Tobacco Control Amendment Bill [B7–2008]: public hearings

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06 May 2008
Chairperson: Mr L Ngculu (ANC)
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Meeting Summary

There was general consensus from the non-profit health organisations present that all advertisements should be completely banned from all forms of media. The South African Medical Association recommended that there should be additional definitions for “domestic worker” and “employee” in order to protect workers who work in a home that could be seen as private and therefore an area to smoke and a paragraph should be inserted that provided further a explanation.

Philip Morris South Africa supported the Bill in principle but was concerned with the vagueness of the definitions for “advertisement” and “promotion”. They asked the Committee to revisit these definitions. They provided recommendations that included the maximum number of signs at point of sale be specified, that health warning labels be excluded from shipping cases but included on the actual unit and that their staff be allowed to participate in corporate social responsibility.

The Chairperson noted that the Committee had raised the question of advertising in its broader sense. He wanted the Department’s legal advisors as well as the Chief State Law Advisors to inform the Committee on the legality of the advertising. Other matters that had to be deliberated were corporate social responsibility and signage. Issues around consultation would be dealt with at the next phase of the process.


Meeting report

Review of Bill by the Department
Mr Ramphelane Morewane (Chief Director: Primary Health Care: Department of Health) sketched the background to the Bill. In June 2006 the drafted Bill was separated into Section 75 (national competence provisions) and 76 Bills (provincial competence). The processing of the Section 75 Bill was concluded in February 2008. This was the Section 76 Bill. South Africa was one of the first countries that had ratified the Framework Convention of Tobacco Control (FCTC) and they were compelled to comply with its provisions. The purpose of the Bill was to amend the Tobacco Control Act of 1993, to ensure compliance with the Convention and to close loopholes and strengthen the Act. It also sought to amend and add definitions, better labelling of tobacco products, strengthen the advertising controls and prohibited sales to those under the age of eighteen years. It also expanded the ministerial regulatory powers.
Health Economics Unit: University of Cape Town
Mr Evan Bletcher (Research Economist) was encouraged by the proposals set forth by the Department. He explained that tobacco should be regulated because of the negative externalities and health consequences. He provided statistics that showed that 8.5% of deaths were as a result of smoking in South Africa. He touched on tobacco control in South Africa thus far and the effect of the 1993 legislation. Changes in smoking statistics were shown as a result of this legislation. The 1999 legislation succeeded in raising public awareness about tobacco risks. This further decreased the number of smokers. In 1999 South Africa was a global leader in tobacco control. However, presently South Africa did not meet the minimum requirements as set out by the Framework Convention on Tobacco Control  (FCTC). Tax increases would not affect government revenue. Via a number of graphs it was indicated that even though there had been a decline in cigarette consumption, the tobacco industry had still increased their profits. It was shown that tobacco control was not failing the tobacco farmers. Agriculture has been declining since 1994. Illicit trade was also a concern and could be divided into two groups: smuggling and counterfeiting. Illicit trade was caused by a country's general tolerance of corruption and specific failure to police smuggling.

Mr Bletcher continued that restaurant restrictions were originally set for a blanket ban. However, this was changed when restaurants predicted that revenue would fall by 30%. Restaurants were highly compliant with tobacco legislation without enforcement. A small survey was conducted of restaurants to determine how the legislation had affected their revenue. He found that 59.3% of those surveyed had no change in their revenue. He had also found that smokers and non-smokers had generally accepted the change. Studies funded by the tobacco industry had shown the opposite effect. Tobacco demand and advertising had two arguments. The anti-tobacco lobbyists that state that advertising increased consumption and the tobacco industry that stated that advertising influenced brand market share and allowed fair competition. Even though South Africa had banned advertising except at point of sale, the tobacco industry had pushed the boundaries on the legislation. He produced photographic evidence of tobacco companies advertising using electronic media. A total ban on advertising was necessary and this was the easiest way to remove any loopholes. Banned advertising would send a clear message that smoking was not a normal activity.

Mr M Waters (DA) mentioned that in Canada, the tobacco industry had gone to court and won its case to permit advertising on the basis that tobacco was not a banned substance and could therefore advertise. He asked if a similar situation would occur in South Africa.

