Tobacco Industry Interference Index The Philippine Report on the Implementation of Article 5.3 of the WHO Framework Convention on Tobacco Control

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First published in Manila on September 2018

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For more information, please visit www.healthjustice.ph. Acknowledgments

This report is prepared by Atty. Irene Patricia Reyes with assistance from Mr. Melanio Mauricio III. It is designed and laid out by Ms. Pauline Marie Villar.

HealthJustice would like to thank New Vois Association of the Philippinees (NVAP) for their comments on the report, and Southeast Asia Tobacco Control Alliance (SEATCA) for providing the tools, support, and guidance for this report. Contents

Introduction 1

Methodology 2

Tobacco Industry Interference Index 3

Tobacco Industry Participation in Policy Development 4

Industry-Related CSR Activities 6

Benefits of the Tobacco Industry 6

Forms of Unnecessary Interaction 7

Transparency 8

Conflict of Interest 8

Preventive Measures 9

Recommendations 12 Tobacco Industry Interference Index The Philippine Report on the Implementation of Article 5.3 of the WHO Framework Convention on Tobacco Control

September 2018 

Introduction

The Philippines is a signatory to the Guidelines in 2008. The Guidelines pro- Framework Convention on Tobacco vide for 8 main recommendations with 34 Control (WHO FCTC). Article 5.3 of the sub-recommendations to governments to WHO FCTC imposes an obligation to the ensure that the industry is prevented from signatory states that when each state exerting its influence on public health establishes and implements their public policy. health policies with respect to tobacco control, the state shall act to protect While the tobacco industry has been the policies from commercial and other utilizing similar strategies around the vested interests of the tobacco industry world, there has been little effort to in accordance with national law. measure and compare the responses of the government or its ability to respond to these strategies. The purpose of the The Tobacco Industry Interference Index is to define the measures and Index intends to gauge the level of elements that contribute to the ability industry interference, as well as of the tobacco industry to interfere the responses or measures implemented with policymaking. The assessment by the government following could provide an indication of the Article 5.3 of the Framework government’s capacity to resist tobacco industry interference. Convention on Tobacco Control.

Article 5.3 of the FCTC aims to protect public health policies from tobacco industry interference, which is a key in an effective tobacco control program. To give more clarity to the provision, the Parties to the FCTC unanimously adopted the Article 5.3

2018 Tobacco Industry Interference Philippine Index Report 1 

Methodology

This is the fifth report reviewing the The questionnaire for the report was implementation of the Philippines of updated in 2015 to quantify the intensity, Article 5.3 of the WHO FCTC based on the frequency, or severity of a given incident Tobacco Industry Interference Index. of interference by providing specific guides (assessment tools) on how to Covering incidents of tobacco industry assess specific situations. interference from January to December 2017, relevant evidence were gathered, The intent was to remove the subjectiv- reviewed, and scored based on the ques- ity by assigning a number, and put all tionnaire provided by Southeast Asia respondents/researchers on the same Tobacco Control Alliance (SEATCA). page when assigning a score. The scores Information sources for the research are ultimately compared with results were based on publicly available or com- from other countries. However, because monly known information. The research of the revision in scoring system, it may was limited to information sourced from not adequately capture the difference official websites, news reports, tobacco between the years. company reports, and anecdotal reports. The results were shared with a core group of tobacco control advocates for review. The report was revised based on the inputs gathered from the core group.

The questions were based on the top twenty (20) most commonly reported in- cidents of tobacco industry interference in the Southeast Asian countries and referenced to specific recommendations in the Article 5.3 Guidelines.

2018 Tobacco Industry Interference Philippine Index Report 2 

Tobacco Industry Interference Index The Philippine Report on the Implementation of Article 5.3 2018 ofTobacco the WHO Industry Framework Interference Convention Philippine on IndexTobacco Report Control 3 Tobacco Industry Participation in Policy Development Philippine Index Report

