{"id":553563,"date":"2021-12-08T03:53:24","date_gmt":"2021-12-08T03:53:24","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2021\/12\/08\/new-tobacco-license-terms\/"},"modified":"2021-12-08T03:53:24","modified_gmt":"2021-12-08T03:53:24","slug":"new-tobacco-license-terms","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2021\/12\/08\/new-tobacco-license-terms\/","title":{"rendered":"New tobacco license terms"},"content":{"rendered":"

<\/a> The tobacco industry is less than pleased with the latest set of conditions for a <\/strong>license to manufacture cigarettes<\/strong>, which the Industrial Development Authority (IDA) issued earlier this week, according to Masrawy<\/a>. The \u201cnew\u201d conditions booklet for the license are largely unchanged from those back in March<\/a> of this year, which met with strong backlash from several tobacco players who argued that the terms of the license would create an e-cigarette monopoly and provide preferential treatment to state-owned Eastern Company. The conditions of the tender have now been redrafted three times<\/a>.<\/p>\n

What\u2019s the same? Pretty much all of the sticking points<\/strong>:<\/strong> The new booklet, a copy of which was published by Masrawy<\/a>, maintains the stipulation that the planned company will have to give Eastern a 24% stake in the new market entrant. The new license will also still authorize the distribution of e-cigarettes and \u201cheated tobacco\u201d products, which companies previously argued<\/a> would create a monopoly and put other cigarette companies at a disadvantage. Minimum production is set for 1 bn cigarettes a year \u2014 the same figure outlined in the last booklet, but down from 15 bn in the original tender.<\/p>\n

What\u2019s new?<\/strong> The revised terms have changed up the pricing structure for the new market entrant, allowing the company to produce cigarette brands \u2014 priced within the lowest tax bracket \u2014 at Eastern's facilities, exclusively for foreign markets. Additionally, \u201cluxury\u201d cigarette brands can now be priced within the range of the second-lowest tax bracket.<\/p>\n

The minor changes continue to give Eastern an unfair advantage<\/strong>, Federation of Egyptian Industries\u2019 (FEI) cigarettes division Head Ibrahim Embaby tells Masrawy. Embaby suggested that issuing the new set of terms didn\u2019t serve anybody, save for Philip Morris, which was the only company to submit an offer in the last round and therefore didn\u2019t need to for over EGP 114k to purchase the conditions booklet again. It is still unclear if the major tobacco players will take part or abstain like last time around.<\/a><\/p>\n

What\u2019s next?<\/strong> The IDA has set this coming Thursday as the deadline for interested companies to purchase the conditions booklet. Companies interested in bidding will be allowed to submit inquiries to the authority a week later, on 16 December. The IDA will then review offers and give its technical clearance on 23 January, ahead of the kick-off for bidding on 3 April. BAT has plans to take out the booklet before tomorrow\u2019s deadline, a company official told us earlier this week on condition they not be named.<\/p>\n

EDITOR'S NOTE- Corrected on 11 December 2021.<\/em><\/p>\n

A previous version of this article suggested that the market entrant would be able to produce the same low-tax cigarettes as Eastern Company. A senior Eastern official tells us that as it stands, a new entrant would be required to bring Eastern any proposal to produce low-tax cigarettes at Eastern's facility if the new company wishes to sell on the domestic market. Eastern would then have the right to agree to commercials terms or not.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

