REPORT ON THE CONSISTENCY OF A PROPOSED PLAIN PACKAGING REQUIREMENT WITH AUSTRALIA’S INTERNATIONAL OBLIGATIONS

Professor Gabriël A Moens and Adjunct Professor John Trone*

Introduction

This Report considers the consistency of a plain packaging requirement with Australia’s treaty obligations. Senator Fielding has introduced a private member’s Bill seeking to require that tobacco products have plain packaging. In his Second Reading Speech Senator Fielding summarized the effect of his Bill: “tobacco companies will be banned from advertising their logos or trademarks on their products. Instead, all cigarette and other tobacco packets will have plain labelling, with the only predominant item to feature on the packets to now be the warning labels.”1

This Report has been written at the request of Philip Morris Ltd (PML), through Allens Arthur Robinson. Philip Morris International (PMI) is the ultimate holding company of PML. The headquarters of PMI is in the United States and its operations centre is in Switzerland.2 PML owns or is the licence holder of numerous trademarks relating to tobacco products.3 PMI is the owner of some of the trade marks used by PML in Australia. Trademarks are frequently referred to as the most important assets of tobacco companies. The introduction of plain packaging would render useless the trademarks held by PML.

Executive Summary

A plain packaging requirement would be inconsistent with Art 20 of the Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS) since it encumbers the use of trade marks in trade with unjustifiable special requirements. It would not fall within the limited exceptions to trademark rights permitted under Art 17 of TRIPS.

The public health clause in Art 8(1) of TRIPS does not provide legal justification for plain packaging. Art 8(1) does not justify measures that are inconsistent with other provisions of TRIPS. Plain packaging would fail the necessity test under Art 8(1) since there are reasonably available alternatives which would protect public health and would be less restrictive of trade. The British government has indicated that “strong and convincing evidence showing the health benefits” of plain packaging would be required before it could be justified under international trade law treaties.

A plain packaging requirement would also violate Art 2.2 of the Agreement on Technical Barriers to Trade. It would constitute a technical regulation imposing an unnecessary obstacle in international trade.

A plain packaging requirement would be inconsistent with Art 6quinquies of the Paris Convention since it would deny registration on grounds that are not permitted by that Article. It would also be inconsistent with Art 7 of the Paris Convention and Art 15(4) of TRIPS since the nature of the goods (tobacco) would be an obstacle to registration of the mark.

In our view under the Australia-United States Free Trade Agreement (AUSFTA) at a minimum clear and convincing evidence of the effectiveness of plain packaging in substantially reducing tobacco consumption would be necessary. If the evidence suggests that the major effect of branded

* The Appendix at the end of this Report contains brief resumes for the authors. 1 Senate Hansard, 20 August 2009, p 5500. 2 http://www.philipmorrisinternational.com/AU/pages/eng/ourbus/Our_business.asp. 3 See http://pericles.ipaustralia.gov.au/atmoss/falcon.application_start. 2 packaging is to influence the market share of particular brands among existing smokers, the introduction of plain packaging would constitute an indirect expropriation of the trademarks of tobacco companies under the AUSFTA. Senator Fielding’s Bill makes no provision for compensation for the expropriation of these trademarks. Introduction of a plain packaging requirement would also breach the AUSFTA obligation to accord fair and equitable treatment to investments.

The World Health Organization Tobacco Control Convention and its implementing Guidelines do not impose an obligation to introduce a plain packaging requirement. Assuming that there is a conflict with the WHO Convention, TRIPS would apply as between Australia and Switzerland. In such a conflict TRIPS would also apply as between Australia and the United States.

US domestic legal restrictions upon intervention by the US Trade Representative on behalf of the tobacco industry are subject to re-enactment with each appropriation. The most likely sanction for a violation of TRIPS is the withdrawal of tariff concessions. The costs of compensation for the expropriation of tobacco company trademarks would be enormous.

Questions

(1) Whether a plain packaging (PP) requirement for tobacco products, in the form of the Fielding Bill or otherwise, would be in violation of Australia’s obligations under the Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS)4

(a) Whether a PP requirement would be inconsistent with Article 20 of TRIPS

Art 20 of TRIPS provides in relevant part: “The use of a trademark in the course of trade shall not be unjustifiably encumbered by special requirements, such as use with another trademark, use in a special form or use in a manner detrimental to its capability to distinguish the goods or services of one undertaking from those of other undertakings. ….”5

Several key concepts appear in Art 20: (1) special requirements, (2) use in a special form, (3) use in a manner that is detrimental to the mark’s capacity to distinguish the goods, (4) encumbrance, and (5) the encumbrance must be unjustifiable.

Firstly, special requirements may include requirements that diminish the distinguishing capacity of the trademark. A plain packaging requirement would eliminate the trademark’s function of distinguishing the product from competing goods.

Secondly, use in a special form is a special requirement. This may include use in a “standard format for all trademark owners”. 6 Plain packaging would constitute use in a standard format for all tobacco trademark owners, given its requirements for standard packaging, colour and size.

Thirdly, another example of a special requirement is use in a manner that is detrimental to the capacity of the mark to distinguish the goods. Plain packaging would eliminate the capacity of trademarks to distinguish tobacco products.

4 Marrakesh, 15 April 1994, 1869 UNTS 299, [1995] ATS 8 p 341. 5 A similar provision appears in Art 1708(10) NAFTA. 6 Peter-Tobias Stoll, Jan Busche and Katrin Arend (eds), WTO – Trade-Related Aspects of Intellectual Property Rights (Leiden: Martinus Nijhoff, 2009), 345 (hereafter Stoll). 3

Fourthly, the special requirements must encumber the use of the trademark in trade. A plain packaging requirement would impose a very substantial burden (encumbrance) upon the use of the trademark. It would prevent the use of almost all characteristics of the trademark, including any colours, lettering, insignias or packet size that falls outside the very limited range permitted.

Fifthly, the encumbrance must be unjustifiable. The use of the word “unjustifiably” implies that some special requirements are justifiable.7 In determining the limits of justification particular regard should be paid to the essential function of the trademark, which is to distinguish the goods offered by different businesses. The special requirements imposed by plain packaging are unjustifiable because they almost nullify the distinguishing capacity of the trademarks.

A plain packaging requirement would be inconsistent with Art 20 of TRIPS.

(b) Whether a PP requirement would fall within the limited exceptions to rights conferred by a trade mark permitted under Article 17 of TRIPS

Art 17 of TRIPS provides: “Members may provide limited exceptions to the rights conferred by a trademark, such as fair use of descriptive terms, provided that such exceptions take account of the legitimate interests of the owner of the trademark and of third parties.” A virtually identical provision appears in the Australia-United States Free Trade Agreement.8

Academic commentary regards Art 17 as having a fairly restricted scope. Art 17 is directed only to limitations relating to unfair competition.9 Art 17 “is about limiting the rights of trademark owners to prevent others from using signs similar or identical to the protected marks.”10 Plain packaging of tobacco products would not fall within the limitations permitted by Art 17 since it is not a measure related to unfair competition.

Furthermore, to be justified under Art 17 an exception must: (1) be limited, and (2) take into account the legitimate interests of the owner.

Firstly, the exception must be ‘limited’. A WTO Panel has emphasised that the word ‘limited’ means that “the exception must be narrow and permit only a small diminution of rights.”11 The Panel added that the question is whether the exception to trademark rights is narrow, not the number of trademark owners who are affected by the exception. A plain packaging requirement would not constitute a narrow exception giving rise to a small diminution of rights. It would be a major diminution of trademark rights.

Secondly, the exception must take into account the legitimate interests of the trademark owner. A WTO Panel has held that the ‘legitimate interests’ of the trademark owner are less than their full legal rights. These legitimate interests “are ‘justifiable’ in the sense that they are supported by

7 Carlos M Correa, Trade Related Aspects of Intellectual Property Rights: A Commentary on the TRIPS Agreement (Oxford: Oxford University Press, 2007), 200 (hereafter Correa); Daniel Gervais, The TRIPS Agreement: Drafting History and Analysis (3rd ed, London: Sweet & Maxwell, 2008), 286 (hereafter Gervais). 8 Art 17.2(5) AUSFTA. A similar provision also appears in Art 1708(12) NAFTA. 9 Stoll, supra n 7, 333, 334. 10 Nuno Pires de Carvalho, The TRIPS Regime of Trademarks and Designs (The Hague: Kluwer, 2006), 294 (hereafter Carvalho). 11 European Communities – Protection of Trademarks and Geographical Indications for Agricultural Products and Foodstuffs (WT/DS290), adopted 20 April 2005, DSR 2005: X-XI, 4603, 5121 at [7.650]. 4 relevant public policies or other social norms”. An exception must “take account” of these interests, which is less than a duty to protect them.12

The ‘legitimate interest’ of the trademark owner in this context would be its interest in continuing to exercise its valuable trademark rights by branding its lawfully sold products. In depriving the trademark owner of this right a plain packaging requirement would not take account of the legitimate interests of the trademark owner.

A plain packaging requirement would not fall within the limited exceptions to trademark rights permitted under Art 17 of TRIPS or Art 17.2(5) of the AUSFTA.

(c) The relevance of Article 8(1) of TRIPS to Australia’s obligations under TRIPS

Art 8(1) of TRIPS provides in relevant part: “Members may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health … provided that such measures are consistent with the provisions of this Agreement.”

There are two conditions for the applicability of Art 8(1): (1) consistency with TRIPS, and (2) necessity.

The first condition is consistency with the remainder of the TRIPS Agreement. Art 8(1) expressly states that measures protecting public health must be consistent with the other provisions of TRIPS.13 These other provisions include Arts 17 and 20, which have been discussed above. Art 8(1) is not a true exception clause because it does not justify derogations from the remainder of the Agreement.14 It is “essentially a policy statement.”15 Art 8(1) confers no legal justification for plain packaging since it does not justify measures that are inconsistent with other provisions of TRIPS.16

The Doha Declaration stated that “the TRIPS Agreement does not and should not prevent Members from taking measures to protect public health. … the Agreement can and should be interpreted and implemented in a manner supportive of WTO Members’ right to protect public health.”17 This Declaration cannot have the effect of amending the Agreement, in particular the requirement that measures protecting public health must be consistent with the remainder of TRIPS.

