Tobacco Advertising and Promotion Bill

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The Chairman: As we have had a fairly wide-ranging debate on specialist tobacconists, I may not allow a clause stand part debate. It will depend on how this debate goes.

Mrs. Spelman: I beg to move amendment No. 9, in page 3, leave out lines 18 to 20.

The Chairman: With this, we may discuss the following amendments: No. 32, in page 3, line 21, leave out `shop' and insert `business'.

No. 31, in page 3, line 22, leave out `half' and insert `one third'.

No. 33, in page 3, line 22, leave out

    `on the premises in question'.

No. 34, in page 3, line 28, after `available', insert

    `(or, if the most recent period for which accounts are available is different from twelve months, that period recalculated to an equivalent twelve month period on a pro rata basis)'.

No. 46, in page 3, line 34, at end add—

    `(5) No offence is committed under section 2 and 3 in relation to an advertisement which is limited to the provision of particulars about a specialist tobacconist and the fact that it sells tobacco products.'.

Mrs. Spelman: I hope, Mr. Malins, that you will be sympathetic to our taking a little time over the way in which specialist tobacconists are to be regulated. We are talking about a lot of small businesses, many of them family businesses built up over a long period. What they have been doing will change, all of a sudden, from being legal to being illegal—potentially, if they get it wrong. Therefore, it is important that we help them by drawing from the Government as much detail as possible about how they will be affected by the Bill. Although the amendments have been grouped together, they are different. I cannot promise to deal with them as swiftly as we dealt with the previous group.

There are at least 350 cigar suppliers in this country. Many of those businesses are small and their owners will be listening attentively to the debate on this clause. Government and Opposition have a responsibility to speak up for the smaller players, as it is not easy for them to change rapidly how they do things—they do not always have the flexibility of large corporate players.

11 am

Amendment No. 9 would remove subsection (1)(c). It is a probing amendment, relating to our worry that small businesses may have to go to court for a ruling about what qualifies as a tobacco advertisement on their specialist premises. Hitherto, owners of such businesses have had to advertise to pursue their livelihood, so what they are permitted must be crystal clear. My hon. Friend the Member for South Dorset referred to the failure to define ``advertisement'', which is the fundamental flaw in the Bill. That will hamper specialist tobacconists in knowing what they may do on their premises and in their business.

It would not be easy for a small business to go to court for clarification on this matter; it would cost a lot of money, and many would be deterred by the hurdle of going to court. Some business owners accused of the offence might feel that they would rather give up than go through the rigmarole, cost and indignity of having to go to court.

The amendment is designed to impress upon the Government that hiving off clarification into regulations by an ``appropriate Minister'' is not satisfactory for the specialist tobacconists, as they remain unclear about what qualifies as an advertisement. The Minister may help us over the guidance. She said that she would consult before it was issued, and I urge her to do so with those small specialists. They should not simply be lumped in one camp, as some have shops and some do not, so we need to ensure that the Government catch in their consultations all those likely to be affected. At the preliminary stage of debate on the Bill, the Government may not have realised that some of those 350 cigar manufacturers do not have a shop per se, and that that is why they depend so heavily on mailings. Those businesses need clarification about what is allowed.

Amendment No. 32 is not a probing amendment. I hope that it offers a constructive and sensible suggestion. Not all specialist tobacconists have shops—I hope that that message has got across loud and clear. If the Government want the Bill to work well, they should pay attention to the word ``shop'', which is too constraining and will not catch all the businesses that they hope to catch with the tobacco advertising ban. The amendment is self-explanatory and I hope that the Minister will agree to the change. If she leaves the word ``shop'', there will be consequences, because some specialist tobacconist shops are part of a chain. What would happen if shops within such a chain were treated differently? It is not impossible that that might happen. The word ``shop'' may trip the Government up in their intentions.

A chain may also have one shop that means that it qualifies, in the aggregate as a specialist tobacconist, although the other shops in the chain do not qualify separately. That does not sit well with the clause. The chain may be both a specialist and non-specialist supplier and we must decide how such a business would be affected by the Bill. Using the word ``business'' would clarify the matter. The clause as it stands will simply not work in practice, so I hope that the Government will reconsider the wording. Left as it is, it will weaken the Bill.

