CTFK Statement: U.S. Authorities Urged to Investigate British American Tobacco for Allegations of Widespread Bribery and Corruption in Africa

CTFK Statement: U.S. Authorities Urged to Investigate British American Tobacco for Allegations of Widespread Bribery and Corruption in Africa

Following new allegations about the conduct of British American Tobacco (BAT) in Africa –published today by The Guardian – the Campaign for Tobacco-Free Kids (CTFK) urged the U.S. Department of Justice and the U.S. Securities and Exchange Commission to investigate BAT and its subsidiaries for possible violations of the anti-bribery and accounting provisions of the Foreign Corrupt Practices Act (FCPA). Tobacco-Free Kids requested the investigation in a letter to the two government agencies.

British American Tobacco has faced mounting allegations that the company engaged in widespread bribery and corruption in Africa to gain an advantage over competitors and stifle government efforts to curb smoking.

Earlier this month, the U.K. Serious Fraud Office (SFO) formally launched an investigation of BAT on suspicions of corruption. An investigative report published today by The Guardian revealed new allegations that, for years, BAT secretly and possibly illegally moved millions of U.S. dollars in cash across international borders into the war-torn Democratic Republic of Congo (DRC) allegedly to support the company’s tobacco leaf operations in that country.

The new allegations indicate BAT’s operations included engaging with armed rebels involved in the long-standing DRC conflict in order to make secret cash drops used to pay for tobacco leaf from farmers in Auzi, an unmapped town BAT built in the 1950’s, according to The Guardian.

In addition to possible violations of the FCPA, The Guardian report raises questions about whether BAT’s conduct in moving U.S. dollars during the DRC conflict also violates federal anti-money laundering laws, especially as the U.S. has had sanctions in place against the DRC since 2006. The story also exposes BAT’s role in flooding South Sudan with its cheapest cigarette brands following years of war and operating around terrorist networks in Somalia to continue selling cigarettes in the country.

The growing allegations about BAT’s conduct are particularly alarming following the July 2017 merger of BAT and Reynolds American in the United States. The recent merger places BAT in a leading position in the U.S. market and, according to BAT, created the largest tobacco company in the world by operating profits.

“Given British American Tobacco’s decades-long history of calculated deception in the United States and abroad and its re-entry into the U.S. market, the mounting allegations of corruption and mass concealment of funds by BAT must be fully investigated by U.S. regulators for possible violations of the Foreign Corrupt Practices Act and any other applicable criminal or civil laws,” said Matthew L. Myers, President of the Campaign for Tobacco-Free Kids. “This is a company that has proven it cannot and will not play by the rules. Unless and until they are held accountable by governments, shareholders, business partners and the public, the company’s wrongdoing will only continue.”

Alleged corruption within BAT was first publicly exposed in November 2015 when the BBC, and later other news outlets, revealed allegations that the company was engaging in bribery and other corrupt acts that included bribing Ministry of Health officials in Burundi, Comoros and Rwanda, a former Kenyan Minister of Justice and a Member of Parliament from Uganda.

Tobacco use kills more than seven million people worldwide each year. Without urgent action by governments to pass proven tobacco control laws and curb the power and influence of tobacco companies, tobacco use will kill one billion people this century.

What does the recent ruling on tobacco control regulations mean for the fight against NCDs in Kenya?

What does the recent ruling on tobacco control regulations mean for the fight against NCDs in Kenya?

Kenya is currently celebrating 10 years since the enactment of the Tobacco Control Act 2007, developed following Kenya’s ratification of the Framework Convention on Tobacco Control (FCTC) in 2004 (link is external). Although the Act has been operational since 2007, full realisation of the gains intended has been elusive due to delays in implementing its associated regulations. The Tobacco Control Regulations 2007 are meant to be subsidiary laws intended to put into effect specific provisions of the Tobacco Control Act 2007 – but the tobacco industry have consistently fought legislation, realising that the regulations would ultimately impact on sales of their health harming products.

