British American Tobacco (UK) Ltd & Ors, R (On the Application Of) v Secretary Of State For Health [2016] EWHC 1169 (Admin)

“Tobacco control is central to any strategy to tackle health inequalities as smoking accounts for approximately half of the difference in life expectancy between the lowest and highest income groups. Smoking-related death rates are two to three times higher in low income groups than in wealthier social groups.”

“… the real experience [for the smoker] begins when they are holding the pack in their hands”. (Cited in Vasseen (2011) “Optimise your brand with an inner foil lid”

“4.8 Contrary to the criticisms made, the authors rightly place emphasis on the overall consistency of results collected through multiple study designs and across several countries (and the absence of evidence pointing in the other direction). This is a commonplace of research analysis which involves determining the direction of effect and, where possible, effect size. In my view, it does not seem to be a fair criticism that drawing studies from peer reviewed journals with a public health orientation represents a biased approach. There has been ample opportunity for the tobacco industry to present the undoubtedly extensive results of its own internal market research, for example focus group research exploring brand switching, but to date this has not been forthcoming other than as a result of litigation in the United States.” (Emphasis added)

“The Government have an open mind at this stage about introducing standardised packaging. Through the consultation, we want to understand whether there is evidence to demonstrate that standardised packaging of tobacco products would have an additional public health benefit over and above existing tobacco control initiatives.”

“… Any decisions to take further policy action on tobacco packaging will be taken only after full consideration is given to consultation responses”

“The Review’s methodology 1.8 On 16 December 2013 I published a Method Statement which set out the method I intended to adopt in carrying out my review (see Annex A). 1.9 In accordance with the Method Statement, the Review Team and I began by considering the existing evidence relevant to the public health issue I had been asked to consider. This involved giving careful consideration to the Summary Report of the Department of Health’s 2012 consultation, reviewing full text versions of a range of detailed responses to that consultation from the main stakeholders and both the Stirling Review and subsequent Research Update published in September 2013. 1.10 Following publication of the Method Statement, some 50 new submissions were received, which brought to light several new papers, including some “in press” or in the process of peer review. The submissions also included a number of organisation’s member opinion surveys, and the views of, amongst others, packaging businesses. 1.11 All submissions to the Review were read and key points of argument and supporting evidence identified for follow-up. In several cases I contacted experts who had articulated what appeared to be the key arguments and/or summation of evidence, and arranged face to face meetings with them to explore their views in greater detail. This included meetings with experts such as Professors Devinney and Steinberg, who had produced detailed critiques of the Stirling Review and the drivers of smoking initiation respectively. 1.12 In addition to meeting with experts, in accordance with my Method Statement I held two main meetings to discuss the views of the principal bodies representing each side of this polarised debate. Accordingly, I met with representatives of the Smokefree Action Coalition on 27 January 2014 and the Tobacco Manufacturers Association on 29 January 2014 in order to better understand and explore their respective views. I also met with representatives of Philip Morris Ltd on 29 January 2014 as they are not a member of the Tobacco Manufacturers Association. I am publishing the transcripts of these meetings. 1.13 A number of papers referenced in the tobacco industry’s submissions were considered in detail after identification of those that appeared most relevant to the task. The voluminous literature on tobacco control was also scrutinised to the extent time allowed, including material sourced from references in submissions, published papers and previous reviews. 1.14 As anticipated in my Method Statement, I also commissioned some further expert advice to assist me in the analysis of the key evidence. In particular, I commissioned two specific pieces of independent analysis on the qualitative and quantitative studies in the Stirling Review (and the subsequent Research Update) using Critical Appraisal Skills Programme assessment tools. These were undertaken by academics at Southampton University and Kings College London respectively. 1.15 Finally, I also sought to take account of the emerging evidence relating to the implementation of plain packaging in Australia. In particular, I met with a range of stakeholders in Australia during March 2014, including representatives of the tobacco industry, leading public health academics, and key departments of the Australian Commonwealth Government. 1.16 A list of all published evidence considered by the Review will be made available separately, together with copies of the submissions sent in response to the Method Statement and further evidence sent to the Review which generally arose in follow-up to questions posed in meetings or in response to specific requests. 1.17 I have not sought to distinguish between different types of tobacco products for the purposes of this Review but have looked at tobacco in general. All tobacco products are dangerous in their health effects. The Review has, however, focused on cigarettes and roll-your-own tobacco in view of their overall prevalence and particularly their use by children and young people. I note in this regard the approach, taken in the revised European Tobacco Products Directive (mentioned further below) in relation to these products which differs from that taken for more mainstream products but preserves power to intervene further as necessary. I see the scope of any standardised packaging scheme as one matter for policy makers to consider further in the event of a decision to introduce such a scheme. 1.18 Given my terms of reference, much of the Review’s time was spent considering the likely impact of standardised packaging on young people. For clarity, in this report references to “children” are generally used to refer to those under 18 years of age (who are unable legally to purchase tobacco), and references to “young adults” are to 18-24 year olds. In practice however, I considered it necessary to consider the effects of standardised packaging across the age range as a continuum. This is because addiction to smoking can involve a number of stages after first initiation, including prolonged progression through occasional use and later consolidation to becoming a habitual smoker. Coupled with the fact that once established, giving up smoking is extraordinarily difficult, there is a clear rationale for targeting anti-smoking efforts at children and young people whenever possible. The nature of the evidence 1.19 I have been asked whether the evidence shows that it is likely that there would be a public health impact. This is clearly not an issue which is capable of scientific proof in the manner one might apply, for example, to the efficacy of a new drug. There have been no double blind randomised controlled trials of standardised packaging and none could conceivably be undertaken. The most direct experiment to test the efficacy of standardised packaging might be to compare the uptake of smoking in non-smoking children with cigarettes in branded packaging and to see which group smoked more. But given the highly addictive and harmful nature of smoking, such an experiment could, rightly, never receive ethical approval. In any case such an experiment would need to be conducted over a long period and within a large population in which other variables were held constant. Indeed in Australia it will be difficult in due course to separate the effect of plain packaging from other factors such as changes in pack sizes introduced by the manufacturers, and price and tax increases. 1.20 However there is a considerable volume of other evidence from interested parties on all sides of the debate, augmented by further tobacco control publications, internal tobacco industry documents, wider marketing literature and practice, all of which I have taken into account in arriving at a considered view of likely effects, grounded in the best available evidence”

“6.9 It is always possible to confuse passionate interest with bias. In this regard I note the opinion of Judge Kessler at the conclusion of a seven-year lawsuit involving scrutiny of thousands of documents and examination of many expert witnesses. Namely that: “Much of the Defendants’ criticisms of Government witnesses focused on the fact that [they] had been long-time, devoted members of “the public health community.”

“While there is still some debate about the feasibility of implementing this measure and about the evidence base for the impact on tobacco consumption, the types of studies presented […] provide evidence of the role and importance of cigarette packaging design in attracting consumers (both current smokers and aspiring smokers) to tobacco products. Thus, given the importance of product attractiveness in product purchasing decisions and evidence that such packaging detracts from the health warning currently placed on such products, it is apparent that plain packaging would have some deterrent impact (albeit difficult to quantify) on the consumption of tobacco products. It might also be envisaged that this impact could be greater in deterring consumers who are non-smokers and therefore not yet addicted to nicotine from taking up smoking. Also, given the evidence on cigarette design attractiveness to different target populations, the impact of plain packaging could also have a particularly positive effect on these groups, encouraging them to reduce their cigarette consumption and uptake”

“It is worth noting that there are significant differences between the markets in the UK and Australia, particularly in terms of the proximity to other countries, so the lessons learnt from the introduction of standardised packaging in Australia may not necessarily translate to the UK”