Mr Bletcher replied that interestingly many of the claims made in that court case were now questionable such as the expert witness that was discredited. This was because the evidence provided in the court could not be replicated. The tobacco industry probably would not go to court.

Mr Waters asked how the Department would enforce the implementation of a total ban on advertising, if it unable to enforce the current law current.

Mr Bletcher replied that the tobacco industry would argue that it was legal and agreed that it would be difficult to enforce because of the loopholes. If the loopholes were removed, the tobacco industry would find it difficult to explain their advertising. The industry did not believe that advertising was illegal and have argued for many years that they abided by the law.

Mr A Madella (ANC) referred to the illicit trade and asked if the controls proposed would lead to an increase in illicit trade.

Mr Bletcher replied he did not think that it would. Illicit trade had very little to do with tobacco control legislation.  Advertising bans and controls would not impact on illicit trade. The Bill could take measures to counter illicit trade.

The Chairperson asked how would they ban internet advertising as it was easily accessible.

Mr Bletcher replied that if it were to be banned, it would become the responsibility of the industry to police itself. The websites were used as viral marketing [spread information about a product by word of mouth on the Internet] for the brands. However the ultimate objective was seen as a strategy for advertising.

The Chairperson commented that when the Committee passed legislation, they ensured it was practicable, realistic and not onerous on law enforcement. He asked the presenter to respond to the trend of tobacco brands expanding into creating clothing.

Mr Bletcher replied it was generally termed as brand-stretching. It was a difficult concept because there seemed to be issues with ownership. A number of countries had banned brand-stretching and he thought that was necessary. If not there would be a massive investment into brand-stretching. It was an innovative way to advertise. He agreed that practicality was important and added that if a total ban was instituted it would make the legislation more practical to enforce.

The Chairperson asked how bans on internet and sms advertising could be enforced.

Mr Bletcher replied that it was almost impossible to stop independent and viral marketing. The way to stop such advertising and promotions was to place the onus on the industry.

The Chairperson commented that the Committee would have to make a decision on this.

Mr Waters asked if that extended to adults purchasing cigarettes online.

Mr Bletcher replied that the industry themselves did not sell cigarettes online. The reason it should be banned because there was no way that the retailer could be certain if a minor had purchased the cigarettes.

South African Medical Association presentation
Mr Dumisani Bomela stated that SAMA fully supported the Bill. Their submission requested that a specific amendment be added that protected domestic workers from employers who determined that their home was private and therefore afforded them the right to make use of tobacco products within the home. Therefore the definition of ‘domestic worker’ and ‘employee’ as defined by section 1 of the Basic Conditions of Employment Act, 1997 (Act 75 of 1997) should be added in the definitions within the Bill. They also submitted that an additional paragraph be inserted into Section 2 of Act 83 of 1993, as substituted by section 2 of Act 23 of 2007 that stated “Notwithstanding the fact that a private dwelling is excluded from the definition of ‘workplace’, no person may smoke any tobacco product in a private dwelling in the presence of an employee or domestic worker employed at that private dwelling, or if that private dwelling is used for any commercial activity, or for schooling or tutoring.” SAMA also contended that the tobacco product manufacturers’ be compelled to disclose the content of tobacco product to the public as well as to the Minister and that it be included in the regulations envisaged in section 6(bA) of the Act.

Ms R Mashigo (ANC) asked on what packaging the information should be placed.

Mr Bomela replied that the actual unit traded was the actual packs of cigarettes. The number of ingredients that went into making those products was so numerous that there would have to be an insert could be placed inside the package.

Cancer Association of South Africa presentation
Ms Martha Molete (Head of Communication: CANSA) explained that CANSA was the largest and oldest non-profit organisation in the country. The seriousness of cancers was detailed and the leading cancers in South Africa were listed. CANSA's mission statement was given and their services were listed. It was also the largest funder of cancer research in South Africa. Tobacco's role in cancer in South Africa was explained and that it was the largest preventable cause of death and cancer. South Africa had always been leaders in tobacco control. They acknowledged their support for the Tobacco Control Amendment Bill. Most smokers begin smoking at a young age. Through advertising tobacco companies were marketing death. There was a need to close loop holes within the legislation. They have also been an increase in alternative tobacco products. They had also noted the new ways of advertising used by the tobacco industry. CANSA asked that all forms of advertising be banned and that charitable donations be made anonymously and that images of smoking be banned as well. CANSA supported the Bill's aims and hoped that like China, South Africa could make 2010 smoke free.

