UK Diplomats Lobbying on Behalf of BAT

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Since the Framework Convention on Tobacco Control (FCTC) came into force in 2005, there have been several instances of direct lobbying by British diplomats overseas on behalf of British American Tobacco (BAT) and its subsidiaries, with repeated contact between UK government overseas staff and the company.

British health charity Action on Smoking & Health (ASH) called it a “global pattern of engagement” by British officials to defend BAT’s interests.[1] Much of this lobbying activity has taken place in low and middle income countries (LMICs) which are important target markets for tobacco companies as those in developed countries become increasingly regulated and less lucrative.[2][3]

Background

Parties to the WHO Framework Convention on Tobacco Control (FCTC) have an obligation to protect public health policies from the “commercial and vested interests of the tobacco industry” and any contact with tobacco industry representatives, or others seeking to further their interests, must be “limited” and “transparent”.[4]

The UK government, a signatory to the FCTC, has had rules in place on the engagement of civil servants with the tobacco industry since 1999.[5] After the exposure of direct lobbying for BAT by a British diplomat in Panama in 2012, pressure from ASH helped lead to further strengthening of these guidelines to support compliance with the FCTC, to be “more prescriptive in relation to provision of support to the tobacco industry”, and to restate and clarify the term “maximum transparency” in the engagement between tobacco companies and government staff overseas.[6]

UK Diplomats Lobbying for British American Tobacco

Despite the revised guidelines, a case came to light in 2017 of a senior UK diplomat lobbying the government of Bangladesh on behalf of BAT.[7] There has also been repeated contact between officials of the UK Department of International Trade (DIT) and the tobacco industry in Panama and Venezuela since 2014;[8][9] direct lobbying by the UK Ambassador on behalf of BAT in Hungary in relation to taxation in 2014 and 2015;[10] and the public association of a senior British diplomat with overt BAT lobbying of the Pakistani government over health warnings on cigarette packaging in 2015.[11][12][13]

Bangladesh

In September 2017, it was revealed that the British High Commissioner in Bangladesh had lobbied on behalf of BAT Bangladesh (BATB) in a tax dispute with the Bangladesh Board of Revenue over £170 million in unpaid VAT for incorrectly categorised cigarettes.[14][7][15][16] DIT officials, including the Director and Deputy Director, were also involved in multiple meetings, e-mails and phone calls with BAT relating to this issue between 2015 and 2017.

Panama

Latin America is a key market for BAT, which held 46% of the cigarette market in 2015.[17] As early as 2002 a report by the Pan American Health Organisation (PAHO) warned of the tobacco industry goal to “forestall any meaningful regulation of the industry’s practices or products” in the region.[18] The FCTC came into force in Panama in 2008, but in 2012, the Financial Times revealed that UK Ambassador Michael Holloway had lobbied the government of Panama on behalf of BAT over tax increases on tobacco, and the impact of the “alarming growth” in smuggled cigarettes on “one of the most important British Companies”.[11]

At the time a Foreign Office spokesperson said that “our Ambassador was following our strict guidelines on lobbying, which allow us to offer assistance to firms operating overseas, including in resolving business problems that are potentially discriminatory”,[11] a defence which has been criticised as running counter to FCTC guidelines.[19] The same argument has been used to justify lobbying in Hungary in 2014/15[10] and Bangladesh in 2017.[16]

Since the UK government guidelines were revised in 2013, stating “Posts must not …Attend or otherwise support receptions or high profile events, especially those where a tobacco company is the sole or main sponsor…”,[6] further contact between UK diplomats in Panama and BAT has been disclosed: “six meetings between BAT and embassy staff. Including two BAT ‘receptions’”.[8]

Venezuela

Venezuela became a party to the FCTC in 2006, but appears to have had limited success with compliance with WHO guidelines on article 5.3, including the requirement for transparency.[20][21] Following Freedom of Information (FOI) requests made by ASH, the DIT disclosed interaction with BAT (Bigott) Venezuela at 25 meetings between 2013 and 2017, mostly meetings of the Venezuelan and British Chambers of Commerce and “CEO Breakfast meetings”.[9]

Little detail of the specific purpose or content of these meetings is given, and it is unclear which officials were present. In one instance, BAT and several other British companies met in 2016 with the Venezuelan Trade & Foreign Investment Minister at the British Embassy to “share the challenges and complexities they face when doing business in Venezuela aiming to obtain the Minister’s support with those issues and to arrange further bilateral meetings”.[9]

Providing an opportunity to lobby the Venezuelan government appears beyond the “basic trade, investment and political information” allowed under the 2013 guidelines.[6]

Issues of Concern

This global pattern of activity, of BAT enlisting UK diplomats to lobby on their behalf and promoting their economic interests above those of public health, is problematic for multiple reasons.

