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April,
2008

FDA Bill Moves Forward in Congress

Potential FDA oversight of tobacco works its way further into uncharted territory as proposed legislation inches past hurdles.

By Thomas A. Briant

During March, legislation that would grant the U.S. Food and Drug Administration the power to regulate cigarettes and smokeless to­bacco products continued to receive hear­ings before Congressional committees.

In the U.S. House, the Subcommit­tee on Health passed bill number H.R. 1108 on March 11th on a 18 - 9 vote to send the bill to the full House Energy and Commerce Committee. All of the Democrats on the subcommittee plus one Republican member voted to pass the bill while the other Republicans voted against sending the bill to the full committee for consideration.

NATO’S POSITION
While NATO has not taken a position on the provisions of the FDA bill that in­volve manufacturer regulations, NATO is concerned with several parts of the bill that could jeopardize the future of retail stores that sell tobacco products. First, Section 917 of the bill specifically allows Congress, federal agencies, states and cities to adopt even more severe re­strictions including a complete ban on the sale of tobacco products.

Second, all color tobacco advertising would be prohibited inside any retail store that sells tobacco products and re­tailers would be reduced to advertising legal tobacco products by using black letters on a white background. This in-store color advertising ban violates the protection of “commercial speech” under the First Amendment of the U.S. Constitution which protects the right to advertise legal products.

Third, under Section 901(b) of H.R. 1108, the FDA would be allowed to simply expand the regulations to apply to all other tobacco products including cigars, little cigars and pipe tobacco. However, one significant amendment offered by Republican Nathan Deal of Georgia and approved by the subcom­mittee requires that any future regula­tions or expansion of regulations pro­posed by the FDA must go through a rulemaking process.

By this amendment, the FDA would need to publish any new proposed regu­lations and allow the public to submit comments on the new rules. This rule­making requirement partially addresses NATO’s concern that the FDA would have had the authority to adopt even more restrictive regulations on cigarettes and smokeless tobacco products and even extend regulations to cigars, little cigars and pipe tobacco without any fur­ther public input or action by Congress.

NATO has corresponded with the members of the U.S. House Energy and Commerce Committee about these con­cerns and NATO retailers have been alerted to contact their U.S. Representa­tives that are members of this committee.

DEFINING A USER FEE VS. TAX
In addition to NATO’s concerns, the Bush administration has publicly voiced a concern that the FDA would be overburdened if it had to regulate the tobacco industry due to a lack of experienced staff and computer system obsolescence. Moreover, Republicans in Congress argue that a “user fee” in­cluded in the bill and to be charged to tobacco manufacturers is really a tax. The House version of the bill would in­crease the user fee over a ten year period to offset an expected loss in cigarette and tobacco tax revenue due to the new regulations. Republicans make the point that increasing a user fee to recover more than just the FDA’s cost of administering the regulations constitutes a new tax.

Last year, the U.S. Senate Health, Ed­ucation and Pensions Committee passed a similar bill that would authorize the FDA to regulate cigarettes and smokeless tobacco products. However, the full Sen­ate has not yet taken up the legislation.

2008 TOBACCO PLUS EXPO
There is still time to register and attend the 2008 Tobacco Plus Expo which will be held on April 24 - 25 at the Las Vegas Con­vention Center. The most important reasons for retailers that sell tobacco prod­ucts to attend the Tobacco Plus Expo include free retail seminars for NATO members, the latest in tobacco products and accessories, numerous product show deals and complimentary tickets to the NATO Annual Awards Dinner.

Retailers can register to attend the 2008 Tobacco Plus Expo by visiting the show’s website at www.tobaccoplusex­po.com and clicking “Attendees” or calling the toll-free registration hotline at 1-888-825-2299.

Thomas Briant is executive director of the National Association of Tobacco Outlets (NATO), Toll-free: (866) 869-8888, Web: www.natocentral.org.


SMOKESHOP - April, 2008