WTO rules for Australia in tobacco plain packaging dispute

29 June 2018

WTO rules for Australia in tobacco plain packaging dispute

Australia’s Tobacco Plain Packaging Act 2011 has contributed to improving public health, a World Trade Organisation (WTO) panel ruled on Thursday.

The panel rejected arguments brought by Cuba, the Dominican Republic, Honduras and Indonesia that alternative measures would be equally effective, and disagreed that Australia’s law unjustifiably limited the exercise of intellectual property rights.

The four complainant countries alleged that Australia had breached article 2.2 of the Agreement on Technical Barriers to Trade, which prohibits unnecessary obstacles to international trade. However, countries may put in place restrictions on trade that are necessary to fulfil a “legitimate objective”, which includes “protection of human health”, and takes into consideration available scientific information.

“We consider that that … objective of these measures … is to improve public health by reducing the use of, and exposure to, tobacco products,” the panel said in its ruling.

“[W]e find … that plain packaging of tobacco products may reduce their appeal, by minimising the ability of various branding features to create positive associations with tobacco products that could have an influence on smoking behaviours, including smoking initiation, cessation and relapse.”

Commencing in December 2012, Australia’s law goes much further than most other countries’ advertising restrictions and health warnings, extending to logos and imposing a uniform colour and plain style of packaging.

According to studies, this has reduced the number of smokers. The WTO ruling may encourage further countries to pursue similar laws, which are already in effect in France, Hungary, Ireland, New Zealand, Norway and the United Kingdom.

Vera Luiza da Costa e Silva, head of the Secretariat of the World Health Organisation’s Framework Convention on Tobacco Control said: “What this shows in reality is that plain packaging is a reality, it will happen anyway, and parties will progressively adhere more to plain package.”

“Plain packaging is part of [the] path” to eradicating smoking, Ms da Costa e Silva said.

Although welcomed by the WHO, Honduras has indicated it will appeal the decision, alleging that it contained a number of legal and factual errors, and appeared to be biased.