The second condition is necessity, i.e. the public health measure must be necessary. While the public health exception in GATT does not apply to TRIPS,18 the concept of necessity in both provisions is likely to be similar. In applying the concept of necessity under the GATT exception the Appellate Body ascertains whether there is a reasonably available “alternative measure that would achieve the same end and that is less restrictive of trade”. 19 The Appellate Body has emphasised the strictness of the necessity test, stating that “a ‘necessary’ measure is … located

12 European Communities – Trademarks and Geographical Indications (WT/DS174/R), adopted 20 April 2005, DSR 2005: VIII-IX, 3499, 4083 at [7.662]-[7.663] (hereafter DS174). 13 Carvalho, supra n 10, 191. 14 Benn McGrady, “TRIPs and Trademarks: The Case of Tobacco” (2004) 3 World Trade Review 53 at 67-68 (hereafter McGrady); Stoll, supra n 6, 191-192, 198. 15 McGrady, id, 68. 16 Mudge Rose Guthrie Alexander & Ferdon, Legal Qpinion with Regard to Plain Packaging of Tobacco Products Requirement under International Agreements, 3 May 1994, p 17 (hereafter Mudge). 17 Declaration on the TRIPS Agreement and Public Health, Doha, 14 Nov 2001, 41 ILM 755. 18 Art XX(b) GATT 1994; DS174, supra n 12, [7.114]. 19 European Communities – Measures Affecting Asbestos and Asbestos-Containing Products (WT/DS135/AB/R), adopted 5 April 2001, DSR 2001: VII, 3243 at [172]; 40 ILM 1193 (hereafter DS135). 5 significantly closer to the pole of ‘indispensable’ than to the opposite pole of simply ‘making a contribution to’.”20

An insight into the limited scope of Art 8(1) of TRIPS may be gained by examining the GATT provision. While the GATT health exception is a true exception, it has been narrowly interpreted. Only one measure has been held to be ‘necessary’ under the GATT exception: a prohibition of the importation of asbestos products.21 The Appellate Body held that a WTO Member was entitled “to seek to halt the spread of a highly risky product while allowing the use of a less risky product in its place”.22

One GATT Panel decision concerned tobacco. Thailand prohibited the importation of tobacco except by licence, which was rarely granted.23 The Panel held that the import restriction would be ‘necessary’ if there is no less trade-restrictive measure that the Thai government could reasonably be expected to adopt in order to achieve its health protection aim.24

The import restriction sought to ensure the quality of tobacco on the Thai market and to reduce tobacco consumption. The Panel held that these concerns could have been addressed by non- discriminatory measures that applied to both domestic and imported tobacco.25 Thailand’s practice of allowing the sale of domestic cigarettes while prohibiting the import of cigarettes was thus not ‘necessary’.26

Given the strictness of the ‘necessity’ test, the ‘necessity’ of this measure under Art 8(1) is doubtful. No country has yet introduced a plain packaging requirement. The British government has indicated that it considers that a plain packaging requirement would fail the necessity test: “as yet, no studies have shown that introducing plain packaging of tobacco would cut the number of young people smoking or enable people who want to quit, to do so. Given the impact that plain packaging would have on intellectual property rights, the Government would need strong and convincing evidence showing the health benefits of this policy before it would be acceptable at an international level.”27 The elimination of tobacco company trademarks through plain packaging would fail the necessity test. There are reasonably available alternatives which would protect public health and would be less restrictive of trade.

Art 8(1) of TRIPS does not provide legal justification for plain packaging since (i) it does not justify measures that are inconsistent with other provisions of TRIPS and (ii) plain packaging would fail the necessity test.

(2)Whether a PP requirement for tobacco products, in the form of the Fielding Bill or otherwise, would be in violation of Australia’s obligations under the Agreement on Technical Barriers to Trade,28 including Article 2.2 of that Agreement

20 Korea – Measures Affecting Imports of Fresh, Chilled and Frozen Beef (WT/DS161/AB/R), adopted 10 January 2001, DSR 2001: I, 5 at [161] (referring to Art XX(d) GATT 1994). 21 Correa, supra n 7, 107. 22 DS135, supra n 19, [168]. 23 Thailand – Restrictions on Importation of and Internal Taxes in Cigarettes (DS10/R), adopted 7 November 1990, BISD 37S/200 at [6]. 24 Id, [75]. 25 Id, [76]-[78]. 26 Id, [81]. 27 http://www.number10.gov.uk/Page20708. 28 Marrakesh, 15 April 1994, 1868 UNTS 120, [1995] ATS 8 p 114. 6 Art 2.2 of the Technical Barriers Agreement provides in relevant part: “Members shall ensure that technical regulations are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to international trade. For this purpose, technical regulations shall not be more trade-restrictive than necessary to fulfil a legitimate objective, taking account of the risks non-fulfilment would create. Such legitimate objectives are, inter alia: … protection of human health ….”

A ‘technical regulation’ is defined as a “[d]ocument which lays down product characteristics … with which compliance is mandatory.” A technical regulation “may also … deal … with terminology, symbols, packaging, marking or labelling requirements as they apply to a product”.29

This definition refers to ‘product characteristics’. The Appellate Body has held that the characteristics of a product “include … any objectively definable ‘features’, ‘qualities’, ‘attributes’, or other ‘distinguishing mark’ of a product.”30 ‘Distinguishing mark’ would include a trademark.

A plain packaging requirement would lay down mandatory product characteristics. It would impose requirements concerning the terminology, symbols, packaging, marking and labeling applied to tobacco products. It would thus constitute a technical regulation.

A plain packaging requirement would impose an unnecessary obstacle in international trade. Less trade-restrictive alternatives exist for the reduction of tobacco use. Furthermore, the British Prime Minister referred to the lack of evidence regarding the effectiveness of plain packaging in reducing tobacco consumption: “no studies have shown that introducing plain packaging of tobacco would cut the number of young people smoking or enable people who want to quit, to do so.”31 A plain packaging requirement would violate Art 2.2 of the Agreement.

There is a rebuttable presumption that a technical regulation pursuing the objective of health protection is not an unnecessary obstacle to international trade if it is in accordance with a relevant international standard. 32 Few international organisations can be considered to be international standards organisations under the Technical Barriers Agreement.33 The World Health Organisation (see below) is not an international standards body under the Agreement. The WHO Tobacco Control Convention and the Guidelines for its implementation are not relevant international standards under the Agreement.

A plain packaging requirement would violate Art 2.2 of the Agreement on Technical Barriers to Trade.

(3) Whether a PP requirement for tobacco products, in the form of the Fielding Bill or otherwise, would be in violation of Australia’s obligations under the Paris Convention for the Protection of Industrial Property (Paris Convention)34

(a) Whether a PP requirement would be inconsistent with Australia’s obligations under Article 6quinquies of the Paris Convention

29 Annex 1(1) TBT. 30 DS135, supra n 19, [67]. 31 http://www.number10.gov.uk/Page20708. 32 Art 2.5 TBT. 33 Jan McDonald, “Domestic Regulation, International Standards, and Technical Barriers to Trade” (2005) 4 World Trade Review 249 at 269. 34 Paris, 20 March 1883, as revised at Stockholm, 14 July 1967, 828 UNTS 305, [1972] ATS 12. 7 Australia, Switzerland and the United States are party to the substantive provisions of the Stockholm Revision of the Paris Convention. 35 Furthermore, WTO Members are required to comply with the substantive provisions of the Paris Convention.36 All three countries are Members of the WTO.37

Art 6quinquies of the Paris Convention provides in relevant part:

“A.(1) Every trademark duly registered in the country of origin shall be accepted for filing and protected as is in the other countries of the Union, subject to the reservations indicated in this Article. …. B. Trademarks … may be neither denied registration nor invalidated except in the following cases: 1. when they are of such a nature as to infringe rights acquired by third parties in the country where protection is claimed; 2. when they are devoid of any distinctive character, or consist exclusively of signs or indications which may serve, in trade, to designate the kind, quality, quantity, intended purpose, value, place of origin, of the goods, or the time of production, or have become customary in the current language or in the bona fide and established practices of the trade of the country where protection is claimed; 3. when they are contrary to morality or public order and, in particular, of such a nature as to deceive the public.”

Art 6quinquies is directed to the registration or invalidation of trademarks. So far as plain packaging affects only use of a trademark after registration it will not infringe this provision. Art 6quinquies protects the rights to registration of a trademark and protection against use by other parties. It does not protect the right of the owner to use a trademark.38

The Director of the Industrial Property Law Department of the World Intellectual Property Organisation firmly rejected the argument that Art 6quinquies protects the right to use a trademark: “Article 6quinquies A does not address the question of use, but the obligation, … to accept for filing and protect (against infringement by others) a mark already registered in the country of origin. …. Article 6quinquies B does not mean that the use of a trademark registered under Article 6quinquies cannot be the subject of a limitation or prohibition for other grounds contained in laws other than the trademark law.”39

Several authors have argued that the Paris Convention protects the right to use a trademark as well as the right to registration. For example, Bernitz suggested that the general scheme of the Convention supports the existence of such a right.40 Castren acknowledged that on a literal reading Art 6quinquies protects only a right to registration, not a right of use. He argued that the historical context of this Article supports a right of use.41 The text of Art 6quinquies does not support such an expanded interpretation. There would need to be very clear and broadly supported statements in the

35 828 UNTS 307, 309, 311; 917 UNTS 347; 1154 UNTS 450. 36 Art 2(1) TRIPS. 37 1867 UNTS 154-155, 1890 UNTS 544. 38 McGrady, supra n 14, 66-67; Carvalho, supra n 10, 240. 39 Letter from Ludwig Baeumer, Director, Industrial Property Law Department, WIPO to Ralph Oman of Mudge Rose Guthrie Alexander & Ferdon, 31 August 1994, p 3 (hereafter Baeumer). 40 Ulf Bernitz, “Logo Licensing of Tobacco Products – Can it be Prohibited?” [1990] European Intellectual Property Review 137 at 139. 41 Martti Castren, “Tobacco Advertising and Trade Mark Law in Finland” (1995) 17 European Intellectual Property Review 87 at 89. 8 preparatory works for the Convention before such an extension of the text would be likely to be adopted by an international tribunal.

However, if a plain packaging requirement prevents the registration of tobacco trademarks it will violate paragraph (A) of Art 6quinquies because it does not come within the exceptions listed in paragraph (B). In Australia plain packaging would be a barrier to the registration of tobacco trade marks as well as a restriction upon their use after registration. Under Australian trade marks legislation an application for registration of a trade mark is dependent upon existing or future use of the mark in relation to the goods.42 Use of the trade mark in relation to goods is defined as “use of the trade mark upon, or in physical or other relation to, the goods”.43

The use must be “in the course of trade”.44 It is possible that the term ‘trade’ includes the wholesale trade as well as the consumer trade. However, it is more likely that use of the mark on packaging in a wholesale context would be regarded as ancillary to the product and would not constitute use in the course of trade.45 Use of the mark in a retail context would be prohibited. Use of the brand name in standard form on retail packages would comprise very little of the trade mark, which frequently includes the full trade dress of the product. The permitted uses would not be sufficient to constitute use in the course of trade.

In Australia a plain packaging requirement would make impossible the registration of new tobacco trade marks because registration is dependent upon use of the mark in relation to the goods. It would thus amount to a denial of registration on grounds that do not fall within paragraph (B) of Art 6quinquies.

A plain packaging requirement would be inconsistent with Art 6quinquies of the Paris Convention.

