R.C.P. on Smoking and Health which is expected t_- be extremely hostile to the industry and recommend Scvern- ment action, particularly in the fields of Fdvertising and promotion. At the plenary session of the Pon-American Health Organisation in September 1969 a resolution was passed C:) co c0 Qn C711 BATCo document for Province of BritiSh Columbia 29 October 1999 requesting the Director to report to the next plenary session on:- (a) Measures which have been taken to control the advertising of cigarettes by restriction or by the inclusion in promotional material of appropriate warnings. (b) Other possible methods of warning the public. (c) Measures which might be taken to control smoking in places of work or in public galleries. In furtherance of a resolution adopted by the World Health Organisation, the Director General submitted to the World Health Assembly on May Ist 1970 a report on Smoking and Health prepared by Professor C.M. Fletcher and Dr. Daniel Horn. The first tnio recommendations of this Report were:- (1) Legislation should be enacted to place the tar and nicotine content on cigarette packets and in advertisements as well as a warning of the health hazards entailed in cigarette smoking. (2) The advertising and promotion of cigarettes should be reduced, with a view to its eventual elimination. A summary showing the existing situation worldwide regarding enforced or voluntary restrictions in the use of advertising media is attached (Appendix A). At a meeting of the American Cancer Society in New York on 5th February this year, Doctors Hammond and Auerbach announced that tumours had been produced in the lungs of animals by cigarette smoke. Although the experiment has not yet been published in any scientific journal it was claimed that a number of beagles who smoked either plain or filter cigarettes through tubes inserted in the trachea developed tumours in their lungs and two which smoked plain cigarettes developed malignent lung tumours of a type similar to that found in human lung cancer. Other work in Germany and the U.K. which will be published in due course has shown that tumours can be produced in the lungs of other experimental animals (rats and hamsters) by cigarette smoke. Following consideration of the implications for the B.A.T. Group of the developments referred to above, CD Ln 0 :) c0 VI -Ii BATCO document for Province of BritiSh Columbia 29 October 1999 - 3 - it is thought desirable to set out revised guidelines to be observed wherever possible in fu-hire by members of the Group in their approach to the smoking and health controversy. B.A.T. LeadershiD The fact that we are the largest tobacco company in the world, with extensive interests in many countries, imposes on us the responsibility to persuade other members of the industry to agree to behave in ways - likely to safeguard the future of the industry as a whole. Wherever we can we should exercise leadership within the industry on the question of Smoking and Health whenever this subject is raised. The growing threat to the industry in a number of countries is that its operations will be seriously restricted by legislation. B.A.T. should not subscribe to industry attitudes which we consider are, through their intran- sigence, likely to provoke the legislation we seek to avoid. Our aim is to persuade all those concerned - other members of the industry, members of the medical profession and Governments - towards courses of action which are designed to preserve the industry's long term commercial interests and at the same time to be as reasonable and realistic as possible in the light of scientific developments. B.A.T. Policy 1. As indicated above, the over-riding policy of B.A.T. is to discourage and delay the process of restrictive legislative action by governments in every way possible so as to allow maximum time for research to establish the precise relationship between cigarette smoking and lung cancer and other diseases so that the possibility of any injury to the smoker's health can be diminished or eliminated. In order not to provoke government acthn it seems prudent to avoid linnecessary con-flict between the industry, the medical authorities and government. The medical authorities are the strongest single influence on government restrictive action in the field of smoking and health. They are also the arbiters of the health effect of any product changes we may make. In the last analysis, therefore, the views of informed medical authorities will affect the future of the industry. U4 C) (.n CO co Ln CO BATCo document for Province of British Columbia 29 October 1999 An important objective of the industry must therefore be to obtain the goodwill of influential medical opinion and to avoid adopting attitudes which provoke unnecessarily the hostility of the medical profession. While in the past it has seemed good sense for the industry to contest the validity of all the evidence against smoking (and may still be necessary to avoid damages in lawsuits), there is little doubt that the inflexibility of this attitude is beginning