China Tobacco International (HK) Company Limited (CTIHK) has executed three renewed framework agreements with affiliates of its controlling shareholder China National Tobacco Corporation (CNTC), extending core connected transactions for the 2027–2029 period.
CTIHK and CNTC subsidiary China Tobacco International (North America) entered a 2027-2029 Offshore Supply Framework Agreement covering procurement of tobacco leaf products for import into mainland China. Annual caps are set at HK$1.50 billion for 2027, HK$1.75 billion for 2028 and HK$1.87 billion for 2029, compared with actual purchases of HK$577.20 million in 2024, HK$626.40 million in 2025 and HK$165.51 million for the nine months to September 2026. The higher limits reflect expanded sourcing, anticipated price increases and potential shipping-schedule shifts.
In parallel, CTIHK renewed five Tobacco Leaf Products Export Agency Agreements with CNTC-related manufacturing entities in Hong Kong, Macau, Laos, Cambodia and Myanmar. Acting as sales agent, CTIHK expects commission income capped at HK$1.23 million, HK$1.37 million and HK$1.53 million for 2027, 2028 and 2029 respectively, down from HK$2.00 million in 2024 and HK$4.20 million in 2025. The lower caps mirror a planned shift toward a direct-sales model under an offshore sales framework signed in 2025.
A third set of deals—the 2027-2029 Framework Agreements on Cigarettes Export to New Regions—was signed with China Tobacco Sichuan, Shandong, Hubei and Anhui, enabling CTIHK to procure cigarettes (primarily cigars) for export beyond its existing exclusive regions. Annual procurement limits are HK$18.17 million in 2027, HK$20.36 million in 2028 and HK$23.95 million in 2029, versus HK$10.25 million in 2024 and HK$13.11 million in 2025.
Under Hong Kong Listing Rule 14A, the aggregated size of the offshore supply and agency transactions exceeds the 5% percentage ratio, requiring disclosure, independent shareholders’ approval and a circular containing independent financial advice. The cigarette procurement caps fall between 0.1% and 5%, mandating only reporting and announcement.
Chairman Li Bin, who also holds executive roles at CTIG and CTI, abstained from the board vote. The remaining directors, including all independent non-executive directors, consider the agreements and caps fair, reasonable and in the company’s ordinary course of business. A shareholder circular, including an independent board committee recommendation and an independent financial adviser’s opinion, will be dispatched within 15 business days.
Comments