[DOCID: f:sr512.110]
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110th Congress
2d Session SENATE Report
110-512
_______________________________________________________________________
Calendar No. 1095
TRUTH IN CIGARETTE LABELING ACT
__________
R E P O R T
OF THE
COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
on
S. 2685
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>
September 26 (legislative day, September 17), 2008.--Ordered to be
printed
SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
one hundred tenth congress
second session
DANIEL K. INOUYE, Hawaii, Chairman
JOHN D. ROCKEFELLER IV, West KAY BAILEY HUTCHISON, Texas
Virginia TED STEVENS, Alaska
JOHN F. KERRY, Massachusetts JOHN McCAIN, Arizona
BYRON L. DORGAN, North Dakota OLYMPIA J. SNOWE, Maine
BARBARA BOXER, California GORDON H. SMITH, Oregon
BILL NELSON, Florida JOHN ENSIGN, Nevada
MARIA CANTWELL, Washington JOHN E. SUNUNU, New Hampshire
FRANK R. LAUTENBERG, New Jersey JIM DeMINT, South Carolina
MARK PRYOR, Arkansas DAVID VITTER, Louisiana
THOMAS CARPER, Delaware JOHN THUNE, South Dakota
CLAIRE McCASKILL, Missouri ROGER F. WICKER, Mississippi
AMY KLOBUCHAR, Minnesota
Margaret Cummisky, Staff Director and Chief Counsel
Lila Helms, Deputy Staff Director and Policy Director
Jean Toal Eisen, Senior Advisor and Deputy Policy Director
Christine Kurth, Republican Staff Director and General Counsel
Paul J. Nagle, Republican Chief Counsel
Mimi Braniff, Republican Deputy Chief Counsel
Calendar No. 1095
110th Congress Report
SENATE
2d Session 110-512
======================================================================
TRUTH IN CIGARETTE LABELING ACT
_______
September 26 (legislative day, September 17), 2008.--Ordered to be
printed
_______
Mr. Inouye, from the Committee on Commerce, Science, and
Transportation, submitted the following
REPORT
[To accompany S. 2685]
The Committee on Commerce, Science, and Transportation, to
which was referred the bill (S. 2685) to prohibit cigarette
manufacturers from making claims or representations based on
data derived from the cigarette testing method established by
the Federal Trade Commission, having considered the same,
reports favorably thereon without amendment and recommends that
the bill do pass.
PURPOSE OF THE BILL
S. 2685 would prohibit cigarette manufacturers from using the
modified Cambridge Filter method, adopted by the Federal Trade
Commission (FTC or Commission) and also known as the FTC
method, as the basis for making representations or claims about
the nicotine and tar content of their products.
BACKGROUND AND NEEDS
Development of the FTC Method. Before a standardized
procedure for testing cigarette yields existed, cigarette
manufacturers started advertising their products' tar and
nicotine content. In 1955, the FTC responded to these practices
by publishing cigarette advertising guides that banned claims
that a specific cigarette brand had low tar or nicotine--or had
lower tar or nicotine than another brand--if no scientific
evidence validated the claim. Contradicting the FTC's
instruction, manufacturers continued to advertise tar numbers,
producing a host of inconsistent product assertions that failed
to equip consumers with an ability to accurately assess
different cigarette tar deliveries. In 1960, after talks with
the Commission, industry agreed to halt tar and nicotine
advertising.
In 1964, the U.S. Department of Health and Human Services
issued the first Surgeon General's report on the health risks
of smoking. The report concluded that cigarette smoking was a
cause of lung cancer in men. Two years later, the Public Health
Service announced that most scientific evidence suggested that
lower levels of tar and nicotine would produce a less harmful
effect on consumers. In 1966, the FTC initiated two actions to
encourage manufacturers to disclose comparative tar and
nicotine yield information to consumers. First, the Commission
lifted the ban on nicotine and tar advertising but made future
industry factual statements conditional: Statements would be
required to support tests conducted in keeping with the
Cambridge Filter method, and they could not include assertions
of reduced health hazards. Second, the Commission authorized
the creation of a laboratory designed to analyze cigarette
smoke and sought public comment on suggested changes to the
Cambridge Filter method. Analysts often refer to the modified
Cambridge Filter method adopted by the Commission as the ``FTC
method.''
