Dominican Republic requests panel under dispute settlement procedures of the WTO challenging Australia's plain packaging measures for tobacco, says measures undermine it's tobacco industry, will increase consumption, illicit trade

Kendall Sinclair

GENEVA , November 13, 2012 (press release) – On 9 November 2012, the Dominican Republic requested the establishment of a panel under the dispute settlement procedures of the World Trade Organization ("WTO") challenging Australia's plain packaging measures for tobacco products. The Dominican Republic has asked that this request be included on the agenda of the WTO Dispute Settlement Body meeting on 17 December 2012.

From 1 December 2012, Australia will mandate that all tobacco products be sold in plain packaging. Packaging will be a standardized drab brown colour, with the brand and variant name in a standardized font and place, banning all logos or other design features. This move will prevent tobacco products from using their well-known trademarks and geographical indications.

These unprecedented measures will undermine the Dominican Republic's tobacco industry, in particular its premium cigar sector. By prescribing standardized plain packaging, the tobacco market will be driven towards commoditization, with declining prices, and increasing -- rather than falling -- consumption and illicit trade.

The Dominican Republic supports Australia's health objectives. However, plain packaging will undermine those health objectives, failing to curb consumption, while destroying the market for Dominican producers. Australia's plain packaging measures do not, therefore, withstand scrutiny under the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) and the Agreement on Technical Barriers to Trade (TBT).

HE Luis Manuel Piantini, Ambassador of the Dominican Republic to the WTO, explains: "Tobacco has been an intrinsic part of the Dominican culture and heritage for centuries, and the tobacco sector is vital for our development. Our producers have made enormous investments -- including in intellectual property -- to turn the Dominican Republic from a simple tobacco leaf exporter into one of the world's leading producers of premium cigars and the world's largest exporter of cigars. This a significant achievement for a small developing economy. Plain packaging will wipe away these achievements -- our premium cigars will be dressed as discount products, which people will continue to smoke; prices will ultimately fall, affecting the livelihood of more than a hundred thousand Dominican workers and their families. The TRIPS and TBT agreements protect our commercial and development achievements."

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