to create in some countries hostility and even contempt for the industry among intelligent, fair-minded doctors. As these are among the people whom the industry most seeks to influence it is thought that we should reconsider our basic answer on the question of causation which it is suggested should be expressed in future as follows:- "As tobacco manufacturers we are not competent to express any authoritative view on a medical matter. We recognise that a substantial number of medical authorities have expressed the opinion that a causal relationship has been established between cigarette smoking and lung cancer and certain other diseases, while some doctors and other scientific experts have expressed doubts about some of the evidence. It seems to us that, in the absence of clinical proof of the mechanism involved, causation at the present time remains an open question. A solution to the problem will only be found through research and, since the matter first arose, the industry itself has made and is continuing to make the major contribution in this field." The opportunity should also be taken to recall the statement in the 1962 Report of the Royal College of Physicians that smoking is "a habit which most smokers enjoy without injury to their health". Reference could also be made to the benefits which smolers derive from the habit and in this context to the comments which appeared in the 1964 Report of the U.S. Surgeon General which read as follows:- "What would satisfy the psychological needs of the 70,000,000 Am-ericans who smoked in 1963 if they were suddenly deprived of tobacco? ...... If the thesis is accepted that the fundamental nature of man will not change significantly in the foreseeable future, it is then safe to pre- dict that man will continue to utilise pharma- cologic aids in his search for contentment." C:) Un 00 CO Ul .10 BATCO document for Province of BritiSh Columbia 29 October 1999 - 5 - 2. If we consider that the adoption of this more realistic view of the evidence is likely in the end to be more effective in securing the survival of the industry, we should not react to the aggressive tactics of anti-smoking lobbies by adopting similar tactics our- nelves, e.g. while concurring with the extracts from the Ri!pni-1; clijoLed nbovn, wo :.11otiJd no[, Lnitiat(- widespread propaganda on the benefiti: of muokine in order to retaliate against those who exhort smokcrs to relinquish the habit. We believe that hostility or exagg(,-rated self-defence on our part, particularly on a public platform, is apt to breed hostility and self- ,],~fence in others; and that attack is liable to create counter attack and accelerate the process of legislation. In the long run, therefore, it is likely to be aamaging to B.A.T., and to the industry to act as though a "war" exists between the industry and the government on Smoking and Health. If a "war" exists, or is believed to exist, then it is one which in the end we stand to lose. Some form of agreement or compro- mise between the industry and the government is inevitable in order to maintain the industry's survival and prosperity. Our policy in summary, therefore, is that negotiation should be pursued to its limits, both within the industry and between the industry and the medical authorities and government, in order to fend off anti-smoking legislation. 3. To this end it is important that, in those countries where the industry is carrying out or sponsoring research of any kind, it should keep the medical authorities fully informed and welcome their collaboration and advice. It should also make known to them the extent of the research effort by the industry in other countries. Details of research expenditure up to the end of 1969 by the B.A.T. Group are attached (Appendix B). In countries where the local industry has sponsored no research to date, it should provide the Ministry of Health or appropriate medical authority with information about industry research in other countries. In this connection it is appreciated that the provision of information about industry research into Smoking and Health may lead the medical authorities to comment that the fact that the industry is heavily involved in research of this nature is tantamount to an admission by it that its products are harmful. To deal with this situation, if it arises, it may be useful to quote from the document attached at Appendix C which sets out the reasons why the Group is engaged in research. 4. An agreed industry approach should be sought in all countries, because individual and differing company U4 C) C=) Ln co 00 BATCo document for Province of BritiSh Columbia 29 October 1999 - 6 - responses demonstrate uncertainty and dissension within the ranks of industry in the eyes of governments and single-minded anti-smoking groups. Such discord can only damage the interests and reputation of the industry. 