October 2007

Code
of Conduct
 Important notices
• This Code of Conduct supercedes and replaces any and all
previous versions, whether electronic or hard copy.
• While local language translations may be made, the original
English version will remain the only official version.
• This electronic version will be verified regularly for updates
and amendments.

Table of Contents
Letter from the President and CEO .................................................................................... p 4
Letter from the Chief Compliance Officer ................................................................. p 5

Who’s Who and What’s What?

Corporate Responsibility Committee ................................................................................................. p 6
Company Policies, Procedures & Operating Guidelines ................................................ p 6
Compliance ................................................................................................................................................................ p 6
Contact Person ...................................................................................................................................................... p 7
Head of Organizational Unit ....................................................................................................................... p 7
JTI Internal Accounting Policies ............................................................................................................. p 8
Local Executive Committee........................................................................................................................ p 8
Regional or Function Legal Counsel .................................................................................................. p 8
JTI Values ..................................................................................................................................................................... p 9

Introduction
The Purpose of the Code of Conduct .......................................................................... p 11
Why This Is Important......................................................................................................................... p 11
Common Sense Principles for Everyday Use .................................................... p 12
Think First ............................................................................................................................................................ p 13
Code Enforcement .................................................................................................................................. p 14
Reporting Concerns .............................................................................................................................. p 15
Employees’ Responsibilities
Respect for the Individual ............................................................................................................. p 17
Respect between Smokers and Non Smokers................................................ p 17
Conflicts of Interest ............................................................................................................................... p 18
Confidentiality ................................................................................................................................................ p 20
Media Relations........................................................................................................................................... p 21
Use of Company Property ............................................................................................................ p 22
Maintenance of Appropriate Records .......................................................................... p 23
Financial Management and Accounting.................................................................... p 24
Government Inquiries and Investigations ............................................................... p 25
Ownership of Inventions ................................................................................................................. p 26
Insider Trading .............................................................................................................................................. p 27

Responsibility as a Business
Equal Opportunity and Workforce Diversity ........................................................ p 29
Environment, Health and Safety (EHS) ........................................................................ p 30
Child Labor......................................................................................................................................................... p 31
Responsible Marketing ..................................................................................................................... p 32
Fair Competition ......................................................................................................................................... p 33
Bribes and Kickbacks ......................................................................................................................... p 34
Expediting Payments ........................................................................................................................... p 37
Entertainment and Gifts ................................................................................................................... p 38
Relationship with Suppliers ........................................................................................................ p 39
Know Your Customer .......................................................................................................................... p 40
Smuggling and Contraband Activities ......................................................................... p 41
Money Laundering ................................................................................................................................... p 41
Political Activities...................................................................................................................................... p 42
Support for Community Activities,
Donations and Sponsorships ................................................................................................... p 43

International Restrictions
UN Economic Sanctions ................................................................................................................. p 45
U.S Economic Sanctions and Export Controls ................................................ p 46
Special Rules for US Citizens and US Residents .............................................................. p 47
Letter from the

President and CEO

Dear Colleague,

Ethical business practices are a JT International hallmark. Like our business

performance, our business conduct must adhere to a high and uniform set of
standards. Each of us has a personal obligation to uphold these standards and
act in an ethical manner in our dealings with each other, our customers and the
general public.

The JT International Code of Conduct describes some of the most important

legal and ethical obligations we must meet in the conduct of our business.
It also describes the practices and procedures that must be followed in
meeting those obligations. The Code of Conduct applies to the entire
Company, which includes JT International and its subsidiaries and affiliates.
It also applies to all Company employees worldwide, as well as to all
Company agents and representatives.

I recognize that business practices and cultural differences vary from country
to country. I, nonetheless, believe that we must set standards for ourselves
with which everyone can comply within the framework of our diverse
environment.

Adherence to the Code of Conduct is vital to our success. The Code of

Conduct will, therefore, be strictly enforced. Violations will be dealt with
severely and, in certain instances, could result in termination.

If you have any questions about the Code, do not hesitate to contact
Corporate Compliance, your Local Executive Committee or your Regional
or Function Legal Counsel.

Pierre de Labouchere
President and CEO

4
Letter from the

Chief Compliance Officer

Dear Colleague,

Our Code of Conduct represents JTIs’ statement to its employees and to the world
regarding our values and responsibilities against which we will be measured. The
Code also serves as an integral component of our Corporate Governance and
supports our efforts to achieve business goals with integrity.

Although the Code is a living document which will evolve over time, it defines the
standards and principles by which we conduct business. To facilitate these
expectations, I strongly encourage you to remain up to date on JTI operating
guidelines and policies & procedures as they are supporting and vital tools to our day
to day activities.

