Wikipedia

Japan Tobacco

"JT Group" redirects here. For the telecommunications company in the Channel Islands, seeJT Group Limited.

TheJapan Tobacco Inc.(Nhật Bản たばこ sản nghiệp kabushiki gaisha,Nihon Tabako Sangyōkabushiki gaisha)(JT) is a Japanese diversified tobacco company. It was established in 1985 as atokushu gaisha(Đặc thù hội xã,lit. "special company" )that inherited the right to monopolize and manufacture cigarettes from the Japan Tobacco and Salt Public Corporation and required the government to hold at least 50% of its shares. In addition to tobacco, JT diversified its businesses, establishing the pharmaceutical research institute in 1993 and making a full-scale entry into the food and beverage industry in 1998. In 2008, it acquired the food manufacturer Katokichi, now TableMark, as a wholly-owned subsidiary, integrating its food business.

Japan Tobacco Inc.
Native name
Nhật Bản たばこ sản nghiệp kabushiki gaisha
Nihon Tabako Sangyō kabushiki gaisha
FormerlyJapan Tobacco and Salt Public Corporation
Japanese:Nhật Bản chuyên bán công xã
Hepburn:Nippon Senbai Kōsha
Company type1985–Present:Public(kabushiki gaisha)
1949–1985:Statutory corporation
IndustryFood
Tobacco
Founded1898 (as Imperial Japanese Tobacco Company)
1 June 1949 (as Japan Tobacco and Salt Public Corporation)
1 April 1985 (privatized)
FounderGovernment of Japan
Headquarters
2-1,Toranomon,Minato,Tokyo,Japan
Key people
Mitsuomi Koizumi
(President and CEO)
Hiroshi Kimura
(Chairman)
ProductsSee below
RevenueIncrease¥2.033 trillion(2012)
Increase¥459.18 billion(2012)
Increase¥328.55 billion(2012)
Total assetsDecrease¥3.667 trillion(2012)
Total equityDecrease¥1.714 trillion(2012)
Number of employees
48,529 (2011)
ParentGovernment of Japan(37.57% by law; as of 31 December 2023)[1]
SubsidiariesJapan Tobacco International
PT Karya Dibya Mahardhika (Indonesia)
Mighty Corporation(Philippines)
Donskoy Tabak Companies (Russian)
Gallaher Group
WebsiteJT

It is part of theNikkei 225andTOPIXLarge70 indices. In 2009 the company was listed at number 312 on theFortune 500list. The company is headquartered inToranomon,Minato, Tokyo,[2]andJapan Tobacco International'sheadquarters are inGeneva,Switzerland.[3]As of 2012 the chairman isHiroshi Kimuraand the CEO isMitsuomi Koizumi.[4]

History

edit

Japan Tobacco is the successor entity to a nationalized tobacco monopoly first established by theGovernment of Japanin 1898 to secure tax revenue collections from tobacco leaf sales. In 1904, the government's leaf monopoly was extended completely to take over all tobacco business operations in the nation, including all manufactured tobacco products such as cigarettes. The ostensible reason for the expansion of control was to help fund the 1904–1905Russo-Japanese War,but because all foreign tobacco interests in Japan at the time were forcibly evicted under the monopolization scheme, this also protected the domestic tobacco business for the following eighty years.[5]

The business operated within the Japanese government as an arm of the nation'sJapanese Ministry of Financeuntil 1949 when the Japan Tobacco and Salt Public Corporation(Nhật Bản chuyên bán công xã[ja],Nippon Senbai Kōsha,lit. "Japan Monopoly Public Corporation" )was established to enforce restrictive labor relations policies under the U.S. and allied forces'Occupation of Japan.[6]The Japan Tobacco and Salt Public Corporation remained a completestate monopolyunder directJapanese Ministry of Financeauthority until 1985, when Japan Tobacco, Inc. was formed as a publicly traded stock company. Periodic incremental sales of share to the public began in October 1994. Japan Tobacco became two-thirds owned by theJapanese Ministry of Financein June 2003,[7]and the ministry continued to own 50% until March 2013. It was announced in May 2012 that the government would sell one-sixth of the company's outstanding shares to raise ¥500 billion to finance reconstruction from the 2011 earthquake and tsunami.[8]In 2013 the Japanese government disclosed the details of its plans to reduce its equity interest in Japan Tobacco by $10 billion, devoting the proceeds to reconstruction in northeastern Japan.[9]The ministry of finance sold the stock in March 2013,[10]selling about 333 million of the 1 billion shares it owned at that time. The government remains required by law to own at least one-third of JT's stock.[11]

