Landmark legal victory for public health and a major setback for the tobacco industry

Today we are celebrating a major victory for public health and tobacco control. On June 9, the World Trade Organization’s (WTO) Appellate Body reported on the dispute brought by Honduras and the Dominican Republic against Australia: “Australia — Tobacco Plain Packaging.

This decision puts an end to the disputes which began in 2012 and saw Cuba, the Dominican Republic, Honduras, Indonesia and Ukraine (Ukraine later decided to withdraw its complaint in June 2015)[1] bring legal complaints regarding Australia’s plain packaging law[2].

"This decision represents a landmark victory for global health and a major setback for the tobacco industry. Plain packaging is consistent with international trade law as part of a comprehensive approach to tobacco control that protects people from the harms caused by tobacco" , says Dr Adriana Blanco Marquizo, Head of the Convention Secretariat.

The World Health Organization (WHO) and the WHO Framework Convention on Tobacco Control (WHO FCTC) Secretariat provided the WTO panel with a joint submission or amicus brief, that gave an overview of global tobacco control, summarized the public health evidence underlying tobacco plain packaging and the relevant provisions of the WHO FCTC and its Guidelines.

More background on the history of this dispute

On 28 June 2018, the panel report was circulated. The panel decided that Australia’s policy on plain packaging was consistent with WTO law.

As a result, Honduras appealed to the Appellate Body the panel’s report. This appeal was consolidated with the one from the Dominican Republic, into one that has now ended with the Appellate Body decision published. Cuba and Indonesia accepted the Panel’s decision, opting not to appeal.

By dismissing appeals from the Dominican Republic and Honduras, the WTO Appellate Body Report finally ends the legal challenges to Australia’s tobacco plain packaging law at the WTO. Australia’s law withstood a domestic legal challenge, an investment treaty claim and the WTO challenges. Although some other countries implementing plain packaging have faced legal challenges from the tobacco industry, there are no other legal disputes on plain packaging at the WTO.

At the WTO, Australia’s plain packaging law was challenged primarily on grounds that it was more restrictive of trade than necessary to protect human health, and that it unjustifiably interfered with use of tobacco company trademarks on packaging. These and other claims were rejected by a WTO Panel and appeals from the Dominican Republic and Honduras have now been rejected. This outcome is in line with litigation in other countries, which has uniformly rejected tobacco industry challenges to plain packaging.

The Appellate Body confirmed:

  • the panel’s findings that plain packaging is “apt to, and does, contribute” to Australia’s objective of improving public health by reducing tobacco consumption and exposure to tobacco smoke;

  • the panel’s finding that plain packaging is no more trade-restrictive than necessary for achieving that public health objective; and

  • that plain packaging does not “unjustifiably encumber by special requirements” the use of trademarks in the course of trade, therefore that the trademark restrictions arising from plain packaging are justified by their contribution to public health objectives.

  • the panel’s findings that plain packaging is “apt to, and does, contribute” to Australia’s objective of improving public health by reducing tobacco consumption and exposure to tobacco smoke;

  • the panel’s finding that plain packaging is no more trade-restrictive than necessary for achieving that public health objective; and

  • that plain packaging does not “unjustifiably encumber by special requirements” the use of trademarks in the course of trade, therefore that the trademark restrictions arising from plain packaging are justified by their contribution to public health objectives.

The Appellate Body ruling finally clears the legal hurdle thrown up in the tobacco industry’s efforts to block tobacco control and is likely to accelerate implementation of plain packaging around the globe.

The Convention Secretariat recognizes the importance of this decision to allow the 182 Parties to the WHO FCTC to implement as agreed, through Article 11 of the Convention, effective packaging and labelling measures and, through Article 13, to undertake a comprehensive ban (or restrictions) on tobacco advertising, promotion and sponsorship, without breaching WTO law.

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