I know that I can count on you to live up to these standards in order to demonstrate
that JTI is striving to achieve the highest level of professional standards, while
operating within a challenging and increasingly regulated environment.

Compliance is not an option, as employees, we are accountable for our actions and
must act and behave responsibly.

Should you have questions on the Code or its application, please do not hesitate to
contact me or a member of the Corporate Compliance team.

Sincerely yours,

Jean-Luc Perréard

Chief Compliance Officer

5
Who’s Who and What’s What?
Corporate Responsibility Committee
Sub-committee of the JTI Executive Committee with the primary responsibility
of identifying, assessing and prioritizing forward-looking strategies and initiatives
to improve awareness and compliance with JTI’s Code of Conduct and its
related policies.

Company Policies, Procedures and Operating Guidelines

All JTI approved documents that define and describe how JTI conducts its
business, worldwide or market specific. This includes generic documents that
relate to JTI as a whole (e.g. the Code of Conduct) plus those that relate to
a function (e.g. Finance, Accounting, Marketing, Legal, Human Resources etc.),
a process (e.g. ‘Operating Guidelines’, ‘BAP’, ‘Memo’, ‘Procure to Pay’ etc.) or
to a specific market or region.

Compliance
Any process that helps ensure JTI Policies, Procedures and Operating
Guidelines and relevant external obligations are being adhered to. Compliance
is overseen by JTI’s Corporate Compliance function and managed by the
following positions:
Chief Compliance Officer
JTI Executive Committee member with the overall responsibility for compliance
within JTI. Reports to the Board of Directors of JTI’s parent company.
JTI Corporate Compliance
JTI function with the responsibility to provide company-wide compliance
support, monitoring and reporting, is based in HQ and reports to the Chief
Compliance Officer.
Field Compliance Officer*
Person responsible for managing JTI compliance within a given market
or region.

* Field Compliance Officers will be appointed over time by JTI Corporate Compliance.

6
Contact Person
Person who can be contacted by any JTI Employee for advice or assistance
concerning the interpretation or application of this Code, or to report an
actual or suspected violation. A Contact Person can be one or more of the
following:

• Field Compliance Officer *

• Regional or Function Legal Counsel
• Member of the Local Executive Committee
• Head of Organizational Unit
• Member of JTI Corporate Compliance.

Head of Organizational Unit

Senior manager in charge of leading a JTI Organizational Unit, which, for this
purpose, is defined as:

• JTI Regions and/or their Markets, or

• GSC structure with its factories, or
• JTI support function (Sales, Marketing, Legal, Corporate Affairs,
Compliance, R&D, Human Resources and Finance/IT, including its support
centers).
Head of Market (also called ‘General Manager’)
Person in charge of supervising and managing a JTI market.
Head of Factory
Person in charge of supervising and managing a JTI factory.
Head of Function
Person in charge of supervising and managing a support function.
Head of Support Center
Person in charge of supervising and managing a support center (BSC,
GSD).

7
JTI Internal Accounting Policies
Generally Accepted Accounting Principles (GAAP) that are applied to the way
business transactions are recorded and reported within the Company. JTI
utilizes US GAAP for recording and reporting purposes. At the same time,
where required by law, JTI entities located around the world are required to
comply with local Generally Accepted Accounting Principles to record and
report business transactions.

Local Executive Committee

Management team responsible for compliance with JTI Policies, Procedures
and Operating Guidelines within a market or factory. The Local Executive
Committee is generally led by a General Manager and/or the Head of Factory.
The Committee is composed of various management members representing
different functions reporting to the Local Executive Committee leader.

Regional or Function Legal Counsel

In-house legal department member responsible for a given region or support
function.

8
JTI Values
JTI’s Corporate Values are Quality, Commitment, Innovation, and Synergy.
Quality
Quality is more than the quality of our brands. We strive for excellence in
everything we do, and aim to satisfy our stakeholders: employees, customers,
society in general, and our shareholders.
Commitment
We are committed to doing the right thing. We don’t encourage people to
smoke and actively work to prevent youth from smoking. We are committed
to complying with all applicable laws and our own internal policies. We do our
best to respect and conserve our workplace environment and the planet
earth. We always tell the truth and are open about everything we do. We
respect all views on tobacco and take those views into account in every
decision we make. We are committed to achieving our goals and objectives
and want to be better about giving recognition to those who help us to do so.
Innovation
Innovation is key to our future success. We need to be dynamic, constantly
one step ahead of the competition. We should think of the bigger picture,
share ideas and information, and constantly question whether we’re doing
something the best way possible. Our corporate behavior must be one
that encourages individuals to come forward and to feel confident about
challenging traditional methods and beliefs.
Synergy
Cultural diversity is our strength, and JTI’s values aim to engage all of us
as part of the same multicultural team. We are much stronger together,
and the more we communicate between markets, factories, and functions,
the more we leverage our strengths.

