Type of Litigation: Challenge to Government Policies Relating to Tobacco Control/Public Health

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Tabacalera Sarandí S.A. v. Argentine Tax Authority (AFIP) [Argentina] [May 13, 2021]

Tabacalera Sarandí S.A. had obtained a preliminary injunction to suspend the application of the minimum amount of a tax established for the commercialization of tobacco. Thus, the company could apply the tax rate (70%) on the retail price without considering the minimum amount. The company argued that this minimum put it at a disadvantage with other multi-national tobacco companies. The Argentine Tax Authority appealed the decision, saying that the ruling affected the public interest and the extra-fiscal purpose of the tax, which is the protection of public health. The Supreme Court ruled that the tobacco company had not sufficiently demonstrated its injury and did not prove the requirements to be granted with the injunction. Thus, the Court revoked the injunction.

BAT Uganda Ltd. v. Attorney General and the Minister of Health [Uganda] [February 01, 2021]

British American Tobacco Uganda (BATU) challenged Uganda's Tobacco Control Regulations, 2019. BATU's court submissions raised a number of substantive and procedural claims, including the insufficient time to implement warnings, size of warnings, ban on some misleading descriptors, and flavoring ban. BATU sought and was granted a temporary injunction suspending implementation of Regulations 3, 4, 5, and 6. However, BAT subsequently withdrew its complaint and the injunction was lifted. 

Vap Labs v. Mexico [Mexico] [January 13, 2021]

Vap Labs asked the Federal Commission for Protection Against Health Risks (COFEPRIS) about the requirements needed to import and commercialize electronic cigarettes (e-cigarettes). COFEPRIS responded that the commercialization of e-cigarettes was banned under the scope of Article 16(vi) of the General Law on Tobacco Control, which states: “It is prohibited to trade, sell, distribute, display, promote or produce any object that is not a tobacco product which contains some of the brand elements or any type of design or auditory sign that identifies it with tobacco products.” Vap Labs filed an Amparo action based on alleged violations of constitutional principles. The District Court agreed and ordered COFEPRIS to authorize the importation, sale and marketing of e-cigarettes in Mexico. The COFEPRIS and the Chamber of Deputies of the Congress of Mexico requested the revision of the District Court's decision. They argued that the District Court decision should be void since the import and commercialization ban incorporated in Article 16(vi) does not violate the Mexican Constitution; Article 16(vi) instead establishes reasonable and proportionate restrictions on the exercise of Vap Labs economic freedom. The Supreme Court of Justice for the Second Chamber agreed and ordered the District Court's decision revocation and amendment, declaring Art. 16(vi) constitutional. This is the fifth decision on this issue of the Second chamber. Similar to a previous case, the Court distinguished between systems that operate exclusively with tobacco and those that do not. The Supreme Court of Justice for the Second Chamber clarified that Article 16(vi)’s ban applied only to e-cigarettes, and not to heated tobacco products as these were tobacco products. This ruling applies only to the plaintiff who was a party to this case. See also Saborn Hermanos Sociedad Anonima v. Mexico, 853/2019, Mexican Supreme Court (2020).

Saborn Hermanos Sociedad Anonima v. Mexico [Mexico] [November 25, 2020]

Saborn Hermanos Sociedad Anónima, a chain of cafés, asked the Federal Commission for Protection Against Health Risks (COFEPRIS) about the requirements needed to manufacture, import, and commercialize electronic cigarettes (e-cigarettes). COFEPRIS responded that the commercialization of e-cigarettes was banned under the scope of Article 16(vi) of the General Law on Tobacco Control, which states: “It is prohibited to trade, sell, distribute, display, promote or produce any object that is not a tobacco product which contains some of the brand elements or any type of design or auditory sign that identifies it with tobacco products.” Saborn filed an Amparo action alleging a violation of the principles of equality and non-discrimination. The District Court agreed and declared Article 16(vi) contrary to the Political Constitution. However, the COFEPRIS and the Chamber of Deputies of the Congress argued before the Supreme Court of Justice for the Second Chamber that Article 16(vi) establishes reasonable and proportionate restrictions on the exercise of Saborn’s economic freedom. The Supreme Court of Justice for the Second Chamber agreed and ordered the District Court's decision revoked.  This is the fourth decision regarding this issue in the Second chamber, but this marked the first time that the Supreme Court of Justice for the Second Chamber declared Art. 16(vi) constitutional. However, it distinguished between systems that operate exclusively with tobacco and those that do not. The Supreme Court of Justice for the Second Chamber clarified that Article 16(vi)’s ban applied only to e-cigarettes, and not to heated tobacco products as these were tobacco products. This ruling applies only to the plaintiff who was a party to this case.