“What is the problem under consideration? Why is government intervention necessary? 1. Tobacco use remains one of the most significant challenges to public health across the United Kingdom and is the leading cause of premature death in the UK. The Government remains concerned about the take up of smoking by young people, the difficulty that adult smokers have in quitting smoking, high levels of relapse of those smokers that do attempt to quit and the consequences for the health of others from exposure to second hand smoke (SHS). Tobacco use also contributes significantly to health inequalities. 2. The Government has a policy to stop the promotion of tobacco. Action to stop the promotion of tobacco has been taken over many years. The Tobacco Advertising and Promotion Act 2002 (TAPA) prohibits tobacco advertising. The Health Act 2009 requires the end of tobacco displays in England (in large stores from 2012 and all other tobacco retailers in 2015). A Cancer Research UK report on plain packaging says that tobacco packaging serves multiple functions for tobacco manufactures. It is used to promote the product using the same strategies employed by other manufacturers of consumer goods, specifically packaging innovation, design and value packaging. Packaging is viewed as a key marketing tool for tobacco companies, according to both their own internal documents and also the retail press. Packaging has a wider reach than advertising and is the most explicit link between the company and the consumer. Tobacco packaging and branding is a key element of tobacco marketing and promotion in the UK today. 3. Evidence suggests that the majority of existing smokers would prefer not to smoke. Almost 7 smokers in 10 say they would like to quit, yet only half actually make a quit attempt. Furthermore, less than 3% of smokers successfully quit each year. The smoker who wishes to give up smoking faces many obstacles, particularly the psychological and physiological components of addiction. Out of the smokers who do attempt to quit, approximately half do so without any assistance. These unassisted quit attempts are associated with the highest rates of relapse. In general, attempts to stop smoking are accompanied by powerful urges to smoke/cravings which are a major source of relapse and occur despite the individual concerned wanting to remain abstinent. Cravings overpower and undermine resolve to remain abstinent. These problems present examples of the difference between what smokers would prefer to do and what they are actually able to do with respect to tobacco consumption. The policy objectives include supporting smokers who want to quit and helping those who have quit avoiding relapse into smoking. In doing so, they will be better able to exercise their free choice in consumption decisions. 4. Introducing standardised packaging represents a policy option for the Department of Health in England and for the Devolved Administrations in Scotland, Wales and Northern Ireland, as part of their wider comprehensive tobacco control strategies, to improve public health by reducing tobacco use. Research evidence suggests that standardised packaging of tobacco products would contribute to the Government’s public health policy objectives by reducing the appeal of cigarettes (including hand rolling tobacco), packs and brands, increasing the salience of health warnings, making perceptions of product harm and strength more accurate and reshaping smokingrelated attitudes, beliefs, intentions and behaviour. 5. Tobacco control policy across the UK aims to reduce youth uptake of smoking, and to encourage and support quitting amongst smokers who wish to quit; standardised packaging is expected to have a positive impact on both. 6. Smoking rates are today broadly the same among men and women. Around two-thirds of smokers say that they started smoking regularly before the age of 18. In 2009, the Public Health Research Consortium (PHRC) published a review of young people and smoking in England. The review found that the onset of smoking is a function of individual factors (e.g. self-image), social and community factors (e.g. family circumstances) and societal factors (e.g. tobacco marketing). Moodie et al. (2008) summarise the different research undertaken on tobacco advertising and smoking uptake by young people, and has found that: Research has consistently revealed that tobacco advertising and promotion increases the likelihood that adolescents will start to smoke, whether employing cross-sectional research, prospective research, time series studies or systematic reviews. The cumulative evidence indicates that there is a dose-response relationship, where greater exposure to advertising and promotion results in higher risk, even when controlling for known causative factors such as low socioeconomic status, parental and peer smoking… Furthermore, we know that tobacco branding is continuing to drive UK teen smoking even after TAPA (2008). 7. Of particular concern is the impact of tobacco packaging on young people who might not yet be in a position to make properly informed or considered adult lifestyle choices. Growing up in homes where smoking by adults is the norm, children are more likely to become smokers themselves and to take up smoking at an earlier age, perpetuating smoking into new generations. Pupils who live in a household where someone else smoked are more likely to smoke than those who do not live with any smokers, and, in England, 37% of pupils live with someone who smokes. 8. The impact of tobacco marketing (including branding) may be a key factor in youth smoking uptake. The British Medical Association says: Young people are greatly influenced by their sense of what is normal and attractive; and this in turn is affected by the messages and imagery attached to different behaviours. Thus, particular fashions, music styles and forms of recreation become more or less popular over time. Young people’s smoking is susceptible to these same forces, but in this case the associated imagery seems, for some young people at least, to remain consistently positive. This capacity to remain ‘forever cool’ belies the reality: smoking continues to be the leading cause of ill health and premature death in the UK. Pro-smoking imagery originates from three overlapping sources. First, it is part of the social milieu: young people see others – parents, peers and public figures – smoking and this reinforces the normalcy of the habit. In Great Britain, smoking still has around 10 million role models. The detritus of smoking also provides a reminder of the apparent normalcy of the behaviour. Second, entertainment media depict smoking on a regular basis. Images of smoking are commonplace in films, television shows and magazines, and can influence the attitudes and behaviours of young people. Other forms of media such as the internet represent a growing concern in this respect. Third, young people are exposed to the positive images of smoking generated by tobacco industry marketing. The ban on tobacco advertising in the UK has greatly restricted the more traditional forms of marketing (e.g. billboards); however, ubiquitous distribution, increasingly elaborate point-of-sale displays, attractive pack liveries and evocative brand imagery continue to provide key marketing opportunities that influence young people. 9. Research suggests that standardised packaging would help to re-shape social norms around the use of tobacco products, assisting people to understand that tobacco use is highly addictive and can be hugely damaging to health. According to an article in the Bulletin of the World Health Organisation, ‘for decades, the tobacco industry has taken advantage of the package as a venue for creating positive associations for their product’. 10. While smoking prevalence has fallen steadily in England since its peak in the mid-20th century, smoking rates are today higher than average among particular groups meaning that smoking has emerged as one of the most significant contributors to health inequalities in England. The association between smoking and inequalities is today apparent from evidence of who smokes. Smoking is most common among those who earn the least, and least common among those who earn the most. In 2010, smoking prevalence was more than twice as high among people in routine and manual occupations compared with managerial and professional occupations. Smoking rates are high in particular ethnic and social groups. Smoking rates among people with mental health problems is significantly higher than among the general population. 11. The difference in smoking between social groups widens throughout adulthood as people from more affluent groups are more able to quit, for a variety of reasons. Differences in motivation do not account for the differences in smoking rates between social groups, as desire to quit remains broadly the same. There is likely to be a number of reasons why people from less affluent backgrounds are less successfully able to quit, including levels of addiction and the socially reinforcing nature of smoking in groups and communities where smoking rates are high. 12. Smoking is the main cause of differences in illness and death between the poor and wealthy. The Government’s Healthy Lives, Healthy People White Paper published in 2010 sets out that one of the Government’s key objectives will be to improve the healthy life expectancy of the population, improving the health of the poorest, fastest. The independent review into health inequalities in England, ‘Fair Society, Healthy Lives’, proposed ‘the most effective evidence-based strategies for reducing health inequalities in England’ and made the following recommendation: Tobacco control is central to any strategy to tackle health inequalities as smoking accounts for approximately half of the difference in life expectancy between the lowest and highest income groups. Smokingrelated death rates are two to three times higher in low-income groups than in wealthier social groups. 13. In England and Wales, at least half of the excess risk of death observed in unskilled manual workers by comparison with professionals is attributable to smoking. Similar effects of smoking on health inequalities were also seen in the United States, Canada and Poland. A 28-year cohort study in Scotland examined the impact of smoking on survival between social classes, and found that the differences in survival between smokers and never smokers are much greater than those between smokers in different social positions. 14. The total cost of treating childhood disease caused by second hand smoke has been estimated at £23m per annum in the UK. We expect this to reduce if legislation to make private vehicles carrying children smokefree is introduced. We would expect this cost to be reduced in proportion to any reduction in parental smoking which might result from a standardised tobacco packaging policy. But, as in previous IAs related to tobacco control policies, we have not otherwise included an impact on NHS costs for the treatment of smoking-related diseases. Although recent research has claimed that quitting may lead to reduced lifetime healthcare costs, the required modelling of cost consequences of deferred mortality requires further development. Summary and Conclusion of Tobacco Standardised Packaging Impact Assessment 15. There is a substantial body of evidence regarding the factors associated with the uptake of smoking by young people and the factors that can inhibit smokers who wish to quit and induce relapse among smokers who have tried to quit. This evidence strongly suggests that the implementation of standardised packaging (“the intervention”) could both reduce the uptake of smoking by young people and create a more supportive environment for those who wish to quit. Recent research has considered the impact specifically of tobacco packaging and branding (including standardised packaging) on the self-image of smokers and on the likelihood of quitting, and has confirmed that introducing standardised packaging could bring substantial benefits for public health. 