GENEVA -- (Marketwire) -- 12/17/12 -- Today, the Dominican Republic requested that the Dispute Settlement Body of the World Trade Organization (WTO) establish a WTO panel to assess the WTO consistency of Australia's plain packaging measures for tobacco products, which came into effect in Australia on 1 December 2012. Australia initially blocked the establishment of the WTO panel but cannot block the Dominican Republic's second request as per WTO rules.
Plain packaging represents a dramatic interference with trademarks, and a restriction on international trade. Luis Manual Piantini, Ambassador of the Dominican Republic to the WTO explains:
"We are proud of our tobacco products and especially our cigars which are among the highest-quality smoking products and appreciated by millions of connoisseurs around the world. We have strived to develop an industry that is a world leader, and do not wish to see it undermined by speculative measures that will work to undermine public health. We will fight to have the WTO rules applied fairly and objectively to our developing economy."
"The Dominican Republic shares Australia's public health goals but plain packaging will not be effective in achieving those goals. Its effect will simply be to commoditize the tobacco market, with declining prices, and increased consumption of tobacco and illicit trade as a result."
Full statement by the Dominican Republic:
1. Since the first day of this month, all tobacco products in Australia have to be sold in plain packaging, and have to meet other stringent requirements. Australia imposes these requirements through the Tobacco Plain Packaging Act 2011 and its implementing regulations.
2. The Dominican Republic held consultations with the Australian Government on these plain packaging measures on 27 September 2012. Unfortunately, these consultations failed to settle the dispute. In conformity with Article 6.2 of the DSU, the Dominican Republic, therefore, requests that the Dispute Settlement Body establish a panel to examine Australia's plain packaging measures in light of its WTO obligations.
3. At the outset, the Dominican Republic wishes to emphasize that it shares Australia's objective in seeking to protect human health. However, we are unconvinced that these plain packaging measures are an effective instrument for reducing consumption of tobacco products or indeed any other harmful product. Rather, the plain packaging measures appear to violate Australia's obligations under both the TRIPS Agreement and the TBT Agreement.
4. The plain packaging measures represent a dramatic regulatory intrusion into the appearance of products that may be sold lawfully in Australia, literally wiping design features off tobacco packaging and individual cigarettes and cigars. These design features include trademarks and geographical indications that Members have agreed to protect under the TRIPS Agreement, and which serve the valuable purpose for both producers and consumers of differentiating products that compete lawfully on the market in Australia.
5. Turning to the TBT Agreement, these plain packaging measures restrict international trade by eliminating competitive opportunities for tobacco products that are forced to appear in the marketplace in virtually identical retail packaging.
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