The Senate passed the legislation earlier this month with a series of amendments that were approved by the House of Representatives today.
This means that from December next year all tobacco sold in Australia will be sold in plain, dark brown packs – with no industry logos, brand imagery, colours or promotional text.
The name of the brand of cigarettes will appear on the pack in a standard font size, colour and position.
Within hours, Philip Morris Asia said that it had served a notice of arbitration under Australia’s Bilateral Investment Treaty with Hong Kong.
"We are left with no option," said Anne Edwards, a spokesperson for Philip Morris Asia, adding that Australia’s government has ignored "serious legal issues associated with plain packaging".
The company wants the legislation to be suspended and compensation to be paid for what it describes as the loss of the company’s trade marks in Australia.
"We are confident that our legal arguments are very strong and that we will ultimately win this case," said Edwards.
The legislation was split into two Bills – Tobacco Plain Packaging Bill 2011 and Trade Marks Amendment (Tobacco Plain Packaging) Bill 2011.
The tobacco companies have consistently argued that the legislation breaches Australia’s commitments under the TRIPs Agreement, violates the country’s constitution and will make it easier for cigarette packets to be counterfeited.
Philip Morris Asia announced its intention to sue the Australian government using the Bilateral Trade Agreement with Hong Kong in June.
The company’s statement today said that its Australian subsidiary will also be pursuing claims under domestic law before the High Court of Australia.
British American Tobacco Australia said earlier this month that it intends to sue the Australian government in the High Court as soon as the legislation receives Royal Assent.
BAT claims that it is unconstitutional for the federal government to remove its property without compensation.
"In years to come plain packaging will be remembered as the legislation which wasted billions of taxpayer’s dollars, caused uncontrollable growth in organised gang activity on the black market and increased smoking rates in young people."
Click here to read all of Managing IP’s coverage of the plain packaging controversy.
