21 Nov, 2011

The Australian government is being sued by Philip Morris, the tobacco company, over its new law which will require all tobacco packaging to be plainly packaged, and devoid of any branding.


The tobacco giant claims that the law breaches a bilateral investment treaty and that by removing branding from the packaging, will have a negative impact on profits and possibly will increase the amount of fake brands seeping into the cigarette market.


The law will come into effect from next month and will see the plain packaging display graphic health warnings about the effects of tobacco.


According to the BBC, Philip Morris Asia has served a notice of arbitration under Australia’s Bilateral Investment Treaty with Hong Kong, and the company’s Australian affiliate, Philip Morris Ltd (PML), is also set to pursue claims under Australia’s domestic law. The company has said that it wants the law to be suspended and said it will ask for considerable compensation to cover the billions of dollars that the law would cost it.


When passed, the Australian government said that the legislation was ‘one of the most momentous public health measures in Australia’s history’, but Philip Morris spokeswoman, Anne Edwards, feels quite differently, and said: “The government has passed this legislation despite being unable to demonstrate that it will be effective at reducing smoking and has ignored the widespread concerns raised in Australia and internationally regarding the serious legal issues associated with plain packaging.”


Australia’s Minister for Health and Ageing, Nicola Roxon, said that the government is ‘fighting to protect lives’ while the tobaccos industry is only ‘fighting to protect profits’.


She said: “We know that packaging remains one of the last powerful marketing tools for tobacco companies to recruit new smokers to their deadly products. In the future, cigarette packets will serve only as a stark reminder of the devastating health effects of smoking.”


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