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Habanos S.A Press Release

Corporación Habanos, S.A. ("Habanos SA") is surprised by the Court of Appeal decision handed down earlier this morning in relation to its litigation with Mastercigars Direct Limited reversing the earlier finding of the High Court. It notes that the decision relates only to the circumstances of specific importation of cigars into the UK by certain individuals prior to August 2004. This point is made expressly by the Court of Appeal in stating that "it does not follow that [MasterCigars] can repeat their purchases and importations".

It should also be noted that the Court of Appeal decision does not affect Habanos SAs trade mark rights nor its agreements with its exclusive distributors.

Since August 2004, changes have been made to the way in which Habanos SAs cigars are sold through independent outlets in Cuba; in particular, the invoices given to individuals purchasing cigars ("facturas") now expressly bear the words "not for resale" on their face. Although independent retailers in Cuba have only ever been authorized by Habanos SA to sell to individuals for private consumption, this additional wording in particular makes it now even clearer that Habanos S.A does not consent to the parallel importation of its cigars into the EU. Habanos SA will take appropriate legal action against any entity undertaking such importation of Habanos cigars into the EU for commercial resale.

Habanos SA is the owner of the Premium Cuban cigars brands and is solely responsible for sales and marketing of its products through its appointed network of exclusive distributors.

Buyers of fine cigars should be aware that the authenticity of Habanos cigars can only be guaranteed if they are purchased through the authorized channels. In the United Kingdom, Hunters & Frankau Limited will continue to guarantee, through its English Market Selection stamp, the high quality and authenticity of the Habanos cigars that it distributes, as it has done for two centuries. Habanos, notwithstanding the above, is currently considering the issue of an appeal with its legal team.

Contact:
   Adargelio Garrido Corporación Habanos, SA + 537 2040528
   Jemma Freeman Hunters & Frankau Limited 020 7471 8400
   Jeremy Hertzog Mishcon de Reya 020 7440 7000
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