Breach of FCTC Article 5.3

The lobbying activity clearly breaches the spirit, and at times the letter, of Article 5.3 FCTC, which highlight the well documented tactics of the tobacco industry “to interfere with the setting and implementing of tobacco control measures”.[4]

The FCTC is very specific on limiting contact with the industry: “Parties should interact with the tobacco industry only when and to the extent strictly necessary to enable them to effectively regulate the tobacco industry and tobacco products”.[4] The extended interaction in Panama and Bangladesh clearly falls outside this definition of necessary contact.

There are also specific recommendations regarding transparency: “… Whenever possible, interactions should be conducted in public, for example through public hearings, public notice of interactions, disclosure of records of such interactions to the public”.[4] None of the transparency recommendations appear to have been followed by UK diplomats in Bangladesh prior to a Freedom of Information Request.

Breach of UK Guidelines for Diplomats

Jointly issued by the UK Department of Health (DH) and the Foreign and Commonwealth Office (FCO) the 2013 guidelines state that “Posts must not…Engage with local foreign governments on behalf of the tobacco industry, except in cases where local policies could be considered protectionist or discriminatory”.[6] Senior officials and politicians have argued that the retrospective tax demand from the Bangladesh government is discriminatory.[5] Under the guidelines some assistance can be given in “resolving business problems, e.g. customs of port clearance, smuggling, trademark violations etc”[6] but national taxation policy would seem to fall better under the direction “to assist tobacco companies to comply with foreign government laws or regulations”.[6]

The need for transparency is emphasised in the UK guidelines: “in the event that interactions with the tobacco industry are necessary, these should be conducted with the maximum of transparency to demonstrate our compliance with the FCTC”. Given the lack of detail and the use of blanket exemptions, the UK government’s FOI releases are far from ‘transparent’, notably the 2018 letter from the UK Ambassador in Bangladesh was omitted. British politicians have also publicly stated that the UK government “does not catalogue the representations it makes on behalf of companies”.[22][23][24]

“Business as Usual?”

FOI requests have revealed frequent contact with the tobacco industry at business meetings and events organised by the FCO/DIT, and local Chambers of Commerce.[8] Since 2016 BATB has been involved in the “Tax working group of the EU Bangladesh Business Climate Dialogue” and taken part in discussions of government budgets, taxation and “market conditions” where the Director of DIT has been present.[16] In addition to BATB, contact has been disclosed with the Imperial Tobacco controlled Lao Tobacco Company in Laos;[25] with Habanos/Brascuba,a joint venture with Imperial Tobacco in Cuba;[26] and with a tobacco company “owned by a British national” in Burundi.[27]

Services and assistance provided are described by the UK government as being the same as for any other UK businesses.[16][9][25] The responses offered in defence of these lobbying activities suggests that, despite clear UK government guidelines for the conduct of overseas officials, elements of the UK Government still consider the tobacco industry to be an industry like any other, and are therefore conducting “business as usual” in conflict with the UK’s own tobacco control policies.[28] In the official dealings with the industry, it does not appear to be taken into account that the tobacco industry does not operate like other businesses.[4][29] BAT is currently under investigation by the Serious Fraud Office after allegations of corruption and bribery in Africa.[30][31]

Undermining Tobacco Control Programmes

A priority for the WHO in Bangladesh (as part of the Bloomberg Initiative to Reduce Tobacco Use[32]) has been to help the National Board of Revenue to build capacity on tobacco taxation”.[33] The UK Department of Health is also “supporting the implementation of tobacco control measures” in low and middle income countries with £15 million of Overseas Development Assistance funds allocated to 2030 [28]

The intervention of UK diplomats on behalf of BAT in Bangladesh and elsewhere appears to be in direct conflict with the aims of these programmes.[8]

TobaccoTactics Resources

Other instances where BAT tried to hinder regulations:

