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Updated - October 16, 1989 by Frank J. Farnel

EEMA Region Annual Report Regarding PMI Corporate Affairs Action Plan (PMI = Philip Morris)

1 - WHO/UICC/IOCU

* Scandinavia/Finland

Dr. Tapani Piha, who has been directing the Finnish National Board of Health's Department addressing tobacco issues, has been appointed as Scientific Tobacco Campaign Leader (effective August 1, 1989) in the WHO Regional Office in Copenhagen. This is significant in part because Dr. Piha has evidenced a willingness to discuss with Philip Morris government proposals prior to enactment. Stig Carlson is following up with him to monitor his current European efforts for WHO.

Due to PM and Nordic Smokers Clubs' efforts, the WHO sponsored No-Tobacco Day in the Nordic countries an May 31 generated less publicity for its messages in comparison to 1988 and significantly this year industry views were positively featured in media reports.

* Gulf Cooperation Council Countries

Bisharah Barcudi has enlisted the consulting services of Jeffery Philips, who is based in Cairo, to begin monitoring the WHO Eastern Mediterranean Regional Office (EKRO). We have learned from this effort that Dr. Hussein Al-Jazairy, the Regional Director of the EKRO (& former SA Health Minister), does not advocate further reductions in MCLs and that Dr. Mojeabai, the head of the ENRO Disease Prevention and Control Department (& former Inspector General of Health for the late Shah of Iran), is responsible for anti-smoking programs - the principal emphasis of which is ETS. They are enlisting sports celebrities to feature on their educational anti-smoking posters. Mr. Philips also accessed for us the EKRO reference work which is a compilation of noted Islamic rulings on smoking. Regular Middle East CA contacts with key GCC Health officials also enable us to follow up and monitor important EKRO initiatives.

Middle East Corporate Affairs in cooperation with INFOTAB arranged for a letter from the International Tobacco Growers Association together with the June FAO Economic Impact of Tobacco Study to be anonymously distributed to key participants in the EKRO Executive Board meeting on September 29 in Tehran Iran.

* SWITZERLAND

Fabriques De Tabac Reunies (FTR) continues to lead the NMA (ASFC) effort to counter the Swiss Federal Public Health Office (OFSP) brochure which claims that smoking kills 5000 people per year in Switzerland (based on WHO recommended methodology). A critique of this brochure by a reputable Swiss Social Scientist, Professor Atteslander, was sent to the members of Parliament, the Federal Public Health Office, and to Mr. Cotti, the Federal Councillor for the OFSP, as well as to the media. This effort persuaded Mr. Cotti to order an investigation of the effort leading to the publication of the brochure. An industry meeting with Mr. Cotti's assistant, Mr. Noth, and with Federal & Cantonal Health Authorities is scheduled for January 17, 1990. EEMA Planning/Industry Issues together with SH&B has prepared an industry response document which could be used to counter the WHO's "death statistic" strategy in other countries.

2 - NEW TACTICS

* Scandinavia/Finland

Between August 30-31, the leaders of the Nordic Smokers Clubs from Denmark, Finland, Norway and Sweden met in Copenhagen for the first ever International Smokers' Rights Congress. They were briefed on issues, review successes to date and to plan future cooperative efforts. One of the mast significant 1989 successes has been our effort to have the respective governments recognize these Smokers' Clubs as a legitimate voice for commenting on government proposals on behalf of smakers (anti-smoking organizations have had the right to comment for years).

Note: we have not yet been able to obtain a definite commitment from New York Corporate Affairs to take a leadership role in helping to organize Smokers' Clubs globally to launch in 1990 an annual World Smokepeace Day to counter the WHO annual No Tobacco Day.

On September 19 in Copenhagen in cooperation with Covington & Burling (C&B) and Burson-Marsteller (BM), Philip Morris hosted its first media issue briefing using the company name as the sole sponsor. Helmut Gaisch introduced Drs. Leslie, Lunau, and Roe who briefed the journalists on ETS. Media reaction was positive and we are now planning follow-up sessions in Finland and Sweden. These sessions will include Egil (Nordic scientists) in the briefing team.

