Decision upheld against PMI accused of underhanded advertising in Lithuania

Philip Morris International (PMI) has failed to overturn a decision by Lithuanian authorities that advertising for Iqos devices constitutes tobacco advertising in a case that has minuscule financial consequences but potentially serious impact on policy going forward.

The Supreme Administrative Court of Lithuania confirmed the decision made by the country’s Department of Drug, Tobacco and Alcohol Control (NTAKD) against PMI’s regional subsidiary, Philip Morris Baltic (PMB). The court found the advertising for Iqos devices was in fact advertising for a tobacco product, as it encouraged the purchase of tobacco products.

This means that PMB was guilty of violating Lithuania’s definition of “hidden” tobacco products in advertisements as established in the country’s tobacco control laws. Effectively it was tobacco advertising by proxy because such a device would typically be used with a tobacco heat stick. This resulted in a €2,100 fine for PMB that the company elected to oppose.

Article 24.4 of Lithuania’s Law on Advertising states that for “non-compliance with the requirements stipulated in Article 12(1), (2), (4) and (12) of this law, operators of advertising activity may be subject to a fine from €289 to €2,896”. Article 12 of the law regulates the rules for outdoor advertising.

The low fine level was set so that it could apply to a wide variety of actors, and the amounts were set before Lithuania joined the euro system in 2014, meaning they used to be LTL5,000.

PMB launched a complaint about the original NTAKD decision in 2018. A lower court had also previously rejected the complaint. The Supreme Administrative Court stated that the information the company provided was misleading consumers into thinking that marketing for Iqos was not a tobacco advertisement.

The company did not respond to specific questions, but it is likely that PMB opposed the tiny fine over concerns about the impact a decision branding all Iqos-related advertising as tobacco advertising might have on its overall international marketing strategy.

– Jessica Suni TobaccoIntelligence contributing writer

Photo: Vitalijs Barilo

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