Industry Arguments Against Plain Packaging

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Imperial scaremongering in interview with The Sun newspaper

Ever since plain packaging for tobacco products was suggested in Canada in 1986 and New Zealand and the UK in the early 1990s, the tobacco industry has been developing arguments and tactics to oppose this legislative proposal. This pages outlines some of the main arguments used by the tobacco industry to oppose plain packaging legislation.

See History of Plain Packaging: Developing the Intellectual Property Argument.


"It Breaches Our Intellectual Property Rights"

As plain packaging removes tobacco companies’ ability to display their branding on tobacco products, they argue that this amounts to the illegal appropriation of their trademarks by Government, thereby breaching their intellectual property (IP) rights.

However, in the 1990s the industry received a legal opinion that they have no protection under IP right treaties and laws.[1] Therefore, the industry has known for years that this argument is spurious and legal challenges are unlikely to succeed (see The Plain Pack Group, Australia: Trademark Claims and Australia: Challenging Legislation).

Nevertheless, two decades later, tobacco companies and their allies continue to use this argument to block and/or delay the introduction of plain packaging.

For example, in response to the proposed revision of the 2001 EU Tobacco Products Directive (TPD) the Tobacco Manufacturers' Association (TMA) whose members include Imperial Tobacco, Japan Tobacco International (JTI) and British American Tobacco (BAT) said: “The Commission [European] must recognize that changes to packaging and pack labelling regulation impact fundamental legal, economic and commercial rights of tobacco manufacturers and consumers. These include... their property right in their brands (including trademarks, goodwill and brand equity)."[2]

Tobacco companies in Australia took the Australian Government to court in 2012 over the Government's appropriation of their trademarks. Their attempt to overturn the legislation was unsuccessful on the merits of this argument.[3]

"It Infringes International Trade Agreements"

Tobacco companies also argue that plain packaging in Australia and elsewhere infringes international trade agreements. On 28th September 2012, in response to a request by Ukraine, the World Trade Organization (WTO) Dispute Settlement Body agreed to set up a panel to assess whether the plain packaging law passed in Australia breaches intellectual property (IP) rules under the Trade Related Aspects of Intellectual Property Rights (TRIPS) agreement and violates the Agreement on Technical Barriers to Trade (TBT).

Ukraine was not the only country to file a grievance against Australia’s plain packaging law. Honduras and the Dominican Republic also lodged a dispute.[4]

Such challenges are not new. In 2008, in its response to the UK Department of Health’s consultation on the Future of Tobacco Control, BAT claimed:

"The Government’s power to introduce plain packaging is constrained by law, not only by the general principles of public law, the European Convention on Human Rights (ECHR) and EU law, but also by international law, including the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)."[5]

The company argued that prohibiting the use of trademarks on tobacco products’ packaging would:

  • "Impose restrictions on the registration and use of trademarks based on the nature of the goods or services for which such marks are registered, contrary to the harmonised European and international system of trade mark protection (in particular under TRIPS and the ECHR);
  • Be an unlawful interference with the ECHR rights to free speech of manufacturers and consumers of tobacco products;
  • Constitute a barrier to the functioning of the internal market, contrary to EU law; and
  • Undermine the very basis upon which intellectual property rights, which are of global commercial significance, are created and protected internationally, with implications far beyond the tobacco industry."[5]

In 2012, Andrew Mitchell, an international law expert at Melbourne University told the Australian publication Lawyers Weekly that the WTO claims are unlikely to be successful. [6] Mitchell argued that “Tobacco companies still have the right to use their trademark and are simply prohibited from exercising a positive right to use it on tobacco products” and therefore IP rules are not breached. As the Legal Claims page shows, the industry has a long history of threatening legal action.

"No Credible Evidence that Plain Packaging Will Work"

  • Imperial Tobacco: Following the launch of the public consultation on plain packaging in the UK, Alex Parsons, a spokesman for Imperial Tobacco, which owned 43.1% of the market share in cigarettes in 2011,[7] told BBC Radio 4's World At One: "There is no credible evidence to substantiate what the government is saying which is that people make the decision to smoke or continue smoking because of the colour of the packs of the cigarettes they buy. Quite frankly, it is a preposterous notion." [8]
  • JTI: Martin Southgate, the Managing Director of JTI at the time, which owned 37.1% of UK market share in cigarettes in 2011,[7] said: "Put simply, this will not work. We hope common sense will prevail and the Government will acknowledge the lack of any credible evidence to show that this proposal will actually work." [9]
  • TMA: The anti-plain packaging sentiment from tobacco companies was reiterated by the TMA, the industry’s trade association. The TMA’s Secretary-General, Jaine Chisholm Caunt, said: "There is no reliable evidence plain packaging will reduce rates of youth smoking. Smoking initiation in children is actually linked to a complex range of socio-economic factors including home life, peer pressure and truancy and exclusion from school." [10]

