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The Good and Bad of Australia’s Plain Packaging

Other countries may follow with graphic warning labels; will it affect U.S. retailers?

CANBERRA, AUSTRALIA -- Last week the High Court of Australia upheld the Plain Packaging Act after major manufacturers such as Philip Morris International and British American Tobacco challenged the law, claiming it would violate intellectual property rights and therefore was unconstitutional.

The Australian court disagreed and released the following statement: "At least a majority of the court is of the opinion that the Act is not contrary to [Australia's constitution].”  Beginning Dec. 1, 2012, the law will require cigarette and tobacco products to be sold in plain green packages featuring graphic images of the health hazards caused by smoking—making Australia the first country to successfully ban tobacco brand logos.

While the success of the Plain Packaging Act will certainly affect those who do business in Australia, many believe it will also have global ramifications. According to Australian Attorney General Nicola Roxon, Britain, Canada and New Zealand are considering similar legislation; China, South Africa and the European Union have followed the case with interest.

“With so many countries lined up to ride on Australia's coattails, what we hope to see is a domino effect for the good of public health,” said Margaret Chan, director general of the World Health Organization, in a prepared statement.

The good news for U.S. tobacco retailers is that such measures are unlikely to pass locally—especially considering previous attempts have all been found unconstitutional.

The New York Association of Convenience Stores (NYACS) was at the forefront of one of the most recent battles, in which New York City attempted to mandate that cigarette retailers display signs containing graphic health warnings. Both the district and appellate courts found that the city could not force retailers to post graphic health warning signs, because posting such imagery next to cigarette displays would affect the content of promotional efforts made by retailers and manufacturers.

“Regardless of what may be occurring in foreign countries, we'll continue to fight excessive signage and packaging restrictions here in New York,” NYACS president Jim Calvin told Tobacco E-News. “From our perspective, there are sufficient warning labels on packages and signs in our stores to get the message across that tobacco use is hazardous to your health.”

Rulings on the national level also indicate graphic warning labels or plain packaging would be difficult to pass. In February, U.S. District Judge Richard Leon blocked the FDA’s graphic warning mandate on the basis that it violated the free speech amendment to the Constitution. While actions in Australia will undoubtedly inspire anti-tobacco groups to push for similar plain packaging or graphic warnings, the evidence so far suggests such legislation will not be upheld in the United States.

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