We are seriously addressing the social cost of smoking issue which is being used to underpin penal taxation, particularly in the Nordic countries. We have completed a third party study (by Malmberg) in Finland on household expenditures, which shows that smoking households consume less on health care than non-smoking households; and we expect to publish this shortly in a reputable technical Scandinavian journal. We are also in the process of initiating similar studies for Sweden and Denmark. To this end a reputable Danish economist, Professor Guldager from the Arhus Business School, is working to publish the Malmberg study and he will also conduct a study on Swedish Duty Free. We are using the most prominent Finnish economic consultant, LTT, to study the social costs/benefits of smoking in Finland. Furthermore Peter Elleman-Jensen, a Danish economist and brother of the Foreign Minister, has been recruited to publish a critique of an unfavourable social cost study published in Sweden. We have initiated a project with C&B to recruit additional welfare economists, statisticians and econometricians.

* Middle East

As part of the on-going taxation lobbying program, Middle East Corporate Affairs was able to persuade the Arab Gulf Health Ministers Council to adopt a resolution during their May 10 meeting which endorsed the adoption of the Saudi Arabian minimum specific duty on cigarettes. Since then the Bahrain and UAE Health Ministers have advocated in writing to their respective Ministers of Finance the adoption of this proposal, and related efforts are on-going in the other GCC countries.

* FAO

In cooperation with our business partner in Lebanon, Elie Razzouk, who has a personal relationship with the FAO Director-General, we are working with INFOTAB to have the FAO recognize the International Tobacco Growers Association as an NGO (non-governmental affiliate organization).

3 - HEALTHY BUILDINGS SEMINARS

In cooperation with PMI, PM EEC and C&B we are working with the HIROSS ventilation company and Healthy Buildings Limited (a UK company owned by C-G Pettersson. C-G Pettersson was one of the principal architects of the Healthy Buildings '88 Symposium in Stockholm) to expand the list of available sponsors for IAQ conferences.

* Scandinavia/Finland

The Swedish white collar labor union (TCO) hosted an IAQ "HB '88-type" conference in June in conjunction with the TCO bi-annual convention. This meeting was a key element of their 1989 year long campaign to advocate policies which will improve the Swedish workplace environment. PM/C&B helped TCO schedule two speakers for this meeting and with the educational materials that flowed from the meeting.

In a related development TCO published three newspaper supplements which featured articles by Bo Mikaelsson, C-G Pettersson and Gray Robertson. The Swedish NMA sponsored workplace smoking attitude study (Eureka) was also featured. These supplements had a circulation in excess of one million readers.

C-G Pettersson, a PM consultant, made a major presentation in June on air quality and ventilation to the Swedish National Building Board. In March Mr. Pettersson also addressed the Norwegian Builders' Association annual conference in Oslo, and this speech was publicized by DM.

During the later part of June in Norway, Dr. Helmut Gaisch delivered a one day ETS briefing seminar to the senior management of Langaards, our Norwegian distributor. This briefing and related efforts have given them the conference to began speaking out publicly.

In July Gray Robertson at the request of C-G Pettersson was interviewed by UK TV in front of Petterson's Millbank building project.

4 - SCIEHTIFIC SEMIHARS

On February 28 with PM's encouragement INFOTAB began the regular distribution of the C&B calendar of scientific conferences and events.

We are utilizing these scientific conferences as an opportunity to educate key government policy makers. For example, Kuwait's

Dr. Al-Mu-men, the Health Ministry Public Health Director, attended the June 1989 annual meeting of the British Occupational Hygiene Society (BOHS) in the UK.

In cooperation with PMI Corporate Affairs, we have also organized scientific issue briefing visits to the USA, such as the August 1989 visit of Dr. Fleming Kismeyer from Denmark who has subsequently been interviewed on Danish national TV.

In August 1989 Dr. Torbjorn Malmfors, the Chairmån of the Egil Group, participated as a panel member in the Nordic Council Risk Perception and ETS Conference in Helsinki.

On November 3-4 in Montreal under the sponsorship of McGill University a conference is being organized entitled International Symposium on Environmental Tobacco Smoke. About 60 scientists are expected from around the world including 25 from Europe. Participants from EEMA include Drs. Malmfors & Werko (Sweden), Voss (Denmark), Baettig & Atteslander (Switzerland), and Salaoos (Finland).

In April of 1990 in Lisbon a seminar is being organized by C&B on the subject of Indoor Air in Warm Climates under the sponsorship of the New University of Lisbon, the British Occupational Hygiene Society (BOHS) and the Asian Occupational Health Society. We are working with C&B to identify those who will be invited to this seminar.

In June of 1990 in the UK a seminar is planned on the topic of Setting Standards for Indoor Air Quality under the sponsorship of BOHS and CIBCI (an architects and building engineers society). This is designed to be a European conference and one presentation will focus on the results of the Swiss ACVA and LINK studies.