5. It follows that it is the duty of associated companies to be well-informed on government attitudes to Smoking and Health, forewarned and alert to likely government action, knowledgeable about ministerial intentions and the influence ancl ;--ignificancr, of anti-smokinG groups. G. What legislative action are governments most likely to take? (a) Prohibition of smoking. This can probably be discounted owing to the fact that governments are loath to interfere with the liberty of the individual to this extent or to face the political consequences of such interference. Governments are also aware of the dangers of removing the means which smoking provides of meeting the psychological and pharmacological needs of many people. (b) Excessively high taxation as a means of stopping cigarette consumption. This would present governments with severe problems of tax evasion and smuggling and is therefore unlikely to be acceptable to them. (c) Prohibition of cigarette advertising and other forms of promotion. (d) Publication of tar and nicotine figures. (e) Cautionary labelling. 7. In support of accepted commercial practice in free enterprise countries, B.A.T. is opposed in principle to the imposition of restraints or restrictions on advertising, coupon trading or other types of promotion. B.A.T. considers that smoking is an adult choice and does not direct its advertising at the young. There is little or no evidence that advertising increases total consumption. We believe however that legislation is worse for the industry than self-imposed restraints. Voluntary restrictions present the industry in a more favourable light than the imposition of legal controls or prohibitions and all the bad publicity for the industry which they engender. We also believe that, provided there is unanimity of action by the industry, companies within the Group in certain countries and in certain circumstances may Un 00 CO BATCO document for Province of British Columbia 29 October 1999 - 7 - derive benefit from offering to accept voluntary restrictions at a significantly earlier stage than the moment when legislation is the only alternative. For instance, if by offering voluntary restrictions at an early stage the industry could gain the goodwill of the medical authorities and the government or bring about a significant change in the attitude of the medical profession w!lich was previously hostile to it, then such a move would be in the long-term interests of the industry. There is a natural reluctance to accept voluntary restrictions, but, when viewed objectively, it may be less harmful than might be supposed to forfeit the use of one or more of the normal advertising media. It might in certain circumstances not be harmful at all. For example, if one of the normal advertising media were to be replaced by effective merchandising aimed directly and solely at the consumer (i.e. at point of sale), then this might be less likely than TV, Radio, Cinema and Press advertising to aggravate the opponents of smoking. In the wea of sales promotion, enticements or incentives which could be construed by the opponents of smoking as appeals to children, such as sweets, toys, children's games or children's gramophone records should of course be avoided. B. It should be emphasised that an offer by the industry to institute voluntary restrictions does not necessarily imply that it accepts that such concessions are justified by known facts. Offers of this kind are made in deference to the strongly held view of a number of people who consider that the smoking habit is offensive and potentially dangerous and that it should be discouraged. We believe that the first step in a more conciliatory policy, is for the industry in each country, if it has not already done so, to agree to a voluntary advertising code which defines certain restrictions in the content of advertisements (e.g. no health claims, no appea2s to the young, etc.) It is difficult to set out guide lines as to the order of priority in which, when the industry deems it advisable, voluntary restrictions beyond those in the advertising code should be offered. Priority will obviously depend very much on the immediate circumstances, the media in use and the local importance of each of these media. An important factor to be taken into consideration by all associated companies, who may be faced with decisions as to whether the industry should offer to accept partial or total restrictions of advertising media, is their own share of the market. LP4 Ln CC) c0 (7% t1 J BATCO document for Province of BritiSh Columbia 29 October 1999 - 8 - Companies with a dominant share of the market can face limitations with much more equanimity than companies with a minority share, whose chances of increasing this share would be prejudiced by the loss of advertising facilities. It seems to us desirable that associated companies in the latter position should seek out alternative concessions to voluntary media restriction which might be offered to governments which are likely to ask for some positive action by the industry. Having chosen one or other of these alternative concessions, the problem still remains of convincing the rest of the industry that this is the most desirable step to take, but alternative concessions to