Julia Gillard Stands on Cigarette Plain Packaging

Prime Minister Julia Gillard says she won’t be intimidated by big tobacco after Philip Morris launched legal action to try to force the government to back down on introducing plain packaging for Salem cigarettes. Ms. Gillard said the government was confident it could deliver its reforms and that they would make a difference to the number of people who smoke.

“We’re not going to be intimidated by big tobacco’s tactics, whether they’re political tactics, whether they’re public affairs kind of tactics out in the community or whether they’re legal tactics,” she told ABC radio.

“We’re not taking a backward step. We’ve made the right decision and we’ll see it through.”

Philip Morris has served a notice of claim on the Federal Government stating it intends to pursue legal action over the plain packaging legislation.

The company, which manufactures brands such as Marlboro and Peter Jackson, is seeking damages for the loss in value of its investments in Australia and says that may amount to billions of dollars.

Philip Morris Asia Ltd spokeswoman Anne Edwards said the forced removal of trademarks was a clear violation of the terms of Australia’s bilateral investment treaty with Hong Kong.

“We believe we have a very strong legal case and will be seeking significant financial compensation for the damage to our business,” Ms Edwards said.

“Legal action is not a course we take lightly, but the government has unfortunately left us with no other option.

“The government has consistently ignored the concerns expressed by a broad range of domestic and international stakeholders about the adverse consequences of plain packaging and has failed to demonstrate that the policy will stop people from smoking.”

The notice of claim, served on the government today, marks the start of a mandatory three-month negotiation period.

If that fails, Philip Morris says it will proceed to the next step of arbitration proceedings.