9
Introduction
 Introduction

The Purpose of the Code of Conduct

The Code of Conduct prescribes the important legal and
ethical principles that you, as an employee, must observe in
conducting JTI’s business.

This Code of Conduct supplements and incorporates JTI

Policies, Procedures, and Operating Guidelines.
You must also familiarize yourself with all such materials and
stay abreast of updates to them.

The Code is available on the Web (www.jti.com), in hard

copy from JTI Corporate Compliance, and on Oasis. On
Oasis you will also find further references to JTI Policies,
Procedures, and Operating Guidelines.

Why This Is Important

JTI's success depends on the trust and respect of
governments, suppliers, and customers in all our
locations.

The consequences of violating the law and ethical principles

can be severe. They could include millions in fines and other
criminal penalties. Equally harmful, JTI could suffer a loss of
business and damage to its reputation. Individual employees
too could face disciplinary action, dismissal, or even significant
fines and criminal penalties.

You are JTI's first line of defense in its efforts to ensure that
its conduct is above reproach. You are, therefore, expected
to act with honesty and integrity in all that you do.

You are also expected to accept personal responsibility

for complying with JTI's Code of Conduct and JTI Policies,
You are JTI’s Procedures, and Operating Guidelines in your day-to-day
first line of defense activities.

11
 Introduction

Common Sense Principles For Everyday Use

As an international group, JTI is subject to many different
laws. Many of these are complex.

You are not expected to be an expert on these laws, but

there are general principles that will guide your day-to-day
behavior, wherever you work.

• Never do anything you know would violate any law.

• Never do anything you think might violate any law.
• Never use JTI property for your own personal gain.
• Never falsify JTI books or records.
• Take special care to ensure that JTI books and records
and the documentation relating to JTI transactions
are accurate and complete.
• Follow JTI Policies, Procedures, and Operating Guidelines
in everything that you do.
• Always treat your fellow employees with respect.

If you are ever asked to do something that you suspect is

illegal, unethical, or against JTI Policies, Procedures or
Operating Guidelines, notify a Contact Person immediately.

12
 Introduction

Think First
The Code covers many subjects, but it cannot anticipate
every situation that you will encounter.
Employees should supplement the Code with their own
common sense, following the Code’s spirit as well as its
express content.

If you face a situation not covered in the Code, you should

ask yourself the following questions:
Don’t operate in the dark.
Get help.
• Do I have any doubts about the legality of what I'm doing
or being asked to do?
• Do I have any doubts about the ethics of what I'm doing
or being asked to do?
• Do I have any concerns about whether management
would approve of what I'm doing or being asked to do?
• Would I have any concerns about what I'm doing
appearing in the newspaper or on TV?
• Would I have trouble explaining what I'm doing to my
family and friends?

If the answer to any of the questions is ‘yes’, you should

seek advice from a Contact Person.

13
 Introduction

Code Enforcement
The Corporate Responsibility Committee will, over time, ensure that
each Head of Organizational Unit has sufficient resources,
internal controls and procedures in place to achieve an
adequate level of compliance with the Code.

The Corporate Responsibility Committee will review and update both

the Code and its enforcement procedures as necessary so
as to maintain a high level of compliance.

The Corporate Responsibility Committee has the exclusive power

to amend this Code and grant exceptions to it.

Heads of Organizational Units must:

• Reinforce internal controls within their respective areas

of responsibility
• Ensure that employees understand the Code and the
importance of adhering to it
• Report all suspected violations of this Code (or other
conduct that risks damage to JTI’s reputation) to
Corporate Compliance

Their performance will be measured against the above mentioned criteria.

This information will be collated by Corporate Compliance on

a quarterly basis and reported to the Corporate Responsibility
Committee.

14
 Introduction

Reporting Concerns
JTI encourages reporting of suspected violations of law,
this Code of Conduct, or any JTI Policies, Procedures and
Operating Guidelines.

If you suspect – or have reason to believe – that anyone

has violated or intends to violate the law, this Code of
Conduct, or any JTI Policies, Procedures and Operating
Guidelines, you must promptly inform a Contact Person.

Before reporting a suspected violation, gather as much detailed

information as possible, including relevant documentation, so
that your concerns can fairly be evaluated.

Retribution of any kind against anyone who reports a

suspected violation or is accused of such violation without
any evidence will be treated as a serious disciplinary offence.
Prohibited retribution includes, but is not limited to, harassment,
intimidation, or any negative change to the conditions of
employment or working conditions.

If you don’t feel right

about what you’re doing,
get help.