(b) Whether a PP requirement would be inconsistent with Australia’s obligations under Article 7 of the Paris Convention and Article 15(4) of TRIPS

Art 7 of the Paris Convention provides: “The nature of the goods to which a trademark is to be applied shall in no case form an obstacle to the registration of the mark.” The virtually identical provision in Art 15(4) of TRIPS46 also applies to services.47

Plain packaging of tobacco products is directly based upon the nature of the goods to which the trademarks are to be applied. Once again, so far as plain packaging affects only use rather than registration it would be consistent with these provisions.

The Director of the Industrial Property Law Department of WIPO also rejected the argument that Art 7 protects a right to use the trademark: “Article 7 … is silent on the question of permission to use a registered mark.” Parties to the Convention are “free to regulate or prohibit the sale of certain types of goods, and the fact that a mark has been registered for such goods does not give the right to the holder … to be exempted from any limitation or prohibition of use of the mark decided by the

42 s 27(1)(b), Trade Marks Act 1995 (Cth). 43 s 7(4), Trade Marks Act 1995 (Cth). 44 s 17, Trade Marks Act 1995 (Cth); Oakley Inc v Franchise China Pty Ltd [2003] FCA 105 at [20]-[30]; Christodoulou v Disney Enterprises Inc (2005) 156 FCR 344 at [27], [36], [2005] FCA 1401. 45 Playboy Enterprises Inc v Fitwear Ltd (1988) 12 IPR 310 at 317. 46 A similar provision appears in Art 1708(5) NAFTA. 47 Correa, supra n 7, 182. 9 competent authority of the country where the mark is registered.”48 The position is the same under the similarly worded Art 15(4) of TRIPS.49

However, the situation is different in relation to the registration of marks. A plain packaging requirement would be an insurmountable obstacle to the registration of new tobacco trade marks. New marks could not be registered as they would not satisfy the requirement for use. The nature of the goods to which the mark is to be applied (tobacco) would be an obstacle to registration of the mark.

A plain packaging requirement would be inconsistent with Art 7 of the Paris Convention and Art 15(4) of TRIPS.

(4) Whether a PP requirement for tobacco products, in the form of the Fielding Bill or otherwise, would be in violation of, or inconsistent with the Australia-US Free Trade Agreement50 or bilateral investment treaties

(A) Australia-US Free Trade Agreement

The AUSFTA defines investment to include “intellectual property rights”.51 Art 11.7(1) provides in relevant part: “Neither Party may expropriate … a covered investment either directly or indirectly through measures equivalent to expropriation … except: (a) for a public purpose; (b) in a non- discriminatory manner; (c) on payment of prompt, adequate, and effective compensation; and (d) in accordance with due process of law.”52

Art 11.7(5) provides that this guarantee against expropriation does not apply to the revocation or limitation of intellectual property rights, provided that this interference is consistent with the intellectual property chapter of the Agreement.53

This directs attention to the content of that chapter. The intellectual property chapter includes a national treatment obligation. 54 This obligation would not be infringed by a plain packaging requirement that treated the intellectual property rights of Australian and US nationals in the same manner. Unlike NAFTA, 55 the AUSFTA does not contain a provision regarding special requirements applicable to trademarks.

Another provision concerns limited exceptions to trademark rights. 56 A plain packaging requirement would not fall within these limited exceptions and would be inconsistent with this provision of the intellectual property chapter. The guarantee against expropriation would thus be potentially applicable to a plain packaging requirement.57

48 Baeumer, supra n 39, 2. 49 Correa, supra n 7, 182 and n 39. 50 Washington, 18 May 2004, [2005] ATS 1, HR Doc No 108-199. 51 Art 11.17(4)(f) AUSFTA. 52 A similar provision appears in Art 1110(1) NAFTA. 53 A similar provision appears in Art 1110(7) NAFTA. 54 Art 17.1(6) AUSFTA. 55 Art 1708(10) NAFTA. 56 Art 17.2(5) AUSFTA. 57 Cp National Intellectual Property Section of the Canadian Bar Association, Submission to the Standing Committee on Health on Plain Packaging for Tobacco Products (May 1994), 8. 10 A plain packaging requirement would not constitute a direct expropriation since there is no taking of title or seizure.58 The guarantee against expropriation expressly applies to measures that are “equivalent to expropriation”, that is, indirect expropriations. 59 The Agreement provides that determining whether governmental actions amount to an indirect expropriation “requires a case-by- case, fact-based inquiry that considers, among other factors: (i) the economic impact of the government action, although the fact that an action or series of actions by a Party has an adverse effect on the economic value of an investment, standing alone, does not establish that an indirect expropriation has occurred; (ii) the extent to which the government action interferes with distinct, reasonable investment-backed expectations; and (iii) the character of the government action.”60

So far as the first factor is concerned, the economic impact of a plain packaging requirement would be very substantial for tobacco companies. Arbitral decisions have denied compensation where the measure “has not affected all or almost all the investment’s economic value. Interference with the investment’s ability to carry on its business is not satisfied where the investment continues to operate, even if profits are diminished.”61 Applying this test, a plain packaging measure would deprive the trademarks of “all or almost all” of their economic value. The investment here is the trademark, not the tobacco company’s wider business operations.

TRIPS provides that trademarks are signs that are capable of “distinguishing the goods … of one undertaking from those of other undertakings”. 62 Similarly, national trademarks legislation emphasizes this primary function of distinguishing between competing products.63 This function has been described as “perform[ing] a crucially pro-competitive effect …. Without trademarks, competition would just not be possible.”64

The combination of the prohibition of tobacco advertising65 and plain packaging would eliminate this characteristic of tobacco trademarks. Plain packaging creates homogeneity, whereas trademarks distinguish between goods in the marketplace. The trademarks held by tobacco companies would be rendered “useless” by a plain packaging requirement.66

Furthermore, in Australia non-use of a trade mark is a ground for removing it from the Register.67 In removal proceedings the tobacco company would need to show that the trade mark had been used in relation to the goods within a period of three years ending one month before the removal application was filed.68

58 Annex 11-B(3) AUSFTA. 59 Art 11.7(1) AUSFTA. 60 Annex 11-B(4)(a) AUSFTA. This language derives from US takings jurisprudence. See Penn Central Transportation Co v New York 438 US 104 at 124 (1978); Lingle v Chevron USA Inc 544 US 528 at 538-539 (2005). Under the President’s trade promotion authority, it is a principal negotiating objective that “foreign investors in the United States are not accorded greater substantive rights with respect to investment protections than United States investors in the United States” (19 USC 3802(b)(3)). 61 LG&E Energy Corp v Argentina (Decision on Liability) (ARB/02/1), 3 October 2006, 21 ICSID Rev-FILJ 203 at [191], 46 ILM 40 (hereafter LG&E). 62 Art 15(1) TRIPS. 63 ss 17, 41, Trade Marks Act 1995 (Cth); s 1(1), Trade Marks Act 1994 (UK); s 5(1), Trade Marks Act 2002 (NZ); s 2, Trade-marks Act (RSC 1985, c T-13); 15 USC 1127. 64 Carvalho, supra n 10, 199. 65 ss 13, 15, Tobacco Advertising Prohibition Act 1992 (Cth). 66 Starrett Housing Corp v Iran (1983) 4 Iran-US CTR 122 at 156, 85 ILR 349; Consortium RFCC v Morocco (Award) (ARB/00/6), 22 December 2003, 20 ICSID Rev-FILJ 391 at [69]. 67 s 92, Trade Marks Act 1995 (Cth). 68 s 100(1)(c), Trade Marks Act 1995 (Cth). 11 A single good faith use within the three year period is sufficient to defeat a removal application.69 However, the use must be in “good faith”.70 A good faith use is “a real as opposed to a token use in a commercial sense. It requires a ‘substantial and genuine’ use”.71 Use of the trade mark in the wholesale context is unlikely to constitute a “substantial and genuine” use of the mark. Use undertaken merely to preserve the mark against removal is not considered to be done in “good faith”.72

Section 100(3)(c) of the Trade Marks Act 1995 provides that the trade mark owner may defeat the removal application by showing that the mark was not used during the three year period “because of circumstances … that were an obstacle to the use of the trade mark”. The issue arises whether a plain packaging requirement would constitute a circumstance that would be an obstacle to use of the trade mark. Not every circumstance that is “external to the owner” falls within this provision: the circumstance must be “of a trading nature”.73

This provision implements Art 19(1) of TRIPS.74 If an Australian legislative provision implements a treaty, resort may be had to the treaty in interpreting any ambiguity in the statutory provision.75 Section 100(3)(c) is ambiguous. Under Art 19(1) registration may be cancelled after three years of non-use unless the trademark owner demonstrates “valid reasons based on the existence of obstacles to such use”. Art 19(1) gives examples of circumstances that may constitute such an obstacle: “import restrictions on or other government requirements for goods ... protected by the trademark.”

Prohibition of the use of a trade mark may be regarded as a circumstance that is an obstacle to use of the mark during the three year period. However, such an obstacle would probably not be available as an effectively permanent ongoing defence against an application for removal. It is likely that after a little over three years a plain packaging requirement would prevent the company from successfully opposing a removal application.

So far as the second factor is concerned, a plain packaging requirement would frustrate the reasonable investment-backed expectation of tobacco companies that they would continue to be able to use their valuable trademark rights. (Under Australian law there is a right to use a trademark, not merely a right to prevent others from using the mark).76

So far as the third factor is concerned, the character of a plain packaging requirement is a major encumbrance upon the right to use the trademark. 77 While use of the brand name in a non- distinctive form would be permitted, use of the remaining trademarked features would be prohibited

69 Woolly Bull Enterprises Pty Ltd v Reynolds (2001) 107 FCR 166 at [17], [2001] FCA 261; Unilever Australia Limited v Karounos (2001) 113 FCR 322 at [64], [2001] FCA 1132; E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2008) 77 IPR 69 at [189], [2008] FCA 934. Counsel referred to this issue during the hearing of the High Court appeal in the Gallo case. See [2009] HCATrans 317 p 63; [2009] HCATrans 318 p 94. As at 23 February 2010 the High Court had not delivered its judgment in this appeal. 70 Woolly Bull, id, [16]. 71 Gallo, supra n 69, [190]. Counsel referred to this issue during the hearing of the High Court appeal in this case. See supra n 69. 72 Mark Davison et al, Shanahan’s Australian Law of Trade Marks and Passing Off (4th ed, Sydney: Thomson Reuters, 2008), 508, citing Imperial Group Ltd v Philip Morris & Co Ltd [1982] FSR 72 and Concord Trade Mark [1987] FSR 209. 73 Woolly Bull, supra n 69, [48]-[49], [54]. 74 Id, [52]. 75 Yager v R (1977) 139 CLR 28 at 44; Phonographic Performance Company of Australia Ltd v Federation of Australian Commercial Television Stations (1998) 195 CLR 158 at [33], [50], [1998] HCA 39. 76 s 20(1)(a), Trade Marks Act 1995 (Cth). 77 Cp Mudge, supra n 16, 3, 20-21. 12 in a consumer context.78 Use of the trademark in a wholesale context79 is of little value when separated from the right to use the mark in a consumer context, which is its primary purpose.80

The conditions for classification as an indirect expropriation are satisfied. However, another clause of the Agreement limits the scope of indirect expropriation in relation to public health measures. This clause provides in relevant part: “Except in rare circumstances, nondiscriminatory regulatory actions by a Party that are designed and applied to achieve legitimate public welfare objectives, such as the protection of public health, … do not constitute indirect expropriations.”81

Similar provisions of varying wordings now appear in numerous free trade agreements. 82 The Canadian version of this clause adds a specific example of such rare circumstances: “when a measure … is so severe in the light of its purpose that it cannot be reasonably viewed as having been adopted in good faith”.83 Another US free trade agreement gives a different example: “when a measure … is extremely severe or disproportionate in light of its purpose or effect”.84

We have been unable to locate any publicly released arbitral tribunal decisions that have interpreted such a clause. The AUSFTA does not define “rare circumstances” or give examples of such circumstances. In our view the word “rare” suggests that the circumstances must be of an exceptional nature, such as a gross disproportionality between the measure adopted and the objective pursued.

