BATSA, Dlamini-Zuma set to face off in court next week over cigarette ban

Nkosazana Dlamini-Zuma. Picture: GCIS
Nkosazana Dlamini-Zuma. Picture: GCIS
  • BATSA has filed its latest legal papers in a bid to have the tobacco ban during lockdown overturned. 
  • The replying affidavit contains a lengthy response to court papers filed by Cooperative Government and Traditional Affairs Minister Nkosazana Dlamini-Zuma.
  • The case is due to be heard next week.


British American Tobacco South Africa has presented hard-hitting arguments to court in a bid to prove government’s tobacco ban is irrational and based on faulty evidence.

This as news broke on Thursday night that the mega-court case will finally be heard next week.

BATSA's latest legal salvo is in response to Minister of Co-operative Governance and Traditional Affairs, Dr Nkosazana Dlamini-Zuma, who recently lodged her own reply to the initial application to have the ban overturned.

In her court papers, Dlamini-Zuma controversially argued that the economic damage from the cigarette ban was being partially mitigated by a flourishing illegal market - representing economic activity.

Now BATSA has hit back in papers lodged with the High Court on June 24.

In an affidavit, CEO of BATSA, Andre Joubert, argues Dlamini-Zuma:

  • failed to make a convincing legal argument that the cigarette ban was legally necessary;
  • failed to make a legitimate health arguments, to show smoking increased the chance of contracting Covid-19, or that smokers would be worse-off if they did contract the virus; and
  • failed to show the ban had stopped the purchase of cigarettes.

Instead, Dlamini-Zuma had admitted 21 billion cigarettes would likely still be bought – illegally – without due taxes accruing to government, leading to a multi-billion rand loss in government income.

In its legal papers, BATSA presents two "expert affidavits" in support of its application.

First, Dr Jaymin Morjaria is a Consultant Physician in Respiratory Medicine at the Royal Brompton & Harefield Hospital in Middlesex, England.

Morjaria specialises "in treating patients with airways disease such as asthma and chronic obstructive pulmonary disease, and lung disorders like cancer, bronchiectasis, and pleural disease".

The doctor reports he has both treated Covid-19 patients personally, and researched "epidemiology and patient demographics  … with particular reference to the literature regarding smoking and Covid-19".  

The second expert is Richard Murgatroyd, Partner at RBB Economics.

In his affidavit, Joubert argues that when Dlamini-Zuma admitted "I do not say that the medical literature is absolutely conclusive" – she lost the credible right to then claim it is "necessary" to prohibit the sale of tobacco and vaping products.

Joubert argues the Minister provided "no evidence" to show that smoking cessation for a limited period would reverse or reduce the risk of contracting a more severe form of Covid-19, adding that she admits, in her court papers, that due to the "newness" of the disease, there is not enough data to assess whether or to what extent the chance of infection or disease progression decreases upon quitting smoking.

Citing Morjaria's expertise, the papers argue that there is "no consensus" in relation to smoking being a risk factor for Covid-19 risk progression – rather, currently available data suggests that risk factors for severe Covid-19 include older age, male gender, medical comorbidities including cardiovascular diseases, diabetes, hypertension, increased body mass index (BMI), chronic kidney disease, solid organ transplants and chronic pulmonary diseases.

"While some of these generally accepted risk factors can be caused by smoking (as noted in the First and Second Respondents’ answering affidavit and in the affidavits of the Respondents’ Medical Experts), the impact of smoking in relation to these diseases occurs over a long period of time, often many years (not weeks or months)," the documents state.  

Dr Morjaria adds that though the reasons are unclear, there is "generally consistent evidence from a number of studies, peer reviewed and pre-prints, suggesting that current smokers may have a lower risk of infection and/or of developing Covid-19 at a level of severity that requires hospitalisation."

On the economic front, Joubert argues: "When the devastating impact on the entire value chain is taken into consideration alongside the losses to the fiscus, it is clear that those consequences far outweigh the supposed gains offered by the tobacco ban."

In the supporting documents outlining BATSA's economic arguments, a report by RBB tackles the studies referred to in Dlamini-Zuma's court papers, stating that the findings of a report by the Human Sciences Research Council (HSRC) – which said 12% of smokers were able to purchase cigarettes at the start of the lockdown – were a function of its timing.

In the early days of lockdown, more smokers would have had stockpiles of cigarettes, and the illicit market would not yet have taken root, Murgatroyd argues.

"It is intuitive that the longer the ban has been in place, the more scope there is for illicit tobacco product suppliers to expand both supply and distribution," his report states.

'Entirely untenable'

The document notes earlier arguments by BATSA that continuation of the ban would place 725 000 jobs at risk and cost over R2 billion in tax revenue.

The report includes a scathing attack on Dlamini-Zuma's answering affidavit, in which she had suggested increasing export activity as a remedy to economic damage caused by the local ban. Her papers had also stated that an increase in illicit trade would in itself boost economic activity: 

(A)n ironic feature of the impact of the ban is that to the extent illicit trade in cigarettes grows, the adverse economic impact of the ban will be reduced."

RBB's response states: "In addition to growing exports, the [answering affidavit] suggests that suppliers can mitigate the harm suffered as a consequence in the decline of legitimate tobacco products by supplying the illicit market.

"However, this is evidently untenable, since not only would such activity either be unlawful or at least facilitate unlawful activity, but the [answering affidavit's] suggestion would amount to the suggestion that an appropriate response to the ban would be to circumvent the ban."

The documents additionally argue that increasing exports would not be viable, since production costs for BATSA are higher in South Africa and the country is not well located for exports.

Lastly, it charges, the economic damage will not necessarily be limited to during the ban itself, but could well be far-reaching, as retailers battle the impact of rising fixed costs and loss of tobacco-related revenue in a struggling economy.

Joubert also challenged Dlamini-Zuma on claims that 2 000 submissions had been received opposing the lifting of the ban, charging that she "either lied or was misinformed …"

On another point of attack, Joubert continues: "In paragraph 236 the Minister makes the astonishing statement that, if a ban on the sale of tobacco products and e-cigarettes is lifted and they become freely available, there will be an increase in risky behaviour by consumers of tobacco and vaping products. 

"The truth is precisely the opposite. Because consumers have had to seek tobacco products illicitly, they have had to make far more effort than they would have had to make were they able to purchase the tobacco products in the normal retail chain.

"In addition, the exorbitant prices of these illicit products has undoubtedly triggered far more sharing of the product than would be the case if they were sold at their normal retail prices."

The matter is due to be heard in the Western Cape division of the High Court on Tuesday June 30.

ZAR/USD
16.77
(-0.03)
ZAR/GBP
21.15
(-0.12)
ZAR/EUR
18.95
(-0.03)
ZAR/AUD
11.66
(-0.03)
ZAR/JPY
0.16
(-0.09)
Gold
1798.22
(+0.06)
Silver
18.69
(+0.13)
Platinum
824.50
(+0.30)
Brent Crude
43.14
(+2.10)
Palladium
1961.36
(+0.61)
All Share
55417.89
(-0.66)
Top 40
51154.08
(-0.74)
Financial 15
10472.31
(+1.28)
Industrial 25
76134.69
(-1.67)
Resource 10
52483.78
(-0.20)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Results
I'm not really directly affected
18% - 1961 votes
I am taking a hit, but should be able to recover in the next year
23% - 2569 votes
My finances have been devastated
34% - 3819 votes
It's still too early to know what the full effect will be
25% - 2748 votes
Vote