15
Employees’
Responsibilities
 Employees’ Responsibilities

Respect for the Individual

You have the right and the obligation to work in an
environment where employees are treated fairly and
respectfully, free from any form of harassment or other
demeaning behavior.

You will not tolerate or engage in any behavior that could

contribute to an intimidating, hostile, humiliating, or offensive
working environment.

You must show respect for cultures, opinions, and lifestyles

that differ from your own and anticipate how others will
perceive and react to your communications and conduct.

Respect between Smokers

and Non Smokers
Smokers must show consideration for nonsmokers, especially
in confined areas such as shared offices or meeting rooms,
even when smoking in those areas is permitted by law.

17
 Employees’ Responsibilities

Conflicts of Interest
You must not allow personal, private, or outside interests
to influence – or even appear to influence – business
decisions.

A conflict of interest exists whenever an individual’s

professional judgment may be impaired, or be viewed
by others as impaired, by the prospect of personal gain
or avoiding personal loss.

All employees must be familiar with situations that could

give rise to a conflict of interest and avoid situations that
create or appear to create conflicts with the interests of the
Company.

JTI will not ask employees to make decisions in a situation

that they have declared to be a potential conflict of interest
and that could compromise their position.

If you develop a conflict or potential conflict of interest, you

must immediately inform a Contact Person. That Contact
Person will act to ensure that all related commercial
decisions are decided in JTI’s interests, such as by requiring
a joint decision or by referring the matter to another
employee.

18
 Employees’ Responsibilities

Examples of conflict of interest include,

but are not limited to, the following:

• Having an ownership or other interest in a customer,

supplier, or competitor
• Having an employment or consulting relationship with a
customer, supplier, or competitor
• Serving as an officer or director of a customer, supplier,
or competitor unless approved in writing by management
• Serving as a director of another company unless approved
in writing by the Senior Vice President, Legal, Corporate
Affairs and Chief Compliance Officer
• Engaging in any outside employment or other activities
that interfere with your ability to give your job the time and
attention needed
• Engaging in any outside activity that is competitive with
JTI's business
• Receiving cash in any amount from anyone with whom
JTI does business
• Supervising, reviewing, or having any influence over the
evaluation, pay or benefits of a close relative employed
by JTI
• Taking personal advantage of a business opportunity that
could be of interest to JTI
• Hiring a spouse, partner, significant other, or close blood
relative when the relationship might compromise the ability
to objectively carry out assigned responsibilities.

Having someone close to you or under your control

Don’t let personal
interests conflict with engaged in any of the conduct above does not resolve
your duties at JTI. the conflict of interest.

19
 Employees’ Responsibilities

Confidentiality
You will obtain information ethically, maintain it securely,
and use it responsibly.

All business-related information is confidential unless

JTI has officially published it. This includes information
about business plans, marketing campaigns, sales or
promotional activity, advertising plans or expenditures,
customer lists, new products, product research, price
changes, mergers, acquisitions, securities offerings,
management changes, trade secrets, compensation,
and other matters relating to the Company's business
that have not been disclosed to the public.

JTI will not ask employees joining us from competitors to

divulge information about their previous company that
contravenes any past confidentiality agreement.

You must not either during or after your employment at Keep Company
JTI, disclose to anyone outside JTI any information relating secrets secret.
to JTI that has not been disclosed to the public, unless
the Senior Vice President, Legal, Corporate Affairs and
Chief Compliance Officer authorizes disclosure in writing.

You must handle and communicate information with care,

making sure that the security of sensitive information is
protected and retained. Thus, you must:

• Ensure that no confidential information is on your desk

where non-JTI employees can see it
• Be careful with JTI documents and laptop computers
when you are not on JTI premises
• Exercise suitable discretion in discussing JTI business in
public places such as airport lounges, restaurants, and
hotel elevators.

20
 Employees’ Responsibilities

You must obtain a written and duly signed confidentiality

agreement (see the Regional or Function Legal Counsel)
before sharing any confidential information with a third party
contractor or service provider, and you may share only the
information needed for the third party to perform the service
contract. To be adequate, a confidentiality agreement must
be signed by JTI and a third party, and prevent or restrict
the disclosure of confidential information by the third party.

Media Relations
Media includes organizations or individuals representing
public communications such as radio, press, magazines,
television and Internet.

Formal or informal conversations with journalists are not

allowed. Please refer any media enquiries to the Corporate
Affairs department or designated person within your
organization. Although JTI welcomes such opportunities,
it is critical that only employees who have been trained and
authorized by the Corporate Affairs department speak to
the media.

You may not refer to JTI in external articles, speeches, or

presentations without first seeking authorization from the
Regional Corporate Affairs Vice President or the Regional
Corporate Affairs Director prior to disclosure. When speaking
in public, you must explicitly state that opinions voiced are
your own and not JTI’s, unless you have explicit authorization
from the Corporate Affairs department in your market (or at
Headquarters) to speak on JTI’s behalf.