For a summary of the evidence in favour of plain packaging see Countering Industry Arguments Against Plain Packaging: No Evidence Plain Packaging Will Work

"Other Countries Have Dropped the Idea"

In 2010, the TMA claimed: "The UK Government decided in 2009, after a preliminary consultation, not to proceed with plain packaging as the evidence is 'speculative' and 'needs to be developed' before regulatory action should be taken." This statement was made in December 2010. Yet the UK Government had already announced in November 2010 that it would consider introducing plain packaging in the UK.[11]

Similarly, in January 2011, Roger Jones, national account manager for BAT UK commented: "We were surprised to hear the Government proposing plain packaging for tobacco products, especially given that a number of governments around the world, including Canada, have already looked closely at this measure and have decided it wouldn't work". [12]


"It Will Lead to Increased Smuggling"

The TMA has used has several variations of smuggling and counterfeit arguments against plain packaging including:


"A counterfeiters' charter"

In September 2008, Imperial Tobacco told the UK’s DH that the introduction of plain packaging "could be described as a 'Counterfeiter's Charter". [13]

Imperial used the expression repeatedly in its submission to the inquiry into plain packaging in Australia.[14]

By March 2011, Unite, a trade union representing tobacco industry workers, was using exactly the same wording. A news release said: The government’s intention to introduce plain packaging for cigarettes would amount to a 'Counterfeiters' Charter'. [15]

"Easier for counterfeiters"

In March 2011, the TMA responded to the UK Government's Tobacco Control Plan: "Plain packs are also likely to lead to yet further increases in the smuggling of tobacco products and plain packs would make it so much easier for a counterfeiter to copy than existing branded packs making it even more difficult for a consumer to differentiate between genuine and counterfeit products." [16]


"Christmas for counterfeiters"

In January 2011 Roger Jones, national account manager for BAT UK, used a variation on the same theme, commenting: "If the Government insists cigarettes are sold in plain packs, it would be like Christmas for counterfeiters and the criminal gangs who smuggle cigarettes into the UK." [12]


"Handing the brands to criminals"

Another common industry argument is it will lead to smuggling

In February 2011, Jeremy Blackburn, head of communications at JTI, was more direct commenting that: "The government would simply be handing over the brands to criminals who would be under no obligation to use plain packs". [17] Imperial Tobacco's UK Communications Manager Iain Watkins used similar language: "Governments need to ask themselves whether they want tobacco products to be sold by responsible, legitimate businesses or criminal gangs". [17]


"It Will Increase Illicit Trade and Terrorism" Imperial Tobacco’s UK General Manager in 2012, Amal Pramanik, warned that plain packaging would increase the illicit trade. He said: “We are particularly concerned about the impact plain packaging will have on illicit trade. Logic dictates that making all tobacco products available in the same generic packaging will increase the already high level of counterfeit product available in the UK, placing further pressures on retailers and government tax revenues." [18]


Speaking in May 2012, Imperial CEO, Alison Cooper, reiterated that plain packaging would not only be a "gift to criminal gangs", but also "terrorists". Cooper said: "Do we really want to hand business like this to gangs in Eastern Europe funding crime and even, in some cases, terrorists?” Reporting on Cooper's remarks, The Sun newspaper ran a sensationalist headline, see right. It argued that "groups who benefit from such trade include al-Qaeda and Hezbollah." [19] There is no independent evidence that plain packaging will increase illicit trade, increase crime or terrorism.[20]

Scaremongering coverage in such an influential national newspaper may influence public opinion on plain packaging. On average over two and a half million copies of The Sun were sold every month in 2012.[21] As most copies of newspapers are thought to be read by two other people (i.e. family members in the household), Media UK estimate that The Sun has a readership of over 7 million adults. This is 14.4% of the adult population in the UK. [21] Furthermore, a February 2012 Guardian news article stated that The Sun had 1,471,788 daily online browsers and 24,055,155 monthly online browsers.[22]

BAT created a short advert; This is the Man which showing the victims of illicit trade (such as women and children), once again making a non-evidence based connection between plain packaging and illicit trade.

For a counter argument to the industry’s position on plain packaging and illicit trade please visit Countering Industry Arguments Against Plain Packaging: It will Lead to Increased Smuggling.


"It Will Cost"

The industry uses the illicit trade argument to rally support amongst retailers and raise concern that an increase in illicit trade will affect profits. They also suggest that tax revenues to the country will be affected by an increase in illicit brought on by plain packaging. A whistle-blower in Australia revealed how contrived such an argument is by showing how tobacco companies set up a front group to reach retailers to represent the interests of the tobacco industry while presenting themselves as an independent group.

