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Investor-state arbitration - tobacco plain packaging

On 1 December 2011 the Tobacco Plain Packaging Act 2011 received Royal Assent and became law in Australia.

The Act forms part of a comprehensive Australian Government strategy to reduce the rate of smoking in Australia. Smoking is one of the leading causes of preventable death and disease in Australia.

Philip Morris Asia is challenging the plain packaging legislation under the 1993 Agreement between the Government of Australia and the Government of Hong Kong for the Promotion and Protection of Investments. On 21 December 2011, the Australian Government provided its response to Philip Morris Asia's Notice of Arbitration.

The arbitration is being conducted under the United Nations Commission on International Trade Law (UNCITRAL) Arbitration Rules 2010. Australia and Philip Morris have agreed that three arbitrators will hear the case. Australia appointed Professor Don McRae of the University of Ottawa as an arbitrator. Philip Morris Asia appointed Professor Gabrielle Kaufmann-Kohler as an arbitrator. The Secretary-General of the Permanent Court of Arbitration appointed Professor Dr Karl-Heinz Böckstiegel as the presiding arbitrator. The tribunal was constituted on 15 May 2012. The First Procedural Meeting was held on 30 July 2012 in Singapore.

As the proceedings brought by Phillip Morris Asia concern the Australian Government's right to take regulatory measures to protect public health, it is important that the public have access to information relating to the proceedings. The government is committed to achieving transparency in these proceedings. This website will be used to provide relevant information and links to available documents.

Key documents

Awards, decisions and order made by the tribunal in the arbitation will be available on the Permanent Court of Arbitration website. Procedural orders are now available on the PCA website.

Constitutional challenges to tobacco plain packaging

Two challenges to the plain packaging legislation were heard by the High Court of Australia between 17-19 April 2012: British American Tobacco Australasia Limited and Ors v. Commonwealth of Australia and J T International SA v. Commonwealth of Australia. On 15 August 2012 the High Court handed down orders for these matters, and found that the Tobacco Plain Packaging Act is not contrary to s 51(xxxi) of the Constitution. The Court will publish its reasons at a later date.

The parties’ written submissions, the full transcript of proceedings, and the orders made can be viewed on the High Court of Australia website.

World Trade Organization challenges to tobacco plain packaging

Ukraine, Honduras and the Dominican Republic requested World Trade Organization (WTO) dispute consultations with Australia in relation to Australia's measures on tobacco plain packaging on 13 March, 4 April and 18 July 2012 respectively. Australia held consultations with Ukraine on 12 April, Honduras on 1 May and the Dominican Republic on 27 September 2012.

At the request of Ukraine, a dispute settlement panel was established by the WTO Dispute Settlement Body at its meeting on 28 September.

More information about the WTO and its dispute settlement process can be viewed on the Department of Foreign Affairs and Trade website.