Relevant Links

Notes

  1. Action on Smoking and Health, How British diplomats have defended BAT’s overseas activities, ASH website, 26 April 2018, accessed June 2018
  2. A. Gilmore, Big tobacco targets the young in poor countries-with deadly consequences, The Guardian, 1 December 2015, accessed June 2018
  3. A.B. Gilmore, G. Fooks, J. Drope, et al, Exposing and addressing tobacco industry conduct in low-income and middle-income countries, The Lancet, 2015; 385(9972):1029–1043
  4. 4.0 4.1 4.2 4.3 4.4 World Health Organization, Guidelines for implementation of Article 5.3. of the WHO Framework Convention on Tobacco Control, 2008, accessed June 2018
  5. 5.0 5.1 Hansard, Parliament debate, UK Parliament website, Hansard column 334, 18 May 1999, accessed June 2018
  6. 6.0 6.1 6.2 6.3 6.4 6.5 Department of Health, United Kingdom’s revised guidelines for overseas posts on support to the tobacco industry, December 2013, accessed June 2018
  7. 7.0 7.1 J. Doward, British diplomat lobbied on behalf of big tobacco, The Guardian, 10 September 2017, accessed June 2018
  8. 8.0 8.1 8.2 8.3 J. Doward, UK accused of hypocrisy on overseas tobacco control, The Guardian, 27 January 2018, accessed June 2018
  9. 9.0 9.1 9.2 9.3 Department of International Trade, List of all contact that diplomatic posts in DIT Venezuela have had with tobacco manufacturers since December 2013. Released in response to Freedom of Information request by ASH. Available from: https://www.gov.uk/government/publications/foi-release-contact-with-tobacco-manufacturers-in-venezuela, accessed July 2018
  10. 10.0 10.1 Foreign & Commonwealth Office, Freedom of Information Act 2000 Request Ref: 1045-17, 8 January 2018
  11. 11.0 11.1 11.2 K. Stacey, K. Shubber, UK accused over cigarette lobbying abroad. Financial Times, 7 April 2015
  12. BAT team asks govt to withdraw decision, The Nation, 20 March 2015, accessed June 2015
  13. Pakistan: British High Commissioner Lobbies for Tobacco Industry, Worldwide News and Comments, Tobacco Control, 2015;24:213-216
  14. PROGGA, BATB deploys British High Commissioner to negotiate tax evasion battle worth Tk. 1924bn-ATMA member exposed, Tobacco Industry Watch BD website, undated, accessed July 2018
  15. M. Yeasin, Revenue caught in legal web, The Independent, 20 May 2018, accessed June 2018
  16. 16.0 16.1 16.2 16.3 Department of International Trade, FOI 1042-17, 29 December 2017
  17. Euromonitor International, Company Shares By Retail Volume Historical % Breakdown: Latin America Cigarettes, 2015
  18. Pan American Health Organization, Profits Over People. Tobacco Industry Activities to Market Cigarettes and Undermine Public Health in Latin American and the Caribbean, November 2002, accessed June 2018
  19. D. Arnott, Britain’s shame in Panama: Trade interests allowed to trump health, FCA Bulletin, issue 11, 29 March 2012, accessed June 2018
  20. World Health Organization, C125-Use of guidelines on Article 5.3, undated, accessed June 2018
  21. Republica Bolivariana de Venezuela, Instrumento de presentacion de informes del convenio marco de la oms para el control del Tabaco, July 2014, accessed June 2018
  22. House of Lords, Tobacco: Written question HL5324, UK Parliament website, 1 February 2018, accessed June 2018
  23. House of Commons, Diplomatic Service: Tobacco: Written question 105761, UK Parliament website, 6 October 2017, accessed June 2018
  24. House of Commons, Tobacco: Written question 127795, UK Parliament website, 8 February 2018, accessed June 2018
  25. 25.0 25.1 Foreign & Commonwealth Office, Freedom of Information Act 2000- Request Ref: 1047-17, 1 December 2017
  26. Foreign & Commonwealth Office, FOI release:contact with tobacco manufacturers in Cuba, 18 May 2018, accessed June 2018
  27. Foreign & Commonwealth Office, FOI release: contact with tobacco manufacturers in Rwanda and Burundi, 15 May 2018, accessed June 2018
  28. 28.0 28.1 Department of Health and Social Care, Policy paper: tobacco control measures overseas, 22 August 2017, accessed June 2018
  29. S. Chapman, Can we trust Big Tobacco to promote public health?, The Conversation, 14 March 2017, accessed July 2018
  30. Serious Fraud Office, SFO investigating British American Tobacco p.l.c, 1 August 2017, accessed June 2018
  31. BBC News, British American Tobacco investigated by Serious Fraud Office, 1 August 2017, accessed June 2018
  32. Bloomberg Philanthropies, Bloomberg Initiative To Reduce Tobacco Use Grants Program, 2009, accessed June 2018
  33. World Health Organization, Tobacco control in Bangladesh, Tobacco Free Initiative, November 2015, accessed June 2018