The Australian Competition and Consumer Commission has obtained court enforceable undertakings from Imperial Tobacco Australia Limited to remove its 'light', 'mild' and similar descriptors from its products. Imperial Tobacco will pay $1 million to the ACCC towards an upcoming consumer education campaign.
"This result successfully resolves the ACCC's investigations on this issue", ACCC Chairman, Mr Graeme Samuel, said today. "The undertakings provided by Imperial Tobacco, the third largest tobacco company in Australia with a 20 per cent market share, means that the ACCC has achieved an industry-wide outcome in response to the ACCC's concerns.
"The undertakings reflect those provided by British American Tobacco Australia Limited and Philip Morris Limited in May this year. It addresses the matters of most concern to the ACCC. These were the removal of the 'light' and 'mild' descriptors, the prevention of further similar conduct and the provision of significant further funding for a media campaign to educate and inform consumers that low yield cigarette brands are not likely to offer health or related benefits to consumers compared to higher yield brands.
"The ACCC welcomes Imperial Tobacco's decision to address the ACCC's concerns and to contribute $1 million to the ACCC's consumer education campaign".
The ACCC's investigations led it to the view that the tobacco companies, in using descriptors on cigarette brands and packaging such as 'light', 'mild', 'medium' etc and numbers (ie. '1','4','7' etc), represented to consumers through the descriptors and related marketing and packaging that there were health benefits in smoking those brands (known as low yield cigarettes due to claimed machine tested average lower yields of tar, nicotine and carbon monoxide) compared to higher yielding or full strength cigarette brands.
The ACCC believes such health claims for low yield cigarettes were likely to have breached the misleading and deceptive conduct provision, and other sections, of the Trade Practices Act 1974. The reasons included the fact that it was generally known that smokers can, and do, compensate for claimed lower yields by smoking cigarettes in ways that obtain higher yields of tar, nicotine and carbon monoxide than indicated on the packets.
Imperial Tobacco has provided court-enforceable undertakings to the ACCC to:
- remove 'light' and 'mild' descriptors and related numbers from all cigarettes produced for Australian consumers by 1 October 2005 and by 24 October for imported cigarettes
- not make claims about the health benefits of low yield cigarettes when compared to high yield cigarettes, and
- pay $1 million to the ACCC to fund anti-smoking consumer education campaigns and programs concerning low yield cigarettes.