Wednesday, November 16, 2011

Tobacco Plain Packaging


The issue of the plain packaging legislative measure of Australia on tobacco products have been questioned by different countries in various fora of the WTO. While it has been questioned as contravening the TRIPS obligations as well as Technical Barriers to Trade (TBT) Agreement obligations, this post relates to the TBT Agreement.

The background to this issue is that the Australian Government (as per its website) announced that :

" In April 2010 the Australian Government announced that, in a world first, all tobacco products sold in Australia would be required to be sold in plain packaging by 1 July 2012.

The Government’s legislative proposal on plain packaging aims to prevent tobacco advertising and/or promotion on tobacco product packaging in order to:reduce the attractiveness and appeal of tobacco products to consumers, particularly young people; increase the noticeability and effectiveness of mandated health warnings; reduce the ability of the tobacco product packaging to mislead consumers about the harms of smoking; and through the achievement of these objectives in the long term, as part of a comprehensive suite of tobacco control measures, contribute to efforts to reduce smoking rates."

Introduced with the Trade Marks Amendment (Tobacco Plain Packaging) Bill 2011, the bill prevents tobacco advertising and promotion on tobacco products and tobacco product packaging by making it an offence to sell, supply, purchase, package or manufacture tobacco products or packaging for retail sale that are not compliant with plain packaging requirements.

The Objects of this Bill in the proposed Section 3 of the Bill states:
 " 3. Objects of this Act
(1) The objects of this Act are:
(a) to improve public health by:
(i) discouraging people from taking up smoking, or using tobacco products; and
(ii) encouraging people to give up smoking, and to stop using tobacco products; and
(iii) discouraging people who have given up smoking, or who have stopped using tobacco products, from relapsing; and
(iv) reducing people’s exposure to smoke from tobacco products;
 and
 (b) to give effect to certain obligations that Australia has as a party to the Convention on Tobacco Control.
(2) It is the intention of the Parliament to contribute to achieving the objects in subsection by regulating the retail packaging and appearance of tobacco products in order to:
 (a) reduce the appeal of tobacco products to consumers; and
 (b) increase the effectiveness of health warnings on the retail packaging of tobacco products; and
 (c) reduce the ability of the retail packaging of tobacco products to mislead consumers about the harmful effects of smoking or using tobacco products."

The relevant provisions as per the TBT Agreement of the WTO in relation to technical barriers to trade are:

" Technical Regulations and Standards Article 2: Preparation, Adoption and Application of Technical Regulations by Central Government Bodies
With respect to their central government bodies:

... 2.2 Members shall ensure that technical regulations are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to international trade. For this purpose, technical regulations shall not be more trade-restrictive than necessary to fulfil a legitimate objective, taking account of the risks non-fulfilment would create. Such legitimate objectives are, inter alia: national security requirements; the prevention of deceptive practices; protection of human health or safety, animal or plant life or health, or the environment. In assessing such risks, relevant elements of consideration are, inter alia: available scientific and technical information, related processing technology or intended end-uses of products. ..."

The TBT Agreement basically says that technical regulations must not be imposed by member countries with a "view to or with the effect of creating unnecessary obstacles to international trade". It further states "technical regulations shall not be more "trade-restrictive than necessary to fulfil a legitimate objective, taking account of the risks non-fulfilment would create".
Hence, essentially the issue is whether the Australian measure of mandating plain packaging for all tobacco products is an "unnecessary obstacles to international trade". Is it more trade-restrictive than necessary to fulfil a legitimate objective, taking account of the risks non-fulfilment would create? In assessing such risks whether relevant elements of consideration like available scientific and technical information was utilised? The countries objecting to the measure "challenged Australia’s scientific evidence. They said Australia’s measures will therefore restrict trade unnecessarily (a key issue in TBT) because the public health objective — which they support —can be met by other means. The argued that plain packaging will cause confusion among consumers because trademarks will not be available for them to distinguish between products, and will encourage smuggling."

The "legitimate objective" could definitely be protection of human health. However whether it is justified on the grounds of being sufficiently "trade-restrictive" to fulfil a legitimate objective needs to be analysed.

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