Reports indicate that Philip Morris Asia is commencing international legal action claiming the Government is in contravention of the 1993 Bilateral Investment Agreement between Australia and Hong Kong. But Professor Donald Rothwell of the ANU College of Law said there are many hurdles ahead for both parties before any ruling can be given.
“Australia and Hong Kong are parties to a 1993 Bilateral Investment Agreement which seeks to protect investments made in both countries by corporations,” said Professor Rothwell. “The basic objective of the Agreement is to ensure that companies do not face discriminatory treatment in a territory in which they made investments.
“Reports that Philip Morris Asia is commencing international legal action under the Agreement suggest that Article 3 of the Agreement headed ‘Promotion and protection of investments and returns’ may be the focus of any legal claim.
“That Article provides that neither country shall “impair by unreasonable…measures the management, use or enjoyment… of investments”. Philip Morris Asia may seek to argue that by the introduction of new federal laws dictating plain packaging of tobacco products that their intellectual property in distinctive packaging is being impaired,” he said.
Professor Rothwell added that it may be many months before any resolution to the issue, or even before the dispute can be heard.
“The agreement provides that before an investment dispute can be settled by way of arbitration, three months notice is to be provided. During this time it may be possible that a settlement could be reached on the matter between Philip Morris Asia and the Government of Australia.
“A crucial legal issue at this stage is whether there exists a ‘dispute’ for the purposes of the Agreement, as no Federal legislation has yet been enacted and, accordingly, no damage has been suffered by the tobacco companies,” said Professor Rothwell.
|Contacts:||For interviews: Professor Donald Rothwell – 02 6125 8948 / 0414 546 830 For media assistance: Martyn Pearce, ANU Media – 02 6125 5575 / 0416 249 245|