What the WTO decision on plain packaging means for developing countries

A graphic health warning on a cigarette pack. Photo by: Eli Duke / CC BY-SA

CANBERRA — Australia’s introduction in 2010 of plain packaging to tackle cigarettes and their associated health challenges led to strong backlash from the tobacco industry, bringing an international dispute to a panel of World Trade Organization judges. Tasked with delivering findings on whether plain packaging impedes intellectual property rights or creates a technical barriers to trade, the WTO panel delivered their ruling on June 28, saying that the health outcomes of the measure far outweighed any business impacts.

The decision has major impacts for developing countries looking to battle the array of noncommunicable diseases associated with smoking.

“Overall, we find that the complainants have not demonstrated that the TPP [tobacco products  and packaging] measures are not apt to make a contribution to Australia's objective of improving public health by reducing the use of, and exposure to, tobacco products,” the report said. “Rather, we find that the evidence before us, taken in its totality, supports the view that the TPP measures, in combination with other tobacco-control measures maintained by Australia (including the enlarged GHWs [graphic health warnings] introduced simultaneously with TPP), are apt to, and do in fact, contribute to Australia's objective of reducing the use of, and exposure to, tobacco products.”

While the findings did not come as a surprise, the strong words on health benefits did. And although the decision could face an appeal, legal experts believe this ruling provides developing countries with the confidence that the plain packaging battle is one that the tobacco industry cannot win — and provides encouragement to move ahead confidently in implementing plain packaging as part of national health programs combating NCDs.

WTO’s stance

The dispute was first brought to WTO in 2013 by Indonesia, and was followed by cases brought by Ukraine, Honduras, Dominican Republic, and Cuba.

The WTO process requires consultation between the parties which was not resolved — and in May 2014 panelists were appointed to hear the arguments. Jonathan Liberman from the McCabe Centre for Law and Cancer who works to reduce the global burden of cancer and other NCDs through the effective use of law, explained to Devex that WTO’s role is not just to focus on trade.

“You do get this narrative of trade versus health — but it is not binary like this at all,” he said.

Social issues including health were a priority in deciding on rulings, considering wider impacts to communities. And in their 888 page report, WTO provided strong wording on the health benefits of plain packaging and the dangers of both smoking and tobacco advertising.

On the dangers of smoking, WTO says that it is “widely recognized, and undisputed in these proceedings, that the public health consequences of the use of, and exposure to, tobacco, including in Australia, are particularly grave.”

The report further highlights the influence and messaging the tobacco industry’s preferred packaging conveys, pointing out its particular appeal for youth.

“[T]he evidence before us supports the view that the imagery and associations, with which tobacco products may be imbued by virtue of their packaging, are of such a nature as to engender a belief that their use will attribute certain qualities to the user, and that adolescents are particularly vulnerable to acting on the basis of such beliefs by virtue of the nature of adolescent decision-making processes, as summarized above.”

Response to the report

The arguments brought to WTO against plain packaging were arguments of the tobacco industry, with those of third parties acting on their behalf.

Kelly Henning, head of Bloomberg Philanthropies’ public health programs, considered the ruling an important fight against the tobacco industry.

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“It sends a message to tobacco companies worldwide that they can and will be defeated, and it helps create a roadmap for other countries to implement plain packaging laws, a strategy that is proven to decrease use of tobacco products,” she said. “Bloomberg Philanthropies applauds the WTO for its decision and will continue to champion efforts like this to implement proven tobacco control policies and help combat the global tobacco epidemic.”

For Liberman, the findings are unsurprising. “It’s what’s been expected since the beginning,” he said.

But it is still an important finding to support health advocacy — especially in the developing world.

“There is a lot good material in the report to support us,” Liberman added.

WTO, he said, confirmed that plain packaging was no more trade restrictive than necessary for a legitimate public health measure. “That is the main thrust.”

A future appeal?

It is hoped that this will be the end of legal challenges against plain packaging. Yet the possibility does exist that one of the four countries that brought action against Australia could appeal the decision. Liberman explained that any action would not be a rehearing but an appeal on matters of law linked to the decision. No new evidence can be presented.