voluntary media restrictions, which might be considered, are:- (a) Publication of Tar and Nicotine Figures The publication of tar and nicotine tables seems relatively harmless. Publication of such figures may indeed be of real help to the industry since they give nervous smokers an opportunity to continue to smoke with what they see as relative safety. The industry should however never put itself in the position that by offering to publish tar/ nicotine figures it is implying that some cigarettes are "safer". If there is to be any suggestion of this, it must come from the government. The industry should aim wherever possible, if league tables are to be published, to get tar and nicotine firmly separated in the public mind. The least objectionable solution, if both are to be published, would be to have tar given in specific figures and nicotine merely in range, e.g. high, low, medium. Each company should have available a brand which will appear at or very near the bottom of tar and nicotine tables. Obviously also it must ensure that the filter version of any one brand yields less tar than the corresponding plain version. Experience shows that publication of tables damages the brand at the top and helps the brand at the bottom but does little else to affect consumer preference. In talking to the government about publication of these figures it is essential that the industry should advocate the appointment of an independent laboratory to carry out the tests and it is suggested that, when the International Standardisation Organisation method of analysis comes into world- wide use after September 1970, this should be the method adopted to ensure uniformity. co co BATCo document for Province of BritiSh Columbia 29 October 1999 - 9 - If the government requests the industry to take steps to reduce the tar/nicotine content of their brand, publication of the figures by an independent laboratory makes known to the public that the industry is cooperating in a responsible manner and tends to reduce the pressure on government from anti- smoking elements in the country. Allied to this there is the question of the possibility that governments may in future define what is the maxi tar/nicotine content that is acceptable in a cigarette. Such action might be welcome to the industry, in certain circumstances, such as a fall in total consumption, because the definition of an acceptable level of tar/nicotine in itself implies to the public that cigarettes meeting these standards are "sa-fe", even if the government has not explicitly said this. However, the industry must ensure that the level set is still an acceptable smoke for the consumer by putting forward to govern- ment the point that if the level is so low that the con-miner does not get adequate satisfaction, he may well increase his personal consumption to achieve this. As regards the printing of tar/nicotine figures on packs it is recommended that this should be strongly resisted, because there are very great practical difficulties for the industry in such a move. The arguments to be put forward to gove = ent on this score are that because of the time factor and the difficulty of guaranteeing exactly similar blending, the figures on individual packs could be highly misleading. Furthermore, this method does not allow the consumer to make an easy comparison between brand figures, whereas the publication of brand tables does. Although, as previously emphasised, the industry must not in putting forward this argument imply that it accepts that the choice of a brand low in the table is a "safer" choice. (b) Cautionar7 Labelling on Packs Cautionary labelling, providing the wording on the pack is relatively innocuous aad in small print, might well be less harmful than voluntary restrictions on the use of advertising media, particularly to a company with a minority share of the market. Obviously it is desirable that the label wording should use a phrase such as "may be harmful to health" rather than "causes lung cancer". Cautionary wording in adver-lising should not be considered as a voluntary concession. U4 co CD C71% Xh- BATCo document for Province of British Columbia 29 October `1999 - 10 - (c) "Moderation" Campaign The Group has always taken the attitude that it is opposed to smoking to excess and that it is sensible for consumers to exercise moderation in smoking as in other things. One of the concessions which industry might make would be to offer to government to help finance, within their means, an advertising campaign advocating moderation in. smoking. Any such offer would have to be conditional on the wording of the advertisements being acceptable to the industry. The campaign itself would of course be organised and run by the government and there is little reason to suppose that its effect on total consumption would be drastic. In view of the fact that the sensational lung cancer warning poster campaigns in the U.K. had little effect on total consumption, it is unlikely that a "moderation" campaign would hit the industry hard, but the industry would be recognised