However, the conditions for the applicability of this clause must be satisfied before the concept of indirect expropriation will be confined to “rare circumstances”. Firstly, the measure must be non- discriminatory. Senator Fielding’s proposal would apply to both local and imported goods.85 It thus does not differentiate between Australian and United States nationals. This condition is satisfied.

78 Burkhart Goebel, “Trademarks as Fundamental Rights—Europe” (2009) 99 Trademark Reporter 931 at 951 (hereafter Goebel). 79 The Fielding Bill would apply to “all retail packages … and all individual packages in which cigarettes are sold at retail” (proposed r 53). 80 Goebel, supra n 78, 952. 81 Annex 11-B(4)(b) AUSFTA. 82 Exchange of Letters on Expropriation, US–Singapore FTA, Washington, 6 May 2003, HR Doc 108-100; Art 10.9, US–Chile FTA, Miami, 6 June 2003, HR Doc 108-101; Annex 10-B(4)(b), US–Morocco FTA, Washington, 15 June 2004, HR Doc 108-201; Annex 10-C(4)(b), Dominican Republic-Central America-US FTA, Washington, 5 August 2004, HR Doc 109-36; Annex B(4)(b), Treaty between US and Uruguay concerning the Encouragement and Reciprocal Protection of Investment, Montevideo, 25 October 2004, 44 ILM 268; Annex 10-B(3)(b), US-Peru Trade Promotion Agreement, Washington, 12 April 2006, HR Doc 110-60; Art III(3), Protocol to the Agreement between India and China on Promotion and Protection of Investments, New Delhi, 21 November 2006; Annex 10-B(3)(b), US-Colombia Trade Promotion Agreement, Washington, 22 November 2006, HR Doc 110-103; Annex 10-B(4)(b), US–Panama Trade Promotion Agreement, Washington, 28 June 2007; Annex 10-B(3)(b), Australia-Chile FTA, Canberra, 30 July 2008, [2009] ATS 6; Annex 13(5), FTA between New Zealand and China, Beijing, 7 April 2008. In several cases the words ‘except in rare circumstances’ are omitted. See Art 20(8), Investment Agreement for the COMESA Common Investment Area, Nairobi, 23 May 2007; Annex 7(5), New Zealand–Malaysia FTA, Kuala Lumpur, 26 October 2009; para 4, Annex on Expropriation and Compensation, Agreement Establishing the Association of Southeast Asian Nations (ASEAN)–Australia–New Zealand Free Trade Area, Cha-am, Thailand, 27 February 2009, [2010] ATS 1. 83 Annex B.13(1)(c), Agreement between Canada and Peru for the Promotion and Protection of Investments, Hanoi, 14 November 2006, Can TS 2007 No 10; Annex 811(2)(b), FTA between Canada and Colombia, Lima, Peru, 21 November 2008. 84 Annex 11-B(3)(b), FTA between the US and the Republic of Korea, Washington, 30 June 2007. 85 Proposed rr 7(3), 53. 13 Secondly, the regulatory action must be designed and applied to achieve the objective of health protection. The AUSFTA does not specify the minimum level of evidence that would be required to justify a public health measure. 86 The WTO Appellate Body has held that in adopting health measures under GATT national governments are not limited to following majority scientific opinion, but may follow “divergent, but qualified and respected” scientific opinion.87 (The Appellate Body did not describe this as a minimum standard). However, this standard will not apply under the investment provisions of the AUSFTA. The GATT health exception does not apply to the investment chapter of the AUSFTA, though it is expressly applied to many other chapters of the Agreement.88

There are no directly relevant decisions of international tribunals. It is our view that under the AUSFTA at a minimum clear and convincing evidence of the effectiveness of plain packaging in substantially reducing tobacco consumption would be necessary before it could be regarded as a regulatory action taken for the protection of public health. The measures taken to address an actual or potential risk to health should be subject to a greater level of scrutiny than that applying to the existence of the risk itself, especially where those measures are expropriatory.

For example, in our view the evidence will not support the effectiveness of plain packaging if it suggests that the major effect of branded packaging is to influence the market share of particular brands among existing smokers.89 In that case the introduction of plain packaging would constitute an indirect expropriation. Such a measure could not be said to be a regulatory action that was designed and applied to achieve the objective of health protection. The second condition for the applicability of the “rare circumstances” clause would not be satisfied and that clause would therefore be inapplicable.

In our view under the AUSFTA at a minimum clear and convincing evidence of the effectiveness of plain packaging in substantially reducing tobacco consumption would be necessary. If the evidence suggests that the major effect of branded packaging is to influence the market share of particular brands among existing smokers, the introduction of plain packaging would constitute an indirect expropriation of the trademarks of tobacco companies under the AUSFTA. Senator Fielding’s Bill makes no provision for compensation for the expropriation of these trademarks.

Under the AUSFTA Australia is also required to accord “fair and equitable treatment” to investments by US investors.90 The obligation to accord fair and equitable treatment is expressly limited to the “customary international law minimum standard of treatment of aliens”. 91 The guarantee of fair and equitable treatment under NAFTA is similarly limited to the customary international law minimum standard.92

86 By contrast, the SPS Agreement requires “sufficient scientific evidence” but does not define that term. See Art 2(2), Agreement on the Application of Sanitary and Phytosanitary Measures, Marrakesh, 15 April 1994, 1867 UNTS 493, [1995] ATS 8 p 65. 87 DS135, supra n 19, [178] (under Art XX(b) GATT 1994); see similarly EC Measures Concerning Meat and Meat Products (Hormones) (WT/DS26/AB/R), adopted 13 February 1998, DSR 1998: I, 135 at [124], [194] (under Art 5.1 SPS). 88 Art 22.1(1) AUSFTA. It also does not apply to the intellectual property chapter (Ch 17). 89 Cp Canadian Parliament Standing Committee on Health, Towards Zero Consumption: Generic Packaging of Tobacco Products (1994), 62. 90 Art 11.5(1) AUSFTA. A similar provision appears in Art 1105(1) NAFTA. 91 Art 11.5(1)-(2) AUSFTA. 92 Para 2(2), NAFTA Free Trade Commission, Notes of Interpretation of Certain Chapter 11 Provisions, Washington, 31 July 2001. Similar limitations appear in Para B, Canada-Chile Free Trade Commission, Notes of Interpretation of Certain Chapter G Provisions, Quito, 31 October 2002; Art 5, Treaty between the US and Uruguay Concerning the Encouragement and Reciprocal Protection of Investment, Montevideo, 25 October 2004, 44 ILM 268; Art 10.5(2), Australia-Chile FTA, Canberra, 30 July 2008, [2009] ATS 6. 14

An arbitral tribunal has held that under NAFTA the guarantee of fair and equitable treatment includes the obligation to maintain a predictable framework for the investment. 93 The same requirement would apply under the AUSFTA. Here the investments are trademarks. By taking away established trademark rights plain packaging would fail to maintain a predictable framework for the investment. The obligation to accord fair and equitable treatment would thus be violated.

The introduction of a plain packaging requirement would breach the obligation under the AUSFTA to accord fair and equitable treatment to investments.

(B) Bilateral Investment Treaties

Australia has entered into bilateral investment treaties with the following nations: Argentina, Chile, China, Czech Republic, Egypt, Hungary, India, Indonesia, Laos, Lithuania, Pakistan, Mexico, Papua New Guinea, Peru, Philippines, Poland, Romania, Sri Lanka, Turkey, Uruguay and Vietnam.94 The Turkish treaty is not yet in force. When it enters into force it will not apply to disputes that arose prior to its entry into force.95

Whether relief against expropriation could be available under these bilateral treaties would depend upon whether ‘investors’ (in some cases ‘nationals’) from any of these nations have investments in tobacco trademarks in Australia. ‘Investor’ or ‘national’ includes an individual or company. 96 Investment is defined to include intellectual property.97

The expropriation guarantees apply to measures with an effect that is ‘equivalent’ to expropriation.98 The agreements do not define ‘equivalent’, so guidance must be sought in the practice of international tribunals. The interference with property rights must cause “at least a

