Responsible Marketing

R.J. Reynolds Tobacco Company (RJRT) products are responsibly marketed to adult tobacco consumers through tailored advertisements that only use models who are aged 35 and older. RJRT uses multiple third-party data sources and technologies in our effort to prevent underage access to tobacco products and ensure our marketing programs are oriented towards adult tobacco consumers only.

In addition to adhering to applicable laws and regulations, RJRT and its employees must also adhere to Marketing Guidelines.

Master Settlement Agreement

After many years of intense national debate, the major issues regarding cigarette marketing and underage smoking have been comprehensively addressed through a Master Settlement Agreement (MSA) signed Nov. 23, 1998, by the major U.S. tobacco companies and 46 states and a number of U.S. territories. The provisions of that settlement were similar to those in individual settlements previously reached with the other four states (Florida, Minnesota, Mississippi and Texas).

The MSA prohibits taking “… any action, directly or indirectly, to target Youth … in the advertising, promotion or marketing of Tobacco Products, or … any action the primary purpose of which is to initiate, maintain or increase the incidence of Youth smoking …. ”

In addition, the MSA profoundly and permanently changed the way RJRT and other cigarette manufacturers can market, advertise and promote our cigarette brands and our industry. It mandates total bans on certain activities and new, severe restrictions on many others.

For example, it specifically bans:

• The use of cartoon images in advertising, promoting, packaging or labeling of cigarettes;
• Billboards, stadium signs, transit signs and other outdoor advertising which advertises tobacco products;
• Tobacco brand-logoed merchandise (such as caps and T-shirts);
• Free-product sampling anywhere except for a facility or enclosed area where the operator ensures that no minors are present;
• Payments for use of tobacco products in movies, TV programs, live recorded performances, videos or video games;
• Use of non-tobacco brand names on tobacco products;
• Licensing of third parties to use or advertise any cigarette brand name in a manner that would constitute a violation of the MSA if done by the participating manufacturer;
• Agreements that prohibit a third party from selling, purchasing or displaying advertising discouraging the use of cigarettes or exposure to second hand smoke; and,
• The use of a cigarette brand name as part of the name of a stadium or arena.

The MSA limits tobacco sponsorships to one per year and prohibits:

• Brand-name sponsorship of events with a significant youth audience;
• Sponsorship of events where the paid participants or contestants are youth;
• Sponsorship of concerts (unless events are age-restricted); and,
• Sponsorship of athletic events between opposing teams in any football, baseball, soccer or hockey league.

With respect to any brand-name sponsorship allowed by the MSA:

• Advertising of the brand-name sponsorship event cannot advertise any cigarette; and,
• No participating manufacturer may refer to a brand-name sponsorship event or to a celebrity or other person in such an event in its advertising of cigarettes.

The MSA requires that:

• Tobacco-industry documents be publicly available through a website paid for by the companies; and,
• Tobacco companies disclose payments to lobbyists and other major donations.

The MSA disbanded the Tobacco Institute, the Council for Tobacco Research and the Council for Indoor Air Research, and provides for regulation and oversight of any new trade organizations. In addition, the MSA restricts participating manufacturers from:

• Supporting diversion of MSA proceeds to any program that is neither tobacco related nor health related;
• Opposing legislation prohibiting the sale of cigarettes in packages less than 20; and,
• Opposing the passage of certain kinds of state and local legislation relating primarily to youth access to tobacco.

In the terms of the MSA, over a 25-year period, the states will receive up to $246 billion from tobacco companies through the MSA and four other individual state settlements that can be used to support anti-smoking efforts. Future annual payments, based upon inflation and cigarette sales, will continue in perpetuity. The MSA provides industry funding specifically earmarked for anti-youth-smoking education programs and a national health research foundation. As part of the $246 billion MSA, the participating tobacco companies agreed to:

• Pay approximately $1.45 billion to the states over five years for the creation and execution of an anti-smoking advertising and public education campaign designed to reduce and prevent teen smoking; and,
• Make contributions of $250 million over 10 years to a research foundation, which will be dedicated to the study of programs to reduce youth smoking, as well as the study of and educational programs to prevent tobacco-related illnesses.

Compliance with the marketing rules and restrictions, as well as all other aspects of the MSA and the four other individual state settlements, is enforced by a court in each state and by each state’s attorney general. Failure to comply with these rules and restrictions can result in broad, court-ordered injunctions and civil penalties. For more information, review the full text of the Master Settlement Agreement.

Food and Drug Administration Regulation 

As a tobacco manufacturer, nearly every aspect of RJRT’s business is governed by the Food and Drug Administration. In 2009, Congress gave the Food and Drug Administration (FDA) broad authority to regulate tobacco products through passage of the Family Smoking Prevention and Tobacco Control Act (the “Act”). The Act gives FDA the authority to regulate the design, manufacturing, packaging, marketing, and sale of tobacco products. Further, FDA must authorize any changes made to tobacco products before such change is implemented in the marketplace. Tobacco products cannot be advertised with modified risk or modified exposure claims unless authorized by FDA. The Act grants FDA enforcement powers including closing plants, seizing tobacco products and halting sales of specific products.

Under its authority from the Act, FDA requires RJRT and other tobacco manufacturers to disclose any research related to health and dependency effects of their products. Tobacco manufacturers also must submit a list of all ingredients, including tobacco, substances, compounds, and additives added to tobacco products on a brand by brand basis to FDA. Harmful and potentially harmful constituents in tobacco products and tobacco smoke for every tobacco product must be provided to FDA. The Act also requires FDA to inspect all tobacco manufacturing and processing facilities. 

The Act and subsequent regulations restrict the sale, advertising and marketing of tobacco products. Sales to those under the legal age are prohibited. Tobacco-brand sponsorships of sports and entertainment events, and free giveaways of sample cigarettes are banned. The Act prohibits the sale or distribution of tobacco branded merchandise. 

To fund FDA regulation of tobacco products, the Act requires tobacco manufacturers to pay annual user fees. No taxpayer money is used to fund FDA’s regulation and oversight of tobacco manufacturers and tobacco products. Since 2009, RJRT has paid over two billion dollars in FDA user fees.

Voluntary Cigarette Advertising and Promotion Code

The Master Settlement Agreement (MSA) that RJRT and other cigarette manufacturers signed in November 1998 sets forth numerous tobacco-marketing restrictions. In addition to those restrictions, RJRT continues to follow several rules, as stated in the Voluntary Cigarette Advertising and Promotion Code, regarding cigarette advertising. (The remainder of the voluntary code was included in or superseded by the MSA.) These rules state:

• No one depicted in cigarette advertising shall be or appear to be under 25 years of age.
• Cigarette advertising shall not suggest that smoking is essential to social prominence, distinction, success or sexual attraction, nor shall it picture a person smoking in an exaggerated manner.
• Cigarette advertising may picture attractive, healthy looking persons provided there is no suggestion that their attractiveness and good health is due to cigarette smoking.
• Cigarette advertising shall not depict as a smoker anyone who is or has been well known as an athlete, nor shall it show any smoker participating in, or obviously just having participated in, a physical activity requiring stamina or athletic conditioning beyond that of normal recreation.
• No sports or celebrity testimonials shall be used or those of others who would have special appeal to persons under 21 years of age.

RJRT has decided to apply the rules set forth in the Voluntary Cigarette Advertising and Promotion Code to its smokeless and other tobacco products.

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