The Tobacco Industry Interference Index The tobacco industry continues to is an attempt to define the measures and participate and exert influence in elements that contribute to the ability of tobacco control policy development the tobacco industry to interfere with public health policy making. The questions were and implementation. designed based on specific situations most applicable to the Southeast Asian nation’s bers of the Inter-agency Committee context that the Article 5.3 Guidelines seeks Tobacco (IACT), a committee tasked to to address.The questions are grouped into implement the provisions of Republic Act seven categories: (I) level of participation 9211 or the Tobacco Regulation Act and in policy development; (II) so-called CSR monitor compliance with Republic Act activities; (III) benefits to the tobacco 10643 or the Graphic Health Warnings industry; (IV) forms of unnecessary inter- Law. There are bills filed to amend RA action; (V) transparency; (VI) conflict of 9211 to remove PTI and NTA in in IACT. interest; and (VII) preventive measures. However, the bill is only at the Committee level in the House of Representatives, or Monitoring on an annual basis serves the first level of deliberation. to measure whether the Philippines is making progress, maintaining status In a committee hearing at the House of quo, or deteriorating when addressing Representatives held last September 13, tobacco industry interference. The scores 2017, during which amendment of RA 9211 are based on a particular indicator on was discussed, the Philippine Tobacco the level of industry responses and the Industry, an umbrella organization of responses of the government in address- tobacco companies in the Philippines, and ing them based on publicly available several tobacco companies were invited evidence. and attended the hearing. Even if they did not sit as resource persons during Tobacco Industry Participation in the meeting, they observed the proceed- Policy Development ings and spoke with several members of congress attending the hearing. Similar to previous years, the Philippine Tobacco Institute (PTI) and the National Members of the House of Representatives Tobacco Administration (NTA) are mem- backed House Bill 4144, a bill filed by Rep.

2018 Tobacco Industry Interference Philippine Index Report 4 Industry-Related CSR Activities

Eugene de Vera, of ABS Partylist, propos- In 2017, the Philippines retained the ing to downgrade the current tobacco tax single-tier system for tobacco products, classification system back to two tiers. when the comprehensive tax reform law was passed last December 2017. However, This move serves to benefit the local it provided only marginal increases for tobacco company, Mighty Corporation. tobacco taxes, which was proposed last Several news reports stated that the bill minute despite calls from advocates for a was pushed by Mighty Corporation. The substantial increase of tobacco taxes. bill was approved on third and final read- ing in the Lower House and was trans- Industry-Related CSR Activities mitted to the Senate. However, a Senate version of the bill was not passed. The WHO FCTC and its Guidelines recom-

Box 1. Tobacco Industry Participation in Policy Development

Indicators 0 1 2 3 4 5

1 The government accepts, supports or endorses any X offer for assistance by or in collaboration with the tobacco industry in setting or implementing public health policies in relation to tobacco control (Rec 3.1)

2 The government accepts, supports or endorses X policies or legislation drafted by or in collaboration with the tobacco industry. (Rec 3.4)

3 The government allows or invites the tobacco industry X to sit in government interagency or multi-sectoral committee or advisory group body that sets public health policy. (Rec 4.8) 1 - Never; 5 - Yes

4 The government nominates or allows representatives X from the tobacco industry (including State-owned) in the delegation to the COP or other subsidiary bodies or accepts their sponsorship for delegates. (i.e. COP 4 & 5, INB 4 5, WG) (Rec 4.9 & 8.3) 5 A. The government agencies or its officials endorses, X supports, forms partnerships with or participates in so-called CSR activities organized by the tobacco industry. (Rec 6.2)

B. The government (its agencies and officials) receives X contributions (monetary or otherwise) from the tobacco industry (including so-called CSR contributions). (Rec 6.4) NOTE: Excludes enforcement activities as this is covered in another question

2018 Tobacco Industry Interference Philippine Index Report 5 Benefits of the Tobacco Industry

mend that Parties ban so-called corporate Benefits of the Tobacco Industry social responsibility activities of tobacco companies, as it is a means to access and Philip Morris has a regional tobacco leaf influence policymakers and continue to warehouse in Subic, a free port zone4 and a advertise tobacco products or brand. manufacturing facility in First Philippine Industrial Park, an economic zone operated Since 2010, after the Department of Health- by PEZA. The tobacco industry gains advan- Civil Service Commission Memorandum tage by operating in these areas as they are Circular on the Protection of the Bureaucracy granted lower taxes or duties. The incentives are given to any business operating in the Against Tobacco Industry Interference Philippines, but because of Article 5.3 of the (DOH-CSC JMC) was implemented, there FCTC, the government should consider mak- has been a decrease of partnerships and ing an exception in the case of the tobacco unnecessary interactions between the gov- industry. ernment and the tobacco companies. The government allowed the settlement of In 2017, WCKF donated a water supply tax liabilities of Mighty Corporation. The system in a barangay in Piat, Cagayan1 Department of Justice granted the motion of and computers to the San Mateo Police the Bureau of Internal Revenue, withdrawing Station.2 The inaguration and turnover the multi-million peso tax evasion complaint ceremony was attended by public officials. filed against Mighty Corporation after the lat- ter secured a compromise deal with the gov- The American Chamber of Commerce ernment. Under the deal, Mighty Corporation Foundation and Philip Morris Philippines will pay the government 25 billion pesos. EMBRACE donated shoes and apparel for 3 the athletes of Cagayan. Forms of Unnecessary Interaction