The FTC method was designed to obtain uniform and
standardized data about tar and nicotine yields of cigarette
smoke. It was not designed to replicate human smoking.
According to the 1967 FTC publication, ``Cigarette Testing and
the Federal Trade Commission: A Historical Overview,'' the
purpose of the cigarette testing was ``not to determine the
amount of `tar' and nicotine inhaled by any human smoker, but
rather to determine the amount of tar and nicotine generated
when a cigarette is smoked by machine in accordance with the
prescribed method.'' Changes in cigarette technology have
created ways to lower a cigarette's tar and nicotine ratings
when tested by the FTC method. These have included: (1) Adding
filters that trapped some tobacco smoke particles before they
reached the machine; (2) wrapping the tobacco plug in paper
with a quick burning rate; and (3) inserting ventilation holes
around the filter's circumference, creating an ``aeration''
effect in which air is absorbed into the filter generating a
diluted mixture of air and smoke which produces lower tar and
nicotine ratings.
According to the FTC, disclosures of tar and nicotine ratings
in advertising by manufacturers are voluntary. No formal legal
requirement obligates companies to disclose the tar and
nicotine ratings in their advertisements. The disclosure of the
ratings in advertisements is the result of a voluntary
agreement in 1971 among five of the then-largest companies and
three smaller companies. Due to the voluntary agreement, the
Commission suspended indefinitely a rulemaking proceeding that
would have required such disclosures.
FTC Critique of the Method. On several occasions, the
Commission has questioned the applicability of its standardized
cigarette testing method and has invited public comment on
proposed revisions to its test. A lack of consensus among the
commenters, however, in addition to related unresolved
scientific issues, have kept the Commission from altering the
testing protocol. Chairman Kovacic in his testimony before the
Commerce Committee in November 2007 noted, ``Despite these
dramatic decreases in machine-measured yields, the Commission
has been concerned for some time that the current test method
may be misleading to individual consumers who rely on the
ratings it produces as indicators of the amount of tar and
nicotine they actually will get from their cigarettes. In fact,
the current ratings tend to be relatively poor predictors of
tar and nicotine exposure. This appears to be primarily due to
compensation--or the tendency of smokers of lower rated
cigarettes to take bigger, deeper, or more frequent puffs, or
otherwise alter their smoking behavior in order to obtain the
dosage of nicotine they need. Such variations in the way people
smoke can have significant effects on the amount of tar,
nicotine, and carbon monoxide they get from any particular
cigarette.''
Smokers' Perceptions: Effects of Marketing Practices. Despite
scientific evidence revealing that ``light'' cigarettes have
neither lowered the disease risk of smokers nor created a
public health benefit, many smokers assume that light or ultra
light cigarettes present less of a health risk than the risk
associated with other cigarettes. Many smokers also
misapprehend ``light'' and ``ultra light'' cigarettes as
exposing them to lower nicotine and tar levels. For example, a
July 1998 survey in the American Journal of Preventive Medicine
indicated that many smokers choose light or ultra light
cigarettes in order to reduce smoking risks. Almost three-
fourths of the ultra light smokers said they smoked ultra light
cigarettes to reduce their intake of tar and nicotine. Thirty
nine percent of light smokers and fifty eight percent of ultra
light smokers said they smoke the lighter brands in order to
reduce risks without having to quit smoking entirely. A 1986
study by the Centers for Disease Control and Prevention (CDC)
found that smokers of light/ultra light cigarettes had a lower
likelihood of quitting than smokers of regular cigarettes. The
study also found that smokers who had never changed to low tar
or nicotine brands had a higher likelihood of quitting than
smokers who had changed to lower tar brands.
Health Advocacy Community's Critique of Marketing Practices.
Health experts and consumer safety advocates have criticized
the use of the words ``light'' and ``low tar'' as inaccurate.