21
 Employees’ Responsibilities

Use of Company Property

You must use company property wisely to meet our
business objectives, and you are accountable for how
it is used.

JTI property includes JTI funds, IT resources, equipment,

information, documents, records, and the services of
JTI employees.

You must provide complete and accurate information

to management, JTI’s auditors, and others in positions
of authority when they enquire about the expenditure
of JTI funds or other uses of JTI property.

You should minimize the personal (private) use of company

telephones, computers, faxes, the Internet, and email, using Accurate Company
them only when strictly necessary to balance work and records are vital.
home life. Your expected behavior is clearly defined in
JTI Policies and Procedures when using IT resources.

You must use JTI funds and property only for company
purposes and strictly in accordance with the specific
JTI Policies, Procedures, and Operating Guidelines.

22
 Employees’ Responsibilities

Maintenance of Appropriate Records

You must ensure that JTI’s books and records accurately
reflect the purposes for which JTI property is used.

Accounting records and supporting documents must accurately

describe and reflect the substance of a transaction.

You have special responsibilities with respect to both these

matters:

• You must deposit all funds belonging to JTI in appropriate

JTI bank accounts.
• You must record all disbursements of JTI funds and other
uses of JTI property accurately and with sufficient detail to
permit others to understand what you are doing and why.
Undisclosed funds or accounts are prohibited.

You must ensure that all business transactions are properly

authorized and accurately recorded in JTI’s books and
records in accordance with both JTI and local Generally
Accepted Accounting Principles and JTI Policies,
Procedures, and Operating Guidelines.

You must retain and dispose of company records only in

accordance with JTI’s Document Management Policy and
any applicable local laws, regulations, or retention obligations
arising from pending litigation.

23
 Employees’ Responsibilities

Financial Management
and Accounting
You must ensure that our financial statements present a
true and fair view of our financial position and performance
at all times.

JTI will prepare and issue financial statements in compliance

with legal requirements and using the appropriate
internationally recognized accounting standards.

Within the scope of your responsibilities, you must ensure

that all financial records and accounts are prepared in
accordance with JTI’s Internal Accounting Policies and,
when applicable, local Generally Accepted Accounting
Principles.

You must accurately record and present all financial information

and bring any concerns about the accuracy or completeness
of financial records to the attention of the Local or Regional
CFO and then to the Corporate Controller.

24
 Employees’ Responsibilities

Government Inquiries
and Investigations
From time to time, governmental agencies inspect, investigate,
or make inquiries into JTI. Some of these are routine.

For routine government activities, such as fire department

inspections and the like, you should follow local practices
and procedures.

If contacted by a government investigator on anything other

than a routine matter, you should record the name of the
investigator, his/her title and the agency he/she represents.

If local officials appear at JTI facilities for an inspection or

investigation, you must immediately inform the appointed
Local Coordinator *, or his/her deputy if the coordinator is
unavailable.

You must not sign anything or engage in any conversation

with the investigator. Under no circumstances should you
furnish documents, answer questions about JTI, disclose
information, or provide any official with access to JTI premises
without explicit instructions from your Local Coordinator.

Leave government
investigations and the * Person in charge of ensuring that all established procedures for governmental
media to the experts. inspections or investigations are followed.

25
 Employees’ Responsibilities

Ownership of Inventions
All inventions, ideas, and concepts conceived, made, or
acquired by an employee in the course of employment are
and will remain JTI’s property, not the employee’s, if they
relate to any aspect of JTI's business.

If JTI requests, you must execute documents to evidence

JTI’s rights to such property.

Inventions
and bright ideas
are Company property.

26
 Employees’ Responsibilities

Insider Trading
You may purchase securities of Japan Tobacco, Inc. (JT),
as well as securities of affiliated companies, for long-term
investment purposes.

You and your close relatives may not, however, engage in

short-term speculative trading of these securities.

You also may not purchase or sell put or call options relating
to these securities or purchase or sell these securities
during periods immediately preceding the declaration of
JTI’s financial performance (Blackout / Restricted Periods).
Violation of these provisions could trigger civil or criminal
investigations and result in adverse publicity for JTI.

You must not divulge non-public information that could

affect the price of JT securities publicly, even to your family.

Restrictions may also apply to purchasing or selling

JT securities on the basis of non-public information about
JT or JTI, especially if you know or have reason to believe
such information could affect the price of such securities
if known to the public.

If you have questions about buying or selling JT securities,

consult the Regional or Function Legal Counsel before
acting.

27
Responsibility
as a Business
 Responsibility as a Business

Equal Opportunity
and Workforce Diversity
We offer a working environment that welcomes and
encourages diversity and where employees are recruited
on merit and rewarded on job performance.