by government and the public to be taking a responsible attitude in cooperating in this field. GCH/FRH C) Ln CO OD BATCo document for Province of BritiSh Columbia 29 October 1999 Lel'-LNVIA A GOVERNMENT REGULATIONS AND VOLUNTARY RESTRICTIONS BY THE INDUSTRY IN THE USE OF ADVERTISING MEDIA SUMMARY OF WORLDWIDE SITUATION - MAY 1970 N.B. This -summary does not include details of advertising codes referring to the content of advertisements. This summary is based on the information currently available to us. If this information is inaccurate or out of date on major points, amendments from associated companies would be welcome and these will then be circulated. I. AFRICA (a) Congo Under an industry self-imposed code no advertisements are placed with Radio, no health claims are made, no coupon or additional value schemes are undertaken, television advertising has been eliminated and newspaper ads. are limited to a maximum size of a half page. This voluntary agreement Congolaise des Tabaco in either party, subject to (b) EthioDia/Eritrea In May 1965 a Government banning radio advertisir43 was signed by Tabacongo and Compagnie June 1968 and may be terminated by three months' written notice. Ordinance was brought into effect of all tobacco products. (c) Kenya Before Rothmans ceased trading in Kenya they had signed an agreement with B.A.T. in this territory to the effect that neither company would use TV in their cigarette advertising campaigns. This code was evolved for financial rather than controversial reasons and is still observed by B.A.T. Kenya, who have also undertaken not to make health claims. (d) Mauritius When TV was first introduced into Mauritius in 1964 certain restrictions regarding cigarette advertising became immediately applicable. These were that no local brand could be advertised except STATE EXPRESS 555 Filter Kings which, although manufac- tured locally, is considered to be an 'imported' brand, and that any 'imported' brand spot should not be broadcast before 9 P.M. (e) Rhodesia The Rhodesian tobacco industry observes a voluntary agree- ment to-restrict TV advertising expenditure to a maximum of E15,000 for each company per year. C:) LJn 00 co BATCo document for Province of British Columbia 29 October 1999 (f) Zambia There has been no government intervention in the operations of the industry in Zambia as yet, but a voluntary ban on TV advertising of tobacco products is observed. However, use of all other media is made by tobacco companies. 2. CENTUAL AMENUGA (a) Costa Rica In September 1969 the tobacco industry in Costa Rica was suddenly faced without warning with proposed legislation that would reauire a health warning on tobacco products and on all advertisements of them. The bill is expected to come up for consideration by the Legislative Assembly during the session beginnin May 1970. SOUTH AMERICA (a) Argentina A law was promulgated in February 1970 prohibiting for one year the advertising of national and imported cigarettes on TV, Radio and Cinema. (b) Chile The P.R. Officer of the Ministry of Health published an article in April last year stating that the Minister was about to present a bi.11 which would oblige all companies connected with drinkin and smoking to contribute to the Ministry a similar amount of money to that which they used for their advertising campaigns. Subsequently tobacco products were withdrawn from the draft law but Companhia Chilena de Tabacos, which is the sole manufacturer in Chile, decided to withdraw all media advertising as a precautionary measure and this situation still pertains. (c) Gu7ana In reply to a question in Parliament in September 1969 Dr. Sylvia Talbot, Minister of Health, stated that the Division of Health Education has been emphasising in lectures the dangers that can result from cigarette smoking. Dr. Talbot also stated that the Government was exploring the possibility of introducing legislation for the cautionary labelling of cigarette packs and the restriction of advertising. In recent months the industry has been negotiating with the Minister. So far there have been no positive developments. L-j C:) Ln co 00 BATCo document for Province of BritiSh Columbia 29 October 1999 3 (d) Venezuela In September 1967 the Minister of Communications issued an order prohibiting cigarette advertising on commercial television in programmes directed specifically to children or young persons. Following this the commercial TV channels collectively agreed that they would not transmit cigarette commercials prior to 7 P.m., with the exception of programmes specifically adult-orientated. 4. AUSTRALIA Federal and State Health Ministers met in June last year to consider the results of a survey which had been carried out on smoking among schoolchildren by the National Health and Medical Research Council, and also to consider another Report which the Council had made to them. This Report called for health warnings and tar/nicotine ratings to be printed on cigarette packs, legislative restriction on all forms of advertising and legal administration of radio and T.V. time for anti-smoking broadcasts. At the beginning of March this year at a meeting of the Health Ministers it was stated that five States were ready to enforce cautionary labelling on packs but that no action would be taken until all States agreed on uniform legislation. Latest indications are however that for the present several States are not prepared to proceed with legislation. 