The Committee had no questions.

Philip Morris South Africa presentation
Mr Steen Hjortholm (Managing Director: PMSA) began the introduction and explained that Philip Morris was a recent entrant into the South African market. They had a constructive dialogue and consultation with the Department of Health and supported the government's decision to supplement the current legislation. They were not a member of the Tobacco Institute of South Africa (TISA).

Mr Neetesh Ramjee (Corporate Executive: PMSA) detailed that they required a revised definition of “advertisement” and “promotion”. Since there was no exclusion for trade or corporate communication. A business card or a phone call could be construed as a violation of the law. They recommended there be a  definition for “tobacco trade” and exclude that definition from the definitions of “advertisement” and “promotion”. Furthermore that trade programmes that did not infringe the Competition Act be allowed. Point of sale signs that were no larger than one square metre were allowed. These were to be no further than one metre from point if sale to show price and availability. The single notice, as proposed by the Department, would severely reduce the ability to compete in the South African market and would be confusing as there were over 250 tobacco brand variants available. The recommendation was for the Department to prescribe a maximum number of signs per point of sale and maximum number of signs per tobacco company or to reduce the current maximum size. They suggested one sign per company. They were not opposed to the pictorial health warnings and recommended that a reasonable phase-in period be allowed to sell out the existing stock and reasonable space to display trademarks.

Mr Ulreich Tromp (Manager: Corporate Affairs: PMSA) continued the presentation by discussing the definition of  “package” that included all packaging in which tobacco products are sold. They recommended that shipping cases be excluded and clear wrappers expressly from health warning requirements by requiring warnings on packs and cartons only. Charitable contributions were also problematic since anonymous contributions might present issues with respect to the Corporate Social Investment (CSI) element of the Black Economic Empowerment (BEE) scorecard. They recommended that tobacco companies be prohibited from proactively seeking publicity for their charitable contributions but be allowed to let their staff be involved in charitable activities. The fiscal marking section of the legislation empowered the Minister to make regulations about the fiscal markings placed on packs. They recommended that the head of the South African Revenue Service (SARS) Working Group on Tobacco be consulted on the progress made to date. Internet sales were mentioned and they recommended that the clause in Section 4(5) be amended to permit sales where proper age verification and tax checks had been conducted. Misleading descriptors had already been voluntarily removed from all PMSA products.

Mr Madella asked for clarity on fiscal marking and whether their recommendation did not object to the clause but rather a practicality that should be discussed between SARS and the Department.

Mr Ramjee replied that their recommendation was that the Department should begin dialogue with SARS as they had already been in discussions with SARS. There was no issue with the clause, but rather that the whole issue of fiscal marking should be revisited and a broader scheme of licensing.

Mr Madella asked for a visual indication of the number of signs at the point of sale considering that there were many brands.

Mr Ramjee replied that the number of tobacco companies in South Africa was not large. They requested that there was one sign per tobacco company and also that the Department specify the maximum number of signs permissible at the point of sale.

The Chairperson added that if any of the stakeholders felt that their issues were not dealt with they could communicate that to the Committee and it would be seen to.

Medical Research Council presentation
Professor Anthony Mbewu (President: MRC) stated that the MRC supported the Bill and was proud of the fact that its research played a part in the formulation of the legislation. He gave a list of global smoking statistics. There were several smoking inequities. Tobacco use was synonymous with poverty. There was a huge impact from Environmental Tobacco Smoke (ETS). He explained the mechanism by which second-hand smoke caused heart attacks as well as the effects of smokeless tobacco. Tobacco use was also linked to gender. He used the examples of the Global Youth Tobacco Survey (GTYS) and the National Youth Risk Behaviour Survey to illustrate smoking in youth and adolescents. Risk factors for disease and chronic disease were also increased. There were vast inequalities in health and it was part of their National Project to reduce the gap between the rich and poor and therefore remove the inequalities in health care. Their conclusion was that South Africa was compelled to comply with the FCTC. The loopholes that might have emerged since the last piece of legislation needed to be closed.