93 Metalclad Corporation v Mexico (Award) (ARB(AF)/97/1), 30 August 2000, 5 ICSID Rep 212 at [99]- [101], 119 ILR 615, 40 ILM 36. 94 Argentina: 23 Aug 1995, 1985 UNTS 85, [1997] ATS 4; Chile: 9 Jul 1996, 2116 UNTS 379, [1999] ATS 37; China: 11 Jul 1988, 1514 UNTS 65, [1988] ATS 14; Czech Republic: 30 Sep 1993, 1819 UNTS 455, [1994] ATS 18; Egypt: 3 May 2001, 2208 UNTS 347, [2002] ATS 19; Hungary: 15 Aug 1991, 1680 UNTS 3, [1992] ATS 19; India: 26 Feb 1999, 2116 UNTS 145, [2000] ATS 14; Indonesia: 17 Nov 1992, 1770 UNTS 301, [1993] ATS 19; Laos: 6 Apr 1994, 1889 UNTS 99, [1995] ATS 9; Lithuania: 24 Nov 1998, 2336 UNTS 341, [2002] ATS 7; Mexico: 23 Aug 2005, UNTS No I: 44575, [2007] ATS 20; Pakistan: 7 Feb 1998, 2044 UNTS 715, [1998] ATS 23; PNG: 3 Sep 1990, 1660 UNTS 223, [1991] ATS 38; Peru: 7 Dec 1995, 1985 UNTS 211, [1997] ATS 8; Philippines: 25 Jan 1995, 1945 UNTS 143, [1995] ATS 28; Poland: 7 May 1991, 1680 UNTS 235, [1992] ATS 10; Romania: 21 Jun 1993, 1819 UNTS 413, [1994] ATS 10; Sri Lanka: 12 Nov 2002, UNTS No I: 44573, [2007] ATS 22; Turkey: 16 Jun 2005, [2005] ATNIF 9; Uruguay: 3 Sep 2001, 2258 UNTS 379, [2003] ATS 10; Vietnam: 5 Mar 1991, 1661 UNTS 225, [1991] ATS 36. 95 Art 2(1) Turkey. 96 Art 1(1)(c) Argentina; Art 1(2)(b)-(c) Chile; Art 1(1)(d) China; Art 1(1)(b) Czech Republic; Art 1(1)(c) Egypt; Art 1(1)(c)(i) Hungary; Art 1(d) India; Art 1(1)(b) Indonesia; Art 1(1)(c) Laos; Art 1(1)(d) Lithuania; Art 1(1)(c)-(d) Mexico; Art 1(1)(c) Pakistan; Art 2(1) PNG; Art 1(1)(c)(i) Peru; Art 1(1)(c) Philippines; Art 1(1)(d) Poland; Art 1(1)(c) Romania; Art 1(1)(c)(i) Sri Lanka; Art 1(1)(c)-(d) Turkey; Art 1(1)(c)(i) Uruguay; Art 1(1)(c) Vietnam. 97 Art 1(1)(a)(iv) Argentina; Art 1(1)(d) Chile; Art 1(1)(b)(iv) China; Art 1(1)(a)(iv) Czech Republic; Art 1(1)(a)(iv) Egypt; Art 1(1)(a)(iv) Hungary; Art 1(c) India; Art 1(1)(a)(iv) Indonesia; Art 1(1)(a)(iv) Laos; Art 1(1)(a)(iv) Lithuania; Art 1(1)(a)(vii) Mexico; Art 1(1)(a)(iv) Pakistan; Art 1(1)(d)(iv) PNG; Art 1(1)(a)(iv) Peru; Art 1(1)(a)(iv) Philippines; Art 1(1)(a)(iv) Poland; Art 1(1)(a)(iv) Romania; Art 1(1)(a)(iv) Sri Lanka; Art 1(1)(a)(iv) Turkey; Art 1(1)(a)(iv) Uruguay; Art 1(1)(a)(iv) Vietnam. 98 Art 7(1) Argentina; Art 6(1) Chile (‘indirectly’); Art 8(1) China (‘similar effect’); Art 6(1) Czech Republic; Art 7(1) Egypt; Art 7(1) Hungary; Art 7(1) India; Art 6(1) Indonesia; Art 7(1) Laos; Art 7(1) Lithuania; Art 7(1) Mexico; Art 7(1) Pakistan; Art 7(1) PNG; Art 7(1) Peru; Art 7(1) Philippines; Art 7(1) Poland; Art 5(1) Romania; Art 7(1) Sri Lanka (‘indirectly’); Art 7(1) Turkey; Art 7(1) Uruguay; Art 7(1) Vietnam. 15 ‘substantial loss of control or value’ or ‘severe economic impact’”.99 A plain packaging measure would deprive the trademarks of tobacco companies of “all or almost all” of their economic value.100

A measure that disappoints legitimate investor expectations is more likely to be regarded as an expropriation.101 A plain packaging requirement would frustrate the reasonable investment-backed expectation of tobacco companies that they would continue to be able to use their trademarks.

The Australian government would not acquire a financial benefit by expropriating the trademarks of tobacco companies. However, it is not necessary that the government itself acquires a financial benefit by its expropriation measure.102 Finally, the expropriation must not be temporary.103 A plain packaging measure would most likely be permanent. The conditions for classification as an indirect expropriation are satisfied.

These treaties do not contain a clause relating to public health or other public objectives. However, even where a treaty contains no specific provision regarding regulatory measures, some international tribunals have held that customary international law exempts non-discriminatory bona fide regulatory measures from the requirement to pay compensation for expropriation.104 Measures for the protection of public health would fall within the ambit of legitimate regulatory measures.

On the other hand, some tribunals have held: “Expropriatory environmental measures—no matter how laudable and beneficial to society as a whole—are … similar to any other expropriatory measures that a state may take in order to implement its policies: where property is expropriated, even for environmental purposes, whether domestic or international, the state’s obligation to pay compensation remains.”105 This reasoning also applies to public health measures. If an international tribunal adopted this approach, expropriatory public health measures would ordinarily be compensable.

The investment treaties do not contain a clause providing that health protection measures will only constitute an expropriation in “rare circumstances”. Without that restrictive language, it will be easier to establish that a measure constitutes a compensable expropriation. There would be room for a balancing test. For example, in applying a guarantee of private property the European Court of Human Rights seeks to strike “a fair balance … between the protection of the right of property and the requirements of the general interest”.106 Plain packaging would likely fail such a balancing test because it strikes the balance entirely on one side when less drastic alternatives exist for reducing tobacco consumption.

99 August Reinisch, “Expropriation” in Peter Muchlinski et al, The Oxford Handbook of International Investment Law (Oxford: Oxford University Press, 2008), 407 at 438-439 (hereafter Reinisch). 100 LG&E, supra n 61, [191]. 101 Reinisch, supra n 99, 448. 102 Tippetts v TAMS-AFFA Consulting Engineers of Iran (1984) 6 Iran-US CTR 219 at 225; Motorola Inc v Iran National Airlines Corp (1988) 19 Iran-US CTR 73 at 95. 103 Tecnicas Medioambientales Tecmed SA v Mexico (ARB(AF)/00/2), 29 May 2003, 10 ICSID Rep 130 at [116], 43 ILM 133 (hereafter Tecmed); LG&E, supra n 61, [193]. 104 Methanex Corp v United States (Final Award), 3 August 2005, 44 ILM 1345 at 1456; Saluka Investments BV v Czech Republic (Partial Award), 17 March 2006, 18 no 3 WTAM 169 at [254]-[255] (hereafter Saluka). 105 Compañía del Desarrollo de Santa Elena SA v Costa Rica (Final Award) (ARB/96/1), 17 February 2000, 5 ICSID Rep 153 at [72], 39 ILM 1317; applied in Tecmed, supra n 103, [121]. 106 Immobiliare Saffi v Italy ECHR 1999-V p 73 at [49], 30 EHRR 756; Efstathiou v Greece ECHR 2003-IX at [26], 43 EHRR 24; Schembri v Malta, 42583/06, 10 November 2009 at [35]. 16 It is our view that under the bilateral investment treaties at a minimum clear and convincing evidence of the effectiveness of plain packaging in substantially reducing tobacco consumption would be necessary. For example, if the evidence suggests that the major effect of branded packaging is to influence the market share of particular brands among existing smokers, a plain packaging requirement could not be regarded as a bona fide regulatory measure. It would thus constitute an indirect expropriation.

In our view under the bilateral investment treaties at a minimum clear and convincing evidence of the effectiveness of plain packaging in substantially reducing tobacco consumption would be necessary. If the evidence suggests that the major effect of branded packaging is to influence the market share of particular brands among existing smokers, a plain packaging requirement would constitute an indirect expropriation under bilateral investment treaties.

Under these bilateral investment treaties the Australian government must also ensure “fair and equitable treatment” for investments made by investors from the other treaty partner.107 Numerous arbitral tribunals have held that the obligation of fair and equitable treatment includes maintaining a stable framework for the investment,108 including the legal framework. Here the investments are trademarks.

An investor is not entitled to expect that the applicable legal framework will remain entirely unchanged. 109 However, introduction of a plain packaging requirement would constitute a fundamental change to the legal regulations applicable to the investment. Such a fundamental change would violate the obligation to ensure fair and equitable treatment by failing to maintain a stable framework for the investment.110

Introduction of a plain packaging requirement would violate the obligation under the bilateral investment treaties to ensure fair and equitable treatment.

(5) Relevance of the WHO Convention

The World Health Organization has adopted a Framework Convention on Tobacco Control (hereafter the ‘WHO Convention’).111 Australia is a party to the WHO Convention.112 Switzerland and the United States have not ratified the treaty.113

Two provisions of the WHO Convention have indirect relevance for plain packaging. Art 11(1) provides in relevant part: “Each Party shall … adopt … effective measures to ensure that: (a) tobacco product packaging and labelling do not promote a tobacco product by any means that are

107 Art 4(1) Argentina; Art 4(1) Chile; Art 3(a) China; Art 3(2) Czech Republic; Art 3(2) Egypt; Art 3(2) Hungary; Art 3(2) India; Art 2(2) Indonesia; Art 3(2) Laos; Art 3(2) Lithuania; Art 4(1) Mexico; Art 3(2) Pakistan; Art 3(3) PNG; Art 3(2) Peru; Art 3(2) Philippines; Art 3(2) Poland; Art 3(2) Romania; Art 3(2) Sri Lanka; Art 3(2) Turkey; Art 3(2) Uruguay; Art 3(2) Vietnam. 108 Occidental Exploration and Production Co v Ecuador (Award) (UN3467), 1 July 2004, 43 ILM 1248 at [183]; CMS Gas Transmission Co v Argentina (Award) (ARB/01/8), 12 May 2005, 44 ILM 1205 at [273]- [274], [276]; Bayindir Insaat Turizm Ticaret Ve Sanayi AS v Pakistan (Jurisdiction), 14 November 2005, 18 no 1 WTAM 163 at [237]-[241]; LG&E, supra n 61, [124]-[125], [131]; PSEG Global Inc v Turkey (Award) (ARB/02/5), 19 January 2007, 19 no 3 WTAM 107 at [239]-[240], [253]-[254]; Enron Corporation v Argentina (Award) (ARB/01/3), 22 May 2007, 19 no 4 WTAM 109 at [259]-[260]. 109 CMS, supra n 108, [277]; Saluka, supra n 104, [305]; Enron, supra n 108, [261]. 110 CMS, supra n 108, [275]. 111 Geneva, 21 May 2003, 2302 UNTS 166, 42 ILM 518, [2005] ATS 7. 112 2302 UNTS 168. 113 http://www.who.int/fctc/signatories_parties/en/index.html. 17 false, misleading, deceptive or likely to create an erroneous impression about its characteristics, health effects, hazards or emissions, including any term, descriptor, trademark, figurative or any other sign that directly or indirectly creates the false impression that a particular tobacco product is less harmful than other tobacco products. ….”