The Campaign for Tobacco-Free Kids points to a distinction
between food advertising and cigarette advertising: ``Foods
with descriptors such as `light' or `low in fat' are required
by the Food and Drug Administration (FDA) to provide an actual
benefit to consumers--a specified reduction in calorie content
or fat grams. With the absence of FDA regulation over tobacco
products, there is no equivalent protection for consumers of
cigarettes branded as `light' or `low tar.''' The National
Cancer Institute (NCI) has affirmed that the FTC's testing
method does not provide smokers with meaningful information
regarding the amount of tar and nicotine smokers will
realistically intake from a cigarette.
In addition, the NCI has concluded that light cigarettes
provide no benefit to smokers' health: ``According to the NCI
monograph Risks Associated with Smoking Cigarettes with Low
Machine-Measured Yields of Tar and Nicotine, people who switch
to light cigarettes from regular cigarettes are likely to
inhale the same amount of hazardous chemicals, and they remain
at high risk for developing smoking-related cancers and other
diseases.'' Finally, according to the NCI, no evidence exists
showing that switching to light or ultra-light cigarettes aids
smokers in quitting.
SUMMARY OF PROVISIONS
S. 2685 would mandate that a cigarette manufacturer cannot
make any claims or representations based on data derived from a
cigarette testing method established by the FTC. A violation of
the prohibition would be treated as a violation of a rule
defining an unfair or deceptive act or practice, which would
allow the Commission to assess civil penalties of up to $11,000
per day per violation.
LEGISLATIVE HISTORY
On March 3, 2008, Senator Lautenberg introduced S. 2685, the
Truth in Cigarette Labeling Act, which was referred to the
Committee on Commerce, Science and Transportation. Senators
Snowe and Clinton cosponsored the measure. The Commerce
Committee held a hearing titled the ``Accuracy of the FTC Tar
and Nicotine Cigarette Rating System'' on November 13, 2007. At
the hearing, the Committee explored the FTC testing method for
determining cigarettes' tar and nicotine ratings, tobacco
companies' marketing of light cigarettes to Americans, and the
public health implications of changes in cigarette design. FTC
Chairman William Kovacic, the NCI, the CDC and other
stakeholders testified at the hearing.
On May 15, 2008, the Committee met in open executive session
to consider S. 2685, as introduced. The measure was accepted by
voice vote. Without objection, the Committee ordered the bill
to be reported favorably without amendment.
Staff assigned to this bill are David Strickland, Democratic
Senior Counsel, Jana Fong-Swamidoss, Democratic Counsel, and
Rebecca Hooks, Republican Professional Staff member.
ESTIMATED COSTS
In accordance with paragraph 11(a) of rule XXVI of the
Standing Rules of the Senate and section 403 of the
Congressional Budget Act of 1974, the Committee provides the
following cost estimate, prepared by the Congressional Budget
Office:
June 25, 2008.
Hon. Daniel K. Inouye,
Chairman, Committee on Commerce, Science, and Transportation,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 2685, the Truth in
Cigarette Labeling Act of 2008.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Susan Willie.
Sincerely,
Peter R. Orszag.
Enclosure.
S. 2685--Truth in Cigarette Labeling Act of 2008
S. 2685 would prohibit cigarette manufacturers from making
certain claims based on data derived from a cigarette testing
method developed by the Federal Trade Commission (FTC). The
bill would authorize the FTC to enforce this new prohibition.
The cigarette testing method developed by the FTC is used
by manufacturers to determine the relative levels of tar,
nicotine, and carbon monoxide produced by a cigarette. Based on
the results of those tests, cigarette manufacturers make claims
about a product that it is ``low tar'' or ``light,'' for
example. S. 2685 would prohibit this practice.
Based on information from the FTC, CBO estimates that
implementing the provisions of S. 2685 would not significantly
increase spending subject to appropriation. Under current law,
the FTC enforces certain laws governing both warnings printed
on cigarette labels and advertising claims made by cigarette
manufacturers, including claims about tar and nicotine ratings.
