The Era Of Plain Packaging Is Coming In Thailand

The latest legislative developments in the
tobacco sector in Thailand are worrying the tobacco industry but also the food
and beverage sectors as similar regulations may follow.

The content of the draft Thai Tobacco
Product Control Act ("TPCA")
regulating the packaging and labeling of tobacco products has first been introduced
in 2010 under a different Bill named draft Tobacco Consumption Control Act (or “TCCA”),
and shows the ever growing restrictions imposed on the tobacco industry in
Thailand.

The increased size of shock-pictures and
health warning statements covering the package of cigarettes is one example.
Compared with its neighbors, Thailand is leading the way since 2014 with 85% of
space coverage (previously, 55%).

Key
provisions of the draft TPCA

• Increase
  of the minimum age for the purchase of cigarettes to 20 years
  (instead of 18 years currently) in an attempt to reduce youth smoking (Article
  26);
• Ban
  of the sale of individual cigarettes and in a number smaller than 20 for
  the purpose of limiting access to, and discouraging purchase of cigarettes
  (Article 39);
• Tobacco
  product sales restrictions such as prohibition of cigarette vending
  machines (Article 27);
• Broader
  definition of tobacco products to cover any item
  containing nicotine, including hookahs and electronic cigarettes (Article 4);
• Stricter
  rules on advertising of tobacco products such as prohibition of
  the display of the names or marks of tobacco products, or of the manufacturer
  or importer, on tobacco products or non-tobacco products and any logo or symbol
  that might cause the public to understand that such names or marks are the
  names or marks of the tobacco products or of the manufacturer or importer, prohibition
  of sponsorship and merchandising as forms of indirect advertisement (Articles
  30-36);
• Obligation for manufacturers to disclose
  all ingredients in tobacco products to the
  MOPH for the purpose of obtaining the Certificate of Notification of the list
  of components of tobacco products, a necessary document for the sale of tobacco
  products in Thailand (Article 37). Since the list would be published, this disclosure
  requirement would jeopardize trade secret protection that may be granted to the
  composition of tobacco products (one condition of the protection being to
  remain secret);
• to disclose the volumes of produced and imported tobacco products,
  marketing costs and incomes generated from the sale of tobacco products in
  Thailand and any other relevant information (Article 40);
• Open door to the introduction of plain packaging for cigarettes by allowing the MOPH to impose the criteria and
  features of tobacco products’ packaging (size, color, symbol, label, trademark,
  pictures and messages (Article 38[1]). “Plain packaging” – also known as homogenous, generic or
  standardized packaging- refers to the
  appearance of all tobacco packages in a standardized manner: the cigarette
  packaging is a single color and the
  brand name is reproduced in a standard
  font, size and location.

Public
Health vs. Private Rights: the battle of the Giants

The Thai Ministry of Public Health is
defending the new text in the name of public health.

For the tobacco industry, this new law (and plain packaging laws
in general) are violating intellectual property rights and international
treaties, encouraging illicit trade and making it difficult for consumers to identify the product’s genuine source.

The Thai Ministry of Commerce is trying to conciliate the interests of
both sides: whilst aiming to discourage, and help consumers quit smoking, the
new Bill should not affect the rights of the trademark owners and trade secrets
as protected under the Thai Trademark and Trade Secret Acts and should comply
with the international agreements regarding trade and intellectual property.

These concerns
are shared by some WTO Member Countries such as Mexico,
Honduras, the European Union, China, the United States of America and Brazil
which raised a series of questions to the Thai representatives during the last WTO’s
Trade Policy Review in November 2015. When asked how to ensure a fair competition environment for the sale of tobacco products, what would be the impact on trademarks currently used on
tobacco products or whether similar plain packaging regulations will be
extended to alcoholic beverages, Thailand reaffirmed its commitment to the WTO
Agreement on Trade-Related Aspects of Intellectual Property Rights and public
health policy.

Current legislative process: 2017, the turning point
for plain packaging in Thailand?

The Bill is
currently pending consideration by the National Legislative Assembly. The decision is
expected by March 2017 (subject to
delays).

The WTO ruling
in the disputes relating to Australia’s tobacco plain packaging measure has been postponed to May 2017. A decision in favor of the
Australian government will likely pave the road for similar regulations in
Thailand. To date, plain packaging is effective in the United Kingdom since May
2016 and in France since January 1, 2017 (for retailers, manufacturers had to
comply by May 2016).

Whist it will be interesting to see how this
story unfolds, the tobacco companies
will probably not go down without a fight should the Bill be passed in Thailand,
as per one of the lawsuits previously brought by Philip Morris (Thailand),
British American Tobacco and Japan Tobacco International against the Ministry
of Public Health before the Supreme Administrative Court in 2013 to (unsuccessfully)
prevent the implementation of the larger health warnings.

Mrs. Maturos
Piyachotisukij, Head of Patent Department, Vidon & Partners

Ms. Noemie
Sancelme, Coordinator/Manager of Overseas Department, Vidon & Partners

Ms. Mathilde
Tachon, Consultant, Vidon & Partners

They can be
contacted at [email protected]

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[1] “The manufacturer or importer of
the Tobacco products for sale in the Kingdom shall arrange for the Package of
the Tobacco products or Tobacco products to have the size, color, symbol,
label including the character of the displaying of trademark, symbol, picture,
and Message in compliance with the criteria, methods and conditions as notified
by the Minister according to the suggestion of the Directing Commission
before taking them out of the manufacturing site or before importation into the
Kingdom as the case may be.

No person shall be allowed to sell the
Tobacco products which are not in the Package of Tobacco products or do not
display the trademark, symbol, picture and Message as prescribed in paragraph
one”.

The initial disputed
provision stating that « The law
on intellectual property shall not apply to the display of the Package under
this Section” has been deleted.