The International Implications for Regulating Cigars

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The Impact of Cigar Overregulation

When we discuss the adverse economic impact of government action against the passion for and production of great cigars—whether it is smoking bans, taxation, or the profound and detrimental effects federal regulation can have on the overall premium cigar industry
—we discuss it in the context of the local cigar shop, the domestic supply chain or the corporations of manufacturers headquartered in locations ranging from Miami to Philadelphia.

Those manufacturers serve as the masterminds of blends, production, marketing and “selling the sizzle,” but there is another side of this equation that cannot be forgotten—the workers of Latin America who handle and orchestrate the production of those works of art, from the seedlings to the ship that delivers them to our shore.

This is where the federal regulation of cigars is most frightening. As Jorge Armenteros of Tobacconist University states, “We are living in a renaissance of cigar-making.” He’s right, as some of the greatest cigars in history are on the local shop shelves as we speak.

It’s a tribute to the creativity and innovation of new and old cigar-makers alike. It’s also a tribute to the nations of Honduras, Nicaragua and the Dominican Republic for not only having the natural environment for the production of great cigars, but having the workforce dedicated to the skill needed to produce outstanding cigars. That impact spans to the nations of Brazil, Ecuador, Mexico, Costa Rica and across the Atlantic to the Republic of Cameroon, where more than 3,000 farms and workers are producing prized tobacco.
Several years ago, I spoke to a group at the Nicaraguan Cigar Festival in Esteli, and I said,

“I challenge any of you to smoke a cigar in the same way after you have looked into the eyes of these rollers, witnessed the care of their hands on that leaf and experienced the dedication and pride they have in their craft.” That’s an image I want every cigar enthusiast in America to have when they are enjoying that cigar among friends or alone on their back porch.

Now along comes the U.S. government with the threat of federal oversight and regulation of the industry—wanting, in many ways, to treat premium cigars more harshly than even the products that Congress actually told them to regulate. If regulation stems production by so much as a fraction, jobs critical to the stability of the Latin American economy will be at risk.

That’s why Cigar Rights of America has been diligent in communicating with the embassies of Latin America on the issue of federal regulation. Working together, a joint letter from the ambassadors to the U.S. from Honduras, Nicaragua and the Dominican Republic expressing their serious concerns about the regulations was sent to the U.S. Department of State, the U.S. Food & Drug Administration (FDA) and to offices of the Trump administration.

The letter notes, “If history is any precedent, some of the regulations that could be imposed by the agency would prove disastrous to the centuries-old cigar industry that provides over 300,000 jobs among our three nations and represents millions of dollars in export revenue. No regulatory measure should threaten such jobs and hence raise the specter of political and economic consequences within our region.”

Then there are issues close to home. As the border issue began to make news cycles here in the U.S. and the implications and association with our issue of cigar regulation started to become clear, news spread that children in Honduras were being affected.

To highlight what this means, the ambassador of Honduras to the United States, the Honorable Jorge Alberto Milla Reyes, noted, “There are, indeed, international trade and economic implications with regulating cigars from Honduras and throughout Latin America. The government of Honduras values the investment and source of employment provided by the premium cigar industry and knows well how it provides for over 35,000 families in Honduras and 300,000 in the region. We cannot underestimate how this contributes to the stability, especially at this time of concern over issues such as immigration and security.”

All of this informs us that this issue is bigger than most imagined. Major multinational corporations are used to playing this game. They are accustomed to courting the government for what they want, opposing what they do not and, most of the time, getting their way. The opposition groups have their tactics down to the push of a button in order to unleash their questionable science and distorted “facts” onto a mass media market more than willing to regurgitate their version of the issue.

Our side exists in a world of craftsmen, farmers and rollers with the hands of a Rembrandt or Picasso. They are not purveyors of nicotine, nor a harm to the public at large. Our world is one of camaraderie, fellowship, solitude and reflection—with our art in hand. That is a message to defend.

While we will not speculate on any judicial action, the ability of Congress to protect the industry is clear. They must advance the exemption language from regulations adopted on July 12, 2017, by the U.S. House of Representatives Committee on Appropriations and strive for a means to make that exemption permanent.

We are calling for every manufacturer, retail tobacconist and consumer in America to contact their two United States Senators and congressperson. Visit their district offices, call the local office and the Washington office, and voice your disapproval of the cigar regulations. Invite them to local cigar shops, and host a cigar town hall. Tell them to support HR 662/SB 441 and the actions of the House of Representatives Committee on Appropriations that call for “no funding for FDA actions against premium cigars.” Let’s make the rest of 2017 the turning point in this debate.

– Contributed by J. Glynn Loope, executive director of the Washington, D.C.-based Cigar Rights of America.

This story first appeared in the September/October 2017 issue of Tobacco Business magazine. Members of the tobacco industry are eligible for a complimentary subscription to our magazine. Click here for details.