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toB50cHaosNoTcoNTrolAbanonmentholcigarettesaswithanytobaccobancouldpotentiallycreatemuchmoreharmthangoodintheformofcigarettesmugglingcounterfeitcigarettesorablackmarketandillegalcigarettetracking.SpeakingonbehalfofLorillardRobertBannondirectorofinvestorrelationscommentsUnderanyreasonableassumptionsbanningmentholcigaretteswouldcreatechaosratherthancontrol.eCenterforRegulatoryEectivenessCREledcommentslatelastyearontheproposedrulebytheBureauofAlcoholTobaccoFirearmsandExplosivesATFtocounterthesmugglingandsaleofcontrabandcigarettesandsmokelesstobacco.ethreebigdangersofanytobaccobanwerepointsraisedbytheATFCigarette-smugglingprotsfundterrorismandotherdeadlycriminalgroups.Counterfeitcigarettesposehealthhazardsoverandabovethoseofgenuinecigarettes.Illegalcigarettetrackingmakesiteasierforchildrentosmoke.eCREinformedtheATFaboutthecontemplatedbanonmentholcigarettesandnotedIfenactedabanwouldcreateenormousdemandforcontrabandmentholcigarettesaproductpreferredbyover18millionpeopleorone-thirdofadultcigarettesmokers.eCREbelievesthattheaforementionedpointsconclusionsreachedbytheFDAsfederalcolleagueasitcallstheATFarethegamechangerstothementholcontroversyitalsostatedthatthereisnoscience-basedjusticationforamentholban.Dr.ElizabethWhelanoftheAmericanCouncilonScienceandHealthrecentlyhighlightedtheobservationthatamentholbancouldmisleadsomesmokersintobelievingthatnon-mentholsaresaferandcouldalsoresultinanetincreaseincigaretteconsumptionbecausementholsmokerstendtosmokefewercigarettesdailythannon-mentholsmokers.InadditionastudycommissionedbyLorillardlastyearandconductedbyCompassLexeconaChicago-basedeconomicconsultingrmdetailedmanyofthesameunintendedconsequencesofabanonmenthol.isreportwaspresentedtoTPSACinDecemberoflastyearaccordingtoBannon.enalndingsofthestudyreinforceourbeliefthatabanonmentholcigarettescannotbejustiedscienticallyorforanyotherreasonsheconcludes.draftsindicatethatthepanelwillrecommendsomerestrictionssuchaslimitingthemarketingofmentholcigarettesratherthananoutrightban.Clearlynoneofthisisgoodfortobaccooutletretailersortheircustomers.MentholisabigandimportantpartofthemarketaccordingtoArmstrongandpeoplehavearighttosmokewhatevertheywant.Andsothementholissuejustputstheindustryrightbacktoitsoverarchingghtagainstunfairintervention.ecountrywasfoundedontobaccofundedbytobaccoandpeopleforgetthatsaysCollett.Tobaccoisaveryeasytargetbecause75percentofthepeoplearenotconsumers.Itseasyforthegovernmentandpoliticianstopickonaproductthatthemajorityofthecountrydoesntreallyuse.Itsharderforthemtodotherightthingitseasytodothepopularthing.Anytypeofgovernmentinterventionregulationconcernsmeeventhoughitmightnothurtmeinmyimmediatebusinessbecauseitcouldjustsnowballintootherthingsbeingbanned.eimportanttake-awayforretailersYoucanteverletthissturolloyourbackArmstrongpointsout.HeurgesretailerstogetinvolvedbyworkingwithoneanotherandwithNATOonlegislativeissuesastheyarise.AsaproudghterforthisindustryArmstrongsaidatswhereweputouremphasisandthatswhereweputourtimetakingactiontodefendourrights.OnFridayMarch18theTPSACissueditsnalreportandsetofrecommendationsontheimpactoftheuseofmentholincigarettesstatingthattheremovalofmentholcigarettesfromthemarketplacewouldbenetpublichealthintheUnitedStates.ButitalsoacknowledgedthatthepotentialforcontrabandmentholcigarettesexistsshouldFDAchoosetoimplementabanortakesomeotherpolicyactionthatrestrictsavailabilityofmentholcigarettes.InaseparatedocumentthataccompaniedthereporttheTPSACnotedthattheFDAsCenterforTobaccoProductswillreviewthereportandmakerecommendationsalongwithareporttobesubmittedbythetobaccoindustryprovidingitsperspectiveontheissue.eFDAnowhasthetaskofdeterminingwhatifanyactionwilltakenthereisnosetdeadlineforthis.IftheFDAdoesdecidetotakeactiontherewouldthenbeaformalrule-makingprocessallowingforpublicnoticeandpubliccomment.EditorsNoteTOBACCOOUTLETBUSINESSMARCHAPRIL2011