5. NEW ZEALAND In April 1963 there was brought into force a complete Broadcasting Corporation ban on advertising cigarettes and cigarette tobacco on TV and Radio. 6. EUROPE (a) BelRium Agreements regarding cigarette and tobacco advertising have existed in Belgium since the creation of the "Federation des Industries de Tabac" (Fedetab) in May 1947. These are reviewed regularly and the last revision took place in November 1966. These agreements bring into operation restrictions on automatic vending, give-aways, price, health claims, and a total ban on television and radio advertising. (b) Denmark In 1962 cigarette advertising on TV was prohibited. C:) C=) Ln 00 c0 C11. c0 BATCo document for Province of BritiSh Columbia 29 October 1999 (c) Finland The Tobacco Manufacturers' Association advised the Minister of Commerce and Industry in June 1969 of certain voluntary restrictions it would institute for the industry. These included a complete ban on cinema advertising and certain limitations on TV and print media advertising. (d) France There is a government imposed ban on all cigarette advertising on television. (e) Holland The Dutch industry entered into an agreement in June 1964 not to advertise on TV. (f) Iceland A law was passed In Iceland in May 1969 to the effect that all cigarette packs should be printed with the label "WARNING: Cigarette smoking can cause lung cancer and heart diseases". (9) Italy A law bannin cigarette advertising on any media at all was passed in Italy in 1962. (h) Norwa7 In March this year the Norwegian Parliament received a report from the Social Committee proposing cautionary labelling on packs and restrictions on "the scope of advertising". (i) Sweden On 17th February the Ministry of Health held a press conference at which it called on the industry to prohibit or heavily restrict all outdoor advertising. It also proposed that a scheme should be evolved, in consultation with the industry, to introduce cautionary labelling on all forms of advertising. In March the goverment announced that it was setting up a committee to investigate the changes in the constitution that would be needed to ban the advertising of tobacco products and alcohol. (j) Switzerland There is a government ban on TV and Radio advertising which has been in force for some years. LP4 C:) U"i co 00 BATCo document for Province of British Columbia 29 October 1999 5 7. INDIA There is a voluntary restriction in force whereby the Cigarette Manufacturers' Association does not use radio advertising. 8. PAKISTAN In 1963 the government enforced a ban on Radio advertising of tobacco products. Recently the Central Board of Television Film Censors banned the advertising of cigarettes and other tobacco products, and also sponsored progra-es by cigarette manufacturers, before 8 p.m. 9. U.S.A. The President has signed the new Cigarette Advertising Bill. This Bill prohibits all radio and TV cigarette advertising as from 1st January 1971. As from November Ist 1971 all cigarette packs will have to carry an amended cautionary clause reading "The Surgeon General has deter- mined that cigarette smoking is dangerous to your health". 10. U.K. In 1965 the Government banned all cigarette advertising on television. The Royal College of Physicians will probably be publishing its new report on Smoking and Health in October. It is considered likely that this report will recommend that the government should prohibit all forms of cigarette advertising. 11. CANADA The Report of the House of Commons Standing Committee on Health, Welfare and Social Affairs on Tobacco And Cigarette Smoking was published in December 1969. A summary of the recommended legislation was given at the end of the report, and this reads as follows:- (i) Immediate "freeze" on cigarette promotional expenditures. (ii) One year from enactment of legislation Complete elimination of free distribution of cigarettes and of all coupon and premium schemes. No cigarette advertising on television or radio before 10 p.m. C-A C:) C:) Ul co co -4 BATCo document for Province of BritiSh Columbia 29 October 1999 - 6 - WaTming on all cigarette packages and cartons, in all cigarette advertising and promotional materials and on all cigarette vending machines. Government authorized statements of tar and nicotine levels on all cigarette packages and cartons, in all cigarette advertising and promotional materials and on all cigarette vending machin s. (iii) Two years from enactment of legislation Prohibition of cigarette advertising on television and radio. Prohibition of other than simple brand name advertisements in remaining media. (iv) Four years from enactment of legislation Complete elimination of all cigarette