16. Quantification of the likely scale of the impact on smoking take up and prevalence is difficult. There is, however, experience in the UK and internationally of other tobacco control interventions, particularly those involving tobacco advertising, promotion and marketing, to provide insight into expected impacts of introducing standardised packaging. Researchers who have specialised in tobacco control are in an informed and experienced position to integrate existing policy experience with the research studies on tobacco packaging. Independent academic research was commissioned by DH to gather an expert view on the likely scale of impact of standardised packaging from a range of tobacco control experts from around the world. The consensus (based on the median of reported views) of these experts is that the intervention would be expected to generate after two years: • a decline in the proportion of 11-15 year olds who have ever smoked of 3 percentage points (the proportion of this population who have ever smoked was 27% at the time of the research, so the 3 percentage points would represent a fall of 11% (3 in 27)); and • a decline in adult smoking prevalence of 1 percentage point (the proportion of this population smoking was 21% at the time of the research, so would represent a 4.8% (1 in 21) fall), as more people find themselves able to quit. 17. The benefits and costs in this IA are assessed on the basis of additional benefits and costs that would be likely to accrue over and above existing tobacco control measures and anticipated measures in place at the time of standardised packaging implementation. This includes the benefits and costs of recently commenced legislation in England to end tobacco sales from vending machines, ending the open public display of tobacco products in shops by April 2015, and the benefits and costs arising due to the revised TPD. 18. Based upon the European Tobacco Product Directive (TPD) Impact Assessment we estimate around a 1.9% reduction in the number of smokers might plausibly be achieved by TPD without standardised packaging, including a 1% reduction due to packaging and labelling aspects. We account for TPD within Option 1 (our “Do Nothing” option), so only the incremental gain of standardised packaging provides our central estimates (i.e. the 11% and 4.8% figures in the above bullet points become a net reduction of 10% and 3.8% to prevent doublecounting) 19. At this time it is difficult to conclude what the impact of standardised packaging on Australian smoking prevalence has been, due to confounding issues of changes to tobacco prices. There are also general difficulties of sample size when investigating impacts that are expected to be relatively small. Also the policy is at an early stage and data on medium and longer term trends do not exist yet. However the evidence that is available is consistent with a hypothesis such as the consensus one above that the policy would contribute to a modest decrease in prevalence. 20. With the intervention sustained for ten years following the policy implementation date (the standard policy appraisal period), such shifts in smoking behaviour would generate very large health benefits – estimated in total at 0.49m life years (discounted). These health gains, using standard DH methodology (based upon surveys of citizens’ willingness to pay for mitigation of health risks), are valued at £29bn. 21. There is considered to be lost economic productivity due to smoking breaks and tobacco-related absenteeism, therefore this policy is expected to decrease this loss and provide productivity gains of £0.9bn (discounted over the lifetime of those who exhibit behaviour change in the 10 years following policy implementation). 22. We estimate a cost saving associated with the production of simpler standardised rather than branded packs, of £0.23bn (discounted over 10 years). Only a small portion of this will accrue to the UK. 23. There are other benefits discussed but not quantified and not included in the Net Present Value calculations. When considering consumer surplus the orthodox approach is based on rational consumer behaviour. However, for addictive goods, this theory is not a plausible approach. For addictive goods, branding may act as a cue that stimulates craving. Removing the cue helps the addict to realise their true preferences. Any reduction in consumption due to standardised packaging might therefore be taken to reflect true preferences. The approach leaves the analyst with the task of assessing both the costs and the benefits realised by those who, in the wake of reduced branding, either do not become smokers or are enabled to quit. In addition to the health benefits listed above, there is pecuniary gain from reduced spending by quitters of around £5.7bn. However, there are offsetting withdrawal pains that quitters endure and any loss of any pleasure associated with smoking. There are also pecuniary gains for those who do not take up smoking, of £880m. These children are not addicted and hence have no offsetting withdrawal pains, but they do lose smoking related pleasures. As the assumptions that would be required to calculate non-health net gains would be relatively unconventional at this time, and were not included in the consultation IA, so they are not included in the NPV. 24. There are also expected to be benefits in terms of reduced morbidity and mortality due to second hand smoke exposure. There would be reduced costs to local authorities, and to businesses, for litter collection due to fewer discarded cigarette butts. 25. We also expect there to be a reduction in health inequalities. In 2010, 13% of the managerial and professional group were smokers compared with 27% of the routine and manual group. If display of branded packets induces take-up within the home and explains the link between parental smoking and take-up, standardised packaging may be helpful in tackling the differences in acculturation to smoking across socio-economic groups. 26. We consider the possibility that standardised tobacco packaging would be easier and cheaper to copy, so increasing the supply of counterfeit tobacco in standardised packs. We also consider the possibility that smokers may be more likely to seek out branded products in a standardised packaging environment. There are also counter arguments to these possibilities as well as the mitigation factors and options, and evidence from Australia in relation to these risks. We conclude that there is a sizeable likelihood that there will be no discernible increase in the illicit market or cross border shopping (CBS), but there is a chance of an increase. A reasonable statistical expectation is of a 0.4% transfer from the UK duty paid market to UK duty unpaid market (both illicit and CBS are part of the UK duty unpaid market), would imply a £31m UK loss to tobacco manufacturers, wholesalers and retailers. 27. There are also expected losses to the exchequer of £5.0bn. These losses mainly come from the reduction in tobacco consumption. They also come about if smokers downtrade from higher price brands to lower price brands (which are taxed less).There is also a contribution from a potential increase in cross border shopping and illicit trade. 28. In general we assume that normal profits lost due to reduced tobacco sales will be offset by sales of non-tobacco within the economy. However, some of the value of these sales is due to the value of brands that have already been created, and whose value is diminished by the intervention. This diminution of value needs to be reckoned as a one-off cost of the policy. With standardised packaging we expect a more rapid decline in sales of high price than of low price brands because of a greater likelihood of quitting among smokers of high price brands and due to downtrading from high price to low price brands among those who continue to smoke. The impact on returns to UK business (tobacco manufacturers, wholesalers and retailers) attributed to the reduction in brand value is estimated to have a present value of £190m. 29. The impact on small and micro businesses is uncertain, but the small and micro business sector may have relatively higher transitional losses compared to larger businesses due to lost footfall-related sales. 30. Standardised packaging may encourage printing to switch from gravure printing to cheaper offset lithography so some gravure machines may become redundant. In any case the value of the produce of packaging manufacturers will drop, diminishing the profit stream associated with this business. An estimate of this impact is the expected drop in the economic value of the capital stock which might be affected. We estimate that £10-£15m worth of machinery may become redundant and use this as an estimate of the lost profit stream to packaging manufacturers. 31. We expect there to be a very short lived increase in serving time whilst shop assistants familiarise themselves with the new system and customers become aware of the change in appearance. We value this loss of time to tobacco retailers and those purchasing tobacco at £0.80m. 32. The Direct impact upon all UK based business for One In Two Out (OITO) purposes is set out in the OITO section of the IA. 33. We need to consider not only the consumer surplus associated with smoking (discussed above) but that associated specifically with branded products, the loss of the ability of those who continue to smoke to gain the intangible benefit associated with smoking a particular brand that only the packaging of that brand, as it is currently available, can produce. 34. It is hard to assess how many of the 9.9 million or so people expected to continue smoking would suffer any felt loss from the absence of this particular avenue of self-expression, and to quantify the loss. Personal branding might be substituted by purchase of other branded goods. There is some further evidence that such branding carries a positional good externality i.e. the positive branding associated with premium brands inspires embarrassment and hostility in others not able to afford such self-branding. For these reasons, we have not quantified the loss of consumer surplus from branding. 35. Those who continue to smoke may also feel as though they have suffered a restriction in freedom. However, from a societal perspective, there is reason to discount the importance of this loss of freedom. For individuals to carry and personally to display branded packets of cigarettes may contribute to encouraging others, including children, to take up smoking and to deter quitting by those who wish to quit. Tobacco packaging and branding plays a promotional role and helps to shape social norms around smoking. The freedom to have branded tobacco, therefore, carries a cost to others; and society arguably need not accord value to a freedom that involves inflicting harm on others. 36. One unquantified cost is a reduction in the ability of tobacco companies to compete through product differentiation because of different packaging. 37. The gross gain of standardised packaging (that could be valued) before considering costs or unquantified impacts is assessed as £30bn. The gross costs of standardised packaging (that could be valued) are assessed as £5.2bn. This gives a net gain of around £25bn. Since the benefits are estimated to be much larger than the costs, the risk of the policy having a net loss is considered small. Furthermore, if the policy had a smaller impact than expected on smoking prevalence then although the benefits would decrease, so would the largest element of cost (that to the exchequer). 38. The intervention is worth pursuing now, notwithstanding these costs and risks. We believe that the cost of delaying a decision on whether to implement the intervention (Option 3) is too great in public health terms, particularly in view of the following considerations: • we can already benefit from the experience of Australia in determining the detail of any legislation and in implementing the intervention; • the potential health gains are very substantial and dramatically outweigh quantified costs; • the deferral of such gains would adversely affect the life expectancy of large cohorts of children and adult would-be quitters in every year of deferral; • if the true impact of standardised packaging is substantially smaller than assumed in this IA (but not zero) it would still be net beneficial to act now; • evidence from Australia is valuable, but there are considerable uncertainties that will remain; • if standardised packaging is implemented, monitoring of extent of impacts, such as any impact on cross-border shopping or the size of the illicit market would identify where mitigating action is needed; the information conveyed by such monitoring is likely to be much more directly pertinent to the policy context in the UK than that which can be gathered from other countries that have implemented the intervention (such as Australia)”

