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BAT and cigarette smuggling ­ ASH publishes startling new evidence on theweb

ASH today challenges British American Tobacco (BAT) over its involvement incigarette smuggling in developing countries by publishing 150 of BAT'sinternal and confidential documents on the ASH web site at www.ash.org.uk/?smuggling[1].  The Guardianand Washington-based Center for Public Integrityalso publish major investigative research today. The evidence presented fromthese sources clearly suggests that smuggling is integral to the operation ofthe international cigarette market and driven by the ferocious competitionbetween the tobacco multinationals for new markets.

Clive Bates, Director of ASH acknowledged that BAT does not actually do thesmuggling itself, but said, "We are making these documents available sothat public can decide for themselves whether they believe the tobacco companies'rhetoric on smuggling. The tobacco industry says that there is nothing they cando about it; we say the documents show that while BAT doesn't actually drivethe trucks and sneak through customs itself, they are a Mr. Big in themanipulation of international cigarette smuggling."

"The documents show that BAT sought to control markets through cigarettesmuggling in the early 90s in ways that went well beyond any acceptable standardof corporate behaviour. It wasn't all happening outside the control of thetobacco industry. They were trying to manage smuggling routes, control price andavailability in illegal markets and were treating smuggling almost like anyother distribution channel." said Bates

ASH will be calling on StephenByers to launch a DTI investigation anddemanding that the Deputy Chairman of BAT, former Chancellor KennethClarke, undertakes an internal inquiry intohis company's involvement in smuggling. As the most senior non-executivedirector, Clarke is responsible for ensuring high standards of corporate conductand governance.

"We have written to Mr. Clarke asking him take his responsibilities forBAT corporate governance seriously and present an interim report to the BAT AGMon April 27^th. It is about time Clarke did the job that BATshareholders, at least in theory, pay him for." said Bates[2]

Emma Must, International Campaign Manager at ASH said: "Cigarettesmuggling is not a victimless crime: the latest projections suggest that onebillion people will be killed by tobacco in the 21^st Century, thevast majority in developing countries. As the tobacco multinationals turn theirmarketing firepower on developing countries, tobacco taxation is an vitalcounter-measure, but this is undermined by large scale smuggling."

[1] The documents have been found by researchers working in the BATlitigation depository in Guildford, England, which contains over 8 million pagesof internal documents from the 1950s to 1994. This archive was made public aspart of a major litigation settlement in the US State of Minnesota in 1998.

[2] As Deputy Chairman of BAT, Clarke was paid UKP(£)67,820 in 1998,according to BAT's 1998 Annual Report.

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