Daily Doc: PM/TI, Aug 24, 1994: PM/TI Corporate affairs: Italy

Daily Doc: PM/TI Corporate affairs: Italy

Title: Business Objectives
PM, Aug 24, 1994
Bates #: 2501021775/1787

June 18, 2000

The multinational tobacco companies came together to form a European version of the Tobacco Institute called the "Zurich Club," whose purpose was to address environmental tobacco smoke (ETS), social acceptability and advertising issues in Europe. One of the stated objectives of the Zurich Club was to "Develop pro-smoking groups in principal Italian cities."

The Zurich Club was funded by Philip Morris (PM), R.J. Reynolds (RJR), British American Tobacco Corporation (BAT) and the Rothman's and Reentsma tobacco companies. 20% of the cost of running the Club was divided equally among these five member-manufacturers, and the remaining 80% of the club's cost was allocated among the companies on a market-share basis. Due to PM's large market share in Europe, they picked up fully 83.8% of this cost of the Zurich Club's operations in 1994. It appears that this significant amount of financing gave PM significant leverage in the Club's operations, as the Club appeared to operate somewhat like a PM subsidiary, using PM rules of operations. According to this document, the Zurich Club's budget:
"...covers all media and political relations initiatives, publication activities, pro-smoking groups, science programs, trade relations, researches and so forth with exclusive attention on ETS and smoking social acceptability and advertising/sponsoring restrictions."
The person writing this internal memo (which outlines the 1994 activities of the Zurich Club) served simultaneously as vice president of both the Italian Cultural Sponsors Association and the Italian National Association of Legislative Consultants, as well as committee board member of the General Industry Association of the Rome area and the national General Industry Association. Whether these were these were pre-existing or PM-created organizations is not clear.

The Zurich Club's influence in Italy was tremendous. It influenced media and government by providing politicians and journalists with free trips to the Grand Prix, Golf World Cup Roma, motorcycling events, sailing events, other sports and cultural events--and also free visits to their cigarette factories. It also provided a Christmas party for all Italian journalists, created a book, "Sketches of Smoke" ("a photography book covering all the most popular past and present smokers, taken by the greatest photographers in the world"), and gave out corporate gifts. The writer of this memo recommends that PM "participate actively" as "ghost leaders" of associations and cultural institutes in order to "[increase our] network of political contacts and promote PM as an outstanding and socially involved company."

In once example of the power of its influence, the Zurich Club reported generating over 1,000 articles and 150 television news segments containing PM's views in Italy--on a single issue.

The Zurich Club operated autonomously using PM company procedures. It was administered by an organization called the Schandwick Group. To advance the tobacco companies' agenda, Zurich Club representatives had a profuse number of meetings with Italian government officials and their staffs.

Title: Business Objectives
Type of Document: Strictly confidential interoffice memorandum
Author A. Regina
Recipient: David Greenberg
Date: 19940824
Site: Philip Morris document site http://www.pmdocs.com/
Page Count 13
Bates No. 2501021775/1787
URL: http://www.pmdocs.com/getallimg.asp?DOCID=2501021775/1787

...Mrs. Vittoria Gervaso is freelance and works almost exclusively for us...in addition to her husband being a well-known writer and journalist, she has a great wealth of friends at very high level, mostly in the government...Her assignment consists exclusively of organizing dinners, meetings and trips with political personalities and our management...

...Contacts have been made and established with

--the Prime Minister (6 times and visits to our exhibits in Rome and Genoa)

--13 ministers (Finance, Health, Post/TLC, Foreign Affairs, Labour, Foreign Trade, EEC Politics and Agriculture)

--8 vice ministers (Finance, Health, Industry, Technological Research, Foreign Affairs, Foreign Trade)

--3 directors of Party Newspapers (Christian Democrats, Socialists and Democrats of Left)

--VP of Chamber of Deputies and more than 20 parliamentaries

-- 3 Political Party Leaders (PLI, PDSI, PSI)

-- 2 Ambassadors (USA and Germany)

-- One EEC Commissioner

--Many staff members of the Prime Minister and Ministries...

--Numerous government/ministerial officials . . .

--70 journalists of major publications, including directors and deputy directors have participated in PM trips in occasion of GP, Tennis Muratti Time Tournaments, Gold World Cup Rome, Motocycling, Genoa Expo 1992, sailing cups, factory visits...theaters, exhibitions...

More than 150 journalists have been contacted by telephone. With regard to the contraband issue alone there have been more than 1,000 articles and over 150 TV news coverage, most of them including our statements and views...

3. Objective: Avoid/Delay any significant extension of smoking ban in public places. Develop pro-smoking groups in principal Italian cities.

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Anne Landman, Regional Program Coordinator
American Lung Association of Colorado, West Region Office
Grand Junction, CO
(970) 245-2120
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