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TOBACCO OUTLET BUSINESS
JULY/AUGUST 2012
changes enacted by the FDA have had
business-attitude-altering effects.
“Although taxes and regulations
are always a major concern, this
was the first year in a long while
where we have to look more at what
the competition is doing and what
we might have to do to remain
competitive,” says Randy Silverman,
president.
Industry trade groups such as the
Tobacco Merchants Association
(TMA), International Premium
Cigar & Pipe Retailers Association
(IPCPR), Cigar Rights of America
(CRA) and others are a big help in
monitoring and reporting on the
latest FDA flashes—rulings and
warnings in regulation. Keeping
in mind that the FDA is getting a
reputation for delays, appeals and
repeated announcements, here is
some of what lit up the industry at
press time:
Cigars—
Mounting
bipartisan
support is behind two federal bills
aimed at stopping the FDA from
regulating premium cigars like
cigarettes. At press time, HR 1639
in the U.S. House of Representatives
had 203 cosponsors, closing in on
the 218 needed for a majority. And S
1461 in the U.S. Senate tallied up at
12 cosponsors.
While cigars have yet to be
examined by the agency’s Tobacco
Products
Scientific
Advisory
Committee (TPSAC), the FDA
has published several notices in the
Federal Register
this past year alerting
that it is considering issuing rules to
regulate cigars.
The IPCPR and CRA are two
groups that have been relentless
in their grassroots efforts and
continuous outreach, representing
the “mom and pop” tobacconist shops
and tobacco outlets with the purpose
of sending a clear message to the
FDA that “we will not back down,”
according to Kyle Whalen, public
relations manager for the IPCPR.
IPCPR CEO Bill Spann has
gone on record for several news
organizations defending the 85,000
Americans the premium cigar
industry employs, suggesting that
the government should be doing
everything possible to protect small
businesses and job growth, not trying
to regulate them out of existence.
It has been highlighted that the
bills before Congress would exempt
only traditional premium cigars, with
the distinction that their enjoyment
is celebratory, not an addiction, and
that they are clearly marketed to, and
enjoyed by, adult cigar enthusiasts,
who can afford their average price of
$8.
Meanwhile, there are tobacco
companies, such as Altria Group, the
parent company of (non-premium
cigar manufacturer) John Middleton
Co., that oppose the proposed
legislation to exempt premium cigars
from FDA regulation because such an
exemption would “provide powerful
incentives for machine-made cigar
companies to modify their products
to avoid FDA regulation,” reported
Washington newspaper
Roll Call
in June. Altria reportedly pointed
out that if John Middleton were
to convert all of its machine-made
cigars from reconstituted tobacco
wraps to leaf wraps it could remove
nearly its entire portfolio of products
from potential FDA regulation.
Supporters of the bill say that
large industry players such as Altria
are using hypothetical arguments to
oppose an exemption for premium
cigars.
Graphic Cigarette Labels—
The
FDA had no intention of dropping
the highly debated graphic cigarette
warning labels issue, so in March it
filed an appeal of U.S. District Judge
Richard Leon’s ruling that halted
the nine new federally mandated
FDA Dashboard