Supply Chain Transparency

The California Transparency in Supply Chains Act of 2010 (the “Act”) requires certain retailers and manufacturers doing business in California to provide information regarding their efforts to eliminate slavery and human trafficking in their supply chains. Liggett Vector Brands LLC is the exclusive sales and marketing agent for cigarettes manufactured by its affiliates Liggett Group LLC and Vector Tobacco Inc. In compliance with the Act, this statement is provided on behalf of Liggett Group and Vector Tobacco (the “Companies”).

The Companies are committed to the highest standards for lawful, honest, and ethical conduct in all business dealings. This commitment is reflected in various policies and practices that the Companies have had in effect for years. For example, the Companies’ Business Conduct Policy provides, among other things, that the Companies, their employees, and their business partners will strictly observe laws and ethical standards in all of their operations and in every geographical area where they do business.

The Companies purchase tobacco and other materials from suppliers located in the United States and in foreign countries.  The Companies generally verify their supply chains by doing business with suppliers that are well-established, reputable organizations that respect the legal requirements of the jurisdictions in which they operate.  The suppliers typically have formal business conduct or similar policies, which the Companies review to ensure that they are consistent with the Companies’ policies.  The Companies believe that their suppliers do not engage in illegal slavery or human trafficking, but the Companies do not otherwise engage in verification of product supply chains to evaluate and address the risks of slavery or human trafficking.  To the extent that the Companies engage in verification efforts, such efforts are not conducted by a third party.

The Companies expect all suppliers to comply at all times with applicable laws and to engage in honest and ethical business conduct. The Companies will take immediate action if they find evidence that a supplier is engaging in any illegal activity, including slavery or human trafficking.  Except as discussed above regarding verification, the Companies do not conduct audits of their suppliers to evaluate compliance with the Companies’ standards regarding slavery and trafficking in supply chains.

As discussed above, the Companies do business with reputable suppliers that to our knowledge are in compliance with the legal requirements of the jurisdictions where they operate and that typically have formal policies in effect to reinforce that their business activities will be conducted in a legal, honest and ethical manner.  The Companies do not require direct suppliers to certify that materials incorporated into our products comply with the laws regarding slavery and human trafficking of the country or counties in which they do business.

The Companies follow, and require all employees to follow, policies that demand lawful, honest, and ethical conduct in every aspect of business dealings, including a Business Conduct Policy that includes the requirement to comply with all laws, rules and regulations of the United States and the states, counties, cities and other jurisdictions in which the Companies do business.  Violation of these policies may result in disciplinary action, up to and including termination of employment, or other legal action as appropriate.

Except as stated above regarding Accountability, the Companies do not currently provide employees and management, who have direct responsibility for supply chain management, with training on slavery and human trafficking, particularly with respect to mitigating risks within the supply chains of products.