Australia’s highest court upheld the world’s toughest law on tobacco promotion today, despite protests from tobacco companies fearing for the value of their trademarks under new rules that will strip all logos from cigarette packs.
The decision by the High Court means that from December, tobacco companies will no longer be able to display their distinctive colours, brand designs and logos on cigarette packs.
The packs will instead come in a uniformly drab shade of olive and feature graphic health warnings and images of cancer-riddled mouths, blinded eyeballs and sickly children. The government hopes the new packs will make smoking as unglamorous as possible.
“This is a victory for all those families who have lost someone to a tobacco-related illness. For anyone who has ever lost someone, this is for you,” attorney general Nicola Roxon and health minister Tanya Plibersek said in a joint statement.
“No longer when a smoker pulls out a packet of cigarettes will that packet be a mobile billboard.”
British American Tobacco, Philip Morris International, Imperial Tobacco and Japan Tobacco International fear the law will set a global precedent that could slash billions from the values of their brands. They challenged the new rules on the grounds that they violated intellectual property rights and devalued their trademarks.
The cigarette makers argued that the government would unfairly benefit from the law by using cigarette packs as a platform to promote its own message, without compensating the tobacco companies. Australia’s constitution says the government can only acquire the property of others on “just terms”.
The court, which ordered the tobacco companies to pay the government’s legal fees, withheld its reasons for the judgment on Wednesday. They’ll be released later this year.
British American Tobacco spokesman Scott McIntyre said the company was disappointed in the court’s decision, but would obey the law.
“Although the (law) passed the constitutional test, it’s still a bad law that will only benefit organised crime groups which sell illegal tobacco on our streets,” Mr McIntyre said.
“... The illegal cigarette black market will grow further when all packs look the same and are easier to copy.”
Imperial Tobacco echoed that argument.
“Plain packaging will simply provide counterfeiters with a road map,” spokeswoman Sonia Stewart said. “The legislation will make the counterfeiters’ job both cheaper and easier by mandating exactly how a pack must look.”
Australia’s health minister dismissed those claims, saying there are still measures to prevent counterfeiting, such as the use of alphanumeric codes on legitimate cigarette packs.
“There are all sorts of counterfeiting operations around the world,” Ms Plibersek said. “The fact that this packaging looks like this now doesn’t make it easier to counterfeit.”
Jonathan Liberman, director of the McCabe Centre for Law and Cancer, said outside the court that the ruling would inspire other countries to take the same measures against tobacco companies.
“It shows to everybody that the only way to deal with tobacco industry’s claims, sabre rattling and legal threats is to stare them down in court,” he said.
“It’s a fantastic decision for public health in Australia.”
In a statement, British American Tobacco said: “We are extremely disappointed by the decision of the Australian High Court and remain convinced that the Tobacco Plain Packaging Act is not only a bad piece of law, but that it is one that will have many unintended consequences for years to come.
“It is important to remember that the scope of the High Court proceedings was tightly focused on addressing whether plain packaging legislation is contrary to a very specific point in the Australian constitution. As such, today’s decision only concerns Australian constitutional law.
“In addition, this decision is wholly separate from the various other investment and trade-related disputes which Australia is currently facing as a result of introducing the Tobacco Plain Packaging Act.
“These include Australia’s World Trade Organisation dispute with Honduras, Dominican Republic and Ukraine, and the claim Australia is facing for breaching its Bilateral Investment Treaty with Hong Kong.
“We fully support any form of evidence-based regulation but there is no proof to suggest plain packaging of tobacco products will be effective in discouraging youth initiation or encouraging cessation by existing smokers.
“In fact, plain packaging would only exacerbate an already significant illicit tobacco trafficking problem, and would have other significant adverse unintended consequences including driving down prices which would lead to increased smoking while reducing government tax revenue.
“British American Tobacco will continue to take every action necessary to protect our valuable brands and our right to compete in global markets as a legitimate commercial business selling a legal product, based on the full legal use of our intellectual property rights.”