JT today

edit

Japan Tobacco has 66.4% of the cigarette market in Japan.[12][13]Although tobacco consumption is declining, the Japanese remain heavy smokers, consuming an average of 1,800 cigarettes per capita in 2013, compared to about 1,000 per capita in the United States.[9]

In April 2012 it was announced thatMitsuomi Koizumiwould become president, and presidentHiroshi Kimurawould become chairman of JT. and Chairman Yoji Wakui would retire. Wakui had previously been a bureaucrat at the ministry of finance. Koizumi assuming the presidency meant that for the first time since the 1985 privatization neither president nor chairman was from the Ministry of Finance.[14]Koizumi, who had been Executive Deputy President, became president in June 2012.[15]

On 30 October 2013 JT announced that it would close four Japanese factories and cut 1,600 jobs in Japan through voluntary retirements. This was planned to be completed by March 2016. JT also planned to consolidate 25 branch offices into 15 regional headquarters, and close leaf-processing and vending machine operations.[16]

Japan Tobacco also operates in foods, pharmaceuticals,agribusiness,engineering, and real estate. It left the beverage industry in September 2015.[17][18]As part of the company's pharma activities, it divested acompound collectionofpotassium channel inhibitorsto Metrion Biosciences in 2018.[19]

Japan Tobacco International

edit

JT International (JTI),acquired in 1999 fromR.J. Reynolds,is an operating division of Japan Tobacco Inc., and produces, markets and sells the group's cigarette brands internationally. It sellsCamel,Salem,andWinstonbrands outside the USA.

Final logo of the Japan Tobacco and Salt Public Corporation until its privatization

Japan Tobacco completed the largest ever foreign takeover in Japanese history through acquisition ofGallaher Groupplcin April 2007.[20]Japan Tobacco runs theTobacco and Salt MuseuminSumida-ku, Tokyo.[21]

In 2006/2007 Japan Tobacco planned to startSerbiaproduction, and also planned to invest another $100 million. JT paid "$35 million euros" [sic] for 98.5 percent ofSenta Tobacco Industryin May 2006, with a further $10 million invested since then. The plant has a production capacity of some five billion cigarettes a year.[22]

On 12 June 2014 JT concluded an agreement to acquire all outstanding shares of British e-cigarettes producerZandera Ltd,best known for its E-Lites brand.[23]On 30 April 2015 JT announced it had agreed to buy Florida-based e-cigarette makerLogic Technology Development LLC.[24]

In September 2015 it was announced that JT would buy the rights forNatural American Spiritoutside the US for $5 billion.[25][26][27]

In August 2017, the company announced it would acquire theIndonesianKretekproducersKaryadibya MahardhikaandSurya Mustika NusantarafromGudang Garamfor $677 million.[28]PT Karya Dibya Mahardhika has a main brand inIndonesia,Apache, Extreme Mild, & Minna International. After that,the Philippines'Mighty Corporationfor $936 million.[29][30]

In 2018, JT acquiredDonskoy Tabak corporation,Russia's fourth largest cigarette manufacturer for $1.6 billion.[31]

Lawsuits

edit

There have been a number of Japanese court cases related to smoking, either directly or indirectly related to JT.

1980–1987 JNR Shinkansen lawsuit

edit

A group of nonsmokers sued at theTokyo District Courtdemanding thatJapanese National Railwaysshinkansen (bullet trains)provide more non-smoking cars. The case was filed in 1980 and while the court recognized tobacco's health risks[32]the 27 March 1987 ruling rejected the lawsuit on the basis that the plaintiffs had failed to prove their harm to be "beyond the limits of toleration".[33]

1998–2005 Tokyo lawsuit

edit

In 1998 seven plaintiffs represented by lawyer Yoshio Isayama sued JT at the Tokyo District Court for ¥70 million compensation (¥10 million per plaintiff) for health damage caused by smoking JT cigarettes. While similar cases had been filed inNagoya,this was the first such case in Tokyo. In addition to financial compensation, the plaintiffs also demanded:

  • That tobacco sales through vending machines be banned;
  • That advertising on television and radio be stopped;
  • That promotions at public and sports events be halted;
  • That a more stringent warning label be printed on cigarette boxes.[34]

