Tobacco lobby threatens EU over plain packaging

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EU Health Commissioner John Dalli will face legal action if he tries to reproduce Australia's plain-packaging proposals for cigarettes in Europe, a tobacco industry representative warned this week.

The Australian rules would force tobacco companies to sell cigarettes in buff packaging free of trademarks and logos but carrying dominant pictorial health warnings.

Australian senators approved the legislation today (10 November), but amendments must still be approved by the lower house before becoming law in December 2012.

Dalli is preparing an impact assessment of policy options in advance of the European Commission's own review of its 2001 Tobacco Products Directive. The review is scheduled for early next year.

Various ideas, including plain packaging, are being considered within this process and the tobacco industry, retailers and distributors, are nervous that the Maltese Commissioner will be tempted to follow the Australian example – the first of its kind. 

A spokeswoman for Dalli, himself a reformed smoker, said that the Commission has not yet made up its mind on plain packaging, but added that it was following the Australian development "carefully and with interest".

Warnings from retailers

A working group organised by the federation of tobacco retailers (CEDT) meeting in Brussels on Tuesday (8 November) blasted plain packaging and claimed that the Commission's health officials were not listening to industry or retailers on the issue.

CEDT President Giovanni Risso said that if measures such as display bans, plain packaging, oversized health warnings and bans on ingredients were introduced, these could result in a loss of up to €20 billion in European tax revenue.

Meeting representatives also said that smugglers and counterfeit manufacturers would increase their already burgeoning activity as a result of plain packaging.

One retailing representative told the meeting: "Dalli has no authority to introduce harmonisation of retail in this way using the Single Market Act, since there have been no complaints about distortions in the market. There is no competence here."

The question of legal authority was later stressed by another source close to the tobacco industry, who told EURACTIV: "We will take him to court if he tries to introduce it (plain packaging) and we are confident we would have a good case."

In Australia, British American Tobacco (BAT) said it would initiate legal action in the nation's top court in a bid to repeal the upcoming plain packaging law, claiming it is unconstitutional.

Industry getting jittery in advance of proposals

Plain packaging is one of the key areas of concern of industry, distributors and retailers as the Commission's impact assessment takes place. EURACTIV understands that a number of meetings have been arranged in Brussels for later this month in which tobacco industry representatives will discuss proposals and strategy with MEPs and consultants.

One likely focus of attack is intellectual property rights, since plain packaging has a smothering effect on companies' logos and trademarks.

A Commission spokeswoman said Brussels was in direct dialogue with the Australian government in respect of intellectual property ramifications of any plain-packaging proposal.

"The EU also asked Australia for more information on how its commitments under other WTO agreements, such as the Agreement on Trade-Related Aspects of Intellectual Property Rights, had been taken into account," she said.

"Tobacco is the largest avoidable health risk in Europe, causing more problems than alcohol, drugs, high blood pressure, excess weight or high cholesterol. It kills half of its users," said a spokeswoman for EU Health Commissioner John Dalli.

"As you know, the Commission is committed to a strong tobacco-control policy as a means to ensure a high level of public health in the EU internal market. An important objective is to prevent young people from taking up smoking."

"Although the principle of public health protection still holds, I think it is counterproductive to adopt punitive regulations towards an entire sector," said Italian MEP Paolo de Castro (Socialists & Democrats), the president of the European Parliament's agriculture committee, adding: "Especially because these would entail serious occupational, economic, fiscal and public safety consequences and would create at best no positive effects."

Giovanni Risso, who heads the European federation of tobacco retailers, or CEDT, said: "We believe we can give a qualified contribution in the current decision-making process within the context of the revision of the Tobacco Product Directive, to defend the legality of the market and in favour of adult and responsible tobacco consumption".

The first tobacco control legislation in the EU was introduced in the 1980s. Since then, EU legislation and policy has been further developed in the areas of product regulation, advertising and protecting people from second-hand smoke, as well as prevention.

Health Commissioner John Dalli is set to widen the scope of cigarette-trading rules to cover potentially harmful electronic cigarettes, flavourings and marketing strategies – potentially including plain packaging – as part of a wider campaign launched in June 2011 to urge Europeans to quit. New proposals will be unveiled early next year.

Meanwhile in Australia, with the plain-packaging plan and tax increases on cigarettes, the government is aiming to bring down smoking rates below 10% by 2018 from 16.6% in 2007.

The new rules would take effect in December 2012, but were met with fierce resistance from the tobacco industry, which argued that the proposals were indicative of a ‘nanny state', and would result in an increase in illicit trade and the activity of crime syndicates.

Australian Health Minister Nicola Roxon said that she believed that the government was "on very strong ground" legally, and was willing to defend the measures in court.

Roxon introduced the plain-packaging bill to the Australian Parliament in July, and it passed through Australia's lower house in late August and the Senate on 10 November.

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