This provision does not impose any obligation to introduce plain packaging. Its terms go no further than requiring parties to adopt measures against false or deceptive labeling. However, the Guidelines for the implementation of this provision promote the adoption of plain packaging:

“Parties should consider adopting measures to restrict or prohibit the use of logos, colours, brand images or promotional information on packaging other than brand names and product names displayed in a standard colour and font style (plain packaging). This may increase the noticeability and effectiveness of health warnings and messages, prevent the package from detracting attention from them, and address industry package design techniques that may suggest that some products are less harmful than others.”114

These Guidelines were adopted by the Conference of the Parties to the WHO Convention. A Convention Secretariat publication states that the Guidelines “are intended to help Parties to meet their obligations under the respective provisions of the Convention. They reflect the consolidated views of Parties on different aspects of implementation …. The guidelines also aim to reflect and promote best practices and standards that governments would benefit from in the treaty- implementation process.” 115 This statement suggests that while some parts of the Guidelines elucidate obligations under the WHO Convention, other parts go further than the Convention by promoting “best practices and standards”.

Given the absence of an obligation under Art 11 to introduce plain packaging, this part of the Guidelines appears to be a non-binding recommendation. The Guidelines do not claim that there is an obligation under the WHO Convention to introduce plain packaging. At most, this aspect of the Guidelines is aspirational.

Art 13(2) of the WHO Convention provides in relevant part: “Each Party shall … undertake a comprehensive ban of all tobacco advertising [or] promotion”. Art 13 does not impose an obligation to introduce plain packaging. Advertising and promotion are defined as “any form of commercial communication, recommendation or action with the aim … or likely effect of promoting … tobacco use either directly or indirectly.”116 Even under this broad definition tobacco packaging does not constitute advertising or promotion. Art 13(5) encourages the parties to introduce more wide ranging measures, but does not impose any obligation to that effect.117

However, the Guidelines for Art 13 encourage the introduction of plain packaging:

“The effect of advertising or promotion on packaging can be eliminated by requiring plain packaging: black and white or two other contrasting colours, as prescribed by national authorities; nothing other than a brand name, a product name and/or manufacturer’s name, contact details and the quantity of product in the packaging, without any logos or other features apart from health warnings, tax stamps and other government-mandated information or markings; prescribed font

114 WHO Framework Convention on Tobacco Control. Guidelines for Implementation: Article 5.3; Article 8; Article 11; Article 13 (Geneva: Convention Secretariat, WHO Framework Convention on Tobacco Control, 2009), 41 (hereafter Guidelines). 115 Id, v. 116 Art 1(c) FCTC. 117 Art 2(1) also provides that “Parties are encouraged to implement measures beyond those required by this Convention”. 18 style and size; and standardized shape, size and materials. There should be no advertising or promotion inside or attached to the package or on individual cigarettes or other tobacco products.”118

The Guidelines also include the following “recommendation”: “Packaging and product design are important elements of advertising and promotion. Parties should consider adopting plain packaging requirements to eliminate the effects of advertising or promotion on packaging. Packaging, individual cigarettes or other tobacco products should carry no advertising or promotion, including design features that make products attractive.”119

The Guidelines may be regarded as relevant in construing the scope of the WHO Convention. Under the Vienna Convention on the Law of Treaties “any subsequent practice in the application of the treaty which establishes the agreement of the parties regarding its interpretation” must be taken into account when interpreting the treaty.120 Australia and Switzerland are parties to the Vienna Convention.121 The United States has not ratified the Vienna Convention, but is bound by the customary international law of treaty interpretation. This provision of the Vienna Convention reflects customary international law.122

The WHO Convention itself does not impose an obligation to introduce a plain packaging requirement. The Guidelines do not purport to impose such an obligation and are expressed in terms of a recommendation. However, the possibility remains that the WHO Convention could be interpreted as giving rise to such an obligation. On that basis it is necessary to consider the relationship between the WHO Convention and the other treaties discussed herein.

The WHO Convention and its implementing Guidelines do not impose an obligation to introduce a plain packaging requirement.

(6) Relationship between the WHO Convention and the Other Treaties

If there is an apparent conflict between treaties, it is necessary to first consider whether a harmonising interpretation of the treaties is possible.123 An obvious harmonising interpretation is that the WHO Convention does not impose an obligation to introduce plain packaging so there is no conflict with the other relevant treaties (TRIPS, the Paris Convention, AUSFTA and bilateral investment treaties). This is the most persuasive conclusion.

Under the lex specialis principle the more specific treaty obligation prevails over the more general treaty obligation. 124 The Vienna Convention does not regulate this principle. 125 Customary

118 Guidelines, supra n 114, 55. 119 Ibid. 120 Art 31(3)(c) VCLT, Vienna, 23 May 1969, 1155 UNTS 331. 121 1155 UNTS 332, 1564 UNTS 424. 122 Territorial Dispute (Judgment) ICJ Rep 1994, p 6 at [41]; Maritime Delimitation and Territorial Questions between Qatar and Bahrain (Jurisdiction and Admissibility) ICJ Rep 1995, p 6 at [33]; LaGrand Case (Judgment) ICJ Rep 2001, p 466 at [99]; Legality of Use of Force (Preliminary Objections) ICJ Rep 2004, p 720 at [98]. 123 Markus Benzing, “US Bilateral Non-Surrender Agreements and Article 98 of the Statute of the International Criminal Court: An Exercise in the Law of Treaties” (2004) 8 Max Planck Year Book of United Nations Law 181 at 222 (hereafter Benzing); Mark E Villiger, Commentary on the 1969 Vienna Convention on the Law of Treaties (Leiden: Martinus Nijhoff, 2009), 402 (hereafter Villiger). 124 Gabrielle Marceau, “Conflicts of Norms and Conflicts of Jurisdictions: The Relationship between the WTO Agreement and MEAs and other Treaties” (2001) 35 Journal of World Trade 1081 at 1092. 125 Villiger, supra n 123, 409. 19 international law applies where the Vienna Convention does not regulate an aspect of the law of treaties.126 This principle is part of customary international law.127 It would apply to treaty relations between Australia and Switzerland or the United States.

It might be argued that the WHO Convention is a more specific obligation in relation to the exercise of intellectual property rights concerning tobacco products, and would prevail over the more general provisions of the other treaties regarding intellectual property. However, only one provision of the WHO Convention expressly refers to intellectual property rights, 128 whereas the other treaties extensively regulate that subject. The other treaties would prevail as the more specific obligations.

Assuming that conflict cannot be avoided by a harmonising interpretation, neither TRIPS nor the WHO Convention contains a “conflict clause” setting out the legal position where the treaty conflicts with another international agreement. The Conference that adopted the WHO Convention decided that conflicts with the WTO Agreements would be determined under Art 30 of the Vienna Convention, which deals with successive treaties concerning the same subject matter.129

Both Australia and Switzerland are party to the Vienna Convention.130 The United States has not ratified the Vienna Convention. However, Art 30 is generally regarded as having the status of customary international law131 and similar principles would apply as between Australia and the United States.

In determining a conflict between treaties the relevant date is the date on which the treaties were adopted not the date when they entered into force.132 TRIPS and the Technical Barriers Agreement (TBT) were opened for signature on 15 April 1994, while the WHO Convention was opened for signature on 21 May 2003. The WHO Convention was thus adopted later in time. The Stockholm revision of the Paris Convention was open for signature on 14 July 1967.133 The WHO Convention was adopted later in time. The AUSFTA was signed on 18 May 2004. The AUSFTA was thus adopted later in time.

Art 30(3) of the Vienna Convention provides in relevant part: “When all the parties to the earlier treaty are parties also to the later treaty …, the earlier treaty applies only to the extent that its provisions are compatible with those of the later treaty.” This provision does not apply here. Not all parties to TRIPS, TBT or the Paris Convention are party to the WHO Convention, which has not been ratified by (among others) Switzerland and the United States. Not all parties to the WHO Convention are party to the AUSFTA.

126 Preamble para 8 VCLT. 127 Right of Passage Over Indian Territory ICJ Rep 1960, p 6 at 44; Legality of the Threat or Use of Nuclear Weapons ICJ Rep 1996, p 226 at [25]; Legal Consequences of the Construction of a Wall in the Occupied Palestinian Territory ICJ Rep 2004, p 136 at [106]. 128 Art 11(1)(a) FCTC (trademarks). 129 Allyn L Taylor, “Trade, Human Rights, and the WHO Framework Convention on Tobacco Control: Just What the Doctor Ordered?” in Thomas Cottier et al (eds), Human Rights and International Trade (Oxford: Oxford University Press, 2005), 322 at 328. 130 1155 UNTS 332, 1564 UNTS 424. 131 Jan B Mus, “Conflicts Between Treaties in International Law” (1998) 45 Netherlands International Law Review 208 at 213 (hereafter Mus); Villiger, supra n 131, 410. 132 Mus, id, 221; Benzing, supra n 123, 224; Christopher J Borgen, “Resolving Treaty Conflicts” (2005) 37 George Washington International Law Review 573 at 601; Anthony Aust, Modern Treaty Law and Practice (2nd ed, Cambridge: Cambridge University Press, 2007), 229; Villiger, supra n 123, 402. 133 The VCLT applies only to treaties concluded after its entry into force on 27 January 1980 (Art 4; 1155 UNTS 332 n 1). The Paris Convention was adopted before this date. However, the relevant principles of customary international law are the same those that apply under the VCLT. 20 Art 30(4) of the Vienna Convention provides: “When the parties to the later treaty do not include all the parties to the earlier one: (a) As between States parties to both treaties [Art 30(3) above applies]; (b) As between a State party to both treaties and a State party to only one of the treaties, the treaty to which both States are parties governs their mutual rights and obligations.”

Paragraph (a) applies as between Australia and those States that are party to both TRIPS, TBT or the Paris Convention and the WHO Convention. TRIPS, TBT and the Paris Convention would apply “only to the extent that [their] provisions are compatible with” the WHO Convention.

Paragraph (b) applies as between Australia and Switzerland. It would also apply as between Australia and the United States. In these two cases TRIPS, TBT and the Paris Convention would apply as they are the treaties to which both States are parties. As between Australia and the United States, the AUSFTA would also apply as it is the treaty to which both States are party.

In the case of a conflict with the WHO Convention, TRIPS would apply as between Australia and Switzerland. In such a conflict TRIPS would also apply as between Australia and the United States.

(7) The likely ramifications for Australia in the event that it is considered that a PP requirement is in violation of or inconsistent with any of the international treaties or agreements to which Australia is a party

(A) Relevance of US Domestic Law

US domestic law raises apparent obstacles to intervention on behalf of the tobacco industry by the US Trade Representative under the AUSFTA or the WTO Agreements. The Doggett Amendment states: “None of the funds provided by this Act shall be available … to seek the reduction or removal by any foreign country of restrictions on the marketing of tobacco or tobacco products, except for restrictions which are not applied equally to all tobacco or tobacco products of the same type.”134 An executive order further provides that executive departments may not seek the reduction or removal of foreign restrictions upon tobacco advertising as well as marketing.135

Since 1997 the Doggett Amendment has been included in Congressional appropriations for the Commerce, Justice, State and Science Departments.136 The statutory restriction applies to the use of funds by these departments. The executive order applies more broadly to all executive departments and agencies and extends beyond the use of funds.

