India threatens Philip Morris with ‘punitive action’ over alleged violations

NEW DELHI, (Reuters) - The Indian government has threatened Philip Morris International Inc with “punitive action” over the tobacco giant’s alleged violation of the country’s anti-smoking laws, according to a letter sent to the company by the federal health ministry.

The letter was prompted by a Reuters investigation last month that revealed how Philip Morris was deploying marketing tactics in India, some targeting young people, that officials said were illegal. (http://reut.rs/2uuye5Y)

The letter cites the Reuters story in the opening paragraph, listing Philip Morris’ marketing methods as outlined in the article, including cigarette advertisements at kiosks, the free distribution of Marlboro smokes at nightclubs and bars, and the use of TV screens to promote the world’s best-selling cigarette brand at these events.

These promotional activities are a violation of the country’s tobacco control law and are subject to punishment under the act, says the letter, dated Aug. 10.

“You are requested to clarify your position and to show cause why appropriate punitive action be not initiated against the company and its directors,” the letter continues.

Such infractions can carry a fine of up to 1,000 rupees (about $15) and a sentence of up to two years in prison for the first conviction, according to the Cigarettes and Other Tobacco Products Act.

The India unit of Philip Morris International did not respond to questions from Reuters.

The health ministry also sent a letter to ITC Ltd, India’s leading cigarette maker, which Reuters also reported last month was using some of the same promotional methods as Philip Morris, such as point of sale displays. In its letter to ITC, the health ministry said the company’s advertisements at kiosks were illegal.

“Advertisement other than listing type of tobacco products available, whether displayed inside or outside the shop is prohibited and attracts punishment,” the ministry said. It also called on ITC to explain why “punitive action” should not be taken against the company. ITC did not respond to questions. Indian officials have repeatedly said that tobacco advertisements that use brand names, pack images or promotional messages are banned at kiosks - inside and outside. Philip Morris and ITC have said they are in compliance with tobacco control regulations and that the law allows advertising inside a kiosk.