“94. As I have explained, the Regulations were considered and approved by affirmative resolution of both Houses of Parliament. As Lord Sumption observed in Bank Mellat v H M Treasury (No 2) [2013] UKSC 39; [2014] AC 700, para 44: “When a statutory instrument has been reviewed by Parliament, respect for Parliament's constitutional function calls for considerable caution before the courts will hold it to be unlawful on some ground (such as irrationality) which is within the ambit of Parliament's review. This applies with special force to legislative instruments founded on considerations of general policy””. “When a statutory instrument has been reviewed by Parliament, respect for Parliament's constitutional function calls for considerable caution before the courts will hold it to be unlawful on some ground (such as irrationality) which is within the ambit of Parliament's review. This applies with special force to legislative instruments founded on considerations of general policy””

“Packaging and product features 15. Packaging is an important element of advertising and promotion. Tobacco pack or product features are used in various ways to attract consumers, to promote products and to cultivate and promote brand identity, for example by using logos, colours, fonts, pictures, shapes and materials on or in packs or on individual cigarettes or other tobacco products. 16. The effect of advertising or promotion on packaging can be eliminated by requiring plain packaging: black and white or two other contrasting colours, as prescribed by national authorities; nothing other than a brand name, a product name and/or manufacturer’s name, contact details and the quantity of product in the packaging, without any logos or other features apart from health warnings, tax stamps and other governmentmandated information or markings; prescribed font style and size; and standardized shape, size and materials. There should be no advertising or promotion inside or attached to the package or on individual cigarettes or other tobacco products. 17. If plain packaging is not yet mandated, the restriction should cover as many as possible of the design features that make tobacco products more attractive to consumers such as animal or other figures, “fun” phrases, coloured cigarette papers, attractive smells, novelty or seasonal packs. Recommendation Packaging and product design are important elements of advertising and promotion. Parties should consider adopting plain packaging requirements to eliminate the effects of advertising or promotion on packaging. Packaging, individual cigarettes or other tobacco products should carry no advertising or promotion, including design features that make products attractive”

“Require that information provided by the tobacco industry be transparent and accurate.”

“24. To take effective measures preventing interference of the tobacco industry with public health policies, Parties need information about its activities and practices, thus ensuring that the industry operates in a transparent manner. Article 12 of the Convention requires Parties to promote public access to such information in accordance with national law. 25. Article 20.4 of the Convention requires, inter alia, Parties to promote and facilitate exchanges of information about tobacco industry practices and the cultivation of tobacco. In accordance with Article 20.4(c) of the Convention, each Party should endeavour to cooperate with competent international organizations to establish progressively and maintain a global system to regularly collect and disseminate information on tobacco production and manufacture and activities of the tobacco industry which have an impact on the Convention or national tobacco control activities. Recommendations 5.1 Parties should introduce and apply measures to ensure that all operations and activities of the tobacco industry are transparent. 5.2 Parties should require the tobacco industry and those working to further its interests to periodically submit information on tobacco production, manufacture, market share, marketing expenditures, revenues and any other activity, including lobbying, philanthropy, political contributions and all other activities not prohibited or not yet prohibited under Article 13 of the Convention. 5.3 Parties should require rules for the disclosure or registration of the tobacco industry entities, affiliated organizations and individuals acting on their behalf, including lobbyists. 5.4 Parties should impose mandatory penalties on the tobacco industry in case of the provision of false or misleading information in accordance with national law. 5.5 Parties should adopt and implement effective legislative, executive, administrative and other measures to ensure public access, in accordance with Article 12(c) of the Convention, to a wide range of information on tobacco industry activities as relevant to the objectives of the Convention, such as in a public repository”

“(a) any agreement relating to the treaty which was made between all the parties in connexion with the conclusion of the treaty; (b) Any instrument which was made by one or more parties in connexion with the conclusion of the treaty and accepted by the other parties as an instrument related to the treaty.”

“Article 1 Community trade mark 1. A trade mark for goods or services which is registered in accordance with the conditions contained in this Regulation and in the manner herein provided is hereinafter referred to as a ‘Community trade mark’. 2. A Community trade mark shall have a unitary character. It shall have equal effect throughout the Community: it shall not be registered, transferred or surrendered or be the subject of a decision revoking the rights of the proprietor or declaring it invalid, nor shall its use be prohibited, save in respect of the whole Community. This principle shall apply unless otherwise provided in this Regulation”

“…it is apparent that the Regulation seeks to remove the barrier of territoriality of the rights conferred on proprietors of trade marks by the laws of the member states by enabling undertakings to adapt their activities to the scale of the Community and carry them out without restriction. The Community trade mark thus enables its proprietor to distinguish his goods and services by identical means throughout the Community, regardless of frontiers. On the other hand, undertakings which do not wish to protect their trade marks at Community level may choose to use national trade marks and are not obliged to apply for registration of their marks as Community marks”

“Application of national laws for the purpose of prohibiting the use of Community trade mark”

“CHAPTER II Labelling and packaging Article 8 General provisions 1. Each unit packet of a tobacco product and any outside packaging shall carry the health warnings provided for in this Chapter in the official language or languages of the Member State where the product is placed on the market. 2. Health warnings shall cover the entire surface of the unit packet or outside packaging that is reserved for them and they shall not be commented on, paraphrased or referred to in any form. 3. Member States shall ensure that the health warnings on a unit packet and any outside packaging are irremovably printed, indelible and fully visible, including not being partially or totally hidden or interrupted by tax stamps, price marks, security features, wrappers, jackets, boxes, or other items, when tobacco products are placed on the market. On unit packets of tobacco products other than cigarettes and roll-your-own tobacco in pouches, the health warnings may be affixed by means of stickers, provided that such stickers are irremovable. The health warnings shall remain intact when opening the unit packet other than packets with a flip-top lid, where the health warnings may be split when opening the packet, but only in a manner that ensures the graphical integrity and visibility of the text, photographs and cessation information. 4. The health warnings shall in no way hide or interrupt the tax stamps, price marks, tracking and tracing marks, or security features on unit packets. 5. The dimensions of the health warnings provided for in Articles 9, 10, 11 and 12 shall be calculated in relation to the surface concerned when the packet is closed. 6. Health warnings shall be surrounded by a black border of a width of 1 mm inside the surface area that is reserved for these warnings, except for health warnings pursuant to Article 11. 7. When adapting a health warning pursuant to Articles 9(5), 10(3) and 12(3), the Commission shall ensure that it is factual or that Member States shall have a choice of two warnings, one of which is factual. 8. Images of unit packets and any outside packaging targeting consumers in the Union shall comply with the provisions of this chapter”

“Article 13 Product presentation 1. The labelling of unit packets and any outside packaging and the tobacco product itself shall not include any element or feature that: (a) promotes a tobacco product or encourages its consumption by creating an erroneous impression about its characteristics, health effects, risks or emissions; labels shall not include any information about the nicotine, tar or carbon monoxide content of the tobacco product; (b) suggests that a particular tobacco product is less harmful than others or aims to reduce the effect of some harmful components of smoke or has vitalising, energetic, healing, rejuvenating, natural, organic properties or has other health or lifestyle benefits; (c) refers to taste, smell, any flavourings or other additives or the absence thereof; (d) resembles a food or a cosmetic product; (e) suggests that a certain tobacco product has improved biodegradability or other environmental advantages. 2. The unit packets and any outside packaging shall not suggest economic advantages by including printed vouchers, offering discounts, free distribution, two-for-one or other similar offers. 3. The elements and features that are prohibited pursuant to paragraphs 1 and 2 may include but are not limited to texts, symbols, names, trade marks, figurative or other signs. Article 14 Appearance and content of unit packets 1. Unit packets of cigarettes shall have a cuboid shape. Unit packets of roll-your-own tobacco shall have a cuboid or cylindrical shape, or the form of a pouch. A unit packet of cigarettes shall include at least 20 cigarettes. A unit packet of roll-your-own tobacco shall contain tobacco weighing not less than 30g 2. A unit packet of cigarettes may consist of carton or soft material and shall not have an opening that can be re- closed or re-sealed after it is first opened, other than the flip-top lid and shoulder box with a hinged lid. For packets with a flip-top lid and hinged lid, the lid shall be hinged only at the back of the unit packet”

