New 'Tobacco Authority' could ease cigarette restrictions

New 'Tobacco Authority' could ease cigarette restrictions

A bill to set up a tobacco authority of Thailand, approved by the cabinet on Dec 13 last year, contains loopholes that could be exploited by transnational tobacco firms aiming to make products in Thailand through their Thai nominees, according to anti-smoking activists.

The bill has touted the benefits of turning the Thailand Tobacco Monopoly from a state enterprise under the Finance Ministry into the Tobacco Authority of Thailand, a juristic entity with the flexibility to conduct transactions.

However, the bill is a cause for concern as it might allow transnational tobacco firms to gain control of firms or public companies allowed under the legislation, said Hatai Chitanondh, president of the Thailand Health Promotion Institute (THPI), Tuesday.

He said the bill should be reviewed to plug loopholes that could endanger public health.

The bill permits companies or public companies producing tobacco to be registered. The transnational tobacco giants could buy into them or manipulate their policies through proxy shareholders, he said.

The companies would also be able to produce a wide range of tobacco products, in a potential threat to Thailand's tobacco controls, Dr Hatai said.

The THPI insisted Prime Minister Prayut Chan-o-cha should consider having the bill revised.

The bill says foreigners are allowed to hold at most 49% of the shares in a company or a public firm producing tobacco, said Wasin Pipatthanachat, a lawyer working with the THPI.

On paper, foreigners might be kept from holding a majority stake. However, in practice no one can guarantee that Thai shareholders are not simply nominees of the foreign firms, he said.

The bill also fails to state clearly what stakes could be permitted for investment in the tobacco firms. The lack of clarity could open the way for foreign shareholders to exert their influence, according to Mr Wasin.

And although the bill says all plans to establish a tobacco company, which allow foreign investors to hold shares in the company, must be approved by the cabinet first, the truth is no one can guarantee the cabinet will be free from influence by the transnational tobacco industry, he said.

The World Health Organisation earlier this year published a report affirming the tobacco industry does more harm than good to countries, given the economic losses associated with cigarette smoking that by far surpass the income that each nation earns from the tobacco industry, said Suchada Tangthantham, an economist at the THPI.

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