It was perhaps no surprise when the Coalition Government decided not to proceed with its policy on plain packaging for cigarettes.
The Scottish Government rapidly announced it would push ahead with its own Scottish initiative to introduce Scottish legislation.
The decision at UK level to analyse the position in Australia, the first and so far only country to introduce a policy of plain packaging, does not appear to have troubled the Scottish Government. There are however aspects of the Australian legislation that should carry a direct warning for any Scottish policy initiative on this subject.
In much of the debate about tobacco plain packaging there has so far been no consideration of the legal competence of any legislation. This is significant as the Scottish Parliament is restricted in what it can enact by virtue of both the EU Treaty and the European Convention on Human Rights (ECHR). Both of these European instruments create an obstacle to plain packaging in Scotland. The obstacle operates this way. Plain packaging imposes a prohibition on tobacco companies using their trademarks and other intellectual property on cigarette packets; prohibiting use of intellectual property is most likely to be regarded by the courts as a deprivation of property; both Article 17 of the EU Charter and Article 1 of Protocol 1 of ECHR preclude as a generality deprivation of property ; and it is not legislatively competent for the Scottish Parliament to act contrary to these European provisions.
This is where the Australian experience is instructive. Its legislation was challenged on the basis of legislative competence. The challenge failed as a result of a particular feature of the Australian constitution. Nevertheless, five out of the seven Australian justices expressed views that the legislation on tobacco plain packaging resulted in a taking or deprivation of the companies' property by prohibiting the use of their intellectual property. Applying their reasoning on this point (which was on simple logical analysis, not on specialities of Australian law), the deprivation standard would be met in the ECHR context, rendering a simple plain packaging policy outside the competence of the Scottish Parliament.
This is not the end of the matter of course. Both the EU Charter and the ECHR permit deprivation of property subject to conditions. In the case of deprivation of the companies' intellectual property the condition would be compensation. The value of the companies' intellectual property, even confined to the Scottish market, is likely to be measured in tens of millions of pounds. The underlying reasoning for a policy of plain packaging is that people and especially the young are attracted to purchasing cigarettes by the allure of the brands, the get-up of the packets - in legal language the intellectual property of the tobacco companies. That intellectual property therefore is of considerable value to the companies. The arguments to the effect that tobacco consumption is a danger that must be halted cannot however ignore that cigarettes are lawful products and the companies that sell them are trading lawfully. Lawful business cannot simply be legislated away without consequences.
One is left with the impression that, not for the first time, a well meaning policy initiative is put into the public domain without being fully thought through. It is usually sensible before legislators become overly enthused with an initiative that they consider consequences. What may initially be seen as a "good thing" is rarely cost free. It may be the Scottish Government has calculated the cost of this initiative but, if so, it would be helpful to share this with taxpayers. This issue is not confined to Scotland. A UK Government proposal would also have to face the question of compensation but the nature of the Scottish Parliament's legislative competence makes it a difficult and high-cost initiative.
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