United States Council for International Business
Peter M. Robinson
President & CEO
June 2, 2011
Drug Strategy Branch
Attention: Tobacco Reform Section
Department of Health and Ageing
GPO Box 9848
Canberra ACT 2601
Dear Assistant Secretary,
On behalf of The United States Council for International Business (USCIB), I am writing to express our views in response to a call for public comments regarding the introduction of the Tobacco Plain Packaging Bill of 2011 in Australia. While we understand and applaud the legitimate state interest of protecting its citizens against unwarranted health risks, we also understand the need to carefully balance a multitude of other rights cherished by these same citizens in carefully crafting responsive legislation. We feel that in this instance, well-established principles of international law would be violated despite the best of intentions and consumers would not be best served by the implementation of this legislation.
USCIB promotes open markets, competitiveness and innovation, sustainable development and corporate responsibility, supported by international engagement and prudent regulation. Its members include top U.S.-based global companies and professional services firms from every sector of our economy, with operations in every region of the world. With a unique global network of international business organizations, USCIB provides business views to policy makers and regulatory authorities worldwide and works to facilitate international trade and investment.
We believe the current bill is inconsistent with the TRIPS Agreement and the Paris Convention, the TBT and the US-Australia FTA, thus rendering it incompatible with accepted international legal standards. For example,
- TRIPS Article 20 prohibits unjustified encumbrances on trademarks. The Bill requires manufacturers to adapt their trademarks to a designated special form and eliminates a critical means for consumers to distinguish among products. This will likely exacerbate consumer confusion;
- TRIPS Article 15 and Paris Convention Article 7 have identical requirements, providing that the nature of the goods or services to which a trademark is to be applied “shall in no case form an obstacle to registration of the trademark.” Under Australian law, a trademark application may be rejected if the mark‟s “use is contrary to law.” The proposed legislation makes use of the trademarks contrary to law because they are associated with tobacco products, thus making the trademarks vulnerable to cancellation in violation of the TRIPS and Paris Agreements;
- Article 6 of the Paris Convention provides “every trademark duly registered in the country of origin shall be accepted for filing and protected as in the other countries of the Union.” The Bill may result in the rejection or invalidation of trademarks registered and protected in their country of origin, thereby violating this provision;
- Article 2.2 of the TBT Agreement requires that technical regulations, including packaging and labeling requirements, be no more trade restrictive than necessary to fulfill a legitimate objective. While protection of public health is clearly a legitimate objective, we believe that the plain packaging requirements are not narrowly tailored to meet this legitimate objective and could result in substantial consumer confusion and potentially consumer harm;
- The U.S.-Australia Free Trade Agreement protects investments, including trademarks. The proposed bill would deny fair and equitable treatment to US investors owning Australian trademarks, thereby depriving those marks of legitimate value and violating the FTA.
USCIB is committed to the protection and enforcement of intellectual property globally and works with its affiliates to combat counterfeiting and piracy of hard goods as well as digital works. It is widely recognized that intellectual property protection and enforcement provides both the foundation and incentive for innovation for both developed and developing economies. Accordingly, international and national legislation ensures that rightsholders of patents, copyrights, and trademarks be protected and that their intellectual property be safeguarded against theft and abusive practices. Trademarks, in particular, not only serve the rightsholders but also ensure that consumers have the means to differentiate products and services in the marketplace based on assumptions the consumers have formed about particular brands. These assumptions range from mere preferences to a recognition of a superior product. Similarly, the accompanying colors and logos and overall feel of the product – trade dress – serve an indispensable role in brand recognition. Therefore, depriving a legitimate business of its trademark not only deprives a company of its hard-earned intellectual property, but also deprives consumers of the means to discern brands and make informed choices in the marketplace.
And while health concerns are certainly of great importance to regulators and citizens alike, it is our concern that such legitimate interests, when construed broadly, could touch upon a number of sectors engaged in a number of legitimate business pursuits that also have invested heavily and relied upon intellectual property assets globally.
Lastly, the current proposal deprives the cigarette companies of their ability to engage in commercial speech in the marketplace so that consumers may make informed decisions. We understand that the doctrine of commercial speech here in the United States is markedly different from the evolution of freedom of expression jurisprudence in Australia. Nevertheless, we cite Article 19 of the International Covenant on Civil and Political Rights ("ICCPR" or "Covenant"), "[e]veryone shall have the right to hold opinions without interference. Everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive, and impart information and ideas through any media and regardless of frontiers." USCIB believes that this right is not limited to individuals but that freedom of expression is best served when businesses are also permitted to „speak” in the marketplace by disseminating information and describing products and services so as to enhance the consumer experience. Consumers need to receive information to make informed choices about their lives, and especially as it relates to their health. Of course, this speech should avoid deceptive and misleading representations, but there should be recognition that there is value in the dissemination of truthful speech both to the business and to society at large.
In conclusion, we believe that the pending legislation is not narrowly tailored to address the legitimate objectives of the legislature in protecting its citizens against the harms of cigarette smoking. In depriving companies of their intellectual property and restricting the free flow of information to consumers, the legislation not only has the potential of violating accepted international laws and norms, but also of harming the very citizens the bill has set out to protect. Accordingly, we would respectfully ask the Committee to reconsider the bill as currently drafted and to explore legitimate alternatives to this legislation so that the citizens and business entities of Australia may pursue healthy lives without relinquishing the rights and protections afforded them by law.
Thank you for affording us the opportunity to contribute our views.
Peter M. Robinson
The Tobacco Plain Packaging Information Kit provides practical information on the responsibilities and obligations of retailers and other suppliers of tobacco products under the new Tobacco Plain Packaging Act 2011.
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On 20 April 2012, the Prime Minister and Minister Butler unveiled a comprehensive package of reforms to build a better, fairer, more sustainable and more nationally consistent aged care system.