* SWITZERLAND

FTR Corporate Affairs, S&T and C&B are coordinating their efforts in planning a Brussels-type ETS Scientific symposium in Switzerland for 1991. The invitation will be issued in the Spring of 1990.

5 - AIRLINE SMOKING SANS

* International Flight Attendants Association (IFAA)

IFAA's annual meeting in Brussels will be held on October 23-25, 1989. PMI/EEC/EEMA are providing sponsorship support for this conference. On Oct. 25 in a plenary session there will be a panel discussion on IFAQ featuring Drs. Charles Caliendi, Larry Holcomb and Gray Robertson.

On Oct. 25 in the evening C&B and BM are organizing an IFAQ media briefing featuring these experts.

* TURKEY

As a result of PM lobbying this year, the smoking ban on Turkish Airlines' (THY) domestic flights is to be lifted on October 28, 1989. In cooperation with BM this story will be widely publicized. A related effort is being made via BM to publicize positive stories about THY's improved airline and Cem Kozlu, the THY Director-General.

* SWITZERLAND

Pursuant to an on-going dialogue between FTR CA and Swissair Management, Swissair reconfirmed publicly its policy of providing seats to both smoking and non-smoking passengers. This story was

the PM/BM Communications Program. Swissair and its been both provided with the SAS IFAQ study. We are Swissair 's recent agreement to affiliate in Europe SAS to follow Swissair's in-flight smoking policy.

widely publicized via affiliate Balair have also trying to use with SAS to persuade

* Scandinavia/Finland

The SAS IFAQ study has been finalized and a paper reviewing the study vas published in Environmental Technology Letters during July. Dr. Larry Holcomb is preparing an overview paper of the IFAQ studies which takes into account the SAS study. A 15 minute video has been produced highlighting the SAS Study which places the IFAQ issue in perspective (this video has been widely shown within SAS and will be featured during the IFAA conference).

* Nordic Council "100 Minute" Smoking Ban Policy

The Nordic Council Committee of Health and Social Affairs Ministers have persuaded Finnair and SAS to voluntarily ban smoking as of Nov. 1 on intra-Nordic flights lasting up to 100 minutes (basically all flights within the Nordic countries). PM, C&B and INFOTAB-are leading the industry in an effort to persuade other airlines not to implement this ban (Pan Am and Swissair are siding with the industry so far). The Nordic NMAs are currently reviewing a BM proposal to publish a guide highlighting the airline flights which will continue to offer smoking seats.

We have learned that SAS plans to host a meeting in the next two weeks of airlines servicing the Nordic countries in an effort to have them adopt this ban. PM is working with the NMAs and Smokers Clubs to communicate directly with the relevant airlines to generate opposition.

* Gulf Cooperation Council Countries

Bisharah Baroudi is working with INTERMARKETS, our Middle East CA Agency, to publicize in the GCC and Pan Arab media the IFAQ expert presentations and documents utilized on Oct. 25 during the IFAA Congress in Brussels.

During this summer, Middle East Corporate Affairs successfully stimulated the GCC media to publicize Swissair's policy of continuing to provide seats for smokers.

6 - APPOSE PUBLIC SMOKING IN RESTAURANTS

* Scandinavia/Finland

In January PM persuaded the Swedish NMA to sponsor ACVA IAQ studies of 20 leading restaurants in the three largest cities. In March, PM arranged for ACVA's Peter Binnie to brief the Swedish Hotel and Restaurant Association on this study. The Association then used this study as part of their presentation in March to the Magnusson Commission.

On September 27 the Motala City Council (a small city in Southwestern Sweden) defeated a Center Party motion to ban smoking in city buildings and said that problems were being solved by voluntary measures.

On September 29 the Vaesterbotten County Council (a northern county in Sweden encompassing 1/5 of the country with a population of 500,000) decided to abolish a mandated total smoking ban in public buildings and instead will permit local institutions to set these rules. This is due in large part to pressure mounted by SMOKEPEACE, the Swedish Smokers' Club.

On October 5 a Swedish appellate court overruled a decision of the Vaesteraas City Council (5th largest city/west of Stockholm) to ban smoking in all restaurants. The appeal was brought by local restaurant owners and the Swedish Hotel and Restaurant Association.

* SWITZERLAND

In April, PMI CA supported by FTR CA began working with the International Organization of Hotel and Restaurant Associations (HORECA) which is based in Zurich. As follow up on the PMI assistance for the October 15 international HORECA meeting in Spain (bringing leading restaurant owners to address the meeting), we are working with BM in the Nordic countries to broadcast their messages.