Ms Mashigo asked for clarification on the statistics presented that stated that the level of second-hand smoke was higher in bars and restaurants than in private homes. She pointed out that one of the previous presentations noted that second hand smoke in the home was higher than outside the home.

Professor Mbewu replied that research indicated that second hand smoke was often higher in bars and restaurants than that of homes. This was relevant because of the rights of workers that needed to be protected from the smokers that were patrons of those places. It was possible that such workers could litigate against their employers, city or the municipality if they were not sufficiently protected in the workplace. This was possible because of increasing evidence that second smoke led to a higher prevalence of heart attacks. However smoking in the home was also an important level of exposure.

Mr Waters asked if the MRC had done any research into fiscal saving for the state since the regulations were first implemented. Specifically, if there had been a reduction in the number of patients going into hospitals.

Prof Mbewu replied that the savings for the state had been evaluated in terms of the economic benefits through studies funded by the MRC and data could be sent to the Committee. The data illustrated that tobacco consumption declined by approximately 30% and the presence of smoking decreased. This information could be accessed from UCT or the MRC. The quantification of the exact benefits was difficult because it occurred at a time when smoking preference should have increased because South Africans had more disposable income and yet there was a decline.  

Mr Madella asked if they had research that estimated the average age of a smoker dying of a smoke related disease.

Prof Mbewu replied that most of the studies indicated that on average half of those that begin smoking during their youth would have reduced their lifespan by ten years. Furthermore, worldwide smoking caused about 5 million deaths per year which was twice the amount of deaths caused by HIV/AIDS. It was estimated that if the current smoking prevalence were to continue through the developing world, one billion people would die during this century. It was the most common single preventable cause of death.

Heart and Stroke Foundation presentation
Ms Zulfa Abrahams (Dietician) began by giving the HSFSA's mission statement and that they supported the Bill. She explained the deadly combination of smoking and heart disease. It was a fact that any form of tobacco marketing sold death. She explained the links between smoking and children. The future generation had to be protected. She concluded that the best way that smoking could be death with was through legislation that banned smoking public places.

The Chairperson asked would it be justified for the tobacco industry to donate their money to educate and correct their wrongs.

Ms Abrahams replied that she did not think that HSFSA would accept their money to correct their wrong.

Campaign for Tobacco-Free Kids presentation
Adv Patricia Lambert (Director: International Legal Consortium) used the preamble to the FCTC as an introduction. She used statistics to illustrate the escalation of the epidemic. The tobacco industry had accused tobacco activists of being emotional and of using old data. She then utilised a quote taken from British America Tobacco (BAT) that saw Africa and Asia as exciting prospects. It was the only legal product that when used according the manufacturer's instructions was harmful. The tobacco industry was a normal industry whose main objective was to increase their profits. The balance needed to be found to between rights and obligations.

She shifted to the power of advertising and noted that there were two kinds of advertising: direct and indirect. Direct advertising was the use of billboards, electronic and print media as well as point of sale. She highlighted her point by giving several graphic examples. She used a quote taken from British American Tobacco that saw point of sale advertising as an opportunity. The effectiveness of point of sale was that children had the perception that cigarettes were normal and easy to obtain. Indirect advertising included brand stretching. She again used a quote that stated that opportunities should explored to communicate the brand name through non-tobacco products. Packaging could also be seen as indirect advertising as well as product placement in movies. A graph was used to illustrate the effects of tobacco promotions on youth. The industry used corporate social responsibility to purchase credibility and to deflect attention away from the manner in which they make their profit. She showed a research model that was initiated by the British American Tobacco company that was specifically aimed at isolating the non-smoking movement and winning over public opinion. Their research model included identifying those that were decision makers and influencers. She recounted an incident that happened when a Kenyan parliamentary portfolio committee was taken on a leisure trip while they were debating tobacco control legislation and the legislation was then forgotten.

