March 10 — Indonesia will join Honduras and Ukraine in seeking a World Trade Organization panel ruling on whether Australia’s tough plain-packaging rules for tobacco products violate global trade rules.
In a notification circulated by the WTO March 6, Indonesia said it would request the establishment of a WTO dispute panel to rule on its claims that the Australian measures violate provisions under the WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) and Agreement on Technical Barriers to Trade (TBT) by imposing restrictions on the use of trademarks, geographical indications and other markings.
Indonesia initiated its complaint in September by requesting WTO consultations with Australia on the issue, and the talks took place Oct. 29. Indonesia said these talks “clarified certain issues pertaining to this matter, but failed to resolve the dispute,” thus prompting the request for a panel.
The request will be taken up at a meeting of the WTO’s Dispute Settlement Body (DSB) on March 26.
Indonesia’s move is the latest indication that critics of plain packaging may be ramping up their efforts against the Australian rules, which ban the sale of tobacco products with their usual logos. Brand names can be placed only on the lower part of the front and the top and bottom of the package, and the names must be in a standard font style, size and color.
The restrictions took effect on Dec. 1, 2012.
Honduras and Ukraine, which have already secured the establishment of WTO panels to rule on their separate complaints against the plain-packaging measures, met with Australian counterparts March 5 for a fourth round of talks on the selection of a single three-member panel to examine their complaints.
Cuba and the Dominican Republic have also initiated WTO proceedings against the Australian rules but have not yet requested the establishment of panels.
Broader Implications
The dispute has implications for other countries such as Ireland, New Zealand and the U.K., which are considering similar plain-packaging restrictions. U.S. business groups such as the U.S. Chamber of Commerce, the National Association of Manufacturers, the United States Council for International Business and the National Foreign Trade Council have criticizing plain packaging for what they say is the destruction of an entire industry’s legitimate rights to trademark protection and branding.
The complainants charge that the requirements violate various provisions under TRIPs, including Article 20. The article states that the use of a trademark in the course of trade “shall not be unjustifiably encumbered by special requirements, such as use with another trademark, use in a special form, or use in a manner detrimental to its capability to distinguish the goods or services of one undertaking from those of other undertakings.”
The WTO complainants also charge the measures violate the TBT Agreement because they are more trade-restrictive than necessary to achieve Australia’s stated objective of reducing the attractiveness and appeal of tobacco products to consumers, particularly the young.
Health advocates, including World Health Organization Director-General Margaret Chan, have come to Australia’s defense, arguing that the WHO’s 2003 Framework Convention on Tobacco Control gives countries the right to impose restrictions on tobacco packaging in order to promote public health objectives.
