1. Plain packaging: Australia’s World First Kylie Lindorff Policy Manager Effective Implementation of FCTC Policies WCOTH - Singapore 19 March 2012

2. Presentation outline Context for plain packaging Government announcement Key features of the legislation Legal challenges

3. Context for plain packaging

4. World Health Organisation FCTC The Framework Convention on Tobacco Control (FCTC) Guidelines for Articles 11 and 13, adopted in November 2008, recommend Parties consider adopting plain packaging Guidelines for implementation of Article 11 (Packaging and labelling of tobacco products) “Parties should consider adopting measures to restrict or prohibit the use of logos, colours, brand images or promotional information on packaging other than brand names and product names displayed in a standard colour and font style (plain packaging).” Guidelines for implementation of Article 13 (Tobacco advertising, promotion and sponsorship) “Parties should consider adopting plain packaging requirements to eliminate the effects of advertising or promotion on packaging.”

5. Plain packaging: a key recommendation of Preventative Health Taskforce Rationale i.‘Smoking is so harmful that no manufacturer... today would succeed in getting cigarettes on the market’ ii.‘With restrictions on other forms of marketing, the branding and design of cigarette packs is now the primary means by which tobacco companies communicate brand image.’ iii.‘Research shows that removing the design elements changes how...packs are perceived, including attitudes to those who smoke that brand and the quality of cigarettes in the packs.’ Source: Tobacco Working Group. Technical report no. 2. Tobacco in Australia: making smoking history. Canberra: National Preventative Health Taskforce, 2008. Available from: http://www.preventativehealth.org.au/internet/preventativehealth/publishing.nsf/Content/tech-tobacco

6. Government commitment to introduce plain packaging

7. Plain packaging announced: 29 April 2010 In response to recommendations from the Preventative Health Taskforce, Commonwealth Government stated it would: i.legislate to mandate plain packaging from 1 January 2012 with full implementation from 1 July 2012* ii.conduct research in 2010 to determine the optimal pack design Rudd K, Swan W and Roxon N. Prime Minister, Treasurer, Minister for Health. Anti-Smoking Action. [Media release]. Canberra: Office of the Prime Minister, 29 April 2010 [viewed 3 September 2010]. Available from: http://www.alp.org.au/federal-government/news/anti-smoking-action/http://www.alp.org.au/federal-government/news/anti-smoking-action/ * The implementation date was later amended to 1 December 2012

8. Objectives of plain packaging (a) reduce the appeal of tobacco products to consumers

9. Objectives of plain packaging (b) increase the effectiveness of health warnings on the retail packaging of tobacco products

10. Objectives of plain packaging (c) reduce the ability of the retail packaging of tobacco products to mislead consumers about the harmful effects of smoking or using tobacco products.

11. Government research on pack design The Australian Government undertook a series of 7 studies between December 2010 and March 2011 (reports at URL below) The overall aim was to assess the optimal combination of plain packaging design elements: –colours for plain packaging; –font style and font size for brand name; and –graphic health warning design (size and layout) The research sought to identify one plain packaging design (colour, font type, font size) that would minimise appeal and attractiveness of the pack, whilst maximising perceived harm and the noticeability of the graphic health warnings. http://www.yourhealth.gov.au/internet/yourhealth/publishing.nsf/Content/mr-plainpack

12. Key Features Tobacco Plain Packaging Act 2011 and Tobacco Plain Packaging Regulations 2011

13. Key features – what packaging? The legislation will affect any box, bag or other container that a tobacco product is packed in at the point of retail sale, including cartons available for retail sale. It will not affect larger wholesale cartons or shipping containers

14. Key features – cigarette packs The packs will be a particular shade of drab dark brown in matt finish (Note: NOT olive green!) The packs will not have any tobacco industry logos, colours, brand imagery or promotional text other than brand and variant names. Brand names will appear on the top, bottom and front of the pack in a standard colour, position, font style and size.

15. Key features – cigarette packs Packs will be required to be a standard rectangular shape with a standard flip-top opening. The dimensions of packs will be limited with a maximum and minimum size stipulated Packs must be made of cardboard and be rigid (no soft packs)

16. Key features – cigarette packs Packs may carry an ‘origin mark’ (to assist with identification of illicit tobacco products) in the form of: – an alphanumeric code; or –a covert mark that is not visible to the naked eye Alphanumeric code must not: –Obscure any relevant legislative requirements (eg. GHWs) –Constitute tobacco advertising or promotion –Provide access to tobacco advertising or promotion

17. Key features – updated graphic health warnings Graphic health warnings will be expanded to cover 75% of the front of the pack, up from the current 30% All packs must carry the new GHWs from 1 December 2012 GHWs will be implemented through the Australian Consumer Law. Examples of new GHWs: Front of pack (75%) Back of pack (90%)

18. Key features – cigarette sticks Cigarette sticks will be limited to either plain white, or plain white with an ‘imitation cork’ filter tip No branding, other colours or design features will be permitted An alphanumeric code will be permitted in a standard position, font size and colour and must not constitute advertising or promotion

19. Key features: non-cigarette tobacco products Design features for roll-your-own (loose) tobacco, cigarillos and cigar packaging will be broadly the same as for cigarette packs. Drab dark brown No logos, colours, brand imagery or promotional text other than brand and variant names. Brand names will appear a standard colour, position, font style and size All non-cigarette products must be sold in compliant packaging, including individual cigars.