Tobacco in Kenya – what’s the problem?

Tobacco is the most preventable cause of death globally and has been singled out as one of the major risk factors for Non-Communicable Diseases (link is external) (NCDs). Owing to this, a global NCDs agenda of reducing up to 30% of prevalence of tobacco use from people 15+ years by 2030 was set within the Sustainable Development Goals (link is external). According to Kenya STEPwise, a survey conducted in 2015 to collect information on the risk factors for NCDs, it is estimated that up to thirteen percent (13%) of Kenyans currently use some form of tobacco products (link is external). About ten percent (10.1%) of this population uses smoked tobacco products such as cigarettes, pipes and shisha, while the remaining three percent (3%) use smokeless tobacco.

Furthermore, it is estimated that nearly twenty-one percent (20.9%) of Kenyans are exposed to second hand smoke at home and work. These are indeed alarming statistics given the disturbing burden of NCDs in Kenya. On Thursday January 5, 2017, The Acting Director of World Health Organization’s (WHO) NCD cluster, and WHO’s Regional Director for Africa, Dr Matshidiso Moeti decried the increasing burden of NCDs in Africa stating that heavy reliance on tobacco use was among the major causes of the rising NCDs and related deaths in the continent (link is external).

Kenyan Tobacco Control Regulations: a major boost in the fight against NCDs

The Tobacco Control Regulations 2014, give a greenlight to regulation of packaging and labelling of tobacco products manufactured locally or imported. Tobacco companies in Kenya are mandated by the regulations to print pictorial health warnings (PHWs) on both sides of their cigarette packs. Having explicit graphical/ pictorial health warnings depicting health effects of tobacco use have been lauded (link is external) as an effective way of encouraging tobacco smokers to quit smoking and discouraging others from starting the habit.

Involuntary exposure to second hand tobacco smoke is also a major concern to the fight against NCDs. With nearly twenty one percent of Kenyans involuntarily exposed to second hand tobacco smoke, there has been a sharp rise of NCDs among children, people living with disability and those living with AIDS. Effective implementation and enforcement of the Tobacco Control Regulations will protect the general public against exposure to second hand tobacco smoke in public places, and distinct private places where children and other vulnerable people could be exposed to tobacco smoke.

NCDs must be taken seriously and resourced sufficiently to maintain momentum

Incapacitation in the fight against NCDs in Kenya and in Africa has largely been attributed to low prioritisation of NCDs within the national agenda. This has in turn affected how resources are being allocated to NCD programs in Kenya, as well as the rest of the continent.

The Tobacco Control Regulations 2014, shine some rays of hope. In a quest to curb the rising negative health effects of tobacco use, these regulations have strongly highlighted provisions for the tobacco companies to justifiably take on the responsibility of dealing with these effects and costs to society. The regulations outline strong provisions for the tobacco companies to mandatorily contribute annually to the Tobacco Control Fund (TCF), through which the Ministry of Health is able to set up structures to support cessation programs, as well as conducting research especially on chronic conditions resulting from heavy reliance on tobacco use.

The tobacco industry – implicated in disease and death, but still fighting for their own survival

The tobacco industry sees the regulations as a threat to their business and income streams, which have increasingly focused on growing markets in Africa. Since before the implementation of the Tobacco Control Act of 2007, the industry has fought legislation in court, a test of our government’s financial resources, commitment to health, and resilience.

On Friday February 17, 2017 a major ruling was made by the Kenya’s Court of Appeal upholding the Tobacco Control Regulations 2007 and disqualifying an appeal case lodged by British American Tobacco (BAT) and Mastermind Tobacco Kenya Limited. Earlier BAT had prevented the Tobacco Control Regulations 2014 from coming into effect in June 2015 through a legal process at the High Court challenging the constitutionality of the regulations. In March 2016, the High Court made a judgement in favour of the regulations which BAT opted to appeal, faulting the judgement by the High Court. They just would not sit back and accept the rule of court, and health advocates again ramped up in efforts to resist the appeal and ensure that the right to health was protected.