Dr. Xavier Frei, the Secretary-General of HORECA, is also the Director of the Swiss Cafeteria and Restaurant Association. (SWV). The Swiss NMA (ASFC) has been supporting courtesy campaigns (My Dear Guest) through the SWV for years, and contributes articles to the SWV's weekly journal - SCHWEIZER WIRTEZEITUNG - and is currently working on an article entitled "Smoking: Only Tolerante Will Help".

7 - MARKETING ETS MESSAGES PUBLICLY

In April Dr. Larry Holcomb was in Denmark to brief journalists on the IFAQ issue and this first visit generated significant, positive media reaction.

Dr. Larry Holcomb was in Europe for the second time this year between Aug. 31 and September 9 for media briefings/interviews on ETS and IFAQ. Dr. Holcomb also briefed key government officials. Countries visited on this second tour were: Finland, Sweden, Switzerland and Italy. Media reaction has once again been very positive.

C&B produced a series of ETS issue briefing papers which have been translated and incorporated into our in-market issue-briefing program. For example, they have been translated into Finnish and are being used by Finnish Smoking Club leaders in their lobbying efforts to oppose smoking restrictions. They were also given to journalists attending the Smokers' Rights Congress press conference on August 30 and the September 19 PM ETS media briefing in Denmark.

In development with BM/C&B and Illustra Films are two ETS issue briefing videos, one of which focuses on ETS science and one which places the ETS issue in the overall IAQ perspective. These videos will be used to recruit coalition members to address government draft proposals and to brief government and media representatives.

C&B is leading the effort to have published in Jan/Feb. 1990 via. Cambridge University Press a textbook on IAQ issues which is tentatively titled "Indoor Air Quality". This book is targeted to academia, scientists, architects, the construction industry and building managers.

* Scandinavia/Finland

Since the end of July, the Swedish NMA has been running two 30 second ETS/courteous smoking commercials in Swedish cinemas: In October a third commercial began to run. The direct media spend for this effort during 1989 is approximately USD $90,000. By end-1989 these commercials will have been shown in over 500 cinemas throughout Sweden.

PM consultants provided input for three TCO (Swedish union) IAQ newspaper supplements which reached approximately 1 million Swedish readers during the Spring and Summer.

The September 19th PM ETS Media briefing in Copenhagen was a first step in a series of company sponsored vehicles for communicating our views publicly.

Leaders of the four Smokers' Clubs have generated positive TV/radio/print media coverage on tobacco issues and particularly on ETS. Notable amongst these has been Denmark's Dr. Tage Voss.

* SWITZERLAND

A French and a German version of the book "Clearing the Air" is being. prepared in collaboration with a Swiss publisher, and it is planned that the French version will be available by the end of 1989.

* Gulf Council Cooperation Countries

ETS and IFAQ issue papers supplied by C&B have been submitted to key GCC health officials.

As part of this effort, Middle East CA is working with Steve Parrish to finalize by end-1989 a tobacco issues Question and Answer booklet which will be printed in Arabic.

8 - PM/BURSON_-MARSTELLER EUROPEAN COMNUNICATIONS PROGRAM

* Scandinavia/Finland

During 1989 EEMA's priority has been to successfully launch this effort . in the Nordic countries. In-market BM affiliates have been activated in Denmark, Norway and Sweden. In Finland together with our licensee Amer, the SEK/Grey/Eminence PR firm has been activated as the in-market network affiliate. In addition to the monthly management review meetings of the entire EEC/EEMA program, beginning in September we began conducting bi-monthly review meetings in the Nordic countries to focus on the Scandinavia/Finland program.

Our overall perspective to date, particularly in comparison to the accomplishments of 1988, is that this program directly or in spin-off efforts is generating a phenomenal quantity of positive publicity. The remaining challenge is to improve the quality and cost efficiency of the effort. Specifically we must enlist more third party individuals and organizations to sign our messages, be able to effectively address a broader range of tobacco issues, penetrate more media segments, develop a media relations program, and more directly impact pending government decisions.

* SWITZERLAND

Beginning in August FTR began working with the Zurich and Geneva offices of BM as the in-market affiliate agency for communicating industry/PM messages.

* TURKEY

We have identified the IMAGE PR firm (Betul Mardin) in Istanbul as the recommended in-market communications affiliate.