The Doggett Amendment and the executive order expressly permit intervention by the US Trade Representative against discriminatory measures. However, the Fielding Bill does not discriminate between domestic and imported products.137

No federal or state cases have interpreted the Amendment. The extent of the restriction this provision places upon the US Trade Representative is unclear. US federal courts have resort to the legislative history of a provision to resolve an ambiguity.138 In the House of Representatives the

134 Pub L 111-117, sec 510, 7082, 123 Stat 3151, 3400 (2009). 135 Exec Order 13193, sec 2(a), 3 CFR 740 (2002), 66 Fed Reg 7387 (2001). As at 29 January 2010 this executive order had not been amended or revoked. 136 Eg Pub L 105-119, sec 618 (1997); 105-277, sec 618 (1998); 106-113, sec 617 (1999); 106-553, sec 616 (2000); 107-077, sec 616 (2001); 111-8, sec 510 (2009). 137 Proposed rr 7(3), 53. 138 Exxon Mobil Corp v Allapattah Services Inc 545 US 546 at 568 (2005). 21 sponsor of the original amendment and an opponent both agreed that the provision would apply to action by the US Trade Representative.139

The legislative history also provides an insight into the scope of the restriction. The House Report concerning the original amendment includes the following language: “the conferees do not intend to prohibit the use of funds for routine international trade services available to all US citizens such as … assistance in assuring fair treatment of US companies by foreign governments in transactions such as customs clearance and intellectual property rights enforcement.”140 This language suggests that the Doggett Amendment may not prohibit intervention by the US Trade Representative in support of the fair treatment of US tobacco companies in relation to the enforcement of intellectual property rights arising under international trade agreements.

Assuming that the Amendment does prohibit such intervention by the US Trade Representative, the Amendment is not a ‘permanent’ provision of federal law that would remain in force until it was repealed.141 It is subject to reenactment by Congress with each appropriation for specific federal departments. Should Congress decline to reenact the Amendment, the consistency of plain packaging with the AUSFTA or the WTO Agreements would clearly be open to action by the US Trade Representative. The executive order is also subject to revocation by a subsequent US administration. It would be prudent to act upon the assumption that these restrictions may not be a permanent feature of US domestic law.

Under US domestic law where there is a conflict between a treaty and a Congressional statute, whichever was adopted ‘last in time’ prevails.142 The current version of the statute was enacted after the treaties (in 2009). However, any inconsistency between the statute and the treaties is limited to enforcement of the treaties, not the treaty obligations themselves. Furthermore, the statute has effect only in US domestic law. The legislation does not affect the existence or scope of Australian obligations under international law, nor US obligations to Australia.

The Doggett Amendment is not a ‘permanent’ provision of US law and is subject to reenactment by Congress with each appropriation.

(B) Remedies for Breach of Treaty Obligations

The WTO dispute resolution process is available for a breach of TRIPS.143 A national government that is a member of the WTO would need to bring enforcement action through the dispute settlement process as private parties do not have that right.

If not settled through consultation, conciliation or mediation, 144 trade disputes are determined by dispute settlement Panels and the Appellate Body on appeal.145 The Dispute Settlement Body adopts

139 143 Cong Rec H8010, H8012 (1997). 140 HR Rep 105-405 at 194 (1997). Subsequent House Reports omit most of the explanatory material, including this statement. See HR Rep 105-825 at 1099; 106-283 at 138; 106-398 at 169; 106-479 at 239; 106-680 at 134; 106-1005 at 315; 107-139 at 136; 107-278 at 169; 108-221 at 158; 108-10 at 785; 108-576 at 130; 109-118 at 156; 109-520 at 143; 110-240; 110-919 at 149; 111-149 at 166; 111-366 at 772. 141 In 1998 the Senate did not pass proposals that would have made this restriction a ‘permanent’ part of federal law. See 144 Cong Rec S5818, S5853, S5897, S6064, S6100, S6486, S6581, S6618 (1998). 142 Breard v Greene 523 US 371 at 376 (1998); Medellin v Texas 552 US 491 at 509 n 5, 518 (2008). 143 Art 64(1) TRIPS. 144 Arts 4-5 DSU, 1869 UNTS 401, [1995] ATS 8 p 375. 145 Arts 6, 17 DSU. 22 Panel and Appellate Body reports unless it decides otherwise by consensus.146 A WTO Member against whom a complaint is brought thus may not block the adoption of a Panel report.147

The most likely sanction for a violation of TRIPS is the withdrawal of tariff concessions under GATT. 148 Compensation and the suspension of concessions are available as remedies for non- implementation of an adopted report.149

The AUSFTA does not include an investor-state dispute mechanism by which an investor could bring a claim before binding international arbitration.150 The Agreement also rules out a private remedy in United States courts against an Australian measure.151

An aggrieved United States investor must thus rely upon action by their national government under the AUSFTA dispute settlement mechanism. A Joint Committee may issue interpretations of the Agreement.152 If a dispute is not resolved by consultations between the parties153 or by the Joint Committee,154 the complainant state may refer the dispute to a dispute settlement panel.155 The panel determines whether the disputed measure is inconsistent with the AUSFTA.156 Compensation and the suspension of benefits are available if the state in breach refuses to implement the panel decision.157

Expropriation of an investment necessitates the payment of compensation under the AUSFTA.158 The costs of compensation for the expropriation of the very large number of tobacco company trademarks would be enormous. Nearly sixteen years ago legal advice regarding a Canadian plain packaging proposal raised the possibility that huge sums would be payable as compensation should the proposal be adopted: “Even if the expropriation is lawful, it would be at great cost to the Canadian Government as the compensation claims of affected foreign trademark holders would be staggering, amounting to hundreds of millions of dollars.”159

The expropriation guarantees in Australian bilateral investment treaties provide that expropriation requires the payment of compensation. These treaties provide an investor-state dispute mechanism, with ICSID arbitration of disputes between a Party and an investor from the other Party.160 This

146 Arts 16, 17(14) DSU. 147 Allen Z Hertz, “Shaping the Trident: Intellectual Property under NAFTA, Investment Protection Agreements and at the World Trade Organization” (1997) 23 Canada-United States Law Journal 261 at 267; Carvalho, supra n 10, 431. 148 Carvalho, supra n 10, 435. 149 Art 22 DSU. 150 United States-Australia Free Trade Agreement Implementation Act S Rep No 108-316 (2004), 28; Senate Select Committee on the Free Trade Agreement between Australia and the United States of America, Interim Report (2004), [3.166]; Joint Standing Committee on Treaties, Report 61: The Australia-United States Free Trade Agreement (2004), [3.13], [4.21]. 151 Art 21.15 AUSFTA. The US Congressional implementing legislation also provides that the Agreement does not create a private remedy. See Pub L 108-286, sec 102(c), 118 Stat 921, 19 USC 3805 note. Cp 19 USC 3512(c)(1) (similar provision regarding WTO Agreements). 152 Art 21.1(2)(e) AUSFTA. 153 Art 21.5 AUSFTA. 154 Art 21.6 AUSFTA. 155 Art 21.7(1) AUSFTA. 156 Art 21.9(1) AUSFTA. 157 Art 21.11 AUSFTA. 158 Art 11.7(1)(c) AUSFTA. 159 Mudge, supra n 16, 21. 160 Art 13(3)(a) Argentina; Art 11(2) Chile; Art 12(4) China; Art 11(3)(a) Czech; Art 13(2)(b) Egypt; Art 12(3)(a) Hungary; Art 12(3)(a) India; Art 11(2)(b) Indonesia; Art 12(2)(b) Laos; Art 13(2)(b) Lithuania; Art 23 option is not available in the case of investors from India, Laos, Mexico, Poland and Vietnam as those nations are not yet parties to the ICSID Convention.161 However, in these cases investor-state arbitration will be available through an ad hoc tribunal162 or under the ICSID Additional Facility.163

The most likely sanction for a violation of TRIPS is the withdrawal of tariff concessions. The costs of compensation for the expropriation of the very large number of tobacco company trademarks would be enormous.

ADDENDUM

When this Report was completed the Australian Treaties Library on AustLII and the Australian Treaties Database on the Department of Foreign Affairs and Trade website stated that the Turkish bilateral investment treaty had not yet entered into force. The relevant parts of the Report were written on the basis of this publicly available information.

After completion of the Report the United Nations Treaty Collection website published information which stated that the treaty had entered into force.164 We emailed the Department of Foreign Affairs and Trade to clarify the situation. The Department confirmed that the treaty had entered into force and indicated that the AustLII and Departmental websites would be updated to reflect this fact. The updated information now appears on these websites. 165 The treaty has also been allocated an Australian Treaty Series citation.166

The following sentences preceding footnote 95 should thus be disregarded: “The Turkish treaty is not yet in force. When it enters into force it will not apply to disputes that arose prior to its entry into force.” Footnote 95 should also be disregarded.

ABBREVIATIONS

ATS Australian Treaty Series. ATNIF Australian Treaties Not Yet In Force. AUSFTA Australia-US Free Trade Agreement. BISD 37S/200 Basic Instruments and Selected Documents, 37th Supp, p 200. Can TS Canadian Treaty Series. CFR Code of Federal Regulations. CLR Commonwealth Law Reports. Cong Rec Congressional Record. DSR Dispute Settlement Reports. DSU Understanding on Rules and Procedures governing the Settlement of Disputes. ECHR European Court of Human Rights, Reports of Judgments and Decisions. EHRR European Human Rights Reports. FCR Federal Court Reports.