“Article 24 Free movement 1. Member States may not, for considerations relating to aspects regulated by this Directive, and subject to paragraphs 2 and 3 of this Article, prohibit or restrict the placing on the market of tobacco or related products which comply with this Directive. 2. This Directive shall not affect the right of a Member State to maintain or introduce further requirements, applicable to all products placed on its market, in relation to the standardisation of the packaging of tobacco products, where it is justified on grounds of public health, taking into account the high level of protection of human health achieved through this Directive. Such measures shall be proportionate and may not constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States. Those measures shall be notified to the Commission together with the grounds for maintaining or introducing them. 3. A Member State may also prohibit a certain category of tobacco or related products, on grounds relating to the specific situation in that Member State and provided the provisions are justified by the need to protect public health, taking into account the high level of protection of human health achieved through this Directive. Such national provisions shall be notified to the Commission together with the grounds for introducing them. The Commission shall, within six months of the date of receiving the notification provided for in this paragraph, approve or reject the national provisions after having verified, taking into account the high level of protection of human health achieved through this Directive, whether or not they are justified, necessary and proportionate to their aim and whether or not they are a means of arbitrary discrimination or a disguised restriction on trade between the Member States. In the absence of a decision by the Commission within the period of six months, the national provisions shall be deemed to be approved”

“Article 28 Report 1. No later than five years from 20 May 2016, and whenever necessary thereafter, the Commission shall submit to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions a report on the application of this Directive. When drafting the report, the Commission shall be assisted by scientific and technical experts in order to have all the necessary information at its disposal. 2. In the report, the Commission shall indicate, in particular, the elements of the Directive which should be reviewed or adapted in the light of scientific and technical developments, including the development of internationally agreed rules and standards on tobacco and related products. The Commission shall pay special attention to: (a) the experience gained with respect to the design of package surfaces not governed by this Directive taking into account national, international, legal, economic and scientific developments; (b) market developments concerning novel tobacco products considering, inter alia, notifications received under Article 19; (c) market developments which constitute a substantial change of circumstances; (d) the feasibility, benefits and possible impact of a European system for the regulation of the ingredients used in tobacco products, including the establishment, at Union level, of a list of ingredients that may be used or present in, or added to tobacco products, taking into account, inter alia, the information collected in accordance with Articles 5 and 6; (e) market developments concerning cigarettes with a diameter of less than 7,5 mm, and consumer perception of their harmfulness as well as the misleading character of such cigarettes; (f) the feasibility, benefits and possible impact of a Union database containing information on ingredients and emissions from tobacco products collected in accordance with Articles 5 and 6; (g) market developments concerning electronic cigarettes and refill containers considering, amongst others, information collected in accordance with Article 20, including on the initiation of consumption such products by young people and non-smokers and the impact of such products on cessation efforts as well as measures taken by Member States regarding flavours; (h) market developments and consumer preferences as regards waterpipe tobacco, with a particular focus on its flavours. The Member States shall assist the Commission and provide all available information for carrying out the assessment and preparing the report. 3. The report shall be followed-up by proposals for amending this Directive, which the Commission deem necessary to adapt it - to the extent necessary for the smooth functioning of the internal market - to developments in the field of tobacco and related products, and to take into account new developments based on scientific facts and developments concerning internationally agreed standards for tobacco and related products”

“As regards the increase in smuggling and the flourishing of the black market predicted by some parties, I consider that argument to be just as unconvincing in the present context as previously in connection with the prohibition on characterising flavours”

“The Member States’ right to establish further requirements in relation to the standardisation of the packaging of tobacco products (question 1(a)) 105. First of all, question 1(a) casts doubt on the legal basis for Article 24(2) of the Directive. Under that provision, the Directive does not ‘affect the right of a Member State to maintain or introduce further requirements, applicable to all products placed on its market, in relation to the standardisation of the packaging of tobacco products, where it is justified on grounds of public health, taking into account the high level of protection of human health achieved through this Directive. …’ 106. The applicants in the main proceedings and their interveners take the view that that provision cannot be based on Article 114 TFEU because it does not lead to the removal of obstacles to trade, but to the creation of such obstacles. In support of their view, the participating undertakings essentially claim that Article 24(2) of the Directive enables the Member States to undermine the free movement of goods in respect of tobacco products by introducing more stringent rules on packaging than those laid down at Union level. 107. In this regard, the participating undertakings, like the United Kingdom, Ireland and Norway, adopt a particularly broad interpretation of Article 24(2) of the Directive. They presume that under that provision the Member States are to be permitted to impose more stringent requirements on the packaging of tobacco products in any respect, regardless of whether or not that aspect of the packaging has been the subject of harmonisation by EU law. 108. In fact, on such a broad interpretation, Article 24(2) of the Directive could be contrary to the objective of Article 114 TFEU, which is based on improving the functioning of the internal market. On such an interpretation, the Directive would harmonise the requirements for the packaging of tobacco products, but at the same time give Member States the right to continue to derogate from that harmonisation without respecting the conditions and procedures specifically laid down for that purpose under Article 114(4) to (10) TFEU. As BAT aptly puts it, the harmonisation given with one hand would therefore be taken away by the other. 109. However, it would be premature to conclude out of hand, without more in-depth consideration of the subject, that Article 24 of the Directive is incompatible with Article 114 TFEU and could not therefore be adopted on that legal basis. The broad interpretation of Article 24(2) of the Directive adopted by the participating undertakings, the United Kingdom, Ireland and Norway is not the only conceivable approach. In addition, according to established case-law, if secondary EU legislation permits more than one interpretation, its wording must be understood in such a way that it is consistent with primary law and its validity cannot be called into question. 110. It seems to be perfectly possible to interpret Article 24(2) of the Directive in conformity with primary law, in particular ensuring that it is compatible with the legal basis of Article 114 TFEU. It is possible — in accordance with the view taken by the EU institutions taking part in the preliminary ruling proceedings, as well as France and Portugal — to adopt a narrow interpretation of Article 24(2) of the Directive and to interpret that provision of the Directive as permitting the Member States to adopt ‘further rules’ only in so far as the Union legislature itself has not carried out any harmonisation. 111. Such a narrow interpretation of Article 24(2) is also most consistent with the purpose and scheme of Directive 2014/40. Contrary to the view apparently taken by the applicants in the main proceedings and some of their interveners, the Directive does not give rise to full harmonisation, but only partial harmonisation or — in the words of Article 1(b) — it seeks ‘to approximate the laws, regulations and administrative provisions of the Member States concerning certain aspects of the labelling and packaging of tobacco products’. This is also suggested by recital 53 in the preamble to the Directive, which states that ‘in light of the different degrees of harmonisation achieved’, the directive merely ‘provides a first set of basic common rules’ ‘in relation to presentation and the packaging’. 112. It is true that the Directive includes an entire chapter with provisions on the labelling and packaging of tobacco products, ranging from the shape and the minimum content of unit packets to the requirement of (combined) health warnings and the prohibition of certain misleading statements on product packaging. Contrary to the view taken by a number of the undertakings taking part in the proceedings, there is nevertheless still scope for a wide variety of additional national rules on the labelling and packaging of tobacco products. In particular, it can be inferred from Article 28(2)(a) of the Directive that certain package surfaces are not governed by the Directive and the Commission monitors, among other things, developments at national level. 113. Thus, the Member States remain free, in particular, to lay down their own requirements as to colours of all parts of the packaging which are not reserved for warnings, extending as far as the standardisation of packaging. Colouring is regulated — indirectly — in the Directive at most in so far as Article 13 prohibits tobacco products being given a misleading or deceptively positive presentation. 114. Against this background, the objection raised by some of the undertakings taking part in the preliminary ruling proceedings that a provision based on Article 114 TFEU, like Article 24 of the Directive, could not permit the Member States to adopt any more stringent national rules on the labelling and packaging of tobacco products because such matters in their entirety ‘fall within the scope of the Directive’ is unconvincing. That objection, which is probably fuelled by the fear of some of the undertakings concerned that national rules will be adopted to introduce plain packaging, ignores the fact that even today many aspects of the labelling and packaging of tobacco products are still to be regulated in EU law, not least colouring. 115. If one were to follow the participating undertakings’ argument, the partial harmonisation of the Member States’ laws, regulations and administrative provisions pursued by Directive 2014/40 would be reinterpreted as full harmonisation. This would be contrary to the broad discretion which the Union legislature enjoys under Article 114 TFEU in selecting the most appropriate method of approximation. The Union legislature is not required, when having recourse to Article 114 TFEU, to decide ‘all or nothing’ between full harmonisation and no harmonisation at all but may also — as in this case — opt for partial harmonisation. 116. The same conclusion follows, moreover, from the judgments relied on by the applicants in the main proceedings. It is true that in its first judgment on tobacco advertising the Court held a directive based on internal market competences, including on Article 100a of the EC Treaty (now Article 114 TFEU), to be unlawful because it did not contain any provisions on the free movement of products complying with the directive. However, if that passage of the judgment is read in context, it becomes apparent that the Court certainly did not intend to slam the door on the adoption of directives for the partial harmonisation of certain matters. Instead, it expressly recognised that internal market harmonisation measures could contain clauses allowing Member States to adopt stricter measures for the protection of the general interest. 117. Only if the Union legislature were not seeking any free movement for products covered by and complying with a directive is it prevented from having recourse to Article 114 TFEU. In addition, the Union legislature may not permit the Member States to prevent, on grounds relating to the matters harmonised by the Directive, the import, sale or consumption of tobacco products which comply with the Directive. 118. That is not the case here, however. First of all, Article 24(1) of the Directive expressly recognises the principle of the free movement of tobacco products which comply with the Directive. Second, Article 24(2) of the Directive, interpreted in the light of recital 53, permits the Member States to introduce ‘further requirements … in relation to the standardisation of the packaging’ only in so far as there is no harmonisation by EU law. 119. Certainly, this kind of partial harmonisation means that products cannot automatically be exported from one Member State to another, even if their labelling and packaging complies with the requirements of the Directive in every respect, as each Member State may impose further requirements for nonharmonised aspects of product packaging. Nevertheless, such partial harmonisation also undeniably offers advantages for the functioning of the internal market, since whilst it does not eliminate all obstacles to trade, it does eliminate some. In the present case, this means, for example, that manufacturers of tobacco products throughout the internal market are able to use cigarette packets which have a uniform basic design and are required to adapt that design to the specificities of their respective national laws, regulations and administrative provisions only in certain details (colours, for example), but no longer in every respect. 120. It is true that those provisions of Article 24(1) and (2) of the Directive and the relevant explanations in recital 53 therefore have primarily a clarificatory function. They explain the operation of the partial harmonisation pursued by the Directive. As is impressively illustrated by the fierce dispute between the parties over the lawfulness of possible national rules on the standardisation of packaging, such clarification can make good sense”