* Gulf Cooperation Countries

During August, the Dubai/UAE-based Advertising and PR firm, INTERMARKETS, was retained as our communication affiliate agency in the Middle-East. The orientation/training program has been completed and the communications effort is underway.

In a related effort during March with the PR arm of the Radius/Leo Burnett Bahrain-based ad agency, the Middle East CA team obtained extensive coverage in GCC media for Philip Morris' corporate contribution to the House of Quran, an Islamic cultural institution in Bahrain.

9 - USING LEGAL RESOURCES CREATIVELY

* Scandinavia/Finland

In Sweden, we have a project under way to impact the anticipated reform of the Swedish Social Insurance System with the objective of eliminating ETS as a compensable item. EEMA Industry Issues in cooperation with C&B and the Swedish Lagerlof law firm are working with Dr. Bo Mikaelsson to analyze the "Gun Palm" cases where ETS-related benefits have been awarded which is intended to result in an article detailing why these benefits should not have been awarded and why the system should be changed (Draft available Dec. 1). The plan is to publish this article in the International Social Security Association REVIEW (ISSA is Geneva-based and is closely connected to the ILO). We also are working with the Swedish Employers Organization to prepare a paper articulating their views for reforming the system.

In response to the SMART PROMOTION publication of IOCU/Swedish Consumer Councillor's Office/Swedish Welfare Board, Philip Morris persuaded the Swedish NMA to file a complaint with the Legal Ombudsman. A decision is expected prior to end-1989. The Lagerloef law firm is leading this effort in cooperation with C&B. This initiative stimulated two leading Swedish columnists to attack the government's ethics and tactics, interrupted their distribution of SMART PROMOTION, forced them to change the publication's cover and to print an insert which clarified some points in the original text.

During the later part of August, the Swedish Tobacco Company and the NMA filed a complaint with the Legal Ombudsman challenging the systematic bias of Margaretha Haglund, Head of the Social Welfare Board, and Paul Nördgren, Secretary of the Magnusson Commission. This complaint is still pending and has generated quite of bit of publicity.

10 - DOCUMENT RETENTION PROGRAM

On August 18 for the EM Management team and during the August 21-22 Regional CA Quarterly Business Review (QBR), Steve Parrish reviewed guidelines for document_. generation and retention.

11 - INGREDIENTS

* Scandinavia/Finland

In Norway, the Ministry of Health and Social Affairs issued in August an unclear draft regulation to ban the introduction of new products delivering nicotine. PM galvanized the industry and allies to oppose this measure. So far the Norwegian Industry and Employers' Federation, the Central Labor Union (LO), the Norwegian Price Commission, the Norwegian Consumer Protection Agency and, Conservative and Progress Party Parliament members have criticized this proposal. The USA Embassy has met with the Minister twice and the Swedish Foreign Office has filed a protest. The Norwegian NMA, with the assistance of C&B has filed two submissions with the Ministry, one focusing the draft regulation and one on the addiction issue.

While we are certain that this effort has forced the Ministry to rethink their proposal, the outcome is not certain. The Ministry is expected to issue a redrafted proposal during the next three weeks.

* Gulf Cooperation Council'Countries

Pursuant to the multi-year effort between Philip Morris scientists and Middle East Corporate Affairs professionals, Standards and Testing Officials in Bahrain, Kuwait and Saudi Arabia now regularly consult with PM in advance of their decisions. Credibility achieved in this on-going program has enabled PM to assist KGF in developing a comparable dialogue.

One of the most important achievements this year has been Kuwait's decision to adopt a +/- 20% testing tolerance in the interpretation of their cigarette constituent tests. We are currently seeking confirmation that the Saudi Arabian Standards Organization (SASO) will adopt the same testing tolerance as Kuwait. Another major achievement this year has been the successful. training of SASO cigarette laboratory technicians in Richmond (a cooperative effort of Neuchatel and PM Richmond).

The most significant current lobbying effort is focusing on the DRAFT GCC STANDARDS FOR CIGARETTES being coordinated by SASO, which has already been substantially amended in line with industry comments. Middle East CA is guiding the industry scientific lobbying effort on this Standard. The final version of this draft is circulating amongst GCC countries for review and comment.

Middle East CA is also leading the effort to open an industry dialogue with the Arab Standards Organization based in Amman, Jordan.

12 - PREPARATION FOR RELEASE OF SURGEON GENERALS REPORT

* SWITZERLAND

FTR together with EEC CA participated in the effort during January 1989 in Washington, D.C. to brief US based journalists who represent European publications.