The new prohibition created by S. 2685 would not add a
significant new burden to the FTC's enforcement efforts.
Enacting S. 2685 could increase federal revenues from civil
monetary penalties on cigarette manufacturers for violations of
the new prohibition; CBO estimates that the effect would not be
significant. Enacting the bill would not affect direct
spending.
The bill would impose a private-sector and
intergovernmental mandate as defined in the Unfunded Mandates
Reform Act (UMRA) on manufacturers of cigarettes and certain
other tobacco products, including certain Indian tribes, by
prohibiting them from making any claims or representations
based on the level of tar and nicotine as measured by the FTC
test method. Based on information from tobacco companies and
tribal manufacturers of cigarettes, CBO expects that the
aggregate costs of complying with the mandate would not exceed
the annual thresholds established in UMRA ($136 million in 2008
for private-sector mandates and $68 million in 2008 for
intergovernmental mandates, adjusted annually for inflation).
The CBO staff contacts for this estimate are Susan Willie
(for federal costs), Elizabeth Cove (for the state and local
impact), and MarDestinee Perez (for the impact on the private
sector). The estimate was approved by Theresa Gullo, Deputy
Assistant Director for Budget Analysis.
REGULATORY IMPACT STATEMENT
In accordance with paragraph 11(b) of rule XXVI of the
Standing Rules of the Senate, the Committee provides the
following evaluation of the regulatory impact of the
legislation, as reported:
Number of persons covered
The prohibition on basing advertisements of cigarettes on the
FTC method would affect every cigarette consumer who relied
upon those statements when purchasing their cigarettes.
Economic impact
S. 2685 could impact sales of light cigarettes in that the
marketing of the product would have to change to reflect the
prohibition of the usage of the FTC method.
Privacy
S. 2685 would not impact the privacy of individuals.
Paperwork
It is not expected that the legislation would increase the
paperwork requirements of the FTC.
CONGRESSIONALLY DIRECTED SPENDING
In compliance with paragraph 4(b) of rule XLIV of the
Standing Rules of the Senate, the Committee provides that no
provisions contained in the bill, as reported, meet the
definition of congressionally directed spending items under the
rule.
SECTION-BY-SECTION ANALYSIS
Section 1. Short title
Section 1 would provide that the legislation may be cited as
the ``Truth in Cigarette Labeling Act of 2008.''
Section 2. Prohibition on claims regarding tar or nicotine yield levels
of cigarettes
Subsection (a) of section 2 would set forth a number of
Congressional findings related to the marketing of cigarettes
using the FTC method for testing tar and nicotine intake.
Subsection (b) of section 2 would define the terms
``cigarette'' and ``roll-your-own-tobacco''. Cigarette would be
given the same definition as in section 3(1) of the Federal
Cigarette Labeling and Advertising Act (15 U.S.C. 1332(1)) but
also would include tobacco, in any form, that is functional in
the product, which, because of its appearance, the type of
tobacco used in the filler, or its packaging and labeling, is
likely to be offered to, or purchased by, consumers as a
cigarette or as roll-your-own tobacco. Roll-your-own-tobacco
would be defined as any tobacco which, because of its
appearance, type, packaging, or labeling, is suitable for use
and likely to be offered to, or purchased by, consumers as
tobacco for making cigarettes.
Subsection (c) of section 2 would prohibit cigarette
manufacturers from making claims or any other representations
based on data derived from a cigarette testing method
established by the FTC and in effect on the day before the date
of enactment of this Act. The subsection also would establish
that a violation of this prohibition be treated as a violation
of a rule defining an unfair or deceptive act or practice
prescribed under section 18(a)(1)(B) of the Federal Trade
Commission Act, and that the FTC shall enforce section 2 in the
same manner, by the same means, and with the same jurisdiction,
powers, and duties as though all applicable terms and
provisions of the Federal Trade Commission Act were
incorporated into and made a part of section 2.
CHANGES IN EXISTING LAW
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, the Committee states that the
bill as reported would make no change to existing law.
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