The ultimate aim of corporate social responsibility was to ensure that stakeholders were aware of the industry's achievements. There were calculated public relations campaigns that were aimed at enhancing the appeal of smoking by framing it as an adult activity. This might detract government from regulatory measures. The FCTC expressly prohibited tobacco industry interference in public health policy. International experience had shown that the only way to protect people from smoking was to ban advertising completely. She used several graphic examples to illustrate the effectiveness of a complete ban on advertising. Furthermore the tobacco industry had taken up specific research and targeting of the upwardly mobile middle-class black person, referred to as 'black diamonds’. They were shown as being the drivers of the economy and she emphasised that the time to act would be immediately.

Mr Waters agreed with the majority of the submission. However it seemed to attack the industry for performing as expected and that was to make profit. They identified a target market and focussed on them.

Adv Lambert replied that she did mention in her presentation that the tobacco industry was like any other industry. The issue was the product that did damage. It was addictive and made it difficult for people to stop. There were documents found in the tobacco industry where young people were described as replacement smokers. If it was analysed it was clear since most who die of smoke related diseases, die in middle age, and that was why they needed replacement smokers. Huge efforts needed to be made to de-normalise smoking through education and they had to ensure that young people did not see adults smoke.

Mr Waters commented that the term 'Black Diamond' had been seen in many newspapers and frequently used in the economic sphere.

Adv Lambert was aware of how 'Black Diamond' was described and how the industry saw them as the upwardly mobile but they also saw them as a profit margin.
Mr Waters understood that some eighteen year olds were not as mature as expected, but there had to be an age where they were considered adults. He asked for clarification on whether she suggested an alternative age.

Adv Lambert replied that if the recent eighteen year old were to see the packs of cigarettes that had pictures on them that showed the dangers of smoking, the point would come across. The age was not the issue, the protection could not stop there, in addition all forms of advertising and promotion should be banned. Society had normalised smoking and it had to be undone. One of the difficulties was that those eighteen year olds were the role models for those who were younger. Those in public health had to think further than just that age limit.
Mr Waters asked why she did not raise the issue of licensing to sell tobacco products.

Adv Lambert replied that she wanted to focus her presentation on advertising.

Mr Waters asked if a complete ban of advertising would go against the Competition Act. He mentioned the Philip Morris suggestion of one company per point of sale.

Adv Lambert replied that a complete ban would not be against the Competition Act. Trade was allowed but there were restrictions on many products particularly those seen as dangerous products. Tobacco was a dangerous product. All advertising should be banned including the point of sale advertising.

Ms Matsemela stressed the issue that the Committee was not in possession of the presentation document. It created a serious problem when they tried to relate what had been presented. She went on to say that the Kenyan portfolio committee had been presented in a manner that meant that they did not serve a purpose in an African context. Were the Kenyan parliamentarians being compared to their counterparts in South Africa?

Adv Lambert apologised for the perception that she had undermined the Committee. She attempted to strengthen the process by illustrating how the tobacco industry had acted. The example of Kenya was used because it was factual. It happened all over the world in countries such as Mexico. There was no intention to compare South Africa and Kenya’s portfolio committees, rather it was chosen because Africa would experience an epidemic.

Ms Matsemela noted that the Constitution was clear that the industry had the right to operate in the country. She asked if the tobacco industry had been consulted as they could not undo the strides made with reckless presentations.

Adv Lambert replied that there were several consultations that took place while they worked on drafting the Bill. The tobacco industry would say that they had not been consulted. They measured consultation by whether or not the Department agreed with them. The deciding element was who acted in the interest of public health.

Ms Madumisa commented that the presentation sounded like a lecture. In the past the Committee had passed laws diligently. It seemed that there was a problem with this specific legislation. How would electronic advertising be monitored?

Adv Lambert replied that monitoring of electronic media was difficult. The Department had consulted experts regarding internet sales. China used technology to block smses and other electronic media so the technology was available.

Mr Waters replied that China used a blanket ban on internet and smsing and they did that because of their government regime. The technology would be different if certain smses were blocked.

