On 31 August,Ukraine asked the to WTO set up a panel to hear a dispute on"measures concerning trademarks and other plain packaging requirements applicable to the tobacco products".
Ukraine has next to no cigarette trade with Australia but it is the site of a Philip Morris International subsidiary that employs 1400 workers.Corporations cannot make an appeal to the WTO in their own name.
Ukraine's statement says Australia's law requiring that all cigarettes must be sold in plain packets is"more trade restrictive than necessary to achieve the stated health objectives and constitutes an unnecessary obstacle to trade
Rejection
Rather than agreeing to the establishment of a disputes resolution panel,as is customary in less serious disputes,Australia rejected the request,arguing the law was"a sound,well-considered measure designated to achieve a legitimate objective,the protection of public health".
Australia's rejection of the request for a panel is a symbolic,rather than a practical,measure.Ukraine will have to ask for a second time at the next WTO meeting on 28 September.Australia would be unable to reject a second request.
The dispute would take some months to hear,during which time Australia could continue to require plain cigarette packets from December 1.
If the panel finds against Australia,the WTO will have the right to impose trade sanctions,should Australia continue to enforce the law.Australia is fending off a second challenge in Hong Kong,where British American Tobacco has relocated its Australian holding company's headquarters.