20. Key features: Cigars Individual cigars may have a band as long as it complies with the following: Drab dark brown in colour Brand, company, business and variant name in specified font style, size and colour Compliant bands may be stuck over existing bands

21. Tube for single sale cigar RYO tobacco pouch Cigarillo/ cigar tin Bag for multiple cigars

22. Imported tobacco products Products may be imported into Australia in non- compliant packaging but must be repackaged into compliant packaging before being offered for retail sale.

23. Penalties Penalties apply for the manufacture, sale/supply and purchase of non-compliant retail packaging of tobacco products and/or non-compliant tobacco products The legislation does not apply to individuals who purchase tobacco products for their personal use, whether or not the products comply with plain packaging requirements.

24. Implementation dates 1 January 2012 – legislation and regulations will be in place 1 October 2012 – all packs manufactured must comply with plain packaging requirements 1 December 2012 – all packs for sale must comply with plain packaging requirements (original dates were:20 May 2012 for manufacturing and 1 July 2012 for sale)

25. Legal challenges

26. WTO forum Countries opposed: Ukraine, Dominican Rep, Mexico, Nigeria, Colombia, Chile, Honduras, Turkey, Indonesia, Zambia, El Salvador, Zimbabwe, Nicaragua, Jordan, and Russia (an observer). Chile opposed in relation to cigars Countries non-committal: EU, Japan and Hong Kong China Countries in support: Norway, Uruguay and New Zealand

27. WTO forum – Ukraine challenge On 13 March 2012 Ukraine submitted a request to WTO for formal consultation A compulsory 60 day consultation period has begun in which the 2 parties will try to negotiate a settlement If there is no settlement after 60 days, the Ukraine may request the establishment of a WTO dispute panel to rule on its claim

28. Industry legal action: Bilateral Investment Treaty Philip Morris Asia 27 June 2011: Served notice of claim under the 1993 bilateral investment treaty with Hong Kong against Australia, triggering a three month mandatory negotiation period between PMA and the Australian Government 21 November 2011: PMA served a notice of arbitration under the Hong Kong 1993 bilateral investment treaty

29. Industry legal action: Bilateral Investment Treaty Australian Government Response 21 December 2011: ''Philip Morris Asia acquired its shares in Philip Morris Australia on 23 February, 2011, both in the full knowledge that the decision had been announced by the Australian government to introduce plain packaging, and also in circumstances where various other members of the Philip Morris group had repeatedly made clear their objections … [which] had not been accepted by the government.''

30. Industry legal action: Constitutional challenges a. British America Tobacco Australasia Limited 1 December 2011: “…the TPP legislation is unconstitutional and invalid due to the fact the Federal Government is trying to acquire our valuable intellectual property without compensation” ˆ b. Imperial Tobacco Australia Limited 6 December 2011: “…the Taking of the Plaintiff’s Property Rights and the receipt of the Benefits would constitute an acquisition of property otherwise than on just terms….” ^ (1 December 2011 British American Tobacco) http://www.plainpack.com/news

31. Industry legal action: Constitutional challenges c. JT International SA (Japan Tobacco) 15 December 2011: “The provisions of the Act…constitute an acquisition of the Plaintiff’s property otherwise than on just terms,…are wholly invalid and are of no effect” d. Philip Morris Limited 20 December 2011: “…the operation of the Act, ….result in an acquisition of the Plaintiff’s property….and do not provide just terms for the acquisition…” HIGH COURT HEARING SET FOR 17-19 APRIL 2012

32. Australian Government response * Department of Health Ageing. Senate Passes World First Plain Packaging of Tobacco Legislation. Media release Nov 10, 2011 http://www.health.gov.au/internet/ministers/publishing.nsf/Content/mr-yr11-nr-nr238.htm?OpenDocument&yr=2011&mth=11 http://www.health.gov.au/internet/ministers/publishing.nsf/Content/mr-yr11-nr-nr238.htm?OpenDocument&yr=2011&mth=11 “Big tobacco has made it clear that it will fight the Government…as it has with each step Australia has taken to introduce tobacco control…the Government is not intimidated by big tobacco and is determined to act in the best interests of the health and wellbeing of the Australian people” Minister Roxon, 10 November 2011*

33. A WORLD FIRST !