A landmark decision last month regarding the investor-state challenge that Philip Morris ("Asia") brought against Australia's tobacco plain packaging law should clear the air for plain packaging legislation to proceed in New Zealand. The Government ought to ensure this legislation is brought before Parliament with all speed in order to protect the health of New Zealand children.
Philip Morris was using an Investor-State Dispute Settlement process to argue that Australia's law was an expropriation or takeover of their investments, interpreted as their logo and cigarette packaging. Philip Morris had shifted its assets to Hong Kong immediately before launching the challenge under the Australia-Hong Kong trade agreement (1983). Although the details of the decision have not been released, it appears this extraordinary procedure was found to "constitute an abuse of rights". This renders unnecessary the second phase of the hearing to estimate whether Australia's legislation expropriated Philip Morris' investments and what compensation was payable if so (it is believed the claim was for billions of dollars).
The aggressive approaches against plain packaging legislation confirm the centrality of the packaging in the marketing and promotion strategies of the tobacco industry. The package is pivotal in maintaining the demand for tobacco, and makes quitting harder. Tobacco companies could not sue for loss of investments if the legislation did not affect sales.
The logic to legislate for plain packaging of tobacco, then, is to reduce the promotional value of the pack and so to reduce tobacco uptake by young people, and aid quitting. Plain packaging legislation has progressed from Australia to UK and Ireland, and France is now considering it. However, it was recommended 26 years ago to the NZ Minister of Health (then Helen Clark), by Murray Laugesen, of the Department of Health, and R. Matthews, chairman of the Toxic Substances Board.
Progress towards legislation since then has been extremely slow. Although it was being considered in 2013, Prime Minister John Key stated then that the Government would wait to see the outcome of challenges against Australia before proceeding. The first reading of the Smoke-free Environments (Tobacco Plain Packaging) Amendment Bill took place in February 2014, the Health Committee reported on August 5, 2014, recommending the bill be passed with amendments. There has been no word of progress since. The Committee noted that in Australia after legislation, "daily smoking rates among people aged 14 and older have declined from 15.1 per cent in 2010 to 12.8 per cent in 2013, the lowest rate recorded to date", and "tobacco clearances (including excise and customs duty) fell by 3.4 per cent in 2013 relative to 2012 when tobacco plain packaging was introduced".