13(4)(a) Mexico; Art 13(2)(b) Pakistan; Art 14(2)(b) PNG; Art 13(2)(b) Peru; Art 13(2)(b) Philippines; Art 13(3)(a) Poland; Art 9(2)(b) Romania; Art 13(2)(b) Sri Lanka; Art 13(2)(a) Turkey; Art 13(2)(b) Uruguay; Art 12(2)(b) Vietnam. 161 http://icsid.worldbank.org/ICSID/Index.jsp (as at 7 January 2010). 162 Art 12(3)(c) India; Art 12(2)(c) Laos; Art 13(4)(c) Mexico; Art 13(3)(b) Poland; Art 12(2)(c) Vietnam. 163 Art 12(3)(b) India (subject to consent of both parties); Art 13(4)(b), Mexico. 164 The treaty was registered under No I: 46855. 165 http://www.austlii.edu.au/au/other/dfat/monthly_updates/2010/201003ma.html; http://www.info.dfat.gov.au/Info/Treaties/treaties.nsf/AllDocIDs/90DAD72BF458C765CA25702200290CCF. 166 [2010] ATS 8. 24 FCTC Framework Convention on Tobacco Control. Fed Reg Federal Register. FSR Fleet Street Reports. HR Doc United States Congress, House of Representatives Document. ICJ Rep ICJ. Reports of Judgments, Advisory Opinions and Orders. ICSID Rep ICSID Reports. ICSID Rev-FILJ ICSID Review-Foreign Investment Law Journal. ILM International Legal Materials. IPR Intellectual Property Reports. Iran-US CTR Iran-United States Claims Tribunal Reports. S Ct Supreme Court Reporter. SPS Agreement on the Application of Sanitary and Phytosanitary Measures. S Rep United States Congress, Senate Report. Stat United States Statutes at Large. TBT Agreement on Technical Barriers to Trade. UNTS United Nations Treaty Series. US United States Reports. USC United States Code. VCLT Vienna Convention on the Law of Treaties. WTAM World Trade and Arbitration Materials. 25

APPENDIX: THE AUTHORS OF THIS REPORT

Professor Gabriël A Moens JD, LLM, PhD, GCEd, MBA, FCIArb Dean and Professor of Law, Murdoch University School of Law

Professor Gabriel Moens is Dean and Professor of Law at Murdoch University School of Law. He is an award-winning teacher of law, including as the co-winner of the 1999 Australian Award for University Teaching in law and legal studies. He has an extensive publications record, including as co-author of Commercial Law of the European Union (2010), The Constitution of the Commonwealth of Australia Annotated (2007) and International Trade and Business: Law, Policy and Ethics (2006). He also co-authored the official “Commentary on the Arbitration Rules of the Australian Centre for International Commercial Arbitration”. He teaches and researches in constitutional law, European Union law, international commercial law, international arbitration law and comparative law.

Professor Moens has taught at a number of international universities, including Loyola University New Orleans, Brigham Young University, University of Notre Dame Australia, University of Ghent, (Belgium), Universitas Pelita Harapan (Jakarta) and the City University of Hong Kong. He is a Membre Titulaire of the International Academy of Comparative Law in Paris and a Fellow and Chartered Arbitrator of the Chartered Institute of Arbitrators. He also serves as Deputy Secretary- General of the Australian Centre for International Commercial Arbitration and as Director of the College of Law Western Australia.

Selected Publications

Books

Commercial Law of the European Union (Dordrecht, The Netherlands: Springer, 2010) (co-authored with John Trone). Lumb & Moens’ The Constitution of the Commonwealth of Australia Annotated (7th ed, Sydney: Lexis-Nexis Butterworths, 2007) (co-authored with John Trone). International Trade and Business: Law, Policy and Ethics (2nd ed, London: Routledge/Cavendish, 2006) (co-authored with Peter Gillies). (editor) The Convergence of Legal Systems in the 21st Century (Brisbane: Australian Institute of Foreign and Comparative Law, 2002) (co-edited with Rodolphe Biffot). (editor) Constitutional and International Law Perspectives (St Lucia: University of Queensland Press, 2000). Business Law of the European Community (Brisbane: DataLegal, 1993) (co-authored with David Flint).

Book Chapters

“Teaching of Comparative Law and Comparative Law Teaching” in Convergence of Legal Systems in the 21st Century (Bruxelles: Bruylant, 2006), 265-299 (co-authored with Rodolphe Biffot). “The Subsidiarity Principle in European Union Law and the Irish Abortion Issue” in Günther Doeker-Mach and Klaus A Ziegert (eds), Law and Legal Culture in Comparative Perspective (Stuttgart: Franz Steiner Verlag, 2004), 406-420. “Australia: A New Approach to International Commercial Contracts” in J Bonell (ed), A New Approach to International Commercial Contracts (The Hague: Kluwer, 1999), 19-54 (co- authored with Lisa Cohn and Darren Peacock). 26 “Bank Confidentiality and Governmental Control of Exchange Operations and of their Unlawful Effects – Australia” in Paolo Bernasconi (ed), Money Laundering and Banking Secrecy (The Hague: Kluwer, 1996), 31-48. “Banking Confidentiality and State Control of Currency Transactions and Related Criminal Activities” in Alice E-S Tay and Conita SC Leung (eds), Australian Law and Legal Thinking in the 1990s (Sydney: University of Sydney, 1994), 249-262. “Mabo and Political Policy-making by the High Court” in M A Stephenson and S Ratnapala (eds), Mabo: A Judicial Revolution (St Lucia: University of Queensland Press, 1993), 48-62.

Articles

“The Mysteries of Problem-Based Learning: Combining Enthusiasm and Excellence” (2007) 38 University of Toledo Law Review 101-110. “An Assessment of Incoterms 2000” (2004) 20 Annual Report of Institute for Legal Research 1-33 (co-authored with Peter Gillies). “Reflections on Commercial Dispute Resolution” (August 2004) 15 no 8 World Arbitration & Mediation Report 242-246. “The Menace of Neutrality in Religion” [2004] Brigham Young University Law Review 535-574. “Preferential Admission Programs in Professional Schools: DeFunis, Bakke and Grutter” (2002) 42 Loyola Law Review 411-503. “Willem C Vis International Commercial Arbitration Moot 1998-1999” (2000) 5 International Trade and Business Law Annual 309-415 (co-authored with Peter Black et al). “Intensive Law Teaching: Flexibility Enhancing Strategies for Law Schools” [1999] International Law School Deans’ Conference on Legal Education for the 21st Century 444-457 (also in Chinese: 458-464). “The Role of the States in High Court Appointments” (1997) 9 Upholding the Constitution 17-38. “Equal Opportunities not Equal Results: ‘Equal Opportunity’ in European Law after Kalanke” (1997) 23 Journal of Legislation 43-59. “Church and State Relations in Australia and the United States: The Purpose and Effect Approaches and the Neutrality Principle” [1996] Brigham Young University Law Review 787-813. “Judicial Law-making in the European Court of Justice” (1992) 17 University of Queensland Law Journal 76-110 (co-authored with Ted Tzovaras). “Freedom of Movement of Goods in the European Economic Community” (1990) 17 Melbourne University Law Review 733-743. “Can you Bank on a Bank? An Examination of the Customer-Bank Relationship in light of the Cheques and Payment Orders Act 1986 (Cth)” (1989) 15 University of Queensland Law Journal 183-208. “The Action-Belief Dichotomy and Freedom of Religion” (1989) 12 Sydney Law Review 195-217. 27

Dr John Trone BA/ LLB, PhD (Qld) Adjunct Professor of Law, Murdoch University

Dr John Trone is the co-author of Commercial Law of the European Union (2010) and the sixth and seventh editions of The Constitution of the Commonwealth of Australia Annotated (2001, 2007). He is the author of Federal Constitutions and International Relations (2001). He has published numerous articles concerning constitutional law, international law and commercial law.

Selected Publications

Books

Commercial Law of the European Union (Dordrecht, The Netherlands: Springer, 2010) (co-authored with Gabriël A Moens). The Constitution of the Commonwealth of Australia Annotated (7th ed, Sydney: Butterworths, 2007) (co-authored with Gabriël A Moens). Federal Constitutions and International Relations (St Lucia: University of Queensland Press, 2001). The Constitution of the Commonwealth of Australia Annotated (6th ed, Sydney: Butterworths, 2001) (co-authored with Gabriël A Moens).

Book Chapters

“International Sales Contracts” in Australian Commercial Law (27th ed, Sydney: Lawbook Co, 2008), Chapter 15. “Business Ethics” in Australian Commercial Law (27th ed, Sydney: Lawbook Co, 2008), Chapter 34. “Constitution, International Treaties, and Contracts: Australia” in George Bermann (ed), Party Autonomy: Constitutional and International Law Limits in Comparative Perspective (New York: Juris, 2005), 45-78. “The Regulatory Environment: Australian Hunting Law” in G McL Dryden and S J Craig-Smith, Safari Hunting of Australian Exotic Wild Game (Kingston, ACT: Rural Industries Research and Development Corporation, 2004), 58-67. “Constitutions, International Treaties and Contracts” in Convergence of Legal Systems in the 21st Century: An Australian Approach (Australian Institute of Foreign and Comparative Law, 2002), 47-52. “The Contribution of Professor Richard Darrell Lumb to the T C Beirne School of Law” in Gabriel A Moens (ed), Constitutional and International Law Perspectives (St Lucia: University of Queensland Press, 2000), 1-10 (co-authored with Gabriël A Moens). “Federalism-based ‘Fragmentation of the Decision-making Process’ in Foreign Relations” in Gabriel A Moens (ed), Constitutional and International Law Perspectives (St Lucia: University of Queensland Press, 2000), 115-126. “The Jewish Enclave in Brisbane” in Rod Fisher and Barry Shaw (eds), Brisbane: The Ethnic Presence Since the 1850s (Brisbane: Brisbane History Group, 1993), 91-99.

Articles

“The International Arbitration Act 1974 (Cth) as a Foundation for International Commercial Arbitration in Australia” (2007) 4 Macquarie Journal of Business Law 293-322 (co-authored with Gabriël A Moens). “The Sovereign Immunity of the Member States of a Federation” (2007) 11 International Trade and Business Law Review 261-268. 28 “German Constitutional Decisions in English Translation: A Supplement” (2007) 11 International Trade and Business Law Review 281-292. “Print Sources for Historical Constitutions” (2006) 34 International Journal of Legal Information 539- 555. “International Law as Domestic Law in the Philippines” (2002) 7 International Trade and Business Law Annual 265-275. “German Constitutional Decisions in English Translation” (2002) 7 International Trade and Business Law Annual 223-249. “The ‘People of Any Race’ Power in the Australian Constitution”, Australia and World Affairs, no 35 (Summer 1998), 53-57 (co-authored with Gabriël A Moens). “Governmental Assistance to Racially Discriminatory Religious Institutions: Free Exercise and Equal Protection Issues in the Bob Jones University Case” (1997) 19 University of Queensland Law Journal 298-304. “Electronic Sources of Asian Laws” (1997) 8 Journal of Law and Information Science 264-282. “United States Legal Information on the Internet” (1997) 3 International Trade and Business Law Annual 379-385. “Territory Rights are not States Rights”, Australia and World Affairs, no 32 (Autumn 1997), 49-51 (co-authored with Gabriël A Moens). “The Law of Kidney Transplantation in Australia”, Australia and World Affairs, no 31 (Summer 1997), 44-46 (co-authored with Gabriël A Moens). “The Stimson Doctrine of Non-recognition of Territorial Conquest” (1996) 19 University of Queensland Law Journal 160-164. “International Treaties in Australian Law - Legitimate Expectations and the Teoh Case”, Australia and World Affairs, no 25 (Winter 1995), 57-61 (co-authored with Gabriël A Moens). “Racist Speech and Freedom of Speech” (Summer 1994-95) 10 No 4 Policy 3-6 (co-authored with Gabriël A Moens). “Is there an Implied Constitutional Right of Freedom of Communication?” (1994) 1 Agenda 71-79 (co- authored with Gabriël A Moens).