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Facing the prospect of severe Food & Drug Administration limits on tobacco marketing, R.J. Reynolds Tobacco Co. in a surprise turnabout is offering to voluntarily accept some of the same ad curbs it is fighting in court.

In negotiations to develop so-called "model" state legislation in its home of North Carolina-legislation that would eventually be offered to other states-RJR proposes to fund anti-smoking messages aimed at teens and accept certain ad restrictions in return for tougher, more rigidly enforced laws barring those under 18 from buying cigarettes.


Central to the discussions that have been carried on with North Carolina Attorney General Mike Easley is RJR's unspoken hope that tougher state law enforcement would lessen problems with un-derage smoking and forestall more ad regulation, like the restrictions on using images and color in ads that are contained in the FDA rules (see related story on Page 52).

The ad restrictions RJR has saidRJR may voluntarily

restrict ads in N.C. it would voluntarily adopt are similar but not identical to those Philip Morris Cos. offered to Congress in May as a substitute for FDA regulation. Philip Morris' proposal was blasted by the White House and tobacco critics for not going far enough.

RJR made clear it will agree to initiate the curbs in any state that passes the legislation and may even sign an agreement to that effect.


However, unlike Philip Morris, RJR will not agree to have the restrictions written into law, since that could weaken the company's legal argument in any challenges of tougher legislation.

Mr. Easley said RJR would:

nEliminate outdoor boards within 1,000 feet of an elementary or secondary school or a public playground. (Tobacco companies now voluntarily won't advertise within 500 feet. The FDA rules and Philip Morris' earlier proposal also extend the limit to 1,000 feet.)

nHalt tobacco ads on taxis, subways, buses or trains, and stations and bus shelters. (The proposal is the same as that in Philip Morris' and in some ways is more sweeping than the FDA proposal)

nStop advertising in sporting facilities where baseball, football, basketball, soccer or hockey are played. The proposal which doesn't mention auto racing.

nEnd brand-name sponsorship of sporting events expected to draw more than 15% of attendance from children under age 18. (Philip Morris' proposal would limit sponsorship to motorsports and rodeos that draw at least 75% adults. Nascar estimates only 3% of attendees at events are under 18).

nPrevent use of tobacco brand names or logos in videogames.

Under the proposed deal, a ban on cigarette packs with less than 20 cigarettes would be written into law, as well as additional restrictions on vending machines, a bar on distribution of product samples except in places where those under 18 aren't allowed and a requirement for companies to fund anti-smoking or enforcement actions.

The proposal suggests a $100 million fund nationally be allocated to "eligible" states that have passed the legislation.

Mr. Easley has indicated he expects to unveil the plan shortly, but RJR-citing the difficulty of reaching executives in the wake of Hurricane Fran-declined to confirm its support for the rules.

A draft of the model law says nothing right now about ad imagery, but Mr. Easley said language could still be inserted.

He told North Carolina media a ban on animation or imagery that targets children could be part of the final agreement; RJR says Joe Camel does not target children.


Ad industry groups are fighting the proposed government restrictions, but would have few problems with self-regulatory actions.

"It's when the government imposes restrictions that we are concerned," said Dan Jaffe, exec VP at the Association of National Advertisers.

Indications are growing that nothing will happen in Congress either to overturn the FDA rules or to pass new legislation before yearend. Congressional sources last week said tobacco supporters have decided against trying to overturn the FDA restrictions.

"It's all up to the courts," said one congressional staffer.

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