CANADA'S LATEST CIG MARKETING REGS UNDER FIRE: LIMITS ON MOTORSPORTS SPONSORS ARE ALREADY RUNNING OUT OF GAS

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Changes and challenges are already in the works for Canada's tough new law curbing tobacco marketing.

Sweeping restrictions on everything from advertising to sponsored events are set to become law this week, following 75-to-1 approval in the Canadian Senate.

CONSIDERING AMENDMENTS

Just a day after the new rules passed the Senate, however, the Canadian government was looking at amendments.

Officials late last week promised they will loosen the rules for motorsports events-keeping them in line with those in other countries-and allow tobacco logos on cars, equipment and team clothing. The new law currently bans such imagery.

Molstar Sports & Entertainment, organizer of the two Indy-style races in Canada, had said it would pull the popular events unless the law was changed.

"We cannot be alone in that" restriction, said Canadian Prime Minister Jean Chretien. "This will be amended in the fall."

LOBBYING FOR CHANGES

Molstar, a unit of Molson Breweries, started lobbying for such a change earlier this month.

"An amendment this year will correct what are currently inequities in the application of the legislation," said Molstar President Brent Scrimshaw.

Event sponsors, nevertheless, will be hit hardest by the new restrictions. Tobacco advertising had already been severely limited for several years by previous legislation. Tobacco marketers in Canada spend about $87 million a year on sponsorships and promotions, according to RJR-Macdonald.

To be in full effect by October 1998, the new restrictions include:

A ban on point-of-purchase, broadcast and outdoor advertising.

Print advertising limited to publications aimed primarily at adults.

Sponsorship allowed, but tobacco logos and brand elements limited to the bottom 10% of on-site ads and signage.

Canada's three major tobacco marketers-RJR-Macdonald; Imperial Tobacco; and Rothmans, Benson & Hedges-have pledged to fight the law.

'WE ARE GOING TO COURT'

"We are going to court," said a spokeswoman for the Canadian Tobacco Manufacturers' Council, which represents the three marketers on industry matters.

At issue for the marketers are uncertain interpretations and vague definitions, which they argue are too broad and "put a legal chill" over their advertising, the industry spokeswoman said, adding, "It's impossible to advertise anything."

The industry has had success in the courts before. After a 1995 court challenge, Canada's Supreme Court struck down similar ad restrictions as unconstitutional,

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