“… maintain or introduce further requirements only in relation to aspects of the standardisation of the packaging of tobacco products which have not been harmonised by the directive” (paragraph [73]). In the present case, in the light of this judgment, the Claimants have argued that there is no free-standing right on the part of the Member States to adopt legislation in the field of tobacco control but that it is a right conferred only, in effect, by the good grace of the EU and is a strictly limited and circumscribed right. This argument mischaracterises the judgment of the Court of Justice for the following reasons which flow from general considerations of EU and international law, and from the judgment of the Court: i) Article 24(2) TPD starts by making clear that the TPD “… shall not affect the right of a Member State to maintain or introduce further requirements” in the field. It is drafted in this way because it recognises that the Member States possess pre-existing rights to regulate health which emanate from international law (such as the FCTC and TRIPS) but also EU law (See Section D(2) and (3) above and Section G(4)(vi) below). ii) The TPD implements the FCTC which (in itself and through the WHO Guidelines) actively urges and recommends to contracting states that they adopt measures on presentational standardisation. The TPD reflects the fact that under international law the Member States are urged to go beyond the TPD and introduce other restrictive measures (which would include but not be limited to standardised rules relating to promotion, branding, colour and design of tobacco products). Indeed the Court of Justice expressly recognised this in Philip Morris (at paragraph [178]) when it recorded that under Section 1.1 of the WHO Guidelines contracting states were “…encouraged to implement measures beyond those recommended in the guidelines”. iii) Paragraph [77] of the judgment expressly confirms that it followed from the general scheme of the TPD that it did not bring about full harmonisation of the rules in “relation to the manufacture, presentation and sale of tobacco products and related products”

“harmonise all aspects of the labelling and packaging of those products”

“... that is to say, where it is manifestly inappropriate for attaining the legitimate objectives pursued, goes manifestly beyond what is necessary to achieve those objectives or entails disadvantages which are manifestly disproportionate to its objectives. It is irrelevant, on the other hand, whether the measure adopted in the legislative act is the only conceivable measure or even only the most appropriate”

“...where it proves to be impossible to determine with certainty the existence or extent of the alleged risk because of the insufficiency, inconclusiveness or imprecision of the results of studies conducted, but the likelihood of real harm to public health persists if the risk materialises, the precautionary principle justifies the adoption of restrictive measures, provided those measures are non-discriminatory and objective”

“... the call made within the framework of the WHO to limit or prohibit internationally the use in tobacco products of ingredients which may improve their taste, including the use of menthol is also nothing other than an expression of the precautionary principle”

“The Pechey Study, which consisted of asking 33 anonymous (but far from impartial) “experts” in anti-tobacco research for their “best guess estimates” of the likely impact of standardised packaging over a two year period from which an average prediction was calculated (the “Pechey Estimate”)”

“Much of the Defendants’ criticisms of Government witnesses focused on the fact that these witnesses had been long-time, devoted members of “the public health community.”

“JTI has no interest in information about minor’s consumption of tobacco products”

“What matters for PMI is its market share and profit margin; not aggregate consumption or prevalence”

“Younger adult smokers have been the critical factor in the growth and decline of every major brand and company over the last 50 years. They will continue to be just as important to brands/companies in the future for two simple reasons: The renewal of the market stems almost entirely from 18-year old smokers. No more than 5% of smokers start after age 24. The brand loyalty of 18-year old smokers far outweighs any tendency to switch with age”

“What this had meant in practice is that the principles of transparency and openness, for so long foundational tablets of the scientific enterprise, have on occasion been sacrificed in what is seen as an academic and political war to be fought against the tobacco industry”

“Experts should consider all material facts, including those which might detract from their opinions”

“… to provide an attractive and moderate-priced package for tobacco related articles which can be handled in a convenient way by means of one hand”: Patent Application Description paragraph [8]. Paragraphs [14] and [15] of the Description explain how the invention was to facilitate smoking whilst driving or whilst operating a computer or generally when the smoker only has one hand free. The Description says that the “…package can rest well in the user’s hand, and the one-hand use of the package is fast and convenient”

“… the best approach for a judge to adopt in the trial of a commercial case is, in my view, to place little if any reliance at all on witnesses' recollections of what was said in meetings and conversations, and to base factual findings on inferences drawn from the documentary evidence and known or probable facts. This does not mean that oral testimony serves no useful purpose – though its utility is often disproportionate to its length. But its value lies largely, as I see it, in the opportunity which cross-examination affords to subject the documentary record to critical scrutiny and to gauge the personality, motivations and working practices of a witness, rather than in testimony of what the witness recalls of particular conversations and events. Above all, it is important to avoid the fallacy of supposing that, because a witness has confidence in his or her recollection and is honest, evidence based on that recollection provides any reliable guide to the truth.” (Emphasis added)

“Submissions should be understandable to non-economists, and [CMA] economists should be able to determine how the analysis enables the parties’ economic experts to reach the submitted conclusions”

“In a number of cases, the [CMA] will want to replicate the results of the analysis that has been submitted. This means that parties should be prepared to respond to a … request at very short notice, for all relevant computer code and data files necessary for the [CMA’s] economists to reproduce the results presented in the parties’ submissions. This will include the raw and the cleaned data and the programs for obtaining the latter from the former”

“… against all the evidence it has received in the case”

“3. In order to determine the relevance and significance of an economic analysis for a particular case, it is first necessary to assess its intrinsic quality from a technical perspective, i.e. whether it has been generated and presented to adequate standards. This involves, in particular, an evaluation of whether the hypothesis to be tested is formulated without ambiguity and clearly related to facts, whether the assumptions of the economic model are consistent with the institutional features and other relevant facts of the industry, whether economic models are well established in the relevant literature, whether the empirical methods and the data are appropriate, whether the results are properly interpreted and robust and whether counterarguments have been given adequate consideration. 4. Second, one must assess the congruence and consistency of the economic analysis with other pieces of quantitative and qualitative evidence (such as customer responses, or documentary evidence).”

