Why WHO Is Wrong About Plain Packaging

(Photo by Justin Sullivan/Getty Images)

Lorenzo Montanari Executive Director, Property Rights Alliance
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Today, the World Health Organization celebrates World No Tobacco Day and the theme this year is Plain Packaging, which means the complete removal of any type of brands and trademarks on cigarette packs.

For this reason, the Property Rights Alliance (PRA) is proud to join 46 free market organizations from 30 countries in a letter to Dr. Margaret Chan Fung Fu-chun, Director General of the World Health Organization (WHO) expressing its strong opposition to plain packaging and its support for all types of intellectual property rights (IP). Instead of weakening the rights of innovators, creators, and entrepreneurs, policymakers should reflect on the integral role IP rights play in economic, technological, and cultural leadership. As such, governments and NGOs should focus on preserving and enhancing IP rights by fostering solutions to widespread IP theft. The letter articulates a framework and suggests guidelines regarding intellectual property. As these issues are discussed in various forums around the world, these guidelines will be a helpful resource.

Through this letter we want to encourage the leaders of international organizations and governments to stand against plain packaging and work together to protect intellectual property. Strong IP rights are the engine of fair, prosperous and transparent societies. Ensuring that intellectual property rights are respected and protected in every nation will promote prosperity, innovation and creativity around the globe.

The letter affirms:

The right to own property is a fundamental human right.

Creating an environment where property rights are protected and legally enforced contributes to social and economic growth and stability.

The importance of secure intellectual property rights is recognized in international treaties and conventions.

Various studies and indexes show that there is a strong positive correlation between a country’s robust intellectual property rights enforcement and GDP per capita.

Plain packaging prohibits the use of trademarks and therefore significantly erodes the value of this intellectual property – a dangerous precedent to set for commerce in general.

Data suggests that the plain packaging efforts may not achieve their stated purpose.

Trademarks, brands, and logos are a critical way to provide brand information to consumers which is an assurance that they are purchasing a legitimate, quality product.

By not allowing companies to use their trademarks, plain packaging forces consumers to make uninformed decisions and in many cases puts them in danger by forcing them to enter the illicit “black” market in search of goods.

Weakening IPR is not only detrimental to the economy, but it can also place the public’s health and safety at risk.

Plain packaging is the use of containers that remove all branding from a company’s own product including colors, logos, and trademarks. Therefore, in forcing manufacturers to use plain packaging, governments are infringing on the very property that businesses manufacture.

Legislation over the packaging of products began with tobacco in Australia in 2012. Since then, other countries have expressed interest in similar laws including Britain, Canada, Hungary, Norway and Slovenia. The spread of plain packaging is especially real since British tobacco companies just lost an appeal over their intellectual property in the UK courts.

A British minister for public health stated that plain packaging is a “victory for a generation that will grow up smoke-free.” While the governments have lofty public health goals in mind when passing plain packaging, the reality is less optimistic. Not only have the packaging laws failed to rid Australia of smokers, they actually led to an increase in adult smokers. Young people were not deterred by plain packaging either as the rate of young smokers rose from 2.5 to 3.4 percent after plain packaging was implemented.

Regardless of the effectiveness of plain packaging on curbing smoking, it has been successful in walking all over property rights which is the concern of this coalition.

The forced use of bland packages devoid of logos is not only an example of governmental overregulation; it is a violation of the basic inalienable right of property. When a company creates a tangible product, it obviously belongs to the company. Similarly, when a company thinks up a design, brand, or marketing strategy, the company has created a new intellectual product. The sale, trade and use of property has been a central component of the modern free market economy since its inception, but with plain packaging, governments are forcing the company to use its property in a way that conflicts with the company’s interests.

Just as plain packaging laws are spreading around the globe, the list of products affected by the legislation may also expand.  South Africa has already made rules regarding the marketing of baby formula. Similarly, there are calls for foodsalcohol or even toys to be the next products forced to use plain packaging.

This is not a defense of tobacco, unhealthy food, alcohol, or toys, it is a call to action in upholding property rights.

The precedent of plain packaging should not be viewed without recognizing attacks on other forms of property rights such as compulsory purchases. Since plain packaging is paving the way for the government to manipulate property that it does not possess. In the future with eroded property rights, the state may not bother buying land that it wants to develop for highways or other infrastructure, it may just seize it.

Ireland recently proposed a bill that would force alcohol manufacturers to include health warnings, calorie labels, and limit the hours that they can advertise. Eleven EU states have already opposed the bill stating that it would limit free trade opportunities. Before the bill can move forward, Ireland must respond to the objections. This concentrated international opposition to government interference on private property must be a model in combatting all forms of plain packaging in every industry.

Similarly, the International Coalition Letter Against Plain Packaging is a request for governments around the world to strengthen property rights instead of implementing plain packaging.

The letter is available here.

Lorenzo Montanari, executive director of the Property Rights Alliance (PRA). Follow PRA on twitter: @PRAlliance