UK Court Strikes Down Tobacco Industry Challenge to Plain Packaging -- 2nd Update
May 19 2016 - 9:32AM
Dow Jones News
By Saabira Chaudhuri
LONDON--A legal challenge by the tobacco industry against plain
packaging in the U.K. has failed, opening the door for cigarette
packs to be stripped of branding across the country and setting a
precedent for other countries in Europe.
Starting Friday, any cigarettes produced for sale in the U.K.
will have to follow plain-packaging rules under which cigarettes
will be sold in uniform packs stripped of distinctive logos and
colors, and adorned with graphic health warnings. Companies will be
granted a grace period to sell their current stocks.
The U.K. parliament in March voted to ban branding on cigarette
packs starting in May 2016. In response, the tobacco industry
mounted a legal challenge, with British American Tobacco PLC,
Imperial Brands PLC, Japan Tobacco International and Philip Morris
International Inc. filing suits with the High Court in London last
summer alleging that plain packaging violates U.K. and European
law.
"Clearly, we are disappointed with today's decision, as we
believe our legal arguments are strong," said a spokesman for
Imperial. He said the company has been preparing for plain
packaging for three years and is "confident that our brands and
product portfolios are well positioned."
Tobacco companies now need to be granted permission from the
U.K. High Court to appeal the judgment.
"We believe that the judgment contains a number of fundamental
errors of law and we are applying for leave to appeal the
decision," a BAT spokesman said.
Philip Morris, however, has decided not to appeal the decision,
said General Counsel Marc Firestone, adding that the company will
focus its energy on developing reduced-risk products.
The High Court ruling comes just days after the European Court
of Justice upheld the 2014 Tobacco Products Directive, which among
other things paved the way for countries to put in place
plain-packaging laws.
"This landmark judgment is a crushing defeat for the tobacco
industry and fully justifies the government's determination to go
ahead with the introduction of standardized packaging," said
Deborah Arnott, chief executive of antismoking body Action on
Smoking and Health.
Matthew L. Myers, president of the Washington-based Campaign for
Tobacco-Free Kids, described the ruling as a "tremendous victory
for public health," adding that it "represents a critical step in
the growing movement for countries to include plain packaging as
part of their comprehensive approach to reducing tobacco use."
BAT argued that the judgment isn't a precedent for other
governments to introduce plain packaging. "No two jurisdictions are
the same and any government considering plain packaging will need
to ensure that it complies with the fundamental rights of
businesses relevant to that country, and be mindful of the World
Trade Organization dispute on plain packaging, which is still
ongoing," said the spokesman.
The governments of Indonesia, Cuba, the Dominican Republic and
Honduras have filed a challenge with the World Trade Organization
against Australia's plain-packaging laws. A decision or further
update is expected in the second half of the year.
Governments in a string of countries have been turning to plain
packaging to discourage smoking. France recently passed legislation
to require plain packaging, and that law also goes into effect
Friday. Australia, Ireland and Hungary have also passed
plain-packaging laws. A BAT lawsuit against Australia in 2012 was
unsuccessful. A total of 20 countries are looking at
plain-packaging regulation, according to Wells Fargo analyst Bonnie
Herzog. The U.S.'s free-speech laws make plain-packaging
legislation all but impossible there.
The tobacco industry argues that plain packaging doesn't
discourage young people from smoking, encourage existing smokers to
quit or increase the effectiveness of health warnings.
Public-health officials counter that brand identity--which is
communicated largely through branded packs--plays a major role in
recruiting children and young people as smokers, and that research
shows that dull, standardized packs are less attractive to
youngsters.
Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com
(END) Dow Jones Newswires
May 19, 2016 09:17 ET (13:17 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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