Australia’s WTO plain cigarette packaging case: an update

Parliament house flag post

Australia’s WTO plain cigarette packaging case: an update

Posted 8/07/2014 by Jaan Murphy


Australia is a respondent in five World Trade Organization (WTO) disputes regarding the introduction of the Tobacco Plain Packaging Act 2011 (TPPA). The disputes were commenced by Ukraine, Honduras, the Dominican Republic, Cuba and Indonesia (the Applicants).

Background

The TPPA was introduced in 2011 to improve public health by discouraging smoking, encouraging cessation, and implementing certain obligations under the World Health Organization (WHO) Framework Convention on Tobacco Control (FCTC). Plain packaging for cigarettes is a central element.

Between March 2012 and September 2013, the Applicants commenced WTO dispute proceedings, which have attracted significant interest, with a record number of countries (40) seeking to be joined in the consultation and dispute settlement processes.  All five disputes will be heard by a single Panel.

At the same time, several countries, such as New Zealand and Ireland, have expressed their intention to adopt more stringent legislation on tobacco products, including plain packaging. Plain packaging for tobacco was first discussed in the TRIPS Council and in the WTO Technical Barriers to Trade Committee (which deals with labelling and general product standards) in June 2011:

India, Brazil and Cuba stressed their view that countries have the right to implement public health policies without intellectual property being an obstacle — referring directly or indirectly to the 2001 Doha Declaration on TRIPS and Public Health.

The dispute

The disputes share an overlapping core of alleged breaches of international agreements including the:

It is not possible to outline all the argued breaches in this post. However, some of the key alleged breaches are outlined below.

GATT and TBT

It is argued that the TPPA introduces technical regulations that breach parts of the GATT and TBT because it:

  • treats imported tobacco products less favourably than domestically produced ones (argument 1)
  • creates unnecessary obstacles to trade and is more trade-restrictive than ‘necessary’ to fulfil a legitimate objective (taking into account the risks that non-fulfilment would create) (argument 2), and
  • does not provide effective protection against unfair competition to nationals of other countries, and creates confusion between goods of competitors (argument 3).

TRIPS and PC

It is also argued that through enacting the TPPA Australia has:

  • failed to protect trademarks registered in a country outside of Australia ‘as is’  (argument 4)
  • placed unjustifiable encumbrances on the use of tobacco related trade-marks (argument 5), and
  • effectively denied or invalidated the registration of tobacco trade marks (argument 6).

The counter arguments

Whilst Australia’s submissions are not publically available, a number of leading commentators have noted Australia has a relatively strong case for the following reasons:

  • Argument 1: The plain packaging requirements are non-discriminatory, as they apply equally to locally manufactured and imported tobacco products alike.
  • Argument 2:  Plain packaging is a ‘necessary’ measure designed to pursue a legitimate objective (the protection of human health and to give effect to the FCTC), is making a ‘material contribution’ to that objective, and is not more trade-restrictive than necessary to fulfil the objective (taking account of the risks non-fulfilment).
  • Argument 3: The TPPA allows tobacco products to have a brand/variant name on the packaging (subject to certain restrictions), along with trade descriptions, brand differentiation and recognition is still possible and hence there should be no confusion between goods of different producers.
  • Arguments 4 and 6: it provides tobacco related trade marks effective protection ‘as is’ and does not deny or invalidate their registration because section 28(3) specifically provides that the fact that a person is prevented from using their trademark on tobacco products is not a circumstance that makes it reasonable or appropriate not to register a trade mark or to revoke the registration of a trade mark.
  • Argument 5: the TPPA does not ‘encumber’ the use of a tobacco trade mark by ‘special requirements’, and, even if it does, as it is necessary measure it is a justifiable encumbrance. 

Current status of the disputes

A panel for the disputes was composed on 5 May 2014. The flow chart below (produced by DFAT) outlines the WTO dispute settlement process and approximate time-frames:

The World Trade Organisation dispute settlement process

It is likely that the outcome of the case will not be known until sometime between late 2014 and early 2015. Depending on the outcome, this may be followed by an appeal.

Why is the case important?

The case is important because:

  • it will determine the compatibility of the TPPA with Australia’s various international commitments and the interaction of these trade agreements with non-trade agreements such as the FCTC, and
  • this dispute has the potential to become a seminal case regarding the human health exception to the GATT, which as noted in a previous Flag post, was the subject of consideration in the recent China rare-earth minerals dispute

Finally, a dispute brought by Phillip Morris Asia against Australia claiming that the TPPA breaches a bilateral treaty between Australian and Hong Kong, is currently being arbitrated. Its outcome is likely to be known later this year.


Thank you for your comment. If it does not require moderation, it will appear shortly.

Add your comment

[Click to expand]

We welcome your comments, or additional information which is relevant to a post. These can be added by clicking on the ‘Add your comment’ option above. Please note that the Parliamentary Library will moderate comments, and reserves the right not to publish comments that are inconsistent with the objectives of FlagPost. This includes comments that are not relevant to the article, factually incorrect or politically partisan, as well as spam, profanity and personal abuse. We will close comments after three months.




