Tobacco Company BAT Sues MOH Official Over Cigarillo Categorisation As Cigarette

MOH is also being sued for revoking its approval for the sale of the Dunhill HTL-Cigarillo as a non-cigarette tobacco product.

KUALA LUMPUR, Nov 14 — Tobacco giant BAT’s Malaysia chapter has filed an application for judicial review of a Ministry of Health (MOH) decision to recategorise the Dunhill HTL-Cigarillo as a cigarette.

BAT’s “mini-cigars” retail at RM9 for a pack of 20, compared to its traditional cigarettes that are almost twice as expensive, amid the flourishing of the illegal cigarette trade that sells illicit cigarettes at between RM3 and RM7.

“The unexpected ‘U-turn’ decision by the Deputy Director General (Public Health) of the Health Ministry to recategorise and revoke the approval of Dunhill HTL-Cigarillo without prior notice, claiming that it is a cigarette, highlights the challenging and unreasonable parameters imposed on a legal tobacco company to operate in this country,” said BAT Malaysia managing director Erik Stoel in a statement, referring to Dr Chong Chee Kheong.

“This product was approved as a non-cigarette not only by MOH for sale a year ago, but also by the Royal Malaysian Customs. Revoking it unilaterally without any chance of consultation is against any reasonable expectation of a legal business, let alone a public listed company like us.”

Stoel complained about an MOH raid in East Malaysia that affected over 100 retailers, weeks before a revocation letter was issued to BAT Malaysia.

This, he said, prevented BAT Malaysia from complying with MOH’s revocation letter that allowed the tobacco company a month to remove the “non-cigarette” tobacco product from the market.

“The heavy-handed approach we have endured is reflective of MOH’s subjective interpretation of the law without consultation of legal tobacco players. We are especially baffled by the fact that there are other legal cigarillo products in the market today, but these products were not a part of any enforcement actions. Only Dunhill HTL-Cigarillos were the focus of these raids. This also shows an inconsistency in the way MOH applies their policy,” Stoel alleged.

He accused MOH of carrying out “selective prosecution” against a legitimate tobacco company like BAT and of “targeting legal non-cigarette products while turning a blind eye to cheap illegal contraband.”

Stoel noted that almost two-thirds, or 65 per cent, of cigarettes consumed in Malaysia are illegal.

“The Deputy DG of Health and the Tobacco Control Sector has clearly lost the plot. The reality is that the Ministry’s own ineffective policymaking has undermined its own health agenda. Smoking consumption has grown by 5 per cent and according to MOH data, incidences of youth smoking have increased to 13.8 per cent on the back of easily available illicit tobacco. Should that not be a priority of the Ministry?” Stoel questioned.

“Until today, there have been no concrete actions from the Deputy Director DG of Health or the Tobacco Control Sector to tackle this 65 per cent black market. Instead, they choose to over-regulate, scrutinise and enforce inconsistent applications of the law against a legal player in the industry.”

According to BAT, Dunhill HTL-Cigarillos are best described as a mini or little cigar. Unlike a cigarette which is wrapped in paper, a cigarillo is wrapped in tobacco leaves or tobacco-based material comprising homogenised tobacco, more commonly known as reconstituted tobacco.

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