British American Tobacco Fined $635 Million for Selling Cigarettes… to North Korea

Tobacco giant British America Tobacco (BAT) has been fined $635.2 million by the U.S. for breaking sanction rules to sell product to North Korea over a ten-year period.

Sanctions against North Korea over its nuclear and missile programmes which prohibit Western imports in the spotlight as the world’s second-largest tobacco company is slapped with a considerable fine by the U.S. Department of Justice. The company will pay “$635,241,338 plus interest” in fines for three upheld complaints, and the Justice Department said the punishment would serve as a warning to other companies considering doing business with North Korea.

BAT had announced it would withdraw from the North Korean cigarette market in 2007 but secretly continued to operate in the country through a subsidiary and an intermediary in Singapore, the New York Times reported. The newspaper also said the settlement “is a victory for the Biden administration during a period of rising tensions with North Korea.”

Responding to the announcement, BAT chief executive Jack Bowles issued an apology, saying: “On behalf of BAT, we deeply regret the misconduct arising from historical business activities that led to these settlements, and acknowledge that we fell short of the highest standards rightly expected of us.”

North Korea has one of the highest rates of smokers in the world, and national leader Kim Jong-un is frequently seen smoking in public and is sometimes described as a “heavy smoker”. The country has recently attempted a crackdown on smoking, with bans on lighting up in public places to improve public “hygiene”.