Differences among employees in nationality, gender, race,

color, ethnicity, religion, culture, lifestyle, age, experience
and talent stimulate new ideas and fresh perspectives.
They also help JTI relate to its customers.

You must not discriminate against on the basis of nationality,

gender, race, color, ethnicity, religion, culture, lifestyle, age,
disability or any legally protected classification.

You should affirmatively strive to maintain a workplace

environment that welcomes and encourages diversity,
where jobs are filled by the most suitable candidates,
and employees are rewarded on performance.

The whole is greater than

the sum of its parts.

29
 Responsibility as a Business

Environment, Health and Safety (EHS)

The Company is committed to providing a safe
and healthful workplace for its employees. It is also
committed to conducting its business in a way that
is environmentally sound.

The Company’s aim is to eliminate all occupational injuries

and illnesses, prevent pollution at source and to optimize
the use of natural resources. In order to achieve these
goals, the Company has established an Environment,
Health & Safety (EHS) Policy, Management System and
Strategy, and provides EHS Standards, Guidance, training
and tools.

You must do your part by conducting your day-to-day

activities in a way that is conducive to the health and safety
of your fellow employees and complies with applicable
health, safety and environmental laws.

You are responsible for:

• Behaving in a manner that protects your own,

and fellow employees, health and safety
• Complying with all applicable EHS laws
• Adhering to company EHS Policy,
Standards and Guidance
• Reporting accidents, near accidents and unsafe
conditions and behaviors.

You are also expected to actively contribute to improving

EHS performance in your area of business.

30
 Responsibility as a Business

Child Labor
JTI does not employ children in any of its operations and
adheres strictly to all national and international laws,
conventions, treaties and principles dedicated to restricting
conditions under which children can be employed.

The International Labor Organization definition of a child

worker is anyone under 15 years of age.

When possible, the company will work proactively with

others, including suppliers, interest groups, and
Governments, to progressively eliminate these abuses in
the labor markets related to the tobacco supply chain.

31
 Responsibility as a Business

Responsible Marketing
We market our products in a responsible way, taking
all reasonable steps to ensure that cigarette advertising,
sampling, promotion and distribution are directed at adult
smokers only and in conformity with local regulation and
our Marketing Standards, whichever is more restrictive.

Our product marketing will be carried out within the

constraints of the law and our Marketing Standards.
You must act within that spirit.

All agencies or other parties used for marketing or promotional

purposes must be contractually bound to comply with the
law and the Marketing Standards. You must carry out due
diligence on all such providers to ensure that they have and
will maintain the capability to self-regulate and demonstrate
compliance.

Any contravention will be taken as a serious offence and

dealt with accordingly.

32
 Responsibility as a Business

Fair Competition
We will compete fairly in all markets.

Many countries in which JTI does business have complex

laws designed to promote economic diversity by preventing
activities that could unreasonably reduce competition.
Inadvertent violations of these laws can easily occur. Hence,
except when instructed differently by the Regional or
Function Legal Counsel, the following rules apply:

• You may not have any direct or indirect discussions

with competitors or enter into any express or implied
agreements with competitors regarding pricing, terms
and conditions of sale, customers, markets, suppliers,
employment conditions, or any other important aspect
of the Company's business. Nor may you share any
JTI sales data with competitors, directly or indirectly,
without prior written approval of the Regional or Function
Legal Counsel.

• If you are engaged in a conversation or meeting with

competitors where sensitive or inappropriate commercial
information is being discussed, you must end the
conversation and leave the meeting immediately.
You must then immediately report in writing to a member
of your Local Executive Committee what was discussed
and what you did.

You must consult the Regional or Function Legal Counsel

Avoid discussing before negotiating a distribution or license agreement with
Company business a competitor to ensure that the agreement complies with
with competitors. local law.

33
 Responsibility as a Business

Bribes and Kickbacks

We will not bribe anyone in any way or accept kickbacks
in any form.

Bribes and kickbacks violate the law and, in the long run,
are bad for business.

The essence of bribery is an attempt to influence

governmental or corporate actions by giving an individual
money or some other personal benefit in return for a
business favor.
Don’t even think
about it!
A kickback occurs when someone gives you (or someone
close to you, such as a family member) money or anything
else of value, including services, in return for providing
them business or providing business on terms that are
more favorable than they would receive in arms’ length
negotiations.

You must not, therefore, offer, pay, promise or authorize

the payment of money or anything else of value to:

• A government official, which means any person employed

directly by the government or employed indirectly to
represent or to act in the interest of the government
• A political party, party official, or candidate for office
or anyone else in order to influence him or her in deciding
whether to do business with JTI or give JTI any other
business advantage, including favorable regulation.

