Clear­ing the smoke

WTO rules that Aus­tralian laws on to­bacco pack­ag­ing don't vi­o­late global obli­ga­tions to pro­tect in­tel­lec­tual prop­erty


A win at WTO for pub­lic health con­cerns against com­mer­cial in­ter­ests

ONE OF the stranger ironies of global trade rules is that coun­tries no longer en­joy the sov­er­eign right to pass laws even if these are in­tended to pro­tect their cit­i­zens’ lives and well-be­ing. Bi­lat­eral treaties and the World Trade Or­ga­ni­za­tion (wto) agree­ments stip­u­late what mem­ber states can or can­not do. Nowhere is this para­dox more ev­i­dent than in the campaign against smok­ing. Big To­bacco has used ev­ery fo­rum it can garner to stop coun­tries from pass­ing or im­ple­ment­ing to­bacco con­trol mea­sures, par­tic­u­larly plain pack­age laws.

Plain pack­ag­ing re­moves all brand­ing in­clud­ing images, colours, cor­po­rate lo­gos and trade­marks, al­low­ing man­u­fac­tur­ers to print just the brand name in a spec­i­fied size on the cig­a­rette pack. All to­bacco pack­ag­ing is re­quired to be stan­dard­ised with the dom­i­nant mes­sage be­ing health warn­ings. In 2010, Uruguay be­came the first tar­get of Big To­bacco when its strict rules to con­trol to­bacco use were con­tested by Philip Morris which claimed that the Uruguayan Pub­lic Health Min­istry had in­fringed its in­tel­lec­tual prop­erty rights (iprs) and thus vi­o­lated its com­mit­ments un­der one of its bi­lat­eral in­vest­ment treaties (bits).

Sim­i­larly, Aus­tralia, too, was dragged to in­ter­na­tional ar­bi­tra­tion by Philip Morris un­der an­other bit af­ter the coun­try passed its plain pack­ag­ing law in 2012. Can­berra’s ar­gu­ment that its mea­sures were in­tended to pro­tect pub­lic health did not cut ice with the to­bacco in­dus­try. As per gov­ern­ment es­ti­mates smok­ing kills 15,000 Aus­tralians each year and costs the coun­try about US $22 bil­lion in so­cial and eco­nomic terms. Although both Uruguay and Aus­tralia were suc­cess­ful in de­fend­ing their laws in the bit cases, Big To­bacco had an­other ace up its sleeve. It got some na­tions to file a com­plaint against Aus­tralia at the wto that its to­bacco con­trol mea­sures were in vi­o­la­tion of the wto’s agree­ment on TradeRe­lated As­pects of In­tel­lec­tual Prop­erty Rights or trips. At wto, only mem­ber states can file cases against an­other. The com­plaints against Aus­tralia were filed by Hon­duras, the Do­mini­can Repub­lic, Cuba and In­done­sia. Af­ter six years, in which 34 other coun­tries and the Eu­ro­pean Union made them­selves party to the dis­pute, the smoke has cleared over the to­bacco con­trol mea­sures with a dis­pute set­tle­ment panel at wto rul­ing on June 28 that Aus­tralia’s plain pack­ag­ing law does not vi­o­late its obli­ga­tions un­der

trips. The panel found that the com­plainants had not been able to show that Aus­tralia’s mea­sures are in­con­sis­tent with its obli­ga­tions un­der the pro­vi­sions they had cited. These are pro­vi­sions of the wto’s Agree­ment on Tech­ni­cal Bar­ri­ers to Trade apart from those of trips.

This is no mean vic­tory in a dis­pute that pits pub­lic health con­cerns against com­mer­cial in­ter­ests and wto’s trade com­mit­ments against the Frame­work Con­ven­tion on To­bacco Con­trol (fctc) of the World Health Or­ga­ni­za­tion (who) which urges na­tions to adopt plain pack­ag­ing. What prob­a­bly helped was the joint sub­mis­sion made by who and its fctc sec­re­tariat act­ing as am­i­cus cu­riae. Plain pack­ag­ing is one of the rec­om­men­da­tions of fctc. An­a­lysts be­lieve that wto de­ci­sion ef­fec­tively re­moves the big­gest hur­dle to pass­ing stricter to­bacco pack­ag­ing laws and is cer­tain to has­ten im­ple­men­ta­tion of plain pack­ag­ing glob­ally.


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