promotional activities. (v) Date of effect unspecified Cigarette vending machines be placed only where they can be under continuing observation by responsible persons and that prominent display of cigarettes be discouraged. Establishment of standards for cigarettes with respect to "fuse" characteristics. It is not yet known what legislation the Minister of Health will recommend to the Canadian cabinet. GCH/FRH U4 U1 CO 00 BATCo document for Province of British Columbia 29 October 1999 APPENDIX B B.A.T. GROUP SMOKING & HEALTH RESEARCH EXPENDITURE (Currency figures converted at current exchange rates) Ist March 1970 Country U.K. - B.A.T. U.S.A. Germany Australia Canada Holland Switzerland South Africa Calendar Year 1969 UlD to 31.12.1969 Z 704,000 Z4,671,500 1,174,819 Z 489,508 4,695,174 L179567322 DM 2,450,000 AC 269,083 DM 15,235,000 Z1,673,256 Z 228,596 Z 106,671 1,743,347 L 813,508 0 192,600 L 74,219 1,686,100 L 649,749 f 85,000 E 9,783 f 238,400 Z 27,440 Fr 31,600 Y, 3,056 Fr 99,700 Z 9,642 L 2,000 Z1,656,720 E9,803,417 Approximate Totals over LIJ million nearly X10 million Q%4 CD C:) (-n co c0 -4 rQ BATCO document for Province of British Columbia 29 October 1999 APPENDIX C RESEARCH INTO TOBACCO PRODUCTS AND THEIR USE Smoking has become an important social question. It is enjoyed by large numbers of people and in varying degrees is of importance to them. But evidence from epidemiological studies suggests that smoking may well be causally related to lung cancer and other diseases. It is true that the epidemiological evidence might support the hypothesis that there is a substantial minority of people pre-disposed to cancer and other diseases. If such people could be identified early enough, it might be possible and would surely be desirable to persuade most of them not to smoke or to reduce their smoking or to modify the way in which they smoke. However, even if it were acceptable as social policy, attempts to end the smoking habit for all, by enforcement or persuasion do not appear to provide a practical answer to the social question. In so far as they are successful such attempts, if pushed too far, may well create new social dangers. Therefore, so far as can be foreseen smoking will remain an important social habit bringing to large numbers of people enjoyment and content- ment in varying degrees. Hence, while recognising social responsibilities, those in the industry recognise also their duty to do their best for consumers consistent with the duties and responsibilities all companies have-to the State, the employees, the shareholders and others. These views are reflected in our research objectives which, in addition to making our products as pleasing, satisfying and competitive as we can, include the investi- gation not only of all evidence that smoking may be harmful but also all such allegations and all serious suggestions for the improvement of our products in these respects. Significant developments in this latter field are not being achieved quickly or easily. There are several large areas where we are still quite ignorant and where progress is slow. For example, we have very little knowledge of smoking behaviour either with reference to the way individual cigarettes are smoked by different people or to the way changes in cigarettes affect the overall smoking patterns of people. Further, although conscientious empirical development over many years has led to products most satisfying to consumer needs, we have only a little know- ledge of the factors which lead smokers to prefer different cigarettes or indeed to smoke at all. We know that the pharmacological effects of nicotine are likely to be very important for some smokers at some times but we are also aware that psychological factors are also important. These psychological factors are related C) to the package presentation, colour, aroma, etc. as well as to the act of smoking itself. It is a question of CD judgement at present whether to regard these effects and factors as separable and whether to regard one or another 00 BATCo document for Province of British Columbia 29 October 1999 - 2 - as more important. If nicotine is the main f actor, we may regard it as important to measure other smoke constituents in relation to the amount of nicotine made available to the smoker and to provide the smoker with a choice of nicotine Contents. But these other factors such as packaging, appearance, tobacco quality, firmness of the cigarettes, weight of tobacco may be more important to some smokers. None of these factors alone can be considered as an objective measure of value of subjective smoking experience. Thus only the consumer can evaluate 'Smoking products in terms of the money he pays and in the end it is competitive presentation of choice that ensures that the smoker gets value for his money. Our research and development aims can thus bro'Adly be resolved into producing different smoking experiences associated with minimum undesirable side- effects and minimum cost. U-J C) C) V1 co co BATCo document for Province of British Columbia 29 October 1999