Amendment No. 33 relates to where the trading of tobacco products is carried out and would catch the specialist tobacco businesses that deal mainly, if not wholly, through mail order and web sites. Such businesses may not have a retail outlet on a high street, but trade their specialist products, which are often of high value, in a different way. As the clause pertains to specialist tobacconists, it should deal with the diverse way in which they retail. We need guidance from the Minister as to how those sales will be regarded for sales threshold qualification purposes, if they take place away from the principal shop premises. That brings us back to the previous amendment. The clause is constrained and weakened by the use of the word ``shop''.

Amendment No. 34 is different again. It is designed to provide a reasonable degree of protection for small businesses starting out. Specialist tobacco businesses come and go in different locations; because of business rates and fluctuations in trade, it is not easy to hold one's place on the high street. The clause may place an excessive burden on a new business. All hon. Members would accept that a fledgling business in its first 12 months of trading—regardless of the product in which it deals—cannot operate to full strength, and will find it difficult properly to assess how things are going. Inevitably, such businesses have to face high capital costs up front when they start up.

The amendment would change the clause, so the period could be

    ``recalculated to an equivalent twelve month period on a pro rata basis''.

It is a probing amendment that would protect start-up businesses.

Yvette Cooper: I struggled to understand amendment No. 34. Could the hon. Lady say a little more to clarify what difference the wording of amendment No. 34 would make in practice? What is the difference between the words

    ``or, if the most recent period for which accounts are available is different from twelve months, that period recalculated to an equivalent twelve month period on a pro rata basis''

and the wording in the Bill?

Mrs. Spelman: It is an attempt to achieve a pro rata effect. If a business has been operating for only a short time, in assessing the proper sales level, the Government should take full account of the pro rata pattern of sale. It is as simple as that. Its purpose is the same as that of the Government: to be reasonable in calculating the volume of sales.

Mr. Kevin Barron (Rother Valley): Why should we?

Mrs. Spelman: In the early stages of operation, it is difficult for a small business to calculate accurately what its volume of sales will be. It may be fortunate, when it starts up, to sell a great number of products and will continue on a high for a long time. Typically, however, that is not the case and sales take some time to get off the ground because customers have to find the location—or relocation—of the business. It takes time to arrive at an accurate reflection of the quantity of product that is sold.

Amendment No. 46 is a probing amendment to clarify that generic advertising by specialist tobacconists will not be illegal. Specialist tobacconists do not usually sell anything other than tobacco products and accessories. They need guidance from the Minister about what they can and cannot do. Under clause 6, as drafted, they would not enjoy the protection that the defences have given to other suppliers of tobacco products. Specialist tobacconists are a group for whom we need to work hard to make it clear what they may or may not do. A simple statement from a specialist tobacconist about the existence and location of the business and the wording, ``Suppliers of fine cigars'', for example, may be considered an advertisement under the Bill.

The failure to define ``an advertisement'' at the beginning of the Bill does not make it easier for specialist tobacconists. We appreciated the concession that they could continue to put their name, address and telephone number in Yellow Pages, but we did not get to the bottom of what other generic advertising may be illegal in future.

Mr. Ian Bruce: I was grateful to the Minister for saying that that was what the Bill meant, but that is not what a judge might say is the position on Yellow Pages. We ought to make it clear that Conservative Members do not guarantee that someone who advertises their name in Yellow Pages as a seller of fine tobaccos will not be prosecuted under the Bill.

Mrs. Spelman: Once again, we are back to the trouble with this Bill. As it stands, a small business may have to go to court for a ruling. Members of the Committee will probably recall that my hon. Friend brought with him an example from Yellow Pages, which helped to illustrate what my amendment is driving at. My hon. Friend may have it with him, but as I recall, under ``Tobacconists'' the page listed a series of telephone numbers and addresses of specialists.

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Prepared 6 February 2001