British American Tobacco challenges Australia packaging laws

1st December 2011, Comments 0 comments

British American Tobacco on Thursday launched a High Court challenge against Australia's plain packaging law for cigarettes, claiming it infringes intellectual property rights.

The proceedings will act as a "test case" on the validity of the legislation relating to property rights of two of its brands, Winfield and Dunhill, the company said.

"If we're successful the decision should apply to other property and brands sold by BAT," it said in a statement.

BAT says it is a legal company selling a legal product and it is both unconstitutional and invalid for the government to remove its trademarks and other intellectual property without compensation.

Under the ground-breaking law, all tobacco products sold in Australia will need to be in plain packaging from December 1, 2012.

Cigarettes will be sold in drab, olive-brown packets with large, graphic health warnings showing diseased body parts and sick babies, while brand imagery and promotional text will be banned.

The government says tobacco use costs the country more than Aus$30 billion (US$29 billion) a year in healthcare and lost productivity.

But the proposal to remove all logos and to print company names in uniform font has angered tobacco firms, who say it will cut profits and see fake products flood the market because plain packaging is easier to reproduce.

Earlier this month, fellow global tobacco giant Philip Morris said it was seeking to suspend the law and wanted substantial compensation for the loss of trademarks.

BAT spokesperson Scott McIntyre said Canberra had left it no option.

"Obviously wed rather not be in a situation where were forced to take the government to court, but unfortunately for taxpayers the government has taken us down the legal path," he said.

"Health Minister (Nicola) Roxon will now waste millions of taxpayers' dollars on legal fees defending plain packaging even though she has said herself there is no proof it will reduce smoking rates.

"As a legal company selling a legal product we have consistently said we will defend our valuable intellectual property on behalf of our shareholders as any other company would."

BAT argue that the legislation would see the black market boom with taxpayers missing out on billions of dollars in excise duties, while organised crime gangs would make a fortune.

"Worse still, cheaper more accessible illegal tobacco will actually increase smoking rates, which is the opposite effect to what the minister is hoping to achieve," said McIntyre.

But Roxon vowed that Australia would not cave in to the pressure.

"(Cigarette firms) have fought governments tooth and nail around the world for decades to stop tobacco control," she said in a statement.

"Let there be no mistake, big tobacco is fighting against the government for one very simple reason -- because it knows, as we do, that plain packaging will work."

Although Australia would be the first country to mandate plain packaging, New Zealand, Canada and Britain have considered a similar approach and are watching developments.

Anti-smoking group Quit called BAT's move "desperate".

"What we are seeing is a tobacco industry completely on the ropes," said Quit executive director Fiona Sharkie.

"It is pulling out any dirty trick or tactic in an attempt to undermine this important legislation which will prevent countless Australians from becoming addicted to their deadly products in the future."

© 2011 AFP

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