This post was written by Neiloy Sircar, J.D.-LL.M Global Health Law Candidate 2017 and summer research assistant at the O’Neill Institute for National and Global Health Law and Sarah Roache, Institute Associate. Any comments or questions about this post can be directed to nrs53@georgetown.edu.
The July 8 rulin
g in favor of the government of Uruguay in the case of Philip Morris Brands v. Uruguay is an historic victory that clearly establishes the primacy of public health measures over companies’ rights to profit from dangerous products. The 6-year-long legal challenge launched by tobacco giant Philip Morris against Uruguay’s strong tobacco control laws ended in abject failure for the multinational. Governments all over the world considering
strengthening their own tobacco control efforts should be encouraged and emboldened that they too can overcome tobacco industry threats and legal challenges.
Uruguay’s World-Leading Tobacco Control Strategy
Since 2006, Uruguay has established itself as a global leader in tobacco control, adopting multiple measures to protect its population from the dangers of tobacco use in compliance with its obligations under the Framework Convention on Tobacco Control. Two key components of Uruguay’s tobacco control strategy emerged in 2008 and 2009: a “single presentation requirement” and an “80/80 Regulation.” The single presentation requirement effectively limits tobacco producers to one variant of their brand for sale, while the 80/80 Regulation imposes a warning label on all tobacco packaging comprising 80% of the package’s surface area.
Philip Morris Brought Fire…
Having failed to strike down the single presentation requirement and the 80/80 Regulation in Uruguayan administrative and constitutional courts, in 2010 Philip Morris challenged Uruguay’s tobacco control measures as a violation of a bilateral investment treaty between Uruguay and Switzerland, where Philip Morris is based. The case was heard by the World Bank’s International Centre for Settlement of Investment Disputes (ICSID). Philip Morris’ primary argument was that Uruguay’s measures expropriated Philip Morris’ investments, resulting in substantial economic losses. This case was more than a legal dispute, it was part of Philip Morris’ efforts to intimidate other governments seeking to adopt strong tobacco control measures in accordance with the FCTC.
…and Got Burned
The ICSID’s binding ruling constitutes a powerful rejection of Philip Morris’ legal challenge. The ICSID tribunal rejected the tobacco giant’s arguments in their entirety, reaffirming Uruguay’s sovereign right to exercise regulatory powers in the interest of public health. In the 300-page decision, one line may be quoted in future writing more than any other:
“The responsibility for public health measures rests with the government and investments tribunals should pay great deference to governmental judgments of national needs in matters such as protection of public health…”
In addition to finding in Uruguay’s favor, the ICSID also ordered Philip Morris to pay Uruguay’s legal costs. The decision comes as the latest in a string of major defeats for Philip Morris and the tobacco industry more broadly. Philip Morris lost a 2012 case in which it sued the government of Norway in respect of a ban on the display of tobacco products at in retail establishments as well as a legal challenge against Australia’s landmark “plain packaging” legislation.
A Victory With Global Resonance
Philip Morris Brands v. Uruguay will likely have a profound influence on global efforts to reduce tobacco use, to the benefit of public health and those who champion it. Uruguay’s victory will not only help protect its population from the dangers of tobacco, it sends a powerful message that public health measures will not be trumped by well-resourced and unrelenting industry litigants seeking profits at all costs.
