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AUSTRALIA


CATCHING TOBACCO IN A STATE OF UNDRESS


Brian Hendy and Stephen Krouzecky Watermark Intellectual Asset Management


Plain packaging for tobacco products


T e Australian government is committed to implementing a suite of reforms as it attempts to reduce smoking and its harmful side-eff ects.


As part of these reforms, the government introduced legislation (the Tobacco Plain Packaging Bill 2011) to require the plain packaging of tobacco products.


T e Tobacco Plain Packaging Act 2011, which is expected to take eff ect in 2012, will prevent the advertising and promotion of tobacco and tobacco products on product packaging with a view to:


• Reducing the attractiveness and appeal of tobacco products to consumers, particularly Australian youth;


• Reducing the ability of tobacco product packaging to mislead consumers about the harmful eff ects of using the product;


• Increasing the prominence and eff ectiveness of health warnings on product packaging that have been used for many years; and


• Reducing the amount of tobacco products sold in Australia and the rate of uptake by potential new users, particularly smokers, of tobacco products.


T e Tobacco Plain Packaging Act 2011 also restricts trademarks from being placed on tobacco products or their retail packaging, except in a very restricted manner. T is prevents trademarks from being used as features that are designed to divert attention away from health warnings, or otherwise to promote use of tobacco or tobacco products.


Aside from the emotive issues of public health and restrictions placed on the trading practices of tobacco companies, many interesting issues arise from the legislation in relation to intellectual property (IP) rights and the commercial value of trademarks.


40 World Intellectual Property Review e-Digest 2012 What are the effects on trademark use?


The legislation will restrict the ways in which trademarks can be used to an extent that has not been seen before. The legislation is careful to ensure that there is no restriction on the ability of tobacco product manufacturers and marketers to obtain registrations for their trademarks. It also proposes to make previously registered trademarks exempt from removal actions for non-use as a consequence of the legislation. However, the legislation is unequivocal in stopping the use of trademarks on tobacco products other than in a highly prescriptive form. A trademark that may be displayed on the retail packaging of a tobacco product is limited to a brand name in the typeface Lucinda Sans. It can be no larger than 10 points in size and must be in a normal, weighted and regular font, and it must be in a prescribed colour. The legislation essentially emasculates the efficacy of all other signs registered by the trademark owner for tobacco products.


Does the legislation ‘acquire’ IP rights?


One area of debate centres on whether, as a result of the legislation, the government is actually acquiring IP from the owners of trademarks that manufacture or sell tobacco products. If it is, there is justification for owners to be compensated on just terms by virtue of Section 51(xxxi) of the Australian Constitution. There is no argument that the government has the ability to acquire trademark rights and limit the use of trademarks on the grounds of public health considerations, but such an act requires strong justification.


An important question is: what IP is the government allegedly acquiring as a consequence of the legislation? Reference to the defi nition of a trademark and the rights that come with a registration in the Trade Marks Act 1995 is helpful in making such a determination.


Section 17 of the Trade Marks Act 1995 provides that: “A trade mark is a sign used, or intended to be used, to distinguish goods or services dealt


www.worldipreview.com


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