Saturday, October 11, 2014



One of the world's largest tobacco companies is threatening to sue the Government for billions of pounds in compensation if it makes plain cigarette packaging compulsory.

Philip Morris International, which makes the Marlboro brand, said it was prepared to "seek fair compensation" in the British courts if the plans go ahead. It claims that its branding would be damaged by the new law.

In its submission to the Government's six-week consultation on the proposals, which ended last week, the firm said: "PMI is prepared to protect its rights in the courts and to seek fair compensation for the value of its property." It added that this could amount to "billions of pounds".

The company, which is in the process of suing the Australian government for introducing a similar law in 2012, added: "Standardised packaging is a euphemism for government-mandated destruction of property. It is unlawful, disproportionate, and at odds with the most basic requirements of the rule of law."

The Government decided to introduce plain packaging after a major study concluded that the move was very likely to have a positive impact on public health. Public Health England has said that the evidence in its favour is "irrefutable".

However, the introduction of the new law has been beset by delays, which critics have suggested have been caused by lobbying on the part of the tobacco industry. Ministers may now struggle to gain EU approval for plain packaging before next year's general election.

A Department of Health spokesperson said: "We want the decision on whether to introduce standardised packaging of tobacco products to be fully informed. This is why we have held a final short consultation to hear any new evidence. We will consider all responses carefully and respond in due course."


On 1 December 2011, the Tobacco Plain Packaging Act 2011 (the Act) received Royal Assent and became law in Australia.

The Act forms part of a comprehensive range of tobacco control measures to reduce the rate of smoking in Australia and is an investment in the long term health of Australians.

Smoking is one of the leading causes of preventable death and disease in Australia.

Tobacco plain packaging is a legitimate public health measure which is based on a broad range of peer reviewed studies and reports, and supported by leading Australian and international public health experts. Further information regarding the implementation of tobacco plain packaging is available on the Department of Health's website.

Philip Morris Asia is challenging the tobacco plain packaging legislation under the 1993 Agreement between the Government of Australia and the Government of Hong Kong for the Promotion and Protection of Investments (Hong Kong Agreement). This is the first investor-state dispute that has been brought against Australia.

Philip Morris Asia is arguing that Australia's tobacco plain packaging measure constitutes an expropriation of its Australian investments in breach of Article 6 of the Hong Kong Agreement. Philip Morris Asia further argues that Australia's tobacco plain packaging measure is in breach of its commitment under Article 2(2) of the Hong Kong Agreement to accord fair and equitable treatment to Philip Morris Asia's investments. Philip Morris Asia further asserts that tobacco plain packaging constitutes an unreasonable and discriminatory measure and that Philip Morris Asia's investments have been deprived of full protection and security in breach of Article 2(2) of the Hong Kong Agreement. Australia rejects these claims.

This webpage will be updated regularly to provide information on relevant developments.

Details at Government of Australia site:

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