The Premium Cigar Association (PCA) is committed to defending and promoting premium cigar and pipe tobacco retailers and manufacturers around the world. Although the word “International” was removed from the Association’s name, efforts to protect all of our members across borders remain steadfast. PCA recognizes the importance of protecting our international partners, which is why our government affairs team continues to advocate at the international level. Bad policy spreads, but so can good policy; thus, PCA is committed to engaging around the world on policy matters that affect the premium cigar & pipe tobacco market.
What Is PCA’s Position on The International Stage?
The Premium Cigar Association’s purpose is to protect and promote specialty retail tobacconists around the world. PCA has engaged with countries on several issues, including but not limited to packaging, taxes, tariffs, generational bans and other burdensome regulations. We plan to continue connecting with partners in every region to ensure engagement in every country that threatens the premium tobacco industry.
What Are the Policy Challenges Facing the International Community?
Generational bans:
A new fight taking center stage are the laws aimed at generational bans of tobacco sales. PCA recently engaged with the European Union, Malaysia, and New Zealand on their proposed generational smoking bans. Simply put, the legislation would ban the option to legally purchase tobacco products to anyone born after an arbitrary date. The “born after date” varies, with some choosing January 1, 2007 and others January 1, 2009. Under such legislation, anyone born after said date would never be permitted to legally purchase any tobacco products. Ultimately, such severe legislation would result in a sweeping and permanent ban on tobacco products in just a few decades. This must be stopped before it spreads.
Taxes:
Much like every policy front in the premium cigar industry, taxes, VAT, and tariffs are of major concern to PCA on the international level. These taxes aim to slow the growth and stop the sale of tobacco products. PCA stands against taxes of all levels placed upon premium cigars and pipe tobacco. This cottage industry is facing a mountain of taxes around the world, and in some places, by the time a premium cigar reaches an individual consumer, that cigar could have a markeup of more than 700% of its wholesale price. This extreme price change is detrimental to a retailer’s ability to open a store, or keep an existing store operating. Even in countries with the highest tax rate imposed on businesses and citizens, legislatures are still trying to increase the tax on cigars.
Packaging:
A growing problem around the world is the issue of plain packaging, graphic warnings, and warning labels on premium cigar bands and boxes. The warning labels and plain packaging serves to hinder continued sales of existing brands and makes it nearly impossible for new brands to enter a country. In countries that require plain packaging, new brands are competing against those with stronger name recognition and are unable to distinguish themselves due to the lack of branding. Plain packaging and extreme warning labels are a huge hurdle for retailers and manufacturers alike. PCA is against warning labels of any kind on premium cigars and is working diligently to ensure that policies like these do not spread. PCA is also working on identifying countries that may be able to roll back plain packaging and graphic warning labels.
Distinction issues:
Much like the past decade in the United States, the international premium cigar industry is under constant threat of being lumped in with all other tobacco products when it comes to regulation and taxes. This issue is present in nearly every tobacco fight we face and is one of education. Once a policymaker is educated about the patterns of use, health effects, and age demographics of premium cigar users, we are often able to initiate deeper conversations and work towards improving the environment for our industry.
Recent PCA Advocacy Work for The International Community:
- New Zealand
- PCA recently provided written evidence and public oral testimony against the generational smoking ban that has been proposed in New Zealand. The testimony focused on how laws in New Zealand have already destroyed the majority of premium cigar retailers, and how premium cigars are characteristically different from any other tobacco product.
- Malaysia
- PCA has submitted evidence to the Health Minister of Malaysia on how premium cigars are distinctly different than any other tobacco product. The proposed legislation in Malaysia is very similar to the generational smoking ban in New Zealand. There has been strong opposition in Malaysia, and the ban is likely to be shelved for several years.
- The European Commission
- The European Commission has fallen in line with New Zealand and Malaysia for a generational smoking ban. PCA has provided a comment detailing the distinctions that premium cigars deserve when it comes to bans like these. Tobacco history and heritage runs deep in Europe, and the industry has a prominent presence across the EU. PCA stands with our European partners that have been fighting bans like these, packaging, and a litany of taxes.
- Canadian Retailer Outreach
- PCA is engaging with Canadian retailers, suppliers, and distributors to identify ways in which PCA can roll back some of the very restrictive laws that have harmed industry partners. From plain packaging to indoor smoking restrictions, PCA is planning to engage parliament and provincial governments to counter these kinds of restrictions.
- Monitoring Issues in Cigar Producing Countries
- PCA monitors foreign relations and trade issues in all tobacco producing nations. The government affairs team regularly engages with Embassy staff to keep abreast of issues facing all tobacco producing nations.
- Research, Monitoring and Outreach
- PCA is making connections in regions and countries around the world to have industry partners monitoring on-the-ground issues that we can engage on. In the past year, PCA has engaged with, or monitored, over 45 countries for policy issues or opportunities. These connections are key when it comes to international issues to ensure that PCA staff is made aware of all current and proposed legislation. If you have international connections in the tobacco industry, PCA encourages you and them them to reach out to Ryan Parada directly to discuss the countries they are operating in and what PCA can do to help.
Government Affairs International Engagement Contact
Ryan M. Parada, Government Affairs Manager
+1 (609) 372-7599