Tobacco Facts.

LONDON -The battle between the U.K. government and the tobacco industry stepped up a gear Wednesday after Imperial Tobacco PLC (IMT.LN) said it was seeking a judicial review of the decision to ban cigarette vending machines.

The ban on cigarette vending machines forms part of the U.K. government’s Health Act 2009 and is set to be implemented in October 2011. The U.K. accounts for 25% of Imperial’s profits and vending machine sales account for less than 1% of sales.

Imperial is seeking permission from a judge to launch a legal challenge to the legislation and a spokesman said it is likely to take some months before a decision is made.

“Legal action is always a last resort but the Government’s decision to ban cigarette vending machines is so disproportionate and unnecessary that it must be challenged,” Chief Executive Gareth Davis said in a statement.

Davis said he supported the Government’s proposal to stop underage smoking through the introduction of electronic ID cards, token mechanisms for vending machines and remote control technology.

“These are effective solutions which have been implemented in a number of other countries and it is a matter of great regret that the UK Government ultimately chose to disregard all of these options in favor of a ban that will result in significant job losses in the vending industry.”

A spokesman for Imperial Tobacco pointed to other European countries such as Germany, the Netherlands and Spain where a variety of methods are successfully used to restrict the access of cigarette vending machines to legal-age smokers. After months of working with the government on implementing similar proposals, he said the company had “the rug pulled from under our feet” by the move to an outright ban.

The ban forms part of wider measures to restrict underage smoking. The U.K. government is also planning to force the sale of tobacco “under the counter” through a ban on retailers’ displaying cigarettes.

Since the 2009 measures were passed by U.K. lawmakers, the government has made more proposals to cut smoking rates include stripping cigarette packs of their logos and branding-a move which is seen as a major threat to profitability for the industry.

In recent years most forms of tobacco advertising and sponsorship has been banned in the U.K., hard-hitting pictorial warnings have been introduced, and the minimum age at which people can be sold tobacco has risen to 18 years from 16.

The government has also banned smoking in enclosed public places such as pubs and restaurants.

These moves have cut the prevalence of smoking in the U.K., particularly among young people. Just 6% of 11-15 year olds now smoke, down from 11% in 1998. By 2020, the government plans to cut that rate below 1%.
Company Web site: www.imperial-tobacco.co.uk/

By Michael Carolan
Of DOW JONES NEWSWIRES

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