Tobacco body 'disappointed' with potential lawsuit against industry
Published : 2014-01-25 11:26
Updated : 2014-01-25 11:26
A national interest group for tobacco companies said Saturday it was "disappointed" with a public agency's plan to sue cigarette manufacturers, calling the move a misguided attempt to solve budget issues.
In an English-language statement, the Korea Tobacco Association (KTA) said the tentative decision by the state-run National Health Insurance Service (NHIS) to file a suit against the tobacco industry "with little legal merit" wouldn't be in the best interest of taxpayers.
The NHIS said on Friday its board of directors approved itsplan to launch an anti-smoking lawsuit against domestic and foreign companies to seek compensation for health care costs associated with cigarette-related diseases.
The KTA also noted that the NHIS was ignoring a government directive on public corporations not to file lawsuits unless the reason for such suits and their claim amount are made clear in advance.
"Litigation against a lawful and highly taxed industry is a reckless attempt to solve NHIS' budget problems by forcing smokers to pay more than their fair share in health care costs," Brian Kim, the KTA's chairman, was quoted as saying.
"Instead of reaching further into the pockets of smokers and exposing Korean taxpayers to years of costly litigation, the NHIS should learn from the failure of similar attempts by other governments and focus on finding a real solution to their budget woes."
The KTA claimed that smokers contribute around 7 trillion won ($6.5 billion) a year in tobacco taxes, 1.5 trillion won of which goes toward the national health promotion fund.
The KTA said this amount is sufficient to cover annual health care costs associated with smoking, as claimed by the NHIS.
"The NHIS is seeking more money through litigation, eventually from smokers' pockets, for legal activities which the government already heavily regulates," the KTA added. "This double payment is neither fair nor reasonable."
The NHIS has said it will have further consultations with lawyers and other experts regarding details of its plan to sue tobacco firms.
It remains uncertain, however, whether the NHIS will actually go ahead and file a suit, with the health ministry urging careful approach in such situations.
In South Korea, four lawsuits have so far been filed against tobacco manufacturers, all by individuals, but no plaintiff has ever won a case. The court has acknowledged the causal relationship between smoking and some diseases, including lung cancer, but has not recognized any wrongdoing by cigarette companies or defects in their products. (Yonhap News)