THE TOBACCO INSTITUTE OF SOUTH AFRICA
SUBMISSIONS TO THE SELECT
COMMITTEE ON SOCIAL SERVICES ON THE TOBACCO PRODUCTS CONTROL AMENDMENT BILL [B
24B – 2006]
INTRODUCTION
1.
The Tobacco Institute of South Africa
("TISA") is a voluntary industry association representing tobacco
growers, leaf dealers and manufacturers of tobacco products in South Africa. We represent more than 95% of the total legal
tobacco industry in this country, which equates to approximately 76% of total
tobacco consumption; illicit trade equates to over 20%.
2.
TISA has considered
the Tobacco Products Control Amendment Bill, No. 24 of 2006 ("the
Bill"). These written submissions
are made in response to the invitation published in the national press on 5
August 2007.
3.
We acknowledge and support the role of the Select
Committee on Social Services ("the Committee") in ensuring that draft
legislation is properly considered in the context of the government's
objectives. We acknowledge also that
tobacco is a product which poses health risks and accordingly that one of the
government's objectives must be to take steps to reduce the harmful effects of
tobacco use. On this basis we have no
objection to many of the provisions contained in the Bill. At the same time, however, we must stress
that we represent a legal industry which produces a legal product; an industry
which makes a huge contribution to the economy of this country.
4.
In these submissions we, firstly, provide some
limited information on the economic and social importance of the tobacco industry
and the need for legislative change. We
thereafter deal with our involvement in the legislation process thus far. Lastly, we comment on 4 issues raised at a
previous hearing of the Committee.
THE ECONOMIC AND SOCIAL
IMPORTANCE OF THE TOBACCO INDUSTRY
5.
Tobacco is one of the most labour-intensive crops
in the agricultural sector. Currently
there are approximately 170 tobacco farmers in South Africa who employ over 12 000 workers, who in turn have approximately 50 000
dependants. Approximately 1 000
others are employed by processors of tobacco leaf. Being a labour-intensive
industry, many tobacco farmers are involved in the provision of facilities such
as clinics, schools and crèches. The
manufacturing sector employs approximately 3 000 people, who produce the
tobacco products consumed by approximately 5 million adult South Africans.
In total, approximately 17 000 people are employed in the legal tobacco
industry, who provide a livelihood for about 75 000 people, most of whom are in
deep rural areas where employment opportunities are extremely limited. This
excludes the multiplier effect of jobs related to a number of other industries
supplying inputs and services to the industry.
6.
The importance of the tobacco industry cannot only
be measured with regard to those people employed by and dependant on it. As significantly, the tobacco industry
contributes approximately R8 billion to the South African fiscus in excise
duties and VAT alone. This amount is in
addition to the income tax paid by the growers and manufacturers, and the
individuals employed by them.
THE NEED FOR
LEGISLATIVE CHANGE
7.
TISA supports the
need for the tobacco industry and the use of tobacco products to be
regulated. This is a logical consequence
of the risk associated with tobacco products.
TISA also agrees that certain
amendments to the current legislation
are urgently required.
TISA'S INVOLVEMENT IN THE
LEGISLATIVE PROCESS THUS FAR
9.
In 2006 a draft of the Bill was circulated to
stakeholders, including TISA. Subsequent thereto, apparently on the advice
of Parliamentary legal advisors, the draft bill was divided into two: some
provisions were included in the Bill, having been identified for passing in
terms of section 75 of the Constitution,
while many of the other provisions in the draft bill were apparently left over
for later processing in terms of section 76 of the Constitution.
10.
TISA has
consistently acknowledged the need for legislative reform. When the Bill was placed before the National
Assembly, TISA made both written submissions
and an oral presentation to the Portfolio Committee,
and appreciated the open and constructive way in which the Portfolio Committee
dealt with the Bill.
11.
Our participation and submissions to the Portfolio
Committee put forward a number of concerns we had with the Bill in the form that
it was at that stage. We were pleased
that certain issues raised by us were also of concern to the Portfolio
Committee, resulting in some of the provisions being rephrased or excluded.
13.
We wish to record those issues raised before the
Portfolio Committee that were not accepted and remain unchanged in the current
Bill, and which therefore remain of concern to us.
14.
The first is the approach in the Bill to the
manufacture and exporting of tobacco products.
Section 3A(3) prescribes that South African regulatory standards will
apply to the tobacco products exported to countries where no regulatory
standards exist. TISA believes that such a provision has the effect of South Africa
imposing its own standards on countries which, for whatever reason, have
elected not to impose standards themselves.
TISA believes that this is inappropriate and that South African
legislation should not de facto seek to impose South Africa's
prescribed standards on foreign jurisdictions.
15.
The second issue raised by us which was not accepted
by the Portfolio Committee, was the breadth of the Minister's regulatory powers. In our view the current section 6(1)(e) of
the Act, which gives the Minister the power to make regulations regarding "any other matter required or permitted
to be prescribed in terms of the provisions of this Act to achieve the objects
of this Act", is a sufficiently wide generic regulatory power which
does not require amendment or amplification.
16.
We turn now to deal with 4 issues which, we
respectfully submit, require careful consideration by the Committee. All of them, we understand, were raised at a
previous hearing of the Committee.
THE DEFINITION OF
"TOBACCO PRODUCT" AND THE PROPOSED NEW EXEMPTION PROVISION
18.