The fight against tobacco and NCDs can’t stop with this latest ruling – there’s much to be done

For all these gains to be enjoyed, there needs to be

  1. Political goodwill to fully implement general tobacco control policies in Kenya;
  2. Unwavering commitment by people charged with the responsibilities of overseeing compliance and enforcing the regulations; and
  3. Consistent monitoring and reporting structures on the achievements made in the implementation and enforcement of the regulations.

We hope that BAT’s appeal was the industry’s final assault on regulations designed to align with the FCTC, and in doing so protect the health of Kenyans today and into the future. We recognise the determination of the tobacco industry to disrupt and interfere using any means to protect their business. We stand vigilant to hold them at bay, and support the government and health sector in efforts to prevent tobacco related harm in Kenya. We also hope that our story inspires other governments and health advocates taking on the tobacco industry in court – it can be done, indeed – it must.

 

About the Author

Achieng Otieno (@sachieng (link is external)) is Communication and Digital Advocate for Kenya Tobacco Control Alliance (KETCA) (link is external) (@KETCA1 (link is external)). KETCA is a not-for-profit organisation that brings together civil society organisations advocating for tobacco control in Kenya. KETCA is a member of the NCD Alliance in Kenya (NCDAK).(link is external) The victory over BAT and Mastermind Tobacco were a result of collaborative effort from various stakeholders within the country and beyond, and for that KETCA expresses appreciation to supporters.

Kenya’s Court of Appeal Rejects British American Tobacco Suit, Upholds Tobacco Control Regulations

Kenya’s Court of Appeal Rejects British American Tobacco Suit, Upholds Tobacco Control Regulations

Press Release by: Campaign For Tobacco Control Kids                                                                           February 17th, 2017

Kenya’s Court of Appeal in Nairobi today upheld the country’s 2014 Tobacco Control Regulations, affirming a lower court’s findings and rejecting legal challenges to the regulations from British American Tobacco (BAT) Kenya. The court’s decision is a resounding victory for public health and allows the government to move forward with implementing a law that will help protect Kenyans from the devastating consequences of tobacco use. As a party to the World Health Organization Framework Convention on Tobacco Control, Kenya is legally obligated to implement evidence-based measures to reduce tobacco use.

Included in Kenya’s Tobacco Control Regulations are requirements for picture-based health warnings and strengthened protections against secondhand smoke. The regulations also require tobacco companies to pay an annual fee into a designated tobacco control fund to assist the government in paying for the harmful health effects of tobacco use for Kenyans.

Today’s ruling sends a strong message that BAT’s legal claims were without merit and that tobacco industry interference in laws to improve public health will not be tolerated. The ruling also has implications for other African countries where tobacco companies are interfering in efforts to pass and implement proven tobacco control policies. In Uganda, for example, BAT has also filed a legal challenge against a tobacco control law aimed at preventing and reducing tobacco use.

Kenya’s Court of Appeal ruling is yet another blow for BAT, a company currently under investigation in Kenya for the alleged bribery of government officials. A 2015 investigative report broadcast by the BBC disclosed extensive evidence, supported by previously secret documents, that BAT paid illegal bribes to influence members of parliament, gain advantage over competitors and undermine tobacco control policies in multiple African countries.

We congratulate the Government of Kenya for its resolve in standing up to Big Tobacco. Today’s decision sends an unequivocal message that African governments can and should move ahead with efforts to reduce tobacco use even in the face of legal challenges from tobacco companies. Around the world, the largest multinational tobacco companies are increasingly losing legal battles to block and delay tobacco control measures.

Tobacco use is the world’s leading cause of preventable death. Without urgent action, tobacco use will claim one billion lives this century.

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