Mastermind Tobacco Kenya

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Mastermind Tobacco Kenya (MTK) is a tobacco company based in Kenya, established in the late 1980s. It also has a Ugandan subsidiary, Continental Tobacco Uganda (CTU). According to business intelligence research company, Euromonitor International, MTK “focuses on [marketing to] rural and peri-urban consumers for its mid-priced and economy brands.”[1] Mastermind’s most popular brands include Rocket and its flagship brand, Supermatch.[1]

A “Threat” to British American Tobacco

MTK was established by ex‐British American Tobacco (BAT) Kenya Director Wilfred Murungi. In addition, it has a history of receiving strong support from powerful politicians. As one academic paper noted in 2007:

“Mastermind Tobacco Kenya is…financed by Baganza, the ousted President of Burundi… it also appears to have a godfather in the person of Nicholas Biwott, who is a front man for President Moi’s commercial interests.”[2]

Because of its political support and insight into BAT’s business, MTK was first identified by BAT as being a “threat” to its business in 1987.[2]

Second Largest Tobacco Company in Kenya

Whist the tobacco market in Kenya was initially dominated almost entirely by British American Tobacco Kenya, the entry of MTK as a “local company”[2] in the late 1980’s broke BAT’s monopoly.[3][4]

MTK’s presence in the market grew steadily thereafter. By 2002, MTK held 22% of the cigarette market share in Kenya, with BAT Kenya dropping from around 90% when MTK first entered the market[5] down to 71% in 2002.[2]

In 2014, MTK had the second greatest market share of cigarettes in the country, with a 16% market share (down from 22% in 2002).[1] All MTK products are produced within Kenya, and leaf is purchased directly from contracted farmers.[1]

Popular Brands

MTK focuses primarily on selling “affordable cigarettes” to Kenyans.[1] Its prominent economy brand, Rocket, is described as “one of the cheapest cigarettes brands available in Kenya”, coined a “cash cow” because of its “affordability and popularity in rural areas.”[1] Supermatch is its mid-priced, low-tar brand, and most of its market success in Kenya has been attributed to this brand.

Market Expansion

In the early 1990s, it also quickly and successfully developed export markets for its tobacco products in South Africa as well as the Democratic Republic of Congo.[3]

MTK now bases it regional production in Kenya and exports all over East Africa.[1]

“Mistreatment” of Farmers

In June 2014, MTK was not allowed to purchase tobacco from Migori County after farmers complained about the low purchase price MTK was offering them.[1] Two months later, in August 2014, local media reported that hundreds of MTK’s contracted farmers in Migori protested, claiming that the company had reportedly failed to pay fees accrued over eight months that amounted to over 100 million Kenya Shillings.[6]

A History of Policy Interference

MTK has made multiple attempts to weaken and delay the introduction of stronger tobacco control policy in Kenya (see below).[7][8][2]

The Tobacco Control Act 2007: MP Retreats and Legal Intimidation

Prior to the introduction of the Tobacco Control Act (TCA) in Kenya in 2007, the regional media reported that MTK, along with other tobacco companies, funded a retreat for over 40 Members of Parliament at an exclusive coastal resort where tobacco control legislation was said to have been discussed in detail.[9][10]

In 2006, MTK succeeded, along with BAT Kenya, in challenging the TCA’s public smoking ban in Kenya’s High Court, and as a result the smoking ban was suspended[11] on the basis that it was unconstitutional.[1] Together, the tobacco companies challenged the authority of the Health Minister to impose the restrictions and claimed that the provisions did not allow them sufficient time to comply.[12]

Lobbying Against the Kenya Tobacco Control Regulations 2014

Following the implementation of the TCA after 13 years of industry interference,[3] MTK also sought to weaken and delay the Kenya Tobacco Control Regulations (TCR). These regulations sought to strengthen the evidence-based framework of the TCA, bringing Kenya into compliance with the World Health Organization’s Framework Convention on Tobacco Control, tobacco control measures which, as a signatory, Kenya was legally obliged to implement.[13]

The company’s attempts to weaken the Regulations involved using what senior civil servants at the Ministry of Health described as “manipulative tactics”.[13] MTK made multiple attempts to influence the development of the TCR, including concerted efforts to lobby policymakers[7] and, on more than one occasion, MTK declared its objections to the TCR to government officials and policymakers.[14][8]

Such strategies contravene Article 5.3 of the FCTC, which seeks to protect policymaking from the vested interests of the tobacco industry.


TobaccoTactics Resources

Notes

  1. 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 Euromonitor International, Mastermind Tobacco (Kenya) Ltd in Tobacco (Kenya), August 2013
  2. 2.0 2.1 2.2 2.3 2.4 P. Patel, C. Collin, A.B. Gilmore “The law was actually drafted by us but the Government is to be congratulated on its wise actions”: British American Tobacco and public policy in Kenya, Tobacco Control 2007,16(1), accessed July 2015
  3. 3.0 3.1 3.2 Ministry of Public Health and Sanitation, International Institute for Legislative Affairs, Centre for Tobacco Control in Africa, Tobacco industry interference in Kenya: Exposing the tactics, January 2013, accessed April 2015
  4. Mastermind Tobacco Kenya,Mastermind Tobacco (K) Ltd accessed July 2015
  5. A. Oluwafemi, Regional summary for the African region. In: O. Shafey, S. Dolwick, G.E. Gunidon, eds. Tobacco control country profiles.2nd edn. Atlanta, GA: American Cancer Society, 2003
  6. O. Omondi, Tobacco farmers stage demo over unpaid dues, News 24 Kenya, 18 August 2014, accessed November 2015
  7. 7.0 7.1 EW. Murungi, MTK, Letter to the Clerk of the National Assembly, Request for a meeting with Parliamentary Committees on Delegated Legislation, Finance and Health, 10 December 2014
  8. 8.0 8.1 RM. Mutuma, Company Secretary MTK, Letter to Tobacco Control Board, MTK's position on the proposed Tobacco Control Regulations 2014, 9 April 2015
  9. Tobacco industry calls another MPs’ retreat, The East African Standard, 19 November 2004, accessed July 2015
  10. D. Simpson, Kenya beach party ‘helps’ tobacco bill, Tobacco Control, 14(1):4, February 2005, accessed July 2015
  11. J. Tumwine, Implementation of the Framework Convention on Tobacco Control in Africa: Current Status of Legislation, Int J Environ Res Public Health, 2011 Nov; 8(11): 4312–4331 accessed November 2015
  12. BBC, Kenya Suspends Smoking Ban, 31 May 2006, accessed November 2015
  13. 13.0 13.1 RR. Jackson, Tobacco industry accused of ‘intimidation and interference’ in Kenya, The Guardian, 2 March 2015, accessed April 2015
  14. BAT MTK, AOTK, KETOFA, Letter to the Tobacco Control Board, WTO TBT concerns the tobacco industry has with FCTC developments, 3 November 2011