The tobacco tango

Yesterday we saw the conclusion of one of the battles in the "tobacco wars". In an earlier post I covered litigation in the Australian High Court relating to a tobacco industry challenge to legislation requiring plain packaging of cigarettes.

The High Court has just found the proposed tobacco plain packaging laws to be both legal and constitutional. From December all tobacco products in Australia must be sold in a uniform olive box with black lettering. The full judgment will not be released until later this year, although it has already attracted comments from a wide audience.

Unintended consequences

A major change like this, even if well-intentioned, is bound to have unintended consequences. I guess it is a matter of opinion whether these consequences are really unintentional, or whether they are merely collateral damage.

British American Tobacco spokesman Nick Booth commented that if plain packaging is brought in, companies will use other devices to attract customers. "Ultimately, if we're not able to use our brands to compete, we'll be forced to compete on things like price, which could actually frustrate the intended goals of plain packaging".

Trust is important to brands, says Stephen Cheliotis of the Centre for Brand Analysis (TCBA). If consumers decide the source of a given product is no longer reliable or safe they will vote with their wallets. Known brands have to uphold certain standards to retain consumer trust. Making packaging easy to copy gives rise to counterfeit cigarettes. Some counterfeit cigarettes have reportedly been found to contain abnormally high levels of cancer-causing chemicals.

The nanny state

Booth also poses the question of where does it end? What about alcohol, fatty foods, sugary drinks and sweets? Should they all be sold in plain packaging or unbranded?

Herald-Sun journalist Patrick Carlyon asks why Australia is still awash in beer and spirits television advertisements. Alcohol is a contributing factor in about a quarter of road deaths in Victoria, Australia. Children are victims of alcohol-related harm in more than one-fifth of Australian homes. It is thought to be a risk factor in about 20,000 cases of child abuse. Yet no one is suggesting that alcohol be plainly packaged.

There are plenty of commercials depicting families gathered at the dinner table eating fast food. Yet Australian waistlines and rates of diabetes are increasing. Does this suggest the introduction of taxes on unhealthy foods, the limiting of advertising on those foods, banning advertising altogether, followed by the introduction of plain packaging?

A property right?

One of the most interesting questions for me remains unresolved. The Australian Government's view was that:

1. a trade mark itself is a privilege. It is not a property right. The Government can take it away.
2. trade mark owners acquire a registration on the proviso that it cannot be used in certain areas

We don't know which one of these arguments found more favour with the High Court. We won't know this until the decision is publicly available.

I can kind of understand the second argument. A patent right gives its owner the right to exclude others rather than the right for the owner to work an invention. Maybe argument 2 along these lines.

But argument 1 is a different matter altogether. This is a major change. I have always thought of trade marks as property rights. Something you own. Something you have the right to control. Something you have the right to use.

What now?

The Australian Government has won the battle but not the war. I understand complaints have been lodged with the World Trade Organisation (WTO) by some countries who claim the law breaches trade agreements. It is going to be an interesting issue to follow.

Photo courtesy of author trbpix under Creative Commons licence.