PERAC Memo #30 - 2014: Tobacco Company List

PERAC MEMO #30/2014

M E M O R A N D U M TO: All Retirement Boards FROM: Thomas J. O’Donnell, Compliance Officer RE: Tobacco Company List

DATE: September 18, 2014

On October 22, 1997 PERAC Memo #37/1997 informed you of the adoption of Chapter 119 of the Acts of 1997. That statute prohibits retirement systems from making any new investments in stocks, securities, or other obligations of any company which derives more than 15% of its revenue from the sale of tobacco products. On December 18, 1997 PERAC sent Memo #48 regarding the implementation of Chapter 119 and the first Tobacco Company List.

Enclosed please find a Tobacco Company List dated October 2014. This list replaces any other Tobacco Company List previously sent to your board and is effective upon receipt by the retirement boards. Most of these companies appeared on previous lists and such investments were prohibited from the time the companies first appeared on the list. Please forward a copy to your investment advisors or inform them that this list is available on the PERAC Home Page under the Investment Unit’s 2014 Memo Index. In communicating with your investment advisors, please inform them that the Tobacco Company List is only for their Massachusetts public fund clients and that any other use of the list is strictly prohibited.

As part of its audit process, PERAC will assess the portfolio of each board to determine compliance. That review will determine if the board, after January 13, 1998, has purchased stock, securities, or other obligations of any company which derives more than 15% of its revenue from the sale of tobacco products. In the event a portfolio is not in compliance, the board must bring the portfolio into compliance by divesting in a prudent manner. Prior to taking any action, the board shall consult with PERAC.

In applying the statute to pooled funds, PERAC will assess the 15% rule against the entire pool as the board is purchasing shares in the pool not the individual holdings of the pool. Thus a pooled fund, if in violation of this standard, will be included on the list.

If you have any questions, please contact this office.

Enclosure

/rac w

TOBACCO COMPANY LIST OCTOBER 2014

COMPANY COUNTRY

22 nd Century Group, Inc. United States Alliance One International Inc. United States Altria Group, Inc. United States AMCON Distributing Company United States Core-Mark Holding Company, Inc. United States Electronic Cigarettes International Group Ltd United States Icon Vapor Inc. United States Lorillard, Inc. United States Lorillard Tobacco Company United States Philip Morris International Inc. United States Reynolds American Inc. United States Schweitzer Mauduit International Inc. United States Smokefree Innotec Inc United States Universal Corporation United States Vapor Corp. United States Vapor Group Inc.
Vaporin Inc. United States Vector Group Ltd. United States

Bangladesh Leaf Tobacco Co. Ltd. Bangladesh British American Tobacco Bangladesh Co. Ltd. Bangladesh

Fabrika Duhana Sarajevo dd Sarajevo Bosnia & Herzegovina

Souza Cruz S.A. Brazil

Bulgartabak Holding AD Bulgaria Gotse Delchev Tabak AD Gotse Delchev Bulgaria Isperih BT AD Isperih Bulgaria Nicotiana BT Holding AD Sofia Bulgaria Pazardzhik-BT AD Bulgaria Shumen Tabac AD Shumen Bulgaria Sila Holding Plc Bulgaria Slantse Stara Zagora Tabak AD Stara Zagora Bulgaria Sofia Bulgartaback AD Sofia Bulgaria Stara Planina Hold AD Sofia Bulgaria Yuri Gagarin AD Plovdiv Bulgaria

British American Tobacco Chile Operaciones SA Chile

Mudanjiang Hengfeng Paper Co., Ltd. China Shenzhen Jinjia Color Printing Group Co., Ltd. China Shiner International Inc China

COMPANY COUNTRY

Adris Grupa dd Croatia Hrvatski Duhani dd Croatia Tvornica Duhana Zagreb dd Croatia

CTO PCL Cyprus

Philip Morris CR as Czech Republic

Eastern Co SAE Egypt

Christian Dior S.A. France

Karelia Tobacco Company Inc SA Greece

Huabao International Holdings Ltd. Hong Kong

Godfrey Phillips India Limited India Golden Tobacco Ltd. India ITC Limited India NTC Industries Ltd. India Sinnar Bidi Udyog Ltd India Virat Crane Industries Ltd India VST Industries Limited India

PT Bentoel Internasional Investama Tbk Indonesia PT Gudang Garam Tbk Indonesia PT Hanjaya Mandala Sampoerna Tbk Indonesia Wismilak Inti Makmur Tbk PT Indonesia

Jerusalem Cigarette Co Ltd Israel

Societe Ivoirienne des Tabacs SA Ivory Coast

Carreras Ltd Jamaica

ITOCHU Corporation Japan Japan Tobacco Inc. Japan Mitsubishi Corporation Japan

Jordanian Duty Free Shops PSC Jordan Sharikat Al Eqbal Lil Istethmar M.En.M Jordan Union Tobacco & Cigarette Industries Co PSC Jordan

British American Tobacco Kenya Ltd Kenya

Tutunski Kombinat AD Prilep Macedonia

COMPANY COUNTRY

Press Corporation Ltd. Malawi

British American Tobacco (Malaysia) Berhad Malaysia Sime Darby Bhd Malaysia

Duvanski Kombinat ad Podgorica u stecaju Montenegro

Khyber Tobacco Company Ltd. Pakistan Pakistan Tobacco Company Ltd. Pakistan Philip Morris (Pakistan) Limited Pakistan

British American Tobacco del Peru Holding SAA Peru

LT Group, Inc. Philippines

BAT Vranje ad Vranje Serbia Duvanska ad Coka Serbia Duvanska industrija ad Bujanovac Serbia Philip Morris Operations a.d. Nis Serbia

New Toyo International Holdings Ltd Singapore

KT&G Corporation South Korea Nongshim Holdings Co., Ltd. South Korea SK Chemicals Company, Ltd. South Korea

Miquel y Costas & Miquel, S.A. Spain

Ceylon Tobacco Company PLC Sri Lanka

Swedish Match AB Sweden

Taisun Enterprise Co. Ltd. Taiwan Taiwan FamilyMart Co., Ltd. Taiwan

Tanzania Cigarette Company Ltd Tanzania

The West Indian Tobacco Company Ltd. Trinidad and Tobago

Bizim Toptan Satis Magazalari AS Turkey Haci Omer Sabanci Holding AS Turkey Tav Havalimanlari Holding A.S. Turkey

British American Tobacco Uganda Uganda

COMPANY COUNTRY

Booker Group Plc United Kingdom British American Tobacco Plc United Kingdom Imperial Tobacco Group Plc United Kingdom

Cat Loi Joint Stock Co. Vietnam Cong ty Co phan Ngan Son Vietnam Hoang Long Group Vietnam

British American Tobacco Zambia Plc Zambia

British American Tobacco Zimbabwe Holdings Ltd Zimbabwe