You will also not offer, pay, promise or authorize the payment
of money or anything else of value to anyone else if you
know or have reason to know that he or she will attempt
to influence such decisions by improper means.

34
 Responsibility as a Business

Contracts with third persons, such as consultants or

distributors, relating to business or other dealings with foreign
governments are of special concern. You must submit
all such contracts for review and written approval by the
Regional or Function Legal Counsel before signing, to ensure
that the arrangement provides JTI with adequate protections
against bribes being paid.

You will actively communicate our position on bribery to your

business partners and other relevant parties.

JTI will seek opportunities to work with other businesses,

governments and non-governmental organizations to reduce
bribery.

If you have any reason to believe that someone whom JTI has
hired or is considering hiring has engaged in or will engage in
bribery, you must promptly inform a Contact Person.

Putting your head

in the sand is asking
for trouble.

35
 Responsibility as a Business

Examples
Bribery and kickbacks can take many forms. Payments in
cash or transfers of funds to personal bank accounts are only
the most obvious. Less obvious but equally questionable are:

• Giving an individual or his/her relative(s) or friend(s)

an opportunity to participate in a business deal
• Adding favored contractors or suppliers to a project
• Paying for someone's holiday, entertaining on an excessive
scale and contributing to someone's designated charity
or cause.
Red flags
Situations that should alert you to the possibility that a
consultant or distributor may have bribery in mind include:

• Vagueness or evasiveness as to precisely what he has

done or plans to do for JTI or on JTI's behalf
• Poorly documented requests for expense reimbursements
• Requests for fees that are unusually high for the type of
services rendered or to be rendered
• Requests for additional payments or reimbursements
beyond those called for by the contract
• Known connections between the third person and foreign
government officials
• An inability to obtain adequate information about the third
person's background or experience
• Lack of experience in performing services of a kind for
which the individual has been or is being hired to do
• A refusal to provide assurances that he will not engage
or has not engaged in bribery.

36
 Responsibility as a Business

Expediting Payments
We strongly discourage the making of expediting
payments and will work to eliminate them.

Bureaucrats and other government officials sometimes

demand direct or indirect payments, whether in cash or in
other things of value (such as lavish entertainment) to do
their job.

Even if not prohibited by local legislation, you should resist

demands for such payments to the maximum extent possible.
However, in countries where resistance is futile and important
business interests are at stake, there may be no choice but
to give in to such demands.

You may not do so, however, without first securing the prior
written approval of the Regional or Function Legal Counsel.

The Regional or Function Legal Counsel will approve the

payment only where it is common business practice to
make such payments in the particular situation. Expediting
payments are never an option in jurisdictions where they
are prohibited.

37
 Responsibility as a Business

Entertainment and Gifts

We base our relationships with suppliers, customers
and other business associates entirely on sound business
decisions and fair dealing. We discourage and do not
accept inappropriate gifts or entertainment from our
business partners.

Entertainment is an important way to communicate

information about the Company and its products.
However, entertainment that is of a disproportionately high
value can look like an attempt to gain business by improper Is this a reasonable
means and, in some circumstances, be regarded as bribery. way to entertain?
In addition, entertainment that is inconsistent with this Code
or could damage JTI’s image and reputation is also prohibited.

You may give or receive modest levels of entertainment

and gifts of a nominal value as part of developing healthy
business relationships.

You may not accept gifts or entertainment that:

• Are directly linked to a commercial transaction

or might be viewed as substantial enough to influence
commercial decisions
• Are made during a tendering period or period of
sub-contractor review.

You must not accept any personal financial payment in the

form of cash, loans or securities from a customer, supplier,
contractor or other business partner.

Should you receive any of the former items, you must refer
to a Contact Person to secure its proper return.

38
 Responsibility as a Business

Relationship with Suppliers

We seek to establish mutually beneficial and healthy
relationships with the people and organizations that supply
us with materials, goods and services.

You shall choose and periodically re-appoint suppliers only

in a completely impartial manner on the basis of price,
quality, performance, reliability, suitability and in compliance
with JTI Policies and Procedures. You must avoid doing
anything that would even suggest that you chose a supplier
for any other reason.

You must inform all your suppliers of our Code of Conduct

and encourage them to adopt business standards equivalent
to our own.

39
 Responsibility as a Business

Know Your Customer

We will sell our products only to customers that have a
reputation for honesty and integrity.

Many of the problems associated with economic sanctions,

export controls, smuggling, and money laundering can be
avoided by making sure you know your customer.

It is therefore essential that you check out any new customer,

in accordance with JTI Policies and Procedures, to ensure
that:

• You understand what the customer plans to do with

the products he buys from JTI.
• You have no reason to believe he will use our products
in illegal or unethical activities.
Don’t sell to people
On an ongoing basis, JTI will conduct due diligence reviews you don’t know.
to ensure we remain up to date with knowledge of our
customers.