“Economic models or econometric analysis, as is the case with other types of evidence, rarely, if ever, provide conclusive evidence by themselves”

“Tobacco industry interference …For decades, tobacco companies have operated with the sole purpose of subverting tobacco control policies in order to expand market share. Their own internal documents confirm this and show the lengths to which the industry will go to deter lawmakers from implementing strong, evidence-based tobacco control measures. WHO continuously witnesses the tobacco industry’s interference in health policy development and implementation. WHO considers the tobacco industry to be the greatest threat to the WHO FCTC’s implementation and enforcement worldwide. The tobacco industry produces, promotes and profits enormously from a product scientifically proven to be addictive, to cause disease and death and to give rise to a variety of social ills, including increased poverty. To protect its highly profitable business, large tobacco companies systematically use their political and monetary influence to weaken, delay and defeat tobacco control legislation across the globe. Similarly, tobacco companies use sophisticated methods to undermine meaningful health policies, laws and initiatives that are adopted and implemented. This cannot be allowed to happen in this case”

“Hatchard et al, in their published review of the volume, relevance and quality of the evidence filed by the Tobacco Claimants in the 2012 Consultation found that 77 of the 143 pieces of evidence cited was used to promote the claim that standardised packaging “won’t work”, but only 17 out of 77 addressed standardised packaging, of which 14 were industry connected - and none of these were published in a peerreviewed journal. The study assessed the Tobacco Claimants’ evidence as being markedly less relevant and of lower quality than the Stirling group’s systematic review. 37 out of 37 pieces of evidence included in the Stirling Report focused on standardised packaging, none had a connection with the tobacco industry and 21 out of 37 were published in a peerreviewed journal. The Chantler Report referred to another independent review published by Ulucanlar et al, criticising the tobacco industry’s misuse of evidence in its consultation submissions. Mr Derbyshire in his second witness statement makes a similar point about the quality of the evidence filed by the Tobacco Claimants’ experts in these proceedings, concerning the evidence which is continually emerging from Australia: “The reports of the Claimants’ experts, which have not been published in peer-reviewed journals, by various means and using different data sources and modelling, contend that the policy is not working. However, many experts working in the field, and whose works are published in respected peerreviewed journals, are considering the emerging data and concluding that the policy is already proving effective in Australia.”

“Although all nine of the expert reports offer opinions on consumer behaviour, none account for nicotine addiction. Indeed, seven of the nine reports do not even contain the word “addiction” or “nicotine”

“The expert reports on which the Claimants rely have established a set of unattainable standards and have applied these standards in an inconsistent manner. Several of the experts have conducted research in the different areas of consumer behaviour. I have reviewed the publication list included in their curricula vitae and I did not identify any studies that met the standards they propose for reliable behavioural evidence. The same is true of tobacco industry research: many of the measures and methods the Reports seek to discredit – including experimental studies, observational studies, consumer surveys, and even qualitative research – are the same methods that had been used by the industry to guide their product to development and marketing strategies for decades. More generally, the methodological criteria used to reject evidence on standardised packaging is inconsistent with the established peer-review standards used in scientific journals. Indeed, several of the reports challenge the integrity of the peer-review system and the credibility of some of the most respected health journals in the world. Jacob Jacoby, who has prepared expert reports on behalf of Philip Morris International, highlights the importance of ensuring that standards for an expert report are consistent with the “relevant scientific community”

“…when evaluating what an expert says or does, one needs to answer several critical questions…Is what is being said and done in keeping with generally accepted scientific practice and wisdom? If not, there is a problem. Is what is being said and done consistent with extant empirical research findings””. 355. A further criticism related to what are called “social desirability and demand effects”

“The report’s criteria and review of studies imply that causality can and should be demonstrated by individual studies. Causality for complex phenomena and outcomes such as smoking is never established by a single study. Indeed, causality is not the property of a single study, but evaluated based upon a body of evidence. A much more appropriate framework for understanding causal inference is the field of epidemiology, which is guided by the Bradford Hill criteria. The criteria consist of a broader – and more realistic – range of criteria that should inform causal inferences, including the strength of association, consistency of findings, specificity of associations, temporality, biological gradient or dose response, plausibility, coherence, and experimentation. In writing about experimentation, Bradford Hill wrote: “Occasionally it is possible to appeal to experimental evidence”

“7. The FCTC, being an unincorporated Treaty, is not of direct effect in English law. Like other provisions of the FCTC, moreover, Article 5(3) is expressly limited by the requirements of national law. But even as a matter of international law, Article 5(3) simply does not require that any adverse treatment be given to the evidence before the Court in these proceedings. As the defendant has quite rightly already accepted, Article 5(3) does not affect the claimants’ right to participate in the consultation process and to submit evidence in these proceedings. Nor does Article 5(3) affect the appraisal by the Court of the adequacy of the defendant’s consultation process or the evaluation of the evidence now before the Court relating to proportionality. 8. To the extent that the defendant implies otherwise, it comes close to contending that tobacco companies alone should be denied the judicial protections afforded to all litigants before the Courts of England and Wales. That implication continues a troubling trend within the defendant’s submissions suggesting that its own actions are somehow subject to a lesser standard of review than is truly the case. It joins company with the defendant’s contentions that it was entitled to dismiss alternatives to plain packaging presented to it during the consultation process on the basis that none of those alternatives was plain packaging itself and/or that plain packaging forms but one element of a “comprehensive tobacco control programme” and that no balancing exercise is required as part of the proportionality analysis. None of these contentions is well-founded. 9. More specifically, nothing in Article 5(3) or the Guidelines requires the United Kingdom Government, or this Court, to exclude or give less weight to otherwise cogent evidence put forward by tobacco companies in an open consultation process or judicial review. All that is required by Article 5(3) is that the Government “protect” the United Kingdom’s public health policies from the “interests” of the tobacco industry “in accordance with national law”

“It is not more impressive than Hatchard et al, however. It is just as selective and apparently agenda-driven. The Tobacco Claimants make the following specific points: (1) First, the paper begins with what appears to be a lament that decisions taken in the public domain having serious economic consequences for participants in particular industries (the complaint apparently extends beyond the tobacco industry to the food and alcohol industries) may be subject to the requirements of “Better Regulation”

“the research evidence into [plain packaging] is speculative, relying on asking people what they might do in a certain situation.”

“[t]he assumption is that changes in the packaging will lead to changes in behaviour”, all of which appeared under the heading “Potential disadvantages of plain packaging.”

“The Viscusi Report fails to provide a full or accurate account of the research literature on key issues, such as when discussing the impact of health warning sizes. As the basis for his opinion that the size of health warnings does not matter, Viscusi cites a single report commissioned by Philip Morris. The report has not been published or peer-reviewed, and omits data published during the last four years, including articles directly relevant to health warning size and standardised packaging. Viscusi also refers to a study of pictorial warnings conducted on behalf of the US Food and Drug Administration (FDA). Again, Viscusi fails to reference the peer-reviewed literature, which includes an empirical analysis of the same question addressed by the FDA study using improved data, which clearly demonstrates the effectiveness of larger pictorial health warnings. When suggesting that the design of health warnings has no impact on their noticeability, Viscusi provides a single citation to an unspecified reference in a book that he himself authored. The Viscusi Report appears to totally disregard not only the published literature in the area of tobacco health warnings, but the broader field of health warnings. Viscusi also offers an opinion regarding the impact of cigarette branding with respect to the influence of pack colour on consumer perceptions: “There is no evidence demonstrating the link of any colour to undermining the efficacy of the warnings or misleading consumers as to the risks of smoking”

“The Claimants’ case is that the Defendant has failed to discharge the burden he bears of proving that the Regulations are proportionate. In particular: (a) The objective of the Regulations is “improving public health by reducing smoking”

“Member States rely on reservations or derogations in EU legislation in order to introduce measures restricting fundamental freedoms”

“proportionality is generally applied more strictly, subject to the qualification we have mentioned”

“It is sufficient that Professor Chaloupka and Hammond have shown that the issue in dispute, concerning the future effects of the Regulations on the behaviour of children and adults in the UK, are issues on which reasonable experts may disagree on reasonable grounds”

“The Union shall pursue its objectives by appropriate means commensurate with the competences which are conferred upon it in the Treaties”

“20. Their effect can be sufficiently summarised for present purposes by saying that the question depends on an exacting analysis of the factual case advanced in defence of the measure, in order to determine (i) whether its objective is sufficiently important to justify the limitation of a fundamental right; (ii) whether it is rationally connected to the objective; (iii) whether a less intrusive measure could have been used; and (iv) whether, having regard to these matters and to the severity of the consequences, a fair balance has been struck between the rights of the individual and the interests of the community. These four requirements are logically separate, but in practice they inevitably overlap because the same facts are likely to be relevant to more than one of them”