In addition, with the United States blocking the appointment of judges to WTO’s appellate body, any appeal could take longer than five years to resolve.

That is a move that could dissuade countries from taking on the plain packaging battle until it has reached its full conclusion — and drag out the debate well into the next decade, while continuing to cost lives.

To date, plain packaging has been adopted in seven countries — Australia, France, the United Kingdom, Norway, Ireland, New Zealand, and Hungary. Unsurprisingly, these are developed countries that can afford to challenge the tobacco industry.

“The [tobacco] industry’s litigation strategy is a combination of threats and actual cases,” Liberman said. “They try to dissuade countries from legislating, or at least to wait, wait, wait. A number of countries are facing, or have faced domestic cases. And this can often be expensive and resource intensive to defend.”

Nine other countries are currently progressing plain packaging laws or regulations — Slovenia, Romania, Georgia, Thailand, Uruguay, Singapore, Canada, Sri Lanka, and South Africa. And plain packaging is under formal consideration in Belgium, Panama, Ecuador, Chile, Turkey, Taiwan, Jersey, Guernsey, Nepal, and Finland.

Expressions of support to implement plain packaging have also been made by the governments of Malaysia, Mauritius, Kenya, Gambia, Botswana, and Burkina Faso.

But the likelihood of any appeal delivering a ruling against WTO’s plain packaging is unlikely — regardless of holdups in personnel.

“I don’t think anyone believes they will win in an appeal,” Liberman said.

The next steps for developing countries

For Liberman, the WTO report “demolishes” another set of claims by the tobacco industry to challenge plain packaging. And despite the messaging to date being that countries should progress with new antitobacco measures including plain packaging with the anticipation of the outcome delivered, he believes it will build confidence of governments globally that the law has their back.

The work of the McCabe Centre includes supporting developing countries in understanding the harms of tobacco, the social and economic costs, as well as sharing their knowledge of how to use the law as a tool to respond to threats and legal challenges the tobacco industry makes.

"And examples of countries that have won their cases have confirmed the space they have to regulate for public health," Liberman said.

The tobacco industry’s arguments to dissuade countries from plain packaging are generally a variant of the same three, Liberman explained.

“Number one is that it is an infringement of their intellectual property rights. Two would be that it is an infringement of their freedom of commercial expression. And three, in some places there is a constitutional or other rights to enterprise or doing business. They make other procedural challenges, suggesting the regulations aren’t supported by legislation they are purportedly made under, or the industry was denied due process in the decision to legislate.”

The responses to these, Liberman said, can vary according to the protections in each jurisdiction.

“For intellectual property, there is no right to use it, and in any case, the use of intellectual property can be limited for other interests including public health — the government can regulate your use of trademarks,” he said. “With commercial expression, this is not always protected, but again, government can limit expression — especially when it is doing harm. You don’t have the right to express yourself however you want.”

And while organizations such as the McCabe Centre have been anticipating the WTO findings and encouraging countries to progress with plain packaging measures, having the final ruling makes their job as advocates easier.

“We’ve been running international legal training programs since the beginning of 2014, when the WTO challenges had already commenced,” Liberman said.

The McCabe Centre is following the ruling by supporting workshops in Thailand later this month, the Asia-Pacific Conference on Tobacco or Health in September, as well as hosting a workshop in Melbourne in November to discuss the WTO decision and its implications, with developing countries in attendance.

For developing countries, the next step is to take a stronger approach against the tobacco industry, to tackle the growing challenge of NCDs.

For more coverage of NCDs, visit the Taking the Pulse series here.

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  • %25257b6eb61a8f df39 4ae1 bb29 9056d33aa739%25257d

    Lisa Cornish

    Lisa Cornish is a Devex Reporter based in Canberra, where she focuses on the Australian aid community. Lisa formerly worked with News Corp Australia as a data journalist for the national network and was published throughout Australia in major metropolitan and regional newspapers, including the Daily Telegraph in Melbourne, Herald Sun in Melbourne, Courier-Mail in Brisbane, and online through news.com.au. Lisa additionally consults with Australian government providing data analytics, reporting and visualization services. Lisa was awarded the 2014 Journalist of the Year by the New South Wales Institute of Surveyors.