Confederação Nacional do Turismo et. Confederacao Nacional do Comercio de Bens, Servicos e Turismo v. Paraná [Brazil] [August 24, 2020]

The National Confederation of Tourism, together with the National Confederation of Commerce of Goods, Services, and Tourism, filed a lawsuit against the Paraná (state-level) tobacco control law, which prohibits smoking in public or private collective environments in the state of Paraná. The Court unanimously held that state legislative assembly did not exceed its competence to legislate public health. The Court concluded that the state law did not offend fundamental freedoms since it did not prohibit the exercise of the individual's right to consume tobacco products. Furthermore, the Court affirmed that the restriction of using tobacco products in collective enclosed environments respected the rights of non-smokers and the adequate protection of health.

Confederacao Nacional do Comercio de Bens, Servicos e Turismo v. Paraná [Brazil] [August 24, 2020]

The National Confederation of Commerce of Goods, Services, and Tourism filed a lawsuit against the Paraná (state-level) tobacco control law, which prohibits smoking in public or private collective environments in the state of Paraná. The Court unanimously held that the state legislative assembly did not exceed its competence to legislate public health. The Court also concluded that the state law did not offend fundamental freedoms since it did not prohibit the exercise of the individual's right to consume tobacco products. Furthermore, the Court affirmed that the restriction of using tobacco products in collective enclosed environments respected the rights of non-smokers and the adequate protection of health.

Cubacigar Benelux NV v. State of the Netherlands (Ministry of Health, Welfare and Sport) [Netherlands] [June 30, 2020]

Cubacigar Benelux NV (Cubacigar) appealed a lower court decision upholding packaging restrictions contained in the Tobacco and Smoking Regulations. Specifically, Cubacigar had challenged restrictions limiting the use of metallic foils and embossing (“glitter and glamor” elements) on cigar boxes. The lower court held that these restrictions in the Tobacco and Smoking Regulations did not conflict with the EU Tobacco Products Directive. The court also determined that although the packaging requirements restricted the free movement of goods, the requirements were justified from a public health point of view because they are aimed at reducing the attractiveness of tobacco products. Further, the requirements of the principle of proportionality were also met.

On appeal, the Court of Appeal upheld the lower court's decision that the packaging requirements under the Tobacco and Smoking Regulations are in line with the EU Tobacco Products Directive. The Court concluded that the government presented sufficient evidence demonstrating that the measures are justified on grounds of public health protection and are proportionate.

Australia - Tobacco Plain Packaging Final Ruling [Australia] [June 09, 2020]

The Appellate Body of the World Trade Organization (WTO) issued its final ruling affirming that Australia’s pioneering law requiring plain packaging for tobacco products and finding it entirely consistent with WTO agreements. In particular, the WTO appeal ruling confirmed the original finding that the evidence shows that tobacco plain packaging laws "are apt to, and do in fact, contribute to Australia's objective of reducing the use of, and exposure to, tobacco products."

The appeal ruling also confirmed that:

  • Tobacco plain packaging is not more trade-restrictive than is necessary to meet its legitimate public health objective.
  • Trademark owners do not have a positive right to use their trademarks under WTO TRIPS agreement, but only the right to prevent third parties from using them.
  • Tobacco plain packaging is a justified restriction on the use of trademarks and does not violate trademark protections.

Korea Electronic Cigarette Association v. Ministry of Health and Welfare [Republic of Korea] [March 17, 2020]

The Korea Electronic Cigarette Association challenged the constitutionality of the Ministry of Health and Welfare’s guidance urging the public to stop using e-cigarettes at least until a safety management system could be put into place and research into human toxicity was completed. The Constitutional Court ruled in favor of the Ministry of Health and Welfare, holding that the guidance did not infringe on e-cigarette companies' constitutional rights. The ministerial guidance did not amount to an "exercise of government power" because it had no direct legal effect on the rights and duties of the people and is, therefore, not subject to adjudication on a constitutional complaint.

Confederacao Nacional do Comercio de Bens, Servicos e Turismo v. Rio de Janeiro [Brazil] [December 20, 2019]

The National Confederation of Commerce of Goods, Services, and Tourism filed a lawsuit against Rio de Janeiro's tobacco control law on smoke-free environments, which banned smoking in public or private collective environments. The Court unanimously held that the state legislative assembly did not exceed its competence to legislate public health. The Court noted that local regulations could be more restrictive than the federal regulation. Further, the judges established that (i) freedom of commerce must be interpreted together with the principle of consumer protection and (ii) restrictions on products that are potentially dangerous are legitimate.