'It will cost jobs' The TMA claims plain packaging will lead to "a diminished contribution to the economy, including loss of efficiencies and business to suppliers, wholesalers, retailers, ink manufacturers, designers and packaging suppliers, and other costs caused."

It will make cigarettes more affordable The European Carton Makers Association (ECMA) argues that "plain packaging legislation would also remove the last differentiating factor at the point of sale, ECMA also believes that plain packaging will inevitably lead to increased price competition and therefore to reduced consumer prices, making tobacco products more affordable". [24]

"Where Will it Stop?"

When considering how to combat plain packaging proposals, BAT realised that it could gain traction with the general public via the use of the so-called ‘slippery slope’ libertarian argument of “if we can have plain packaging for cigarettes what will be next?” Michael Prideaux, BAT's Communications Director said: "There is a feeling among the general public that the theft of trademarks is a step too far in terms of tobacco regulation. Who will be next? I think the libertarian argument resonates among people who wouldn't normally take notice of what the tobacco industry say". [25]

In Australia, Imperial Tobacco unrolled a nationwide PR campaign based on the "No Nanny State" theme[26] and set up a website called nonannystate.com.au and a video channel to encourage people to oppose the plain packaging legislation, in a concerted effort to depict the government as interfering. The language used was subsequently adopted by other bloggers backing the industry (see Australia: Campaigning websites).

BAT New Zealand, which owns the majority of the New Zealand cigarette market ran a print, tv and radio campaign against plain packaging in 2012. The following is a link to the tv advert arguing for personal freedom.

Imperial Tobacco UK has also utilised the slippery slope argument in an anti-plain packaging advert Britain - 2020 Vision?. The advert misleadingly suggests that by 2020 all products perceived to be unhealthy will be sold in plain packaging. It was uploaded to YouTube by the tobacco industry front group Hands Off Our Packs. The advert (which had received nearly 30,000 views on YouTube by June 2013) was promoted through the distribution of leaflets on petrol forecourts. The leaflet (see below), which amongst other products showed baked beans in plain packaging, had a smart phone bar code link to the Britain 2020 Vision advert and asked recipients to say no to plain packs by responding to the consultation. Nowhere on the leaflet did it say that the campaign was attributable to or funded by Imperial Tobacco. Only at the bottom of the 2020 Vision You Tube advert itself, in very small print, did it say it was funded by Imperial Tobacco.

Front of leaflet used to advertise Imperial Tobacco funded anti-plain packaging video
Back of leaflet used to advertise Imperial Tobacco funded anti-plain packaging video


"It Breaches EU Better Regulation Principles"

In their submissions to the UK public consultation on plain packaging, each of the big four tobacco companies in the UK argued that policy makers and the public health community were acting in a way that contravened the principles of Better Regulation.

The Better Regulation method of policy making, which was introduced in the early 2000s, has been criticised for favouring business interests and largely ignoring social (health) and environmental interests.[27][28] Furthermore, evidence shows that BAT was heavily involved in the development of Better Regulation principles so that they could use business arguments to block regulation, specifically Smokefree Legislation in indoor public places.[28]


All The Arguments in 10 Minutes

In June 2011, the Head of Corporate Affairs for Imperial Tobacco in Australia, Cathie Keogh, appeared on Australian radio to attack the government's plans on plain packaging (listen to the interview on the ABC website). Keogh's answers neatly summed up all the industry's standard arguments in 10 minutes:

  • "It has not been introduced anywhere else in the world."
  • "The government has a policy of introducing evidence-based legislation, and there is no evidence that plain packaging will stop people from smoking."
  • "We should look at what the incidental consequences are."
  • "There are international organisations who believe that their welfare is also impacted, the International Chamber of Commerce has written to the Government."
  • "Another impact is that this policy - like no other - will fund the growth of illicit tobacco in Australia."
  • "Politicians are interfering in people's lives and lifestyles: what is going to be next? Are they going to be putting controls on soft drinks, fast-foods and alcohol?"
  • "Our campaign is about if people are concerned about the government making decisions for them they have the opportunity to make a protest." [29]


"Spinning on Behalf of the Unspinnable"

Even libertarian writers in Australia were bewildered by Imperial's public relations offensive. After the interview, one commentator said:

"Hearing people such as the woman from Imperial Tobacco on radio, you wonder whether they have some perverse intellectual attraction to spinning on behalf of the unspinnable. There are public relations firms which have won awards within this strange industry for helping Union Carbide salvage its abysmal reputation after the Bhopal factory disaster in India, and helping to rehabilitate the Argentine military after it spent most of the 1970s chucking university students out of Cessnas and into the River Plate."