The tobacco industry is less than pleased with the latest set of conditions for a license to manufacture cigarettes, which the Industrial Development Authority (IDA) issued earlier this week, according to Masrawy. The \u201cnew\u201d conditions booklet for the license are largely unchanged from those back in March of this year, which met with strong backlash […]<\/p>\n","protected":false},"author":1,"featured_media":553564,"comment_status":"closed","ping_status":"open","sticky":false,"template":"single-feature.php","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[7255],"tags":[7411,247,72,289,131,1730,7401],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-553563","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-manufacturing","tag-cleopatra","tag-eastern-company","tag-enterpriseam","tag-industrial-development-authority","tag-manufacturing","tag-philip-morris","tag-tobacco","wpautop","entry"],"acf":{"mongo_id":"83c92e37-c4e9-4ddf-a0b6-0fac26b6d725","is_powered_by":true,"story_type":"1","photo_url":"https:\/\/ent.news\/2021\/12\/255.jpg","photo_position":"above","related_issue":[553555],"teaser":"","voice_url":""},"yoast_head":"\nNew tobacco license terms - EnterpriseAM Egypt<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/enterpriseam.com\/egypt\/2021\/12\/08\/new-tobacco-license-terms\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"New tobacco license terms\" \/>\n<meta property=\"og:description\" content=\"The tobacco industry is less than pleased with the latest set of conditions for a license to manufacture cigarettes, which the Industrial Development Authority (IDA) issued earlier this week, according to Masrawy. 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Advisors are working\u2026","rel":"","context":"In "COMPETITION WATCH"","block_context":{"text":"COMPETITION WATCH","link":"https:\/\/enterpriseam.com\/egypt\/category\/competition-watch\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":561186,"url":"https:\/\/enterpriseam.com\/egypt\/2021\/03\/29\/the-latest-on-eastern-co\/","url_meta":{"origin":553563,"position":2},"title":"The latest on Eastern Co.","author":"enterpriseam admin","date":"29 March 2021","format":false,"excerpt":"New, more competitive terms for the license to establish Egypt\u2019s second major tobacco company could be introduced after several tobacco players filed a formal complaint with the Federation of Egyptian Industries\u2019 tobacco division. The complaint looks to scrap the conditions booklet the Industrial Development Authority (IDA) had issued for the\u2026","rel":"","context":"In "COMPETITION WATCH"","block_context":{"text":"COMPETITION WATCH","link":"https:\/\/enterpriseam.com\/egypt\/category\/competition-watch\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":554088,"url":"https:\/\/enterpriseam.com\/egypt\/2021\/12\/20\/tobacco-tender-boycott-take-two\/","url_meta":{"origin":553563,"position":3},"title":"Tobacco tender boycott, take two?","author":"enterpriseam admin","date":"20 December 2021","format":false,"excerpt":"Three major tobacco companies have reportedly chosen not to bid for a license to manufacture cigarettes: International tobacco producers JTI-Nakhla Tobacco, British American Tobacco Egypt and Al Mansour International Distribution Company will not be taking part in the renewed tender from the Industrial Development Authority (IDA), Akhbar El Youm reports.\u2026","rel":"","context":"In "Manufacturing"","block_context":{"text":"Manufacturing","link":"https:\/\/enterpriseam.com\/egypt\/category\/industries\/manufacturing\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2021\/12\/399.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":563687,"url":"https:\/\/enterpriseam.com\/egypt\/2021\/07\/13\/tobacco-license-tender-to-be-rolled-out-on-1-august\/","url_meta":{"origin":553563,"position":4},"title":"Tobacco license tender to be rolled out on 1 August","author":"enterpriseam admin","date":"13 July 2021","format":false,"excerpt":"Tobacco license tender goes live in August: Tobacco players will be able to bid for a license to establish Egypt\u2019s second major tobacco company from 1 August in the second iteration of a tender that was pulled earlier this year after attracting criticism for containing unfair terms, Al Shorouk reports.\u2026","rel":"","context":"In "COMPETITION WATCH"","block_context":{"text":"COMPETITION WATCH","link":"https:\/\/enterpriseam.com\/egypt\/category\/competition-watch\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2021\/7\/182.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":562706,"url":"https:\/\/enterpriseam.com\/egypt\/2021\/06\/03\/the-tobacco-license-tender-may-be-back-on-again\/","url_meta":{"origin":553563,"position":5},"title":"The tobacco license tender may be back on again","author":"enterpriseam admin","date":"3 June 2021","format":false,"excerpt":"Revised terms for the license to establish Egypt\u2019s second major tobacco company have been handed to four local tobacco companies, according to a document seen by Reuters. 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