13 - MCL 'S

Jean Besques/EEMA Industry Issues is continuing to work with SH&B/Ed Reeves and Steve Parrish to finalize a general white paper on the MCL issue.

* Scandinavia/Finland

Johan Puotila is working to custom tailor an MCL paper for submission in Finland by the end of 1989.

Gulf Cooperation Council Countries

Middle East CA has submitted to the Middle East Trade Association a discussion paper on MCL's in an effort to develop industry consensus on this issue and to encourage joint industry action to redress the threat of further MCL reductions.

By the end of October, Bisharah Baroudi will have finalized a tailored position paper to use as a submission in GCC countries.

14 - INFOTAB

* Scandinavia/Finland

In cooperation with C&B, BAT and INFOTAB, PM has led the on-going effort to develop an active industry forum for the Nordic countries. The next meeting will be on October 23 in Stockholm hosted by PM. Gray Robertson will make a presentation to this meeting.

* AFRICA

The last Africa Working Group (AWG) took place in Nairobi (Kenya) on September 27-29. During this meeting the industry agreed to finalize a proposal for implementation in 1990 by which the AWG would hire a professional staff person to coordinate this industry effort..

* TURKEY

On September 22, an Importers Working Group/Turkey was formally created under the leadership of INFOTAB. Philip Morris was elected as Chairman. The next meeting is scheduled for December 11, 1989.

* Middle East Tobacco Association (META)

META member companies (BAT/GI/PM/RI/RJR) have agreed not to renew Abdullah Borek's contract as META coordinator. Goddard, Kay & Rogers (Andrew Clowes) is conducting the search for a new coordinator. A "short list" of candidates will be interviewed in early November, 1989. The next meeting will be on Feb. 8, 1990.

15 - SMOKERS' CLUBS

* Scandinavia/Finland

There are today active, effective Smoking Clubs in four Nordic countries. Highlights of accomplishments in 1989 not covered elsewhere in this report include:

The Swedish Group, SMOKEPEACE, participated with Stig Carlson in a national tv debate during January for the first time. In conjunction with the May 31 WHO No-Tobacco Day, SMOKEPEACE arranged for the former Swedish Prime Minister, Torbjorn Falldin, to publicly comment on the antis' excesses. During June SMOKESPEACE ran their first membership recruitment advertisement and the press conference discussing this initiative generated a two month series of regular positive publicity (they have over 1000 members today). SMOKEPEACE appeared before the Magnusson commission on September 13. The Swedish NMA shares the costs of SMOKEPEACE activities.

ROYKRINGEN (Norway) came alive publicly as an organization to oppose the WHO No-Smoking Day when they held a press conference in Oslo on May 29 and issued a white paper called "Free or Smokefree Norway" opposing the Government "Smokefree Norway 2000" program. ROYKRINGEN generated a flood of positive publicity from this initiative and for the first time captured the front page of Morganbladet. Group have appeared frequently on Norwegian TV and radio programs. During August/September ROYKRINGEN has enthusiastically opposed the "nicotine ban" draft regulation. Tiedemanns finally agreed in October to began funding ROYKRINGEN's activities.

HU-TU (Finland) played an instrumental role in communicating publicly and to key government and union officials the industry messages arguing against eliminating tobacco from the CPI which in turn helped defeat the Minister of Finance's penal tax proposal to increase the consumer pack price by 20%. Following the Nordic Smokers Club Congress, the HU-TU leadership was positively profiled for 6 minutes on the September 3 weekly Finnish TV Sunday night "news magazine program" (600,000 viewers). one of the Club leaders, Jorn Donner (a Finnish MP and celebrity movie producer who is also popular in Sweden) will appear later this year in a SMOKEPEACE advertisement in Sweden.

During May HEN-RY (Denmark) published two courteous smoking advertisements (one feåturing HEN-RY'S patron the Danish Foreign Affairs Minister Ulf Elleman-Jensen and one a leading actress). These were the vehicle for a major, successful Nordic publicity effort for smokers rights. Subsequently HEN-RY board members have participated in Smokers' Club press conferences in Norway and Sweden. HEN-RY hosted the first Smokers' Clubs' Congress Aug. 29-30. HEN-RY currently has about 2000 members, including 25 medical doctors.

* SWITZERLAND

Pursuant to FTR's initiative, the Swiss NMA (ASFC) began this year to provide substantial support (SFR 80,000) to the Swiss Smokers' Club, RAUCHER-CLUB. During March RAUCHER-CLUB generated significant publicity in Switzerland and internationally by offering to pay "in the interest of worldwide smokers' solidarity" the fines of smokers jailed in the Philippines: This summer RAUCHER-CLUB filed a petition with over 18,000 signatures with the Swiss Federal Council urging that the government cease wasting taxpayers funds on campaigns harassing smokers. The club has over 500 members.

