By Timothy S. Donahue
Top Takeaways:
- New claims: Another group of institutional investors have filed High Court claims alleging that BAT failed to disclose its historical North Korea business to the market.
- 2023 settlement: The lawsuits stem from BAT’s $635 million 2023 settlement with the U.S. DOJ and OFAC regarding sanctions violations.
- Disclosure focus: The claims address alleged securities disclosure failures, not new allegations of sanctions violations.
British American Tobacco is facing a new wave of shareholder litigation stemming from its historical business activities in North Korea.
Institutional investors, including Aberdeen and ReAssure, part of Standard Life, have filed claims in the High Court of England and Wales, alleging that BAT failed to properly inform the market about its operations in North Korea from 2007 to 2023.
The latest lawsuits follow similar claims filed earlier this year by another group of institutional investors and focus on whether BAT complied with its disclosure obligations to shareholders during U.S. authorities’ investigation of the company’s North Korea business.
According to reports, the new claimants are represented by Stewarts, while an earlier group of nearly 130 international institutional investors is represented by Fox Williams.
The litigation follows BAT’s April 2023 resolution with the U.S. Department of Justice (DOJ) and the Office of Foreign Assets Control (OFAC). Under the settlement, BAT agreed to pay approximately $635 million after admitting to conspiring to violate U.S. sanctions by facilitating cigarette sales into North Korea through intermediaries between 2007 and 2017.
At the time, the DOJ said BAT’s Singapore subsidiary and its North Korean partners used front companies and intermediary financial institutions to conceal transactions with North Korea and to gain access to the U.S. financial system. OFAC alleged that the scheme generated more than $250 million in profits from BAT’s North Korean joint venture, which were routed through U.S. banks despite sanctions.
The current shareholder claims do not seek to revisit the sanctions case itself. Instead, they allege that BAT failed to adequately disclose information about those historical operations and the related regulatory risks to investors over an extended period.
A spokesperson for Fox Williams said the claim alleges that BAT “failed to properly publish information to the stock market about its business operations in North Korea from 2007 to 2023.” BAT acknowledged the new proceedings in a statement.
“BAT is aware that proceedings have been commenced in the High Court that relate to BAT’s historical business activities in relation to North Korea,” the company said. “The claims relate to the same historic activities that resulted in the 2023 agreement BAT reached with the DOJ and OFAC but are separate and unconnected legal proceedings.”
The company added that, under the terms of its agreement with U.S. authorities, it cannot comment on the facts underlying the government’s investigation.
The shareholder litigation follows the DOJ’s May 2026 announcement that BAT had fully complied with the terms of its three-year deferred prosecution agreement, including implementing enhanced compliance procedures.