Ms Mashigo asked what was the opinion of the presenter on the implementation of the Bill because, since the inception of control legislation, smoking had declined.

Adv Lambert replied that it proved that legislation had worked. However there were loopholes in the Bill and the goal was to stop people from taking up other nicotine habits. Those countries that have acted strongly to control the tobacco industry experienced a drop in smoking rates.

Ms Mashigo noted that advertising had an effect in encouraging trade. She asked how anti-smoking advertising affected those who were smokers.

Adv Lambert replied that pictures that depicted the effects associated with the use of tobacco products had proved to be enormously successful.

Mr Madella agreed that it did feel as if they were in a lecture, however the information was powerful. Industry would argue that they had to communicate with their retailers and that trade publications would not be available to the wider public and therefore should allow advertising.

Adv Lambert replied there were many ways of communicating with their retailers. They were not preventing the industry from communicating but how they communicated. Trade publications were seen lying around. There was no way of guaranteeing that public did not see trade publications.

Adv Lambert replied that if the law was passed, the onus fell on the industry not to use the electronic media for advertising and that the fine should be sufficient to further deter electronic advertising.

Mr Madella noted that the presenter had indicated that MXit originated from the tobacco industry and that clearly this was problematic because those that used MXit were below the age of 18 years old.

Adv Lambert replied that the industry would use everything they could to push their products.

Ms Madumisa noted that since this Bill had been separated from the initial one, there was no need for further consultation.

Adv Lambert noted that the separation of the Bill was technical but the content of the Bill remained the same, except for changes made because of the stakeholders. It would seem that another round of consultation would not be needed.

Ms Matsemela asked if the industry was complying with legislation in the country.

Adv Lambert replied that in general they had broken legislation at the point of sale because they had interpreted the law in a particular way.

Ms Matsemela asked about social responsibility and whether they should refuse funding offered by the tobacco industry when there were areas that urgently needed schools and clinics.

Adv Lambert replied that in the legislation currently they could be approached but the donated buildings would have to be built anonymously.

Ms B Ngcobo (ANC) asked about the protection of young pregnant mothers and the education required to be aware of the ill effects of smoke.

Adv Lambert replied that young mothers needed both protection and education.

The Chairperson asked that the submission be restricted to issues on the Bill. Facts that the Committee were already aware of should not be repeated. He asked that the answers to questions be kept short and concise. The industry was legal but it was the fact that the product was harmful, that became problematic.

Massmart Holdings Limited presentation
Mr Jay Currie (Group Corporate Executive: Massmart) began by explaining that Massmart was the third largest supplier of consumer goods on the African continent. They recognised that tobacco use required a restrictive legislation. Massmart sustained an intensive social investment programme across nine provinces in South Africa as well as Namibia, Botswana and Zambia. The primary focus of this investment was in education and training, with a secondary emphasis on disadvantaged children and the disabled. The Bill proposed to be amend Section 3(2), together with Section 7(3) of the principal Act. It stipulated that a fine of R1 000 000 would be imposed on a retailer that made any financial contribution to any person in respect of any organised activity that was to take place or would take place in the Republic. The wording of the sections included a scope retailer and would prevent Massmart from continuing the programme. They noted that Section 3(3) allowed for the Minister to prescribe exemptions for unintended consequences, however this could take a while and they would prefer not to take that uncertain route. They proposed that the clause include a participative sales mix measurement and excluded all retailers and distributors with a tobacco sales mix of less that 10% of total sales.

Mr Thami Mseleku (Director General: Department of Health) commented that the section was not being amended.

Mr Waters asked if it was against the Financial Intelligence Centre Act rules if money was given anonymously.

Mr Mseleku replied that anonymous donations were allowed within the FICA rules.

Mr Currie responded that they were obliged to report all donations that were made and were unable to make donations not fully declared. They were clearly not using the activities to promote any products.

Mr Madella noted that if the organised activity was not related to the promotion of products, then there would be no reason to be concerned.

Ms Madumisa felt that they were protected since they were retailers.

The Chairperson commented that they would look at their proposal.
The Chairperson thanked the presenters and adjourned the meeting.

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