From a NY Times article today:
Tobacco companies are pushing back against a worldwide rise in antismoking laws, using a little-noticed legal strategy to delay or block regulation. The industry is warning countries that their tobacco laws violate an expanding web of trade and investment treaties, raising the prospect of costly, prolonged legal battles, health advocates and officials said.
The strategy has gained momentum in recent years as smoking rates in rich countries have fallen and tobacco companies have sought to maintain access to fast-growing markets in developing countries. Industry officials say that there are only a few cases of active litigation, and that giving a legal opinion to governments is routine for major players whose interests will be affected.
But tobacco opponents say the strategy is intimidating low- and middle-income countries from tackling one of the gravest health threats facing them: smoking. They also say the legal tactics are undermining the world’s largest global public health treaty, the W.H.O. Framework Convention on Tobacco Control, which aims to reduce smoking by encouraging limits on advertising, packaging and sale of tobacco products. More than 170 countries have signed it since it took effect in 2005.
Tobacco companies are objecting to laws in both developed and developing nations. Industry officials say they respect countries’ efforts to protect public health, but face difficulties promoting their brands as more countries ban cigarette ads. Often, the only space left is the packaging, and even that is shrinking, with some countries requiring that packages be plastered with shocking pictures of people with cancer; in Australia, brand names are reduced to uniform block letters on drab olive backgrounds.
It's puzzling to me that this continues to be an issue, because the conflict here would be so easy to solve. All you need is for trade and investment rules to focus on non-discrimination as a guiding principle. Under a non-discrimination rule, tobaco regulation would not violate trade and investment agreements as long it didn't discriminate against foreign products. (Yes, it's a little tricky to formulate non-discrimination principles, but it can be done.) I wrote a short Cato paper about this last year: http://www.cato.org/publications/free-trade-bulletin/free-trade-tobacco-thank-you-not-smoking-foreign-cigarettes
So why don't we just change the rules to reflect this? I'm not sure. On one side, for reasons I can't figure out, some tobacco opponents seem to think tariffs on imported cigarettes are a good idea. But as I've said before, I don't see how protecting the domestic tobacco industry from competition helps public health. And on the other side, legal principles such as "fair and equitable treatment" mean that just about any government regulation a company doesn't like could be subject to international litigation. But people seem very attached to these rules, for whatever reason.
Anyway, the problem would be easy to fix, and it seemed worth noting this, although I've said the same thing already, so I don't have much hope that this blog post will have an impact on the debate!
ADDED: Of course, when I say "easy to fix," I mean in the technical, legal sense, not in the political sense!