The plaintiffs' case was dismissed by the district court on 21 October 2003. The court agreed with the 1980s ruling that tobacco had health risks, but said that there was no causal link between the smoking habits and the specific diseases of plaintiffs. In addition, Judge Kikuo Asaka denied thatnicotinewas highly addictive. Isayama said that the group would appeal the decision to theTokyo High Court.[35]

On 22 June 2005 the Tokyo High Court dismissed the case; by that time brought by only six plaintiffs. Three of the plaintiffs had died during the course of the case. Judge Toshinobu Akiyama said he agreed with the District Court decision. Jun Araki, the son of one of the deceased plaintiffs, said: "This ruling placed priority on the annual 2.3 trillion yen in [tobacco] tax revenue over the precious lives and health of the Japanese people". He also said the plaintiffs would appeal to theSupreme Court.[36]

2005–2010 Yokohama lawsuit

edit

In January 2005 plaintiffs Kenichi Morishita, Koreyoshi Takahashi, and Masanobu Mizuno filed a case in theYokohamaDistrict Court against JT seeking ¥30 million in damages for smoking related illness. Morishita died of pneumonia while the case was being fought, and JT used the same argument as in the 1998–2005 Tokyo case, that smokers were free to quit any time and that cancer and other illnesses had multiple causes.[37]

On 20 January 2010 the court clearly ruled that there was a link between smoking andlung cancerand respiratory illnesses, and said that smoking may be addictive. However, the court rejected the demand for damages, and said that the plaintiffs had smoked of their own free will and that there was no proof that smoking had directly caused their sicknesses.[38]

Brands

edit

JT flagship brands

edit

Other brands

edit

Smoking etiquette posters

edit

JTI runs a series of posters designed to educate smokers about smoking etiquette. They can be seen widely around Japan, especially located near train stations.Poster galleryArchived16 July 2011 at theWayback Machine

Environmental record

edit

In 2008, Japan Tobacco had health issues involving their company: Contaminatedgyozadumplings made by a Chinese company's factory in China, which sold its products to JT, poisoned ten people, including a five-year-old girl.[40]Thousands of other Japanese people were going to the hospital because of stomach issues as well. A number of dumplings were found containingdichlorvosandmethamidophosfrom pesticide.[41]The health minister of Japan said the contamination at the Chinese factory was possibly intentional, and the police are investigating for an attempted homicide.[41]The dumplings were from China, but Japan Tobacco has said it does not plan to cease its manufacturing in China. Frozen food sales went down by 60% for the business since this health scare.[42]Japan Tobacco's stock price fell 7.1% after they were forced to recall their products, and the company also lost a $500 million merger deal withNissin Foodsbecause of this incident.[43]

Anti-illicit trade compliance

edit

Japan Tobacco Inc, through its international operating divisions JT International S.A. and JT International Holding BV, signed a Cooperation Agreement with the European Commission in 2007 to combat the illicit trade in cigarettes under Article 9 of which the company agreed to "pro-actively disclose" to the European Commission's Anti-Fraud Office (Office Europeen de Lutte Antifraude – OLAF) "...all material information coming into (its) possession after the Execution Date relating to potentially Illegal Product."[44]The Agreement defines "Illegal Product" as Contraband or Counterfeit Cigarettes. Both Japan Tobacco Inc and JT International S.A. claim to adhere to a "zero-tolerance approach" to illicit trade.[45][46]

JT International S.A. and several of its distributors, including Megapolis in Russia and IBCS Trading in Cyprus, however, have been implicated as recently as 2011 in widespread smuggling to include selling cigarettes to a buyer in Syria subject to EU, Swiss, and US Sanctions and diverting cigarettes from Russia into the European Union and smuggling Winston and other popular cigarette brands into Iran.[47][48][49]A JT International S.A. executive told the Wall Street Journal in August 2012 that the firm had continued to ship cigarettes to Syria until as recently as February 2012, almost a full year after the imposition of EU and US sanctions. The Journal cited Syrian dissident sources who claimed that the government of Syrian President Bashar al-Assad uses cigarettes as payment for the irregular military forces and militias, known as the shabeeha, who have had a central role in its violent crackdown.[50]

Company documents show that in 2010 the head of the JT International SA security office – who performed a similar function at the former Gallaher Group PLC – sought to destroy evidence linking up to 13 company officers to smugglers in the Balkans region; a parallel effort was then being run by company management to hack into the emails of company anti-smuggling investigators, competitors, and law enforcement.[48]