From the point of view of TISA,
we support the need for legislation to regulate the manufacture, consumption
and promotion of snus. We, however,
believe that this can best be done through separate legislation. It appears
that too little consideration has been given as to whether the incorporation of
snus in the proposed new definition of "tobacco
product" will assist in achieving the purposes of the Act as set out
in the amended Preamble, and whether, with reference to snus, there are
potentially less restrictive means to achieve those purposes.
19.
As stated in paragraph 12 above, when it became clear to us that there was
little support for retaining the current definition of "tobacco product", we proposed an exemption
provision. Our proposal was then amended
by the Portfolio Committee which eventually approved the current proposed new
section 6A. In our submission to the
Portfolio Committee, we suggested that the exemption provision should make
reference to harm reduction properties.
This was specifically proposed with reference to snus. The exemption provision proposed by us read
as follows:
"The Minister may by notice in the Gazette
exempt any tobacco product from a provision of this Act on such conditions as
may be determined by the Minister in the notice, provided that, in the opinion
of the Minister, it is in the public interest for the particular tobacco
product to be so exempted, taking into consideration its harm reduction
properties." [emphasis added]
We remain of the view that it would be beneficial for reference to be
made to harm reduction properties. In
this way, the Minister will not be able to exempt all tobacco products if it is
in the public interest for her to do so, but only those in respect of which it
can be shown that they have harm reduction properties. Snus would be an obvious example of such a
tobacco product, but not necessarily limited to snus only.
AGE LIMIT PROVISIONS
20.
A very early draft of the Bill (ie before the Bill
was divided into a section 75 Bill and a section 76 Bill) contained a provision
to the effect that the age limit in respect of the sale of tobacco products to
and by persons should be increased from 16 to 18 years. This provision has been excluded from the
Bill.
21.
For many years, long before the issue was first
raised in draft legislation, TISA and its
members have actively supported the raising of the age limit from 16 years to
18 years, the internationally accepted age limit. By means of a dedicated Youth Smoking
Prevention campaign, TISA encouraged and
assisted retailers to ensure that, despite the 16-year restriction in the current
legislation, tobacco products should not be sold by or to persons under 18
years.
22.
The exclusion of the age limit provision from the
Bill has resulted in two bizarre anomalies.
Firstly, the proposed new section 2(6) obliges owners and persons in
control of public places to ensure that persons under 18 are not permitted to
enter designated smoking areas, and obliges employers to ensure the same in
relation to designated smoking areas within workplaces. However, by retaining the 16-year provision
in relation to the sale and purchase of tobacco products, a bizarre outcome results. A 16 or 17 year old can legally purchase or
sell a tobacco product, but cannot enter a designated smoking area. The second bizarre anomaly concerns the
proposed new section 2(1)(a)(iii), which prohibits any person from smoking a
tobacco product in "any motor
vehicle with a child under the age of 12 years". This means that a child from ages of 12
to 17 can be present in a motor vehicle in which tobacco products are being
consumed, but not in a designated area of a restaurant.
23.
These anomalies will be removed if the age limit
for all purposes is raised to 18. TISA fully supports the age limit for all purposes being
18, whether in relation to motor vehicles, designated smoking areas or the
right to purchase or sell tobacco products.
In addition, increasing the age limit for all purposes to 18 would
ensure a greater alignment between the Act and the World Health Organisation
Framework Convention on Tobacco Control. The proposed amendment to the Preamble to the
Act
records that this is one of the objects of the proposed amendments.
LOW IGNITION PROPENSITY
(LIP) CIGARETTES
24.
Low ignition propensity cigarettes are designed to
extinguish when the smoker has not inhaled on the cigarette for a certain
period of time. This design was
introduced as a safety feature to prevent lit cigarettes from posing a fire
hazard. However the incorporation of
such a design to cigarettes does have cost and health implications that must be
acknowledged and considered before the passing of any regulation relating to this
tobacco design product. TISA strongly submits that the introduction of ignition
propensity cigarettes should only be done on the basis of extensive
consultation and research, in particular with regard to the applicable product
standards, and in accordance with prevailing capacity in this country.
PENALTY PROVISIONS
25.
In section 6 of the Bill, an amendment to section 7
of the Act is proposed in which penalties for contravention of the Act are set
at maximum amounts, ranging from R500.00 to R1 million. TISA's
only proposal in this regard is that the maximum penalties should be proportional
to the offences potentially being committed.
TISA therefore requests the Committee
to give careful consideration to the relationship between the offences and the
proposed maximum penalties.
CONCLUSION
26.
TISA supports the
need for the tobacco industry to be regulated.
It wishes to work closely with the Select Committee, the Portfolio
Committee, the Department of Health and other role players in preparing
legislation that meets the government's objectives. At the same time, TISA
remains very concerned about the risk of over-regulating the tobacco
industry. As set out more fully in
paragraph 8 above, over-regulation can have the effect of
encouraging and stimulating the illicit trade, which remains one of the biggest
stumbling blocks to the government achieving its objectives.
27.
Accordingly, while TISA
does not oppose the passing of the Bill, it requests the Committee to give
earnest and considered attention to the issues we have raised above. If the amendments which we have proposed are
adopted, the end result will be a Bill which is fairer and more workable, and
which has a better chance of ensuring that the government's objectives are achieved.
17
August 2007
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