There were no reported incidents of top level government officials meeting with tobacco companies or accepting assistance from the 1 Philippine Daily Inquirer, Business Mirror, Manila tobacco industry. Standard, Manila Times, January 8 - January 14, 2017. 2 Manila Standard, Manila Bulletin, Manila Times, A summit on the implementation of Philippine Daily Inquirer, February 11, 2017 Adaptation and Mitigation Initiative in 3 Manila Standard, January 31, 2017, Available at Agriculture was held in January 2017. The http://www.thestandard.com.ph/news/-news-in-pho- two-day summit was spearheaded by the pro- tos/228057/shoes-for-athletes.html. vincial government of Cagayan, Philip Morris and Fortune Tobacco Corporation (PMFTC) However, tobacco companies and the American Chamber of Commerce of continued conducting so-called the Philippines Inc. (AmCham). The summit CSR activities by coursing it was held in partnership with Department of Science and Technology and the Department through foundations and other of Agriculture. groups such as the Wong Chu King Foundation and the American Chamber of Commerce Foundation. 4 (2009, August 25). Philip Morris expands Subic facility by 4x. ABS-CBN News. Retrieved from http://news.abs-cbn.com/business/ 08/24/09/ philip-morris-expands-subic-facility-4x.

2018 Tobacco Industry Interference Philippine Index Report 6 Transparency

Box 2. Benefits to the Tobacco Industry

Indicators 0 1 2 3 4 5

6 The government accommodates requests from the X tobacco industry for a longer time frame for imple- mentation or postponement of tobacco control law. (e.g. 180 days is common for PHW, Tax increase can be implemented within 1 month) (Rec 7.1) 7 The government gives privileges, incentives, exemp- X tions or benefits to the tobacco industry (Rec 7.3)

Box 3. Forms of Unnecessary Interaction

Indicators 0 1 2 3 4 5

8 Top-level government officials (such as President, X Prime Minister, or Minister) meet with/ foster relations with the tobacco companies such as at- tending social functions and other events sponsored or organized by the tobacco companies or those furthering its interests. (Rec 2.1) 9 The government accepts assistance, or offers of X assistance from the tobacco industry on enforcement such as conducting raids on tobacco smuggling or enforcing smoke free policies or no sales to minors. (including monetary contribution for these activities) (Rec 4.3) 10 The government accepts, supports, endorses, or X enters into partnerships or agreements with the tobacco industry. (Rec 3.1) NOTE: This must not involve CSR, enforcement activity, or tobacco control policy development since these are already covered in the previous questions.

It was attended by 412 participants, including tection advocates, and local government town and city mayors, local government unit officials. The event was organized by the representatives, city and municipal agricul- provincial government of Misamis Oriental turists, farer leaders, representatives of in partnership with the American Chamber various government agencies, non-gov- of Commerce of the Philippines and Philip ernment organizations, the private sector Morris Fortune Tobacco Corp.6 led by the Filipino-Chinese Chamber of Commerce of Cagayan.5 Transparency

On October 2017, a forum was held discuss- One commendable provision of the ing child labor in the business sector. It was DOH-CSC JMC is to require government attended by industry players, child pro- agencies to report or disclose interactions

5 Manila Times, January 31, 2017 Available at http:// www.manilatimes.net/da-bats-implementation-cli- 6 Philippine News Agency, October 25, 2018, Available mate-change-mitigation-measures/309845/. at http://www.pna.gov.ph/articles/1013881.