The firm also announced in 2011 that it had purchased the largest cigarette producer in Sudan and South Sudan as part of an effort to expand sales in the war-torn region, which has emerged as an entrepot forcigarette smuggling.[51][52]

Sponsorships

edit

See also

edit

References

edit
  1. ^https:// jt /investors/results/integrated_report/report/2023/about/info/index.html
  2. ^"Corporate Data (as of June 22 2012)Archived2 February 2010 at theWayback Machine."Japan Tobacco. Retrieved 27 September 2012.
  3. ^Japan Tobacco InternationalJTI Information for JournalistsArchived29 September 2012 at theWayback MachineRetrieved on 27 September 2012
  4. ^Japan TobaccoMembers of the Board, Auditors, and Executive Officers 22 June 2012Archived13 July 2012 at theWayback MachineRetrieved on 27 September 2012
  5. ^Levin, Mark, Smoke Around the Rising Sun: An American Look at Tobacco Regulation in Japan. Stanford Law and Policy Review, Vol. 8, p. 99, 1997. Available at SSRN:http://ssrn /abstract=1691348
  6. ^Id.
  7. ^Levin, Mark, Tobacco Industrial Policy and Tobacco Control Policy in Japan ( Nhật Bản におけるたばこ sản nghiệp chính sách とたばこ quy chế chính sách ). Tobacco Free Japan: Recommendations for Tobacco Control Policy, pp. 298-313, November 2004; Asian-Pacific Law & Policy, Vol. 6, No. 1, 2005. Page 301, Table A.1: Privatization of Japan's Tobacco Monopoly, 1985 to present. Available at SSRN:http://ssrn /abstract=1691804
  8. ^The Japan TimesMinistry to sell chunk of JT shares 20 May 2012Retrieved on 22 August 2012
  9. ^abHiroko Tabuchi(25 February 2013)."Japan Plans to Sell $10 Billion Stake in Cigarette Firm"(Dealbook blog).The New York Times.Retrieved26 February2013.
  10. ^JT websiteNotice concerning decision on offer price 11 March 2013
  11. ^Financial TimesJapan to raise up to $10bn from tobacco share sale 25 February 2013
  12. ^"JT holds approximately two-thirds of the domestic cigarette market share, which is built on its best-selling brands: Mild Seven, Cabin, Caster, Seven Stars, Peace, Camel, and Salem."Archived18 December 2006 at theWayback MachineJapan Tobacco website, 2006
  13. ^Hoover'sbusiness report, 2006, on Japan Tobacco Inc. "Japan Tobacco has plenty to puff about. The company controls more than 70% of the cigarette market in a country where about half of the male population smokes."
  14. ^The Japan TimesJapan Tobacco names Koizumi as next president 24 April 2012Archived29 July 2012 at theWayback MachineRetrieved on 22 August 2012
  15. ^ReutersKoizumi, Mitsuomi BRIEF BIOGRAPHYRetrieved on 22 August 2012
  16. ^ReutersJapan Tobacco to shut plants, cut jobs as domestic demand falls 30 October 2013
  17. ^Wall Street Journal website4 February 2015 Last Call for Drinks at Japan TobaccoRetrieved 12 February 2015
  18. ^Reuters website4 February 2015 UPDATE 1-Japan Tobacco says to end beverage business due to lack of scaleRetrieved 12 February 2015
  19. ^"Deals this week: Onconova Therapeutics, Humorigin Biotechnology, Zosano Pharma".Drug Development Technology.Kable. 2 February 2018.Retrieved3 February2018.
  20. ^"Gallaher agrees £7.5bn Japan Tobacco takeover – Scotsman News".The Scotsman.Edinburgh. 15 December 2006.
  21. ^Tobacco & Salt MuseumHomeRetrieved on 27 September 2012
  22. ^"Japan Tobacco starts Serbia production, eyes more".Reuters.24 April 2007. Archived fromthe originalon 20 July 2012.
  23. ^Ng, Melody (12 June 2014)."Japan Tobacco acquires leading e-cigarette brand E-Lites".The Moodie Davitt Report.Retrieved9 January2018.
  24. ^"Japan Tobacco to buy U.S. e-cigarette maker Logic Technology".Reuters.30 April 2015.Retrieved9 January2018.
