Plain packaging of tobacco products a step too far

British American Tobacco New Zealand (BATNZ) opposes the plain packaging of tobacco products and will take every action necessary to protect its intellectual property rights as would any other business faced with the removal of their brands,” said BATNZ’s Head of Corporate and Regulatory Affairs, Susan Jones.

BAT Cigarette Brands

British American Tobacco's popular cigarette brands - Kent, Lucky Strike, Pall Mall and Dunhill

“Packaging is an important element of any company’s intellectual property. A government prohibition on a company’s right to use their own intellectual property constitutes property removal and sets a disturbing precedent for businesses throughout New Zealand. “If government is prepared to do this today, are the next logical steps to force alcohol, fast food, salty or sugary products into plain packs as well?” said Ms Jones.

This policy has a number of serious implications which need robust consideration.

International trade agreements founded on the principles of the protection of property rights may well be compromised and this policy announcement by Government is less than reassuring to foreign investors and brand owners. The Australian Government is already the subject of a World Trade Organisation challenge and constitutional legal challenges in the Australian High Court as a result of their plain pack legislation.

Plain packaging is a policy with serious unintended consequences:

•The plainer the pack, the simpler it is to counterfeit. Illegal tobacco costs taxpayers billions – but makes criminals rich. Criminals currently have to go to some trouble to manufacture colours and designs on packs to trick customers into thinking they are getting the real thing – plain packaging effectively gives criminals a hand up with more ill gained profits.

•The black market significantly undercuts legitimate retailers and doesn’t ask for proof of age so a move designed to discourage youth from smoking could end up having the exact opposite effect.

•Perversely, smoking rates will increase as many more young people take it up after gaining greater access to cheap illegal cigarettes. Legal cigarettes may also become cheaper as prices are forced down through increased competition in the industry due to the removal of branding. BATNZ believes the consultation process announced will be extremely important given the serious unintended consequences of this proposal and the precedent it sets for other trademark owners.

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