2018 Tobacco Industry Interference Philippine Index Report 7 Conflict of Interest

with the tobacco industry. Through this, Estrelito Mendoza is counsel of Lucio it supports dissemination of information Tan, the Chairman of PMFTC. Retired to the public and obliging officials and General Edilberto Adan is the Director agencies to report buttresses an environ- and President of Mighty Corporation ment that denormalizes interaction with while retired Judge Oscar Barrientos is the tobacco industry. However, previous the Executive Vice President of Mighty inquiry with the CSC revealed that it has Corporation, and Romulo Neri, Former no full information about meetings or National Economic and Development interactions of other agencies with the Authority director, is a consultant of tobacco industry. Two conclusions can Mighty Corporation. be made from the lack of reports, either there are no meetings or interactions There are no available information on with the tobacco industry or the govern- current government officials working in ment agencies are not complying with tobacco companies. the requirement to submit reports. In any case, the government needs to improve Preventive Measures monitoring and reporting interactions with the tobacco industry. There are preventive measures in place to implement Article 5.3 of the FCTC. Like any other company, tobacco compa- The DOH and the CSC issued the JMC in nies are required to register with a govern- 2010, which applies to all officials and ment agency. However, the requirement employees of the government. The JMC does not require disclosure of affiliated prohibits interaction with the tobacco organizations aor individuals acting on industry unless strictly necessary for its their behalf. effective regulation.

Conflict of Interest Where there is a necessary interaction with the tobacco, the JMC requires trans- There are former government officials parency in interactions with the tobacco that are now working with tobacco industry through submission of reports companies. Former Solicitor General or minutes of meetings that can be pub-

Box 4. Transparency

Indicators 0 1 2 3 4 5

11 The government does not publicly disclose meetings X or interactions with the tobacco industry in cases where such interactions are strictly necessary for regulation. (Rec 2.2)

12 The government requires rules for the disclosure or X registration of tobacco industry entities, affiliated organizations, and individuals acting on their behalf including lobbyists.

2018 Tobacco Industry Interference Philippine Index Report 8 Preventive Measures

Box 5. Conflict of Interest

Indicators 0 1 2 3 4 5

13 The government does not prohibit contributions X from the tobacco industry or any entity working to further its interests to political parties, candidates, or campaigns or to require full disclosure of such contributions. (Rec 4.11) 1 - Never; 5 - Yes 14 Retired senior government officials form part of the X tobacco industry (former Prime Minister, Minister, Attorney General) (Rec. 4.4)

15 Current government officials and relatives hold X positions in the tobacco business including consul- tancy positions. (Rec. 4.5, 4.8, 4.10)

licly accessible.Article 3.1 and the Annex of about the JMC in an effort to better inform the the CSC-DOH Joint Memorandum Circular public. provide that any necessary interactions between public officials and employees and The Civil Service Commission, in a news the tobacco industry should be document- report, stated proposed revisions in a joint ed in a specific manner and required to be memorandum circular issued by the CSC and in an official transcript of records, which Department of Health to strengthen efforts should be filed and be made available to the to stop cigarette companies from circum- public upon request. venting anti-tobacco policies. CSC assistant commissioner, Ariel Ronquillo, said they In addition, Article 5.2 requires agencies are looking at including the Office of the to submit reports on interactions with the Ombudsman in the fight against “tobacco tobacco industry, any preferential treatment industry interference” in the government.7 given, and any offer of donation to the public official or employee by the tobacco industry. The Department of Education Secretary, Leonor Briones, has warned school officials In the past years, the CSC, DOH, and other against interference from the tobacco in- tobacco control groups have been conduct- dustry, reminding them of existing guide- ing capacity building workshops in different lines prohibiting any form of donation regions in order to raise awareness about from tobacco companies. Briones issued a Article 5.3, tobacco industry interference, memorandum following the release of the and the requirements under the JMC. Due latest Tobacco Industry Interference Index to combined efforts, other agencies in the Philippine report, which cited instances of government have also adopted their own tobacco companies engaging in activities policies implementing Article 5.3, rejected such as feeding programs and giving dona- donations from the tobacco industry, and tions to schools.8 terminated previous partnerships with the industry. 7 The Philippine Star, September 30, 2017, Available at http://www.philstar.com/headlines/2017/09/30/1744111/ Some government agencies, like the CSC ombudsmans-inclusion-eyed-joint-memo-vs-tobacco and the Department of Education, have 8 The Philippine Star, December 14, 2017, disseminated press releases in the media Available at http://www.philstar.com/campus/