16 - INTERNATIONAL SMOKERS' SURVEY

A presentation of this 10 country survey is being finalized for presentation during the upcoming PMI CA Conference.

In addition, EEMA Region Market Research is reviewing the survey results with area line and CA management in Finland, Sweden, Switzerland and Turkey.

17-AECA/NY SOCIETY

* SWITZERLAND

We are working to have the Swiss Federal Counsellor Delamuraz, who is currently President of Switzerland, make a presentation to the New York Society for International Affairs. This should be-scheduled in 1990.

* Scandinavia/Finland

We are working to persuade Anders Bjorck, the Chairman o€ the European Council and a member of the Swedish Parliament, to accept an invitation to address the AECA.

18 - ILO

* Scandinavia/Finland

In Sweden, contacts between EEMA Planning and the ILO provided documentation from ILO policy recommendations with which the Swedish NMA successfully lobbied the Swedish Parliamentary Finance Committee to defeat on March 8 a motion removing tobacco from the CPI.

In Finland, ILO documentation provided PM and ATO with solid argumentation to defeat during August the Minister of Finance's proposal to remove tobacco from the CPI.

EEMA Planning together with David Morse has enlisted a former ILO Deputy Director-General as a labor consultant in the Nordic area to assist PM in promoting its taxation arguments with key labor leaders.

19 - LIBERTAD

We are working in cooperation with PM EEC to publicize in EM countries the messages being delivered during the current series of European LIBERTAD conferences. We are also making an effort to determine if such conferences can be scheduled in EM countries.

our efforts to expand the Children's Research Unit country database (with studies in Kuwait, Sweden, Switzerland & Turkey) on advertising's negligible impact on juvenile smoking initiation and to merchåndise the study results have born fruit this year. The updated 1989 IAA (INFOTAB) 16 countries Report has been widely distributed and publicized in our priority markets.

EEMA Planning has initiated and is providing technical support to publish critiques of unfavorable studies on the impact of ad bans. A recent example is Jean Boddewyn's article in the 1989 fall issue of the BRITISH JOURNAL OF ADDICTION critically reviewing the New Zealand study by Chetwynd et al.

* Scandinavia/Finland

Stig Carlson is seeking to persuade Professor Anna Christensson based at Lund University to organize a LIBERTAD Chapter in Sweden.

* Gulf Cooperation Council Countries

PM is actively participating in the UAE Chapter of the International Advertising Association. George Nassif has been nominated as a member of the Chapter's Executive Committee. Middle East CA is helping the UAE Chapter to broaden their organizational base to include all GCC countries and to prioritize the defense of commercial advertising freedoms in their on-going programs.

Via the IAA UAE Chapter, the CRU research in Kuwait was distributed to key opinion leaders in the GCC. The research report was also successfully publicized in the GCC during June.

* TURKEY

The IAA Turkish Chapter was officially created. PM is taking an active role in it as a member: The CRU 16 countries research report has been translated into Turkish and will be published and marketed by this IAA. Turkish Chapter by the end of October.

PM is also sending HQ Corporate Affairs staff to activate the IAA Turkish Chapter for defending marketing freedoms: PM will be the initiator of a WFA press conference (organized under the IAA Turkish Chapter) to be held during the first week of November, aimed at fighting the advertising ban threat. We have also enlisted a consultant to directly lobby members of Parliament, stimulated the media to publish favorable stories opposing the ad ban, and are redistributing the CRU 16 countries study to a broader audience of government officials and opinion makers.

20 - PROMOTING SPORTS SPONSORSHIPS

* Scandinavia/Finland

Four Swedish and one Norwegian journalists visited the United States in September and were briefed on sports sponsorships. Media reaction was positive.

The Finnish National Medical Board issued an injunction in September banning the promotion in Finland of Philip Morris' sponsorship of the sailing yacht Belmont Finland II which is currently competing in the Whitbread Round The World race. The Legal department is presently preparing an appeal of this injunction.

21 - LABELING

* Gulf Cooperation Council Countries

The UAE Minister of Health, based on input from Philip Morris, has written to the Arab Gulf States Health Ministers' Council (AGSHMC) proposing that the AGSHMC drop its requirement that manufacturers print both the month and year of manufacture on each package. A final decision is expected during December 1989 at the next AGSHMC semi-annual meeting.

