The authors note that -
The Australian federal government recently released an exposure draft of legislation to introduce a scheme for the mandatory 'plain packaging' of cigarettes and other tobacco products from 2012. The scheme will prohibit the use of brand logos, graphics and colors on tobacco products and packaging manufactured or sold in Australia or imported into Australia. All packages will be the same dark olive brown color, largely taken up by graphic and textual health warnings, with brand names appearing in the same font and limited size. As Australia is set to become the first country in the world to implement such a scheme, its outcome will establish a critical precedent for both tobacco control interests and tobacco companies. Unsurprisingly, the scheme is already coming under attack through extensive advertising campaigns funded by tobacco companies and allegations of domestic and international legal violations, some of which have reached the level of formal complaints in bilateral and multilateral fora. This chapter critically analyses claims that plain packaging as envisaged by Australia would breach various agreements of the World Trade Organization. We explain in particular why the scheme is consistent with the TRIPS Agreement, the TBT Agreement, and the GATT 1994, and not covered by the SPS Agreement.They conclude that -
Our analysis ... demonstrates that Australia’s plain packaging scheme does not breach Australia’s obligations under any WTO agreement. In particular, it does not breach: TRIPS Articles 2.1 or 15.4 because those provisions concern trademark registration, whereas plain packaging affects trademark use; TRIPS Article 17 because that provision concerns exceptions to the rights conferred by trademarks, which — as indicated in TRIPS Article 16 — are negative rights to prevent use by others rather than positive rights to use trademarks; or TRIPS Article 20 because even if the scheme encumbers trademarks with special requirements, that encumbrance is justifiable and indeed justified by relevant evidence including the public health objectives of the Australian government, as borne out by the WHO FCTC and its agreed implementing guidelines. The scheme is not covered by the SPS Agreement and is consistent with the TBT Agreement because of its limited impact on trade and its contribution to the legitimate objective of protecting public health. Finally, it does not breach the GATT 1994 because it is non-discriminatory, with a limited impact on international trade and a sound public health basis.
With a bilateral investment dispute on Australia’s plain packaging initiative already underway, and a domestic constitutional claim widely anticipated, tobacco companies appear determined to make an example of the Australian government and its bold challenge to their products. They might well succeed in convincing a WTO Member to bring a WTO dispute against Australia. However, for the reasons we have explained, we believe this legal challenge would be a desperate last gasp.