2018 Tobacco Industry Interference Philippine Index Report 9 

Box 6. Preventive Measures Scoring for this section: 1 - Yes; 2 - Yes but partial only; 3 - Policy/Program being developed; 4 - Committed to develop such a policy/program; 5 - None Indicators 0 1 2 3 4 5

16 The government has put in place a procedure for X disclosing the records of the interaction (such as agenda, attendees, minutes and outcome) with the tobacco industry and its representatives. (Rec 5.1)

17 The government has formulated, adopted or X implemented a code of conduct for public officials, prescribing the standards with which they should comply in their dealings with the tobacco industry. (Rec 4.2) 18 The government requires the tobacco industry to X periodically submit information on tobacco produc- tion, manufacture, market share, marketing expen- ditures, revenues and any other activity, including lobbying, philanthropy, political contributions and all other activities. (5.2) 19 The government has a program, system, or plan to X consistently raise awareness within its departments on policies relating to FCTC Article 5.3 Guidelines. (Rec 1.1, 1.2)

20 The government has put in place a policy to disallow X the acceptance of all forms of contributions or gifts from the tobacco industry (monetary or otherwise) including offers of assistance, policy drafts, or study visit invitations given or offered to the government, its agencies, officials and their relatives. (3.4)

2018 Tobacco Industry Interference Philippine Index Report 10 

Box 7. Philippine Government Policies Pursuant to WHO FCTC Article 5.3 There are other policies that aim to implement Article 5.3, among others:

Department of Health Memorandum 2010-0126 protecting the DOH against tobacco industry interference

Department of Education Order No. 6 Guidelines on the adoption and implementation of public health policies on tobacco control and protection against tobacco industry interference

Department of Labor and Employment Memorandum reiterating CSC-DOH JMC 2010-01

Bureau of Internal Revenue Memorandum Order No. 16-2012 restricting interactions with the tobacco industry

Department of Foreign Affairs Memorandum directing compliance with the JMC

Metro Manila Development Authority Memorandum amending their Code of Conduct to include protection of the MMDA against tobacco industry interference

2018 Tobacco Industry Interference Philippine Index Report 11  Recommendations

Smoking, the single largest preventable policy and conduct briefing in media cause of death in the world, still continues about it. However, there is clearly room to be a big health problem worldwide for improvement for the policy’s imple- despite what we know about the product mentation. The JMC will not work without and the addiction, pain, and suffering the proper monitoring and reporting it causes. One just needs to look at the system. There are transparency and strategies of the tobacco industry and reporting requirements, such as requiring how it uses its influence to connect with to provide information about meetings or governments in order to create an en- interactions with the tobacco industry, but vironment where it will be convenient, the government agencies need to be stricter accessible, and affordable to smoke. in enforcing it.

In 2017, while the Philippines has had a The Philippines also needs to address the victory through the signing of a policy new challenges subverting the imple- which intends to prohibit smoking in mentation of Article 5.3. While policies public places. It is undeniable that industry implementing Article 5.3 have been participation in policy development and successful in prohibiting unnecessary implementation continues to be a big interactions with the tobacco industry concern. There are stricter tobacco and prohibiting donations to government control measures that must be passed, agencies, the limited scope creates a loop- such as higher taxes, removal of tobacco hole and an opportunity for the industry industry in policy implementation, and to use private organizations to continue banning of tobacco advertisements. conducting and publicizing its so-called In addition, there are newer products CSR activities. that the tobacco companies are currently investing in, such as electronic cigarettes. Civil society organizations need to provide Thus, there are bigger battles to fight, support in building an environment where which makes it more important to prevent tobacco industry interference is denor- interference of the tobacco industry. malized and where the public is not only aware, but understands and supports the The Philippines continues to have policies issue. This might include strengthening the that help prevent tobacco industry communications campaign and conducting interference through the DOH-CSC regular policy advocacy meetings with JMC, and other policies implementing legislators, and other government officials. Article 5.3. Government offices prom- inently display information about the

2018 Tobacco Industry Interference Philippine Index Report 12

Tobacco Industry Interference Index 2018 Published by HealthJustice, Inc. with support from the Southeast Asia Tobacco Control Alliance

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