Australia adopted the Tobacco Plain Packaging Act in 2011 to curb tobacco use and reduce smoking-related mortality and disease. The Australian Government successfully defended the legislation within its territory from industry action in subsequent years. In 2012, JT International SA claimed an unjust acquisition of intellectual property rights and goodwill, which was rejected by the Australian High Court. The Australian Government was then challenged by Philip Morris and also prevailed.
The debate over World Trade Organisation (WTO) compatibility of the law emerged even before it was passed in Australia, with tobacco companies expressing concern that such a move notably violated the Agreements on Technical Barriers to Trade (TBT) and Trade-Related Aspects of Intellectual Property Rights (TRIPS), as well as the General Agreement on Tariffs and Trade (GATT).
In 2012, prompted by the tobacco industry, a dispute was brought before WTO by tobacco-producing countries (Dominican Republic, Honduras, Cuba, Indonesia and Ukraine), who claimed that they would be adversely affected by the Australian plain packaging law and that it violated WTO ruling on trademarks, which distinguish between products from different companies.
In July 2018, the WTO dispute panel ruled in favour of the Australian Government, and this ruling was upheld by the appeals body on 9th June 2020.
The claim that the plain packaging law breached international agreements was rejected on the basis that the public health risks of not introducing plain packaging trumped any possible barriers to trade created by the law and there were no demonstrable violations of the TRIPS Agreement nor GATT.
"This is a crucial milestone in the fight against tobacco that should help safeguard future generations from deadly tobacco products. It is especially significant coming a week after World No Tobacco Day and the campaign led by WHO to protect youth from tobacco industry tactics. An industry making billions in profits at the expense of the health of its consumers, the poor and the global population."
- Yannick Romero, Ph.D, Knowledge and Advocacy Manager, UICC
The McCabe Centre for Law & Cancer in Australia has hailed the dismissed appeal as a “decisive legal victory” that should further accelerate the move towards plain packaging globally and support countries in implementing effective, evidence-based tobacco control measures. 15 other countries have now implemented in full or are transitioning towards plain packaging; a further eight others are in the process of adopting or considering legislation to introduce the measure.
“The long legal battle at the WTO shows how powerful and well-financed the tobacco industry lobby is, and the lengths to which it will go to impede any effective measure against the sales of its products taken in the name of public health. The tobacco industry will not stop here. They are determined to continue killing more people around the world and will no doubt use more legal arguments country by country to protect the sales of their lethal product.”
- Dr Cary Adams, CEO, UICC
* WIPO Magazine, “Plain packaging of tobacco products: landmark ruling”.