The Habanos festival is over in Havana…it is not like Pro Cigar, instead it is the Habanos version of the IPCPR trade show. They roll out new products and show off their stuff to the worldwide wholesalers and retailers. With all the talk about the possible normalization of relations with Cuba (personally I am not sure it will happen) Habanos S.A.—the maker of Cuban cigars—predicted that once the embargo is lifted, it will immediately take 25-30 percent of the U.S. premium cigar market. Eventually it says it would end up with 70 percent of the U.S. premium market. No doubt the inclusion of Cuban cigars after being a forbidden fruit would increase cigar popularity.
“It would add to the mystique of the cigars that we’re making,” said Eric Newman, president of J.C. Newman Cigar Co., one of the largest American cigar companies.
Of greater concern to many American cigar companies are smoking regulations proposed by the Food and Drug Administration. Under the rules, cigar companies would be required to receive government approval before introducing new product lines and issue new health warnings.
Newman suggested the smoking regulations could shutter his company.
“We can deal with smoking bans, we can deal with the Cuban embargo, we can deal with high taxes — but we’re really concerned about the regulations from the FDA that could wipe us out of business,” Newman said.
But the interesting thing is while the Administration wants to open up Cuba and its biggest import is cigars, at the same time the FDA is trying to crack down on cigars and that would include the Cubans as well. But there could be time to stop the FDA. Last week, cigar makers were walking the halls of Congress to try to get support for HB 662 and S.441 which would keep the FDA out of our humidors. There was some success in that the Senate bill now has 12 sponsors and the House version is up to 52. We need more. You need to write to your Congressional delegation and get them to pay attention before it is too late. It’s easy to do it…just go here.
Then there is the whole issue of trademarks. Altadis owns Montecristo, H. Upmann and Romeo y Julieta, among others both in the U.S. and the Habanos versions. No problem there. But General Cigar owns Partagas, La Gloria Cubana, Punch and maybe Cohiba for the U.S. but not overseas. I say maybe for Cohiba because just recently the Supreme Court declined to hear a case on the Cohiba trademark. Cubatabaco was suing General for the rights over the Cohiba name and the last court ruling gave Cuba the win. General was hoping for SCOTUS intervention but that will not happen. The case now goes to U.S. Patent and Trademark Office’s trial and appeal board.