Plain packaging legislation for tobacco products is spreading throughout Europe despite efforts by IP rights advocates. Nonetheless, INTA, after submitting comments to UK, Ireland, France, Norway, Hungary, and Slovenia, sent on June 29, 2016 a letter to the Swedish government stating concern over its decision to consider plain packaging for tobacco products. INTA’s comments focus on the deleterious impact of plain packaging on trademark rights and do not weigh-in on public health issues.
Plain packaging requirements on tobacco products may indeed be the harbinger for the erosion of trademark rights across other industries. Governments may decide to require plain packaging for other products or industries whose impact on public health is being scrutinized.
INTA’s submission also stresses that plain packaging would severely impair the function of trademarks. It leads to a restriction or a prohibition of certain existing trademarks and the impossibility to register new tobacco trademarks. Plain packaging would effectively diminish the value of trademarks of the tobacco companies which other than a block word mark would be unable to be used in Sweden. This is tantamount to the government forcibly taking away the trademarks of the tobacco companies as a mark can be cancelled if it is not used in the country for five years without a good reason. Plain packaging also may constitute suppression of freedom of expression. All of these issues, it should be noted, go against European Union (EU) law and various international treaties that Sweden has pledged to follow.
Moreover, plain packaging would cause an unfair burden on manufacturers because they would have no choice but to make containers specifically for use inside of Sweden. This would also hamper trade within the EU because other countries would not be able to ship any tobacco products to Sweden if they fail to meet the strict and different Swedish plain packaging requirements.
INTA’s letter also explained that plain packaging would make counterfeiting significantly easier because counterfeiters, rather than having to copy the distinctive and unique casings of current tobacco products, would need only to copy plain packages, which they would find significantly easier. Not only would this allow more counterfeit products to go undetected, it would also eventually lead to consumers losing faith in the actual brand-owning companies, as those consumers would not be able to easily differentiate between the real products and the inferior counterfeits.
Industries affected by plain packaging laws risk severe disruption of the use of their trademarks. INTA urged Sweden to postpone the consideration of adopting plain packaging until the legality of plain packaging is confirmed—if indeed it is so confirmed—in the WTO Dispute Settlement Proceedings.