He continued:

"This industry, which in essence is in the death business, is itself in its death throes. As it sinks further into the abyss it is thrashing about spouting nonsense in defence of its right to sell demonstrably deadly products [...] On listening to the radio interview, it's not so much that the tobacco industry's arguments are ballsy, but just boorish and banal ... Someone should have taped this interview and given it to high school debaters as an example of how not to make an argument." [30]

Countering Industry Arguments against Plain Packaging

The public health community refers to industry reactions to proposed regulations as the "scream test". The more they protest the more the regulation will damage their business. The industry has screamed loudly in response to plain packaging proposals. Many of the arguments discussed above are examples of well-rehearsed industry tactics, to read about the public health responses to these arguments see Countering Industry Arguments against Plain Packaging.

Notes

  1. Physicians for Smoke Free Canada, Packaging Phoney Intellectual Property Claims, June 2009, p11 accessed 1 June 2011
  2. TMA Website, Tobacco Manufacturers' Association's complete response to the public consultation on the possible revision of the Tobacco Products Directive 2001/37/EC, 17 December 2010, accessed 3 June 2011
  3. Mark Metherell, Big Tobacco loses high court battle over plain packaging, The Sydney Morning Herald, 15 August 2012, accessed August 2012
  4. World Trade Organization, Panels set up on Australia's tobacco measures and on US duties on China's exports, 28 September 2012, accessed October 2012
  5. 5.0 5.1 British American Tobacco, Response to the Department of Health discussion document “Consultation on the future of tobacco control, May 2008”, 15 September 2008, accessed June 2011
  6. L, Mezrani, Tobacco challenges unlikely to succeed, Lawyers Weekly, 17 August 2012, accessed October 2012
  7. 7.0 7.1 Euromonitor International, Company shares by Global Brand Owner Historic UK 2011, accessed August 2012
  8. Conal Urquhart, "Lansley comes under fire over plain cigarette packet plans", The Guardian, 13 April 2012, accessed June 2013
  9. Matthew Chapman, “Tobacco branding ban debate: reaction from all sides”, Marketing Magazine, 13 April 2012, accessed June 2013
  10. BBC News, “Cigarette packet branding to face consultation”, 13 April 2012, accessed June 2013
  11. Secretary of State for Health, Healthy Lives, Healthy People: Our strategy for public health in England, 30 November 2010, accessed 8 June 2011
  12. 12.0 12.1 John Wood, "On a Roll", Wholesale News, January 2011, p31
  13. Imperial Tobacco Group and Imperial Tobacco UK, Submission to the Department of Health Consultation On the Future Of Tobacco Control, September 2008
  14. Imperial Tobacco, Submission to the Senate Community Affairs Legislation Committee for the inquiry into the Plain Tobacco Packaging (Removing Branding from Cigarette Packs) Bill 2009, April 2010, accessed 7 June 2011
  15. Unite, Plain packaging for cigarettes is 'Counterfeiters’ Charter', 9 March 2011, accessed 9 June 2011
  16. TMA, TMA responds to Government’s Tobacco Control Plan, 9 March 2011, accessed June 2011
  17. 17.0 17.1 Ronan Hegarty, "Smokers Roll On", The Grocer, 19 February 2011, p.51
  18. Talking Retail, “Plain tobacco packaging will ‘increase illicit trade’”, 13 April 2012, accessed June 2013
  19. Steve Hawkes, "Fag packet ban 'boosts terror' - Move is ‘gift to black market’ says boss”, The Sun, 25 May 2012
  20. Luk Joossens, Smuggling, the Tobacco Industry and Plain Packs, Cancer Research UK, November 2012
  21. 21.0 21.1 B. Hall, Newspaper ABCs: Interactive national figures for August 2012, Media Week, 14 September 2012, Accessed February 2013
  22. M. Sweney Mail online close to 100m users, The Guardian, 23 February 2012, Accessed February 2013
  23. Anne Davies, 'Big Tobacco hired public relations firm to lobby government', Sydney Morning Herald, 11 September 2010, accessed 8 June 2011
  24. William McEwen, "From Riches to Rags?" Tobacco Journal International, 1, 2011, p89
  25. Christopher Thompson, 'Big Tobacco Hits Out at 'Big Mother', Financial Times, 7-8 April 2012, p4
  26. Sydney Morning Herald, "Cigarette packaging war gets dirty", 14 June 2011
  27. Smokefree Partnership, The Origin of EU Better Regulation – The Disturbing Truth. 2010
  28. 28.0 28.1 K. Smith, G. Fooks, J. Collin, H. Weishaar, S. Mandal, A. Gilmore, "'Working the system' British American Tobacco's influence on the European Union Treaty and its implications for policy: an analysis of internal tobacco industry documents", PLoS Medicine, 2010, 7(1), e1000202
  29. ABC, "'Politicians are interfering with people's lives': Imperial Tobacco", 16 June, 2011
  30. David Penberthy, "Tobacco industry can't be serious with its latest push. Smoke lobby a laugh", Geelong Advertiser (Australia), 20 June 2011, p.18