* EASTERN EUROPE

In Czechoslovakia, the Ministey of Health and Social Affairs confirmed on August 29 that PM did not have to place the warning 1abe1 on the front of the pack and could include an attribution with the warning label. This was the direct result of Philip Morris lobbying.

* SWITZERLAND

Based on INFOTAB and EEC argumentations a position paper has been drafted opposing the ECC Directive on labeling.

22 - TRAINING PROGRAM N.A.

23 - TAXATION

In Finland we have successfully prevented the Minister of Finance from implementing penal taxation on cigarettes. Earlier this year Parliament adopted a resolution to increase substantially the tax an cigarettes to curb consumption. In the fall, the Minister of Finance proposed a 20% retail price increase for the 1990 budget. EEMA Planning provided extensive argumentation and documentation for our Licensee, ATO, to use in activating the labor movement, the Smokers Club and the trade. This intensive effort resulted in the proposal being withdrawn.

In Sweden, by defeating the motion in Parliament to remove tobacco from the CPI, we limited the opportunity to raise the tobacco excise tax.

In Norway we are working to equalize taxation on tobacco products, particularly between cigarettes and RYO (RYO has about 55% of the market). Recently we enlisted the personal intervention of Olav Thon, the owner of our Norwegian distributor Langaard.

In Yugoslavia by intensively lobbying the local agents directly, through USA Embassy officials and by providing documented argumentation to the Finance authorities, we are working to substantially reduce and restructure the new tax burden thrust upon the hard currency business. A new tax on the retail margin was introduced alongside the existing 20% tax on the wholesale price. The lobbying effort has resulted in the lates being reduced to 7.3% with an understanding to abolish it completely in January 1990.

We are devoting considerable resources to protect the duty free business in the EFTA countries in the face of the EEC threat and potential overspill in surrounding countries. We have joined and are galvanizing the duty free associations in Sweden, Switzerland and Denmark. EEMA Planning is providing technical assistance on economic impact studies, including one being prepared by the International Duty Free Association's Working Group for the EEC.

24 - RECRUITMENT OF SPOKESPERSONS

* Scandinavia/Finland å O

Stig Carlson, Bengt Hällsten, Johan Puctila, and Mikeal Westergaard participated in the BM/C&B spokesperson training program on October 12-13.

On November 2-3, representatives from Amer Tupakka (Finland) and Langaard (Norway) together with Johan Puotila) will participate in this training program.

We are planning to arrange spokesperson training and issues briefings for Nordic Smokers Club leaders early in 1990.

* SWITZERLAND

The designated spokespeople are: Ulrich Crettaz, George Diserens, Philippe Grandjean, Raymond Pantet, and Jean-Pierre Paschoud.

* Gulf Cooperation Council Countries

The designated PM spokespersons are: Bisharah Baroudi, Torquil Macleod, and George Nassif. Their first formal training session was on October 4-5 in the BM London offices in cooperation with C&B.

* TURKEY

The designated spokespersons are: Mark Duerst, Turhan Talu, Haluk Mesci (the Managing Partner of Leo Burnett Turkey), and the Manager of Corporate Affairs to be hired.

25 - CRISIS/MANAGEMENT

EEMA has participated in the initial review session with Burson Marsteller and we are now awaiting the receipt of their preliminary findings.

26 - JOURNALIST VISITS TO THE USA

* Scandinavia/Finland

During the later part of May in cooperation with ATO, five Finnish journalists visited the USA. This effort generated significant positive publicity and the follow up effort with the journalists produced major articles incorporating our taxation/CPI messages during the successful campaign to defeat the Finance.Minister's penal taxation proposal.

During early September in cooperation with Sven Bergen, PM's Swedish motor racing sponsorship promoter, Johan Puotila accompanied four Swedish and one Norwegian sports journalists to the USA for briefings on the sports sponsorship issue.

* SWITZERLAND

A group of 5 Swiss reporters will visit PM in the USA in December. They will be briefed on general tobacco issues with an emphasis on ETS related issues.

* Gulf Coperation Council Countries

At the request of PMI CA, the USA visit of GCC journalists is being postponed from end-November to the first quarter of 1990.

During the PM Superband visit to Cairo Egypt, Middle East CA and Intermarkets arranged for 4 GCC-based journalists, and 3 Cairo-based journalists who represent Saudi Arabian papers to participate in the Cairo press conference and to attend one of the two concerts.

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