  25. ^Bray, ChadJapan Tobacco Buys International Rights to Natural American Spirit 29 September 2015NY TimesRetrieved 1 October 2015
  26. ^Japan Tobacco to acquire foreign sales rights to Natural American Spirit cigarettes 30 September 2015Archived2 October 2015 at theWayback MachineAsahi ShimbunRetrieved 1 October 2015
  27. ^Monami, YuiJapan Tobacco Lost $9 Billion After Betting on American Spirit 30 September 2015Bloomberg BusinessweekRetrieved 1 October 2015
  28. ^"Japan Tobacco to Buy Indonesian 'Kretek' Cigarette Firms for $677m".Jakarta Globe.4 August 2017.Retrieved9 January2018.
  29. ^"News & Views | Japan Tobacco International – a global tobacco company".
  30. ^Editorial, Reuters (22 August 2017)."Japan Tobacco to buy Philippine cigarette maker Mighty for $936..."Reuters.Archived fromthe originalon 22 August 2017.Retrieved17 March2018.{{cite news}}:|first=has generic name (help)
  31. ^"JT Group Acquires Russia's Donskoy Tabak".JT Group.Retrieved27 August2019.
  32. ^Matsubara, HiroshiFormer smokers denied in health compensation claim 22 October 2003Retrieved on 27 September 2012
  33. ^Levin, Mark A [papers.ssrn /sol3/papers.cfm?abstract_id=1691348 "Smoke Around the Rising Sun: An American Look at Tobacco Regulation in Japan" Stanford Law and Policy Review, Vol. 8, p. 99, 1997] Retrieved on 27 September 2012
  34. ^The Japan TimesJapan Tobacco is taken to court 15 May 1998Retrieved on 27 September 2012
  35. ^Matsubara, HiroshiFormer smokers denied in health compensation claim "The Japan Times" 22 October 2003Retrieved on 27 September 2012
  36. ^Ito, MasamiDeath, disease not linked to smoking: high court 23 June 2005The Japan TimesRetrieved on 27 September 2012
  37. ^Kageyama, YuriJapan's smoking habit runs into court challengeThe Japan Times7 August 2009 Retrieved on 27 September 2012
  38. ^Suit fails but tobacco risks noted 27 January 2010The Japan TimesRetrieved 27 September 2012
  39. ^ab"Japan Tobacco buying Bangladesh Akij's tobacco business for $1.5 billion".Reuters.6 August 2018.
  40. ^McCurry, Justin (31 January 2008)."Chinese dumplings poison dozens in Japan".The Guardian.Retrieved9 January2018.
  41. ^ab"Breaking News, World News & Multimedia".Retrieved17 March2018.
  42. ^"Japan Tobacco to Stay in China Despite Dumpling Scare – Food Industry News".Retrieved17 March2018.
  43. ^"After Bad Dumplings, Nissin Loses Appetite For Japan Tobacco Deal".Archived fromthe originalon 30 April 2008.
  44. ^"EC-JTI Cooperation Agreement 2007"(PDF).Archived fromthe original(PDF)on 30 October 2013.Retrieved1 May2012.
  45. ^"JTI Zero Tolerance Policy".Archived fromthe originalon 5 April 2012.Retrieved1 May2012.
  46. ^"JT Anti-Contraband Policy".Archived fromthe originalon 29 October 2013.Retrieved1 May2012.
  47. ^Doward, Jamie; Fulford, Lucy (29 January 2012)."Tobacco giant JTI quizzed over shipment to Syrian tycoon 'bankrolling Assad's terror'".The Guardian.Retrieved31 December2017.
  48. ^abProject, Organized Crime and Corruption Reporting."Big Trouble at Big Tobacco".OCCRP.
  49. ^"Reuters Article on JTI Smuggling".4 November 2011.
  50. ^Solomon, Jay (21 August 2012)."WSJ Article EU Probes Cigarette Deal That May Have Aided Syria, 21 August 2012".Wall Street Journal.
  51. ^"JTI Announces Purchase of Sudan's Hagger Cigarette".Archived fromthe originalon 9 April 2012.Retrieved1 May2012.
  52. ^"Research Report on Trade in East Africa" Blood "Cigarettes".
edit
Wikimedia Commons has media related toJapan Tobacco.
Retrieved from "https://en.wikipedia.org/w/index.php?title=Japan_Tobacco&oldid=1255862278"