40
 Responsibility as a Business

Smuggling and Contraband Activities

JTI is not, and will not be, involved in the illegal sale
of its products. Furthermore, JTI is committed to do
everything possible to prevent its products from ending
up on the illegal market.

Evasion of customs duties or other customs requirements can

have serious consequences. Helping others evade such duties
or requirements can have serious consequences as well.

Under no circumstances may you engage in any activities

that evade or help others evade such duties or requirements.

Money Laundering
JTI actively manages its business to prevent association
with money laundering activities.

In most countries it is a crime to engage in activities that

have the effect of helping criminals hide or ‘launder’ money
derived from criminal activity, such as smuggling, dealing in
contraband, tax evasion, violations of foreign exchange
controls or narcotics trafficking.

Unusual requests, such as requests to pay for goods

or services from or to transfer funds to accounts outside
the customer's home country or accounts of a third person,
such as a customer's law firm or accountant, may be
indicative of an attempt to engage in money laundering.

You must always refer to JTI Policies, Procedures

If the source of the and Operating Guidelines for appointing new customers
money is suspicious, and executing payment for goods and services sold by
check it out. the Company.

41
 Responsibility as a Business

Political Activities
We fully support the right of all employees to take an active
part in political processes on their own time and using their
own resources. However, any political affiliation must be
expressed individually and not as the view of JTI.

You may not circulate or post political material on company

notice boards, or premises.

You may not engage in political activities on JTI time or use

JTI funds, facilities, equipment, communication channels or
other resources for such purposes without the prior written
approval of your General Manager or the Regional or
Function Legal Counsel.

All employees must declare to the Senior Vice President,

Legal, Corporate Affairs and Chief Compliance Officer if they
intend to stand for public office election as a candidate.

42
 Responsibility as a Business

Support for Community Activities,

Donations and Sponsorships
We aim to support the communities in which we operate
through our core business activities. Where appropriate
we will supplement this by actively contributing funds
or resources to worthwhile causes in the interest of
the development of local, national or international
communities.

We support trustworthy, sustainable projects with credible

partners and seek to engage in long-term partnerships with
the local community.

You must never make donations to an individual, and you

must properly and fully account for all donations or corporate
sponsorships.

43
International
Restrictions
 International Restrictions

UN Economic Sanctions
The United Nations from time to time imposes economic
sanctions that severely restrict and sometimes prohibit
business dealings with specified countries, entities or
individuals. As a consequence, no sales to or other dealings
with those countries, entities or individuals may be undertaken
without the prior written approval of the Regional or Function
Legal Counsel.

Please consult our dedicated intranet site for an updated list

of concerned countries.

The UN says No.

45
 International Restrictions

U.S Economic Sanctions

and Export Controls
The United States from time to time imposes unilateral
economic sanctions against specified countries, entities or
individuals. Like UN sanctions, these severely restrict and
sometimes prohibit business dealings with the sanctioned
country, entity or individual. The United States also prohibits
exports of U.S. origin goods or technology or non-U.S.
manufactured goods containing U.S. origin parts, components
or ingredients to entities or individuals who have violated
U.S. export control laws. Such entities or individuals are
known as Denied Persons.

As a consequence, no sales or exports of U.S. origin goods,

technology or services may be made to Denied Persons
or any country, entity or individual who is subject to U.S.
economic sanctions without the prior written approval of
the Regional or Function Legal Counsel. In addition, no sales
or exports of non U.S. manufactured goods containing U.S.
origin parts, components or ingredients may be made to
Denied Persons or anyone that is subject to U.S. economic
sanctions without the prior written approval of the Regional
or Function Legal Counsel.

The US says No.

46
 International Restrictions

Special Rules for US Citizens and US Residents

No U.S. citizen or U.S. permanent resident alien may be involved
in any sales or other dealings with anyone that is subject to
U.S. economic sanctions without the prior written approval of
the Regional or Function Legal Counsel even if the transaction
involves no U.S. origin goods, technology or services and even if
the unit for which he works has permission to engage in such
sales or other dealings.

Please consult our dedicated intranet site for an updated list

of concerned countries.

The Legal Department maintains a list of entities and

individuals designated as International Terrorists, International
Drug Traffickers or Denied Persons. Before dealing with any
customer, you should check to see whether it is on the
International Terrorists, International Drug Traffickers or Denied
Persons list.

47
If you have any question, suggestion or feedback,
please contact us at:
onebehavior@jt-int.com

Your Compliance Team

JT International
1, rue de la Gabelle - CH-1227 Carouge (Geneva) - Switzerland
www.jti.com