Captcha
Generate a new image
Type characters from the image:

Facebook LinkedIn Twitter Add | Email Print

FlagPost

Flagpost is a blog on current issues of interest to members of the Australian Parliament


Parliamentary Library Logo showing Information Analysis & Advice

Archive

Syndication

Tagcloud

refugees asylum immigration climate change Australian foreign policy parliament social security elections welfare reform welfare policy school education Australian Defence Force health financing higher education emissions trading indigenous Australians women private health insurance people trafficking Employment illicit drugs gambling health reform federal election 2010 Middle East disability Sport Australian Bureau of Statistics statistics United Nations Asia Taxation Afghanistan income management Medicare health forced labour Australian Sports Anti-Doping Agency World Anti-Doping Agency United States federal budget Industrial Relations Carbon Pricing Mechanism politics dental health Australian Electoral Commission WADA criminal law transport aid child protection environment poker machines Australia in the Asian Century steroids National Disability Insurance Scheme detention aged care 43rd Parliament slavery health system ASADA Law Enforcement Australian Federal Police Fair Work Act Australian Public Service governance labour force people smuggling debt international relations constitution New Zealand food Australian Crime Commission pharmaceutical benefits scheme OECD corruption pensions public service reform children's health Aviation federal election 2013 foreign debt gross debt net debt defence capability parliamentary procedure Senate Senators and Members ALP Newstart Parenting Payment multiculturalism Youth Allowance sea farers UK Parliament election results voting mental health Federal Court terrorist groups science social media Higher Education Loan Program HECS federal state relations accountability Papua New Guinea youth paid parental leave same sex relationships coal seam gas customs planning doping crime health risks International Women's Day Gonski Review of Funding for Schooling sex slavery Special Rapporteur Northern Territory Emergency Response social policy violence against women domestic violence China ADRV terrorism transparency research and development welfare ASIO intelligence community Australian Security Intelligence Organisation carbon tax mining High Court military history electoral reform employer employee renewable energy regional unemployment fishing by-election European Union family assistance skilled migration banking United Nations Security Council Australian economy forestry food labelling vocational education and training Drugs welfare systems Indonesia children Constitutional reform local government codes of conduct terrorist financing homelessness Parliamentary remuneration money laundering Trafficking in Persons Report energy social inclusion human rights paternalism national security fuel disability employment Tasmania integrity standards NATO Australian Secret Intelligence Service sexual abuse World Trade Organization Australia public health housing affordability bulk billing political parties water productivity health policy Governor-General US economy trade unions export liquefied natural gas foreign bribery firearms question time speaker superannuation public housing expertise public policy climate Intergovernmental Panel on Climate Change leadership Department of Agriculture Fisheries and Forestry regulation Pacific Islands reserved seats new psychoactive substances synthetic drugs UNODC carbon markets animal health middle class welfare Census Indigenous constitutional recognition of local government referendum consumer laws PISA competition policy royal commission US politics language education baby bonus Leaders of the Opposition citizen engagement policymaking Australia Greens servitude Trafficking Protocol forced marriage Population rural and regional alcohol entitlements ministries Hung Parliament social citizenship maritime Iran ANZUS regional students school chaplains federal budget 2011-12 salary Medicare Locals primary care Building the Education Revolution EU China soft power education Fiji India Disability Support Pension Antarctica Diplomacy by-elections state and territories Bills anti-corruption fraud bribery corporate ownership whistleblower G20 economic reform innovation Members of Parliament Scottish referendum early childhood education Middle East; national security; terrorism social services Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2013 online grooming sexual assault of minors ACT Assembly smoking plain packaging tobacco cigarettes Asia; Japan; international relations Work Health and Safety Migration; asylum seekers; regional processing China; United States; international relations fiscal policy Racial Discrimination Act; social policy; human rights; indigenous Australians Foreign policy Southeast Asia Israel Palestine asylum refugees immigration political finance donations foreign aid Economics efficiency human rights; Racial Discrimination Act employment law bullying asylum seekers Animal law; food copyright Australian Law Reform Commission industry peace keeping contracts workplace policies same-sex marriage disorderly conduct retirement Parliament House standing orders prime ministers election timetable sitting days First speech defence budget submarines workers financial sector Canada Somalia United Kingdom GDP world heritage political engagement leave loading Trade; tariffs; safeguards; Anti-dumping public interest disclosure whistleblowing Productivity Commission limitation period universities Ireland cancer gene patents genetic testing suspension of standing and sessional orders live exports infant mortality honorary citizen railways disciplinary tribunals standard of proof World Health Organisation arts international students skilled graduate visas temporary employment visas apologies roads Italy national heritage NHMRC nutrition anti-dumping Rent Assistance obesity evidence law sacrament of confession US presidential election international days DFAT UN General Assembly deregulation Regulation Impact Statements administrative law small business Breaker Morant regional engagement social determinants of health abortion Members suspension workplace health and safety marine reserves hearing TAFE Victoria astronomy resources sector YMCA youth parliament Korea rebate Australian Greens presidential nomination Racial Discrimination Act political parties preselection solar hot water Financial Action Taskforce Horn of Africa peacekeeping piracy Great Barrier Reef Stronger futures political financing political education Social Inclusion Board early childhood National Quality Framework for Early Childhood Education and Care Murray-Darling Basin sanctions Norway hospitals republic President Barack Obama Presidential visits qantas counselling Korean peninsula Work Choices biosecurity hendra environmental law federalism federation preselection therapeutic goods Therapeutic Goods Administration plebiscites computer games pests suicide nuclear COAG Ministerial Councils floods ADHD stimulant medication advertising electricity extradition conscience votes poverty preventative health rural health coastal erosion Parliamentary Budget Office work-life balance

Show all
Show less
Back to top