WTO panel to issue tobacco plain packaging report by November

More countries have asked to be third parties in the proceedings than in the long-running banana war between the EU and a number of Latin American countries.

WTO Director-General Roberto Azevêdo this week appointed three panellists to consider the plain packaging issue after the six countries at the centre of the row – Australia, Ukraine, Indonesia, Cuba, Dominican Republic and Honduras – failed to agree who should examine the disputes.

The panel will be chaired by Alexander Erwin of South Africa. The other two members are François Dessemonted of Switzerland and Billie Miller of Barbados. The parties will make written and oral representations to the panel, which must finalise its report within six months.

The panellists will decide whether they think Australia’s tobacco plain packaging laws breach the trade organisation’s rules before the end of the year.

Five panels have been established to consider the complaints made by five countries about Australia’s decision to force tobacco companies to sell their products in so-called plain packaging. The same three panellists will head each panel after the parties agreed to a harmonised procedure.

Although each of the complaints target Australia’s plain packaging rules, they are not exactly the same. Ukraine’s deals with “certain measures concerning trademarks and other plain packaging requirements applicable to tobacco products and packaging” while the rest also invoke the WTO’s rules on geographical indications.

The appointments come shortly after Australia complained that the unresolved trade row was having a chilling effect on other countries that are considering introducing similar constraints on the way that tobacco is packaged. Ukraine requested consultations with Australia under WTO procedures more than two years ago.

New Zealand has already said that it plans to follow Australia’s lead, and the UK government said last month it will introduce plain packaging following a review.

If the panel decides that plain packaging does breach WTO trade rules, it recommends how the measure should be changed. Its report becomes the Dispute Settlement Body’s ruling or recommendation within 60 days unless a consensus rejects it. If one or more party appeals, the appeal is heard by three members of the WTO’s permanent seven-member Appellate Body. It has up to 90 days to uphold, modify or reverse the panel’s legal findings and conclusions. The Dispute Settlement Body has to accept or reject the appeals report within 30 days — and rejection is only possible by consensus.

You can read an article by lawyers from Bird & Bird and Truman Hoyle on plain packaging in the latest issue of Managing IP.