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Tobacco giant creates new marketing arms
SIMON TUCK
Imperial Tobacco Ltd. unveiled two new subsidiaries yesterday, as the domestic industry's biggest player attempts to carve out a marketing plan that stays within the boundaries of Ottawa's new anti-tobacco legislation.
Montreal-based Imperial said it has created one subsidiary, Channel 2, to conduct product displays in bars, sporting events and other entertainment events directed at adults. Canada's largest cigarette maker has also created a wholly owned unit, Rumbling Walls Events, to promote other company's products through its own magazines and Web sites, and organize events where cigarettes could be displayed.
Christina Dona, a spokeswoman for Imperial, said the company is trying to find new ways to use product displays in stores, one of the industry's few remaining marketing avenues. "It's about the only one available."
The final stage of the federal government's new anti-smoking legislation, which is being appealed by the industry, takes effect today. The legislation severely restricts the industry's marketing.
Imperial's new marketing plan is the industry's latest response to its changing legal parameters. The company announced a plan last month to restructure its arts-granting program, also a result of the new federal restrictions on the tobacco industry's ability to use advertising and sponsorships.
Cynthia Callard, executive director of Physicians for a Smoke-Free Canada, said Imperial's new marketing plan is the industry's latest move to get around anti-smoking legislation. "If they find a loophole, they'll drive through it."
Ms. Callard said the federal government should move quickly to stop all lifestyle advertising, including those efforts aimed solely at adults.
The industry, Ms. Callard said, is trying to nurture an "economic dependency" between the cigarette companies and bar owners. That would create a lobby group for the tobacco companies to replace the arts and sports groups that are no longer allowed to accept most forms of support from the cigarette makers, she added.
"We knew they'd do something."
Cigarette companies have long argued that their advertising and marketing efforts have been designed only to lure existing smokers who use competitors' products, not to create new smokers. Many anti-smoking lobbyists and health experts have disagreed.
Imperial is owned by London-based global tobacco giant British American Tobacco Co., which says it has 61.6 per cent of the Canadian cigarette market. The other two major players are JTI-Macdonald Corp. and Rothmans Benson and Hedges Inc.
The federal government's latest anti-smoking legislation marks the latest leg in a continuing battle between Canadian governments and the tobacco industry.
In 1995, the industry successfully argued before the Supreme Court that the government's first federal law that banned tobacco advertising violated free speech.
Earlier this year, British Columbia failed in its bid to emulate some U.S. states in trying to recover billions of dollars in health care costs associated with smoking.
A judge in Montreal, meanwhile, yesterday rejected a request by two businessmen who wanted the Montreal Grand Prix allowed an exemption from the new anti-tobacco laws. The judge refused to consider arguments that the loss of the race will hurt the city's economy.
Race organizers said the Formula One event was dropped from the 2004 schedule because of federal and provincial anti-smoking laws.
© The Globe and Mail
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