For the half-year to 30 June 2014, the IPKat's regular team is supplemented by contributions from guest bloggers Alberto Bellan, Darren Meale and Nadia Zegze.

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Wednesday, 19 December 2012

The Tobacco Product Directive: Commission cuts to the chase

Not for the first time, the IPKat finds himself hosting another piece on the treatment of trade marks and branding in the context of proposals to discourage the dangerous and unhealthy uses to which tobacco is put.   Caught in the crossfire between the tobacco giants (who have the funds with which to fight, plus the loyalty of consumer addiction on their side) and the European Commission (armed with the de jure power to propose legislation and the de facto power to push it through), the position of tobacco brands is unenviable, if not untenable.

In this guest contribution, veteran trade mark commentator Christopher Morcom QC argues that, in the gathering momentum towards amendment, the role and function of trade mark rights has been insufficiently considered.  This is what he writes:

"The European Commission's revised Tobacco Product Directive published today: the threat to intellectual property rights

As is now well-known, since 1 December 2012 tobacco products have to be sold in plain packaging format in Australia, although it is understood that there are outstanding legal challenges to the law there. Today, the EU Commission has published its proposal on a revised Tobacco Product Directive (see Commission’s press release  and text of proposal). In essence, the Commission has accepted Directorate General (DG) SANCO's proposed measures. Among those measures are: a requirement for combined warnings (picture and text) covering 75% of the front and the back of packs, general warning and information message on both sides of the packs, 'standardization' of packs (same shape and format) and possibility for member states to introduce 'plain packaging'. Such requirements are particularly likely to affect IP rights.

Commissioner Barnier
Attention should be drawn to the fact that Commission's inter-service consultation (the internal process of the Commission under which a legislative draft is submitted to the services of the DGs) on DG SANCO's proposals commenced on 30 November, and only lasted for 12 days, closing on 11 December. Further, according to reports in European media, the President of the Commission, Jose Manuel Barroso, gave instructions to the DGs not to issue a 'negative opinion' so as not to block the revision process. It also appears that DG Internal Market and Services ('DG MARKT'), led by Commissioner Michel Barnier, did not submit any remarks during the inter-service consultation process which might have been seen as an effort to ensure due protection for IP rights, especially trade marks. If that is indeed the case, then the procedure adopted in the consultation process would seem to have been inadequate. It is DG MARKT that has the responsibility to ensure that legislative proposals emerging from the Commission will take into account the legitimate interests of owners of IP rights, and also the interests of consumers in distinguishing the products of different undertakings. That includes due recognition of treaty obligations on Member States, such as TRIPS, the Paris Convention, and the ECHR, intended to protect such rights. A number of EU and other international IP associations have expressed their concerns in these respects during the inter service consultation process.

It is now seems clear that IP rights have not received adequate consideration in the preparation of this draft Directive. The proposed provisions affecting packaging are clearly, it is suggested, prejudicial to IP rights, and in particular to the normal use of trade marks in the Single Market. In putting forward the proposals, the EU Commission is sending a negative message to industry. DG MARKT should instead be encouraging a competitive market, in tobacco, as well as other legal products. It has an important role to play, in motivating business to create and to innovate, and in particular to ensure that IP rights are duly protected. Enough has been said to Commissioner Barnier, by the organisations already mentioned, to alert him to the issues which the proposals raise. He seems so far to have ignored these issues. Industry is entitled to have expected otherwise.

The Commission's text will be conveyed to the National Parliaments of the EU Member State at the same time as being sent to the European Parliament and Council. It is therefore now in the hands of MEPs and member states of the EU to take the action that is needed, and to limit the unwarranted measures proposed by the Commission".
MARQUES, the organisation for trade marks in Europe, has already issued its own, equally monitory, press statement (see Class 46 here), and the Kats expect that there will be more.

"Cat to the chase"? DG MAR-KAT  races
to make its inter-service comments before
DG SANCO makes its decision
Has the consideration process been inadequate? Anyone who has been involved in the recent rush to secure the European patent package may wonder whether there is any point of consultation and expert consideration at all, while those folk whose main interest lies in the field of copyright and the information society may be wondering why their sector has been singled out for so much careful consideration, for so long and in so much depth?  Merpel's theory is that the Commission is best at weighing up the pros and cons of IP-related issues when it hasn't a clear idea what it wants to do, but tends to cut to the chase when its various bits have already made their mind up ...

5 comments:

Peter Lawrence said...

I do find it worrying that in the moral panic that "something must be done" about the fact that many of us enjoy products that can be unhealthy, normal considerations of good policy making go out of the window. Another example of politics getting in the way of evidence based policy?

Thank you Christopher for this update.

Anonymous said...

Christopher writes:
"In putting forward the proposals, the EU Commission is sending a negative message to industry."

Well, you don't need 20/20 vision to see that. Is it wrong to send a negative message to the industry though?

He further writes "DG MARKT should instead be encouraging a competitive market, in tobacco, as well as other legal products." I think the problem which Christopher does not address is the health issues associated with these "legal products".

I see no reason why trade mark rights should be seen as some form of holy grail. They are rights granted by governments and which can be restricted by governments if they see fit.

Anonymous said...

Tobacco manufacturers should realise that the jig is up. The only reason that tobacco products are on sale is that they were established on the market before anyone realised the health hazards involved. We now know that tobacco represents the biggest cause of preventable death on the planet. Can you imagine the row if tobacco were recently discovered and companies were trying to put it on the market? Against this, the companies should realise that their trade mark rights represent very small beer indeed. If they want to continue to sell their noxious weed to the poor individuals they have deliberately hooked on it, they should put up and shut up.

Norman said...

It is well established that a patent gives a right to exclude others, not a right to use. That you have a patent for an automatic rifle does not give you the right to fire it. Similarly, copyright in a libelous work does not give the author the right to publish it. I see no reason why trade marks should be treated any differently. The only reason that the point is not already established is that it is rare for the use of a trade mark to cause harm. But in this case, there is reason for the government to reasonably conclude that the use of tobacco trade marks has caused thousands of deaths. Consequently, I see no reason why the use of such trade marks should not be regulated, in the same way that the use of patented weapons is regulated.

Anonymous said...

"Is it wrong to send a negative message to the industry though?"

Indeed. You don't see anybody complaining about how anti-narcotics raids "send a negative message" to the cocaine, heroin or meth industries (and "heroin" once was a registered trademark). This is an actively harmful industry, selling a damaging, highly addictive drug. There's a broad consensus, from health professionals to the general public, that the world would be better off without this industry. The only valid reason not to ban it outright is that it has managed to make so many addicts that prohibition would lead to an extensive black market and organised crime (much like some other prohibitions past and present). But it absolutely deserves a harsh ride, and not just a "negative message".

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