US issues warning on tobacco packaging

05:32, Feb 10 2014

United States business groups have issued a thinly-veiled warning to the New Zealand Government that plain-packaging laws for cigarettes could affect this country's exports.

Legislation over the plain packaging of tobacco is due to be passed in Parliament this week. It has cross-party support, but the Government has already said it would not implement the law until legal battles over similar laws in Australia had been settled.

But six high-powered groups have jointly expressed their "concern" that the proposed law was not in the public interest.

"It will violate New Zealand's international-trade obligations, while facilitating illicit trade and counterfeiting." the groups said.

"Above all, there is no compelling evidence that it will actually advance the public interest."

The Emergency Committee for American Trade, National Association of Manufacturers, National Foreign Trade Council, US-ASEAN Business Council, US Chamber of Commerce, and United States Council for International Business have all criticised the legislation, which is due before Parliament this week.

The US groups said the law could have a negative impact on New Zealand's primary exports.

"We see this as a systemic threat to rules which intellectual property rights and the trading system, with their nexus to regulation, are dependent upon," the group said.

"We encourage the New Zealand Government to consider the concerns we have raised for the possible impact on New Zealand exports, such as dairy and wine, should other governments feel emboldened to take similar unwarranted measures."

Free-trade negotiations between New Zealand and the United States, along with a number of other countries are at a critical stage.

The 12-member Trans-Pacific Partnership (TPP) could deliver annual gains of $5.5 billion by 2025, ministers have said.

But a recent study cast doubts on that, saying it could deliver less than a quarter of what was promised.

Labour trade spokesman Phil Goff, a former foreign affairs minister, said as much as "apologists for tobacco" might pretend this was about intellectual property rights or removing barriers to trade, it was actually about a government’s sovereign right and responsibility to promote good health and public wellbeing.

"Lobbyists promoting the use of tobacco should butt out of the debate and New Zealand should not agree to anything being included in any trade agreement that stops our Parliament from acting in the public good,” Goff said in reference to the current Trans-Pacific Partnership free-trade talks.

"Business interests promoting the use of tobacco have no place and no rights in this debate. Tobacco is a produce unique in killing a large percentage of those who consume it."

He said Australia was embroiled in a legal battle with the tobacco industry over plain packaging because it had signed a sloppy free-trade deal with Hong Kong.

US big business, which includes tobacco and pharmaceutical companies, have taken issue with a number of New Zealand laws, helping delay a TPP agreement being reached.

Last year, eight tobacco-producing countries objected to the World Trade Organisation, arguing that the Government's plain-packaging plans would restrict trade and hurt tobacco growers.

At least three of those countries - the Dominican Republic, Indonesia and Nicaragua - made submissions to the Ministry of Health, warning the Government it risked violating its international trade obligations.

But the Government withheld the submissions, claiming publication could prejudice national security and international relations.

The US business group warned similar laws that already been introduced in Australia were not working as intended, and New Zealand should await the outcome of several legal battles before introducing plain packaging here.


Fairfax Media