Plain Packaging: The Negative Nature Of Trade Mark Rights

Recent developments in the UK regarding plain-packaging requirements for cigarettes have again shone the spotlight on this contentious issue.

A while back, we reported on developments in Australia, where the country's Tobacco Plain Packaging Act, 2011 requires tobacco companies to sell their products in identical olive green packs, with graphic images reflecting the possible health consequences of smoking, and the brand name (sans logo) in very small script. The tobacco industry went to court on the issue and the Australian court ruled that the legislation was lawful. What was particularly interesting was that the court found that the legislation did not involve an acquisition of property - the argument had been raised that plain-packaging requirements essentially amount to an expropriation of IP.

Plain packaging has now played out in the UK. The emotive nature of the issue became very clear when tobacco company Philip Morris said this early on: "Standardized packaging is a euphemism for government-mandated destruction of property. It is unlawful, disproportionate, and at odds with the most basic requirements of the rule of law." But the UK High Court found that the UK plain-packaging regulations are lawful. This decision was taken on appeal and, on 30 November 2016, the Court of Appeal handed down its judgment in which it upheld the High Court's judgment.

The Court of Appeal's judgment dealt with various issues. Most interesting from an IP perspective was the finding that the essence of the trade mark right is the negative right to exclude others from using it, rather than a positive right to use it. The court said that there is no positive right to use a trade mark under either UK or international law. The negative right to stop others using the trade mark is not affected by the plain-packaging regulations.

The court also ruled that the plain-packaging regulations are not inconsistent with the Agreement on Trade-Related Aspects of Intellectual Property Rights ("TRIPS"), which should be interpreted in conjunction with the Doha Declaration on TRIPS and Public Health. The Doha Declaration says that TRIPS should be interpreted in a way that is supportive of the right of World Health Organization members to protect public health. The court acknowledged that the Doha Declaration was adopted in the context of medicines, but said that it is not limited in any way.

The Court of Appeal went on to hold that the UK plain-packaging regulations do not...