“… the legality of an EU measure cannot depend on a retrospective check on a predictive assessment”

“Particularly in situations where a measure is introduced on a precautionary basis, with correspondingly less by way of an evidential base to support the particular restrictions imposed, it may well be relevant to its proportionality to consider whether it is subject to review in the light of experience”

“38. The intervention is worth pursuing now, notwithstanding these costs and risks. We believe that the cost of delaying a decision on whether to implement the intervention (Option 3) is too great in public health terms, particularly in view of the following considerations: • we can already benefit from the experience of Australia in determining the detail of any legislation and in implementing the intervention: • the potential health gains are very substantial and dramatically outweigh quantified costs; • the deferral of such gains would adversely affect the life expectancy of large cohorts of children and adult wouldbe quitters in every year of deferral; • if the true impact of standardised packaging is substantially smaller than assumed in this IA (but not zero) it would still be net beneficial to act now; • evidence from Australia is valuable, but there are considerable uncertainties that will remain; • if standardised packaging is implemented, monitoring of extent of impacts, such as any impact on cross-border shopping or the size of the illicit market would identify where mitigating action is needed; the information conveyed by such monitoring is likely to be much more directly pertinent to the policy context in the UK than that which can be gathered from other countries that have implemented the intervention (such as Australia)”

“The basic problem with the majority of the evidence relied on by the Impact Assessment is that it relates to attitudes and beliefs about smoking, or perceptions about the possible impact of standardised packaging. However, attitudes, beliefs and perceptions do not, by themselves, prevent or reduce smoking-related illnesses. Only changes in individual smoking behaviour can do that. …. A focus group or survey participant can talk freely about their intention to quit smoking without making any of the sacrifices that accompany actually quitting”

“Quantitative” and “qualitative” as descriptions of evidence are loose terms. “Quantitative” data refers generally to observations and research results expressed in numbers. “Qualitative” evidence is evidence based upon matters other than numbers such as surveys or focus groups’ comments, or reports of human reactions to scientific or psychological experiments or tests. Because quantitative evidence is based upon numbers it is capable of being verified and its probative value or reliability can therefore become a function of the robustness of the methodology used in the research. If the methodology is watertight and all of the underlying assumptions are verifiable and correct then the end result may be said to be very reliable. Qualitative evidence may of course be generated through methodologies which are more or less robust, such as the number of persons in the sample, or whether it is “cross-sectional” or “longitudinal”

“ … neither my analysis nor those of Professor Mulligan can provide definitive evidence on the effects of standardised packaging on tobacco use in Australia, given the limitations of the data used in these analysis and the relatively short postimplementation period covered by these data and it will likely require several more years before strong evidence is available one way or the other.”

“… the evidence examined in this PIR suggests that the measure is achieving its aims. This evidence shows that tobacco plain packaging is having a positive impact on its specific mechanisms as envisaged in the TPP Act. All of the major datasets examined also showed on-going drops in national smoking prevalence in Australia. These decreases cannot be entirely attributed to plain packaging given the range of tobacco control measures in place in Australia, including media campaigns and Australia’s tobacco excise regime. However, analysis of Roy Morgan Single Source Survey Data shows that the 2012 packaging changes (plain packaging combined with enhanced graphic health warnings) have contributed to declines in smoking prevalence, even at this early time after implementation. The analysis estimated that the 2012 packaging changes resulted in a “statistically significant decline in smoking prevalence [among Australians aged 14 years and over] of 0.55 percentage points over the post- implementation period, relative to what the prevalence would have been without the packaging changes”

“64. The PIR required a holistic assessment of the measure, such that the accuracy of the claims made by stakeholders and the various strengths and quality of the sources relied upon have been considered as part of the analysis of the stakeholder consultations. This includes in particular: the independence of a source, the authority or credentials of its authors, the public or confidential nature of data relied upon, its peer reviewed status and the consistency of the findings of a source with the entire body of evidence.”

“a multiple filtering process articles go through before being published in academic journals. This process includes the work being evaluated by experts in relevant fields to ensure it is rigorous and coherent before it is published, as is recognised as best standard in academic publishing.”

“During consultations one tobacco company stakeholder provided three reports prepared by SLG Economics, which the tobacco company had commissioned. The most recent of the SLG reports criticised a number of the findings summarised above including: (i) In relation to the appeal of tobacco products, the SLG report concluded that a number of different measures from the National Tracking Survey and NDSHS suggest that tobacco plain packaging was not successful in reducing the appeal of tobacco products and that the evidence was mixed in relation to the effectiveness of health warnings; (ii) in relation to effectiveness of health warnings, the SLG report compares NSW Tracking Survey data from 2012 to 2014, critiques the peer-reviewed study of the NSW Tracking Survey data described above, and states that the data does not show an increase in the effectiveness of health warnings following the implementation of tobacco plain packaging; (iii) in relation to the ability of the packaging to mislead about the harms of smoking, the SLG report concluded that the results from the National Tracking Survey do not point to a strong impact of tobacco plain packaging in either direction; The SLG reports provided limited information on the methodology used and contradicts the findings of peerreviewed and published academic studies that have been prepared by recognised experts in public health and tobacco control.”

“19. There is also extensive evidence, including in tobacco industry documents, which shows that the tobacco industry uses tobacco packaging (including logos, imagery and colour) to create positive brand associations in order to promote and reinforce smoking. Industry documents confirm that tobacco companies have invested heavily in pack design, including innovative packaging, in order to communicate messages about brand identity and to appeal to specific demographic groups, especially young smokers.”

“In some key markets legislative restrictions mean that the only medium available to communicate with consumers is via packaging. The pack becomes the primary communication vehicle for conveying the brand essence. In order to ensure the brand remains relevant to target consumers, particularly in these darkening markets, it is essential that the pack itself generates the optimum level of modernity, youthful image and appeal amongst ASU30 [Adult Smokers Under 30] consumers.”

“24. The NPHT identified the need to address the remaining forms of tobacco advertising and promotion in Australia, including tobacco packaging. This included the recommendation that tobacco plain packaging be implemented, based on evidence demonstrating that: • young adult smokers associate cigarette brand names and package design with positive personal characteristics, social identity and aspirations; • packaging can create misperceptions about the relative strength, level of tar and health risks of tobacco products; • decreasing the number of design elements on cigarette packs reduces their appeal and perceptions about the likely enjoyment and desirability of smoking; and • plain packaging of tobacco products would increase the salience of health warnings, make the packaging less attractive, and reduce the propensity of packaging to mislead consumers about the harmful effects of tobacco products.”

“… it is my opinion that the evidence is consistent with the conclusion that the TPP Act is having its intended effect. The evidence indicates clearly that the combination of plain packaging and updated and enlarged graphic health warnings is succeeding in reducing smoking prevalence. Specifically, I estimate a statistically significant decline in smoking prevalence of 0.55 percentage points over the postimplementation period, relative to what the prevalence would have been without the packaging changes. The 95 percent confidence interval around the estimated reduction in smoking prevalence is -0.095 to -1.01 percentage points. Because plain packaging is intended to deter smoking initiation, promote cessation, and deter relapse, the benefits of the packaging changes will likely grow over time.”

“My analysis relates an individual’s decision to smoke to a set of explanatory variables, including socio-demographic factors and controls for tobacco control policies (including the policies governing plain packaging and enlarged graphic health warnings) that are widely believed to influence individuals’ decisions to smoke. There are two important features of this analysis. First, it disentangles the effects of multiple factors that may simultaneously be influencing the observed outcome. Second, it identifies the effect of the packaging changes by comparing smoking behaviour before the policy to smoking behaviour after. A finding that the packaging changes had a negative and statistically significant effect on smoking prevalence, controlling for changes in other factors, would provide support for the conclusion that the packaging changes are having their intended effect. Moreover, the estimation results can be used to determine what smoking prevalence would have been absent the packaging changes.”

“One would need access to the Chipty Data in order to see in detail how Dr Chipty has estimated her margin of error”

“Estimating elasticities through regression analysis is conceptually straight forward, and generally allows for more robust results than simply plotting a line. Nevertheless, there are often pitfalls and complexities with such analysis…High standards need to be met before a regression analysis can be considered robust – economists have developed a reasonably clear idea of what constitutes “good economic practice”

“These growth rates do not take into account refunds of excise equivalent customs duty made under the [relevant scheme] between December 2012 and May 2013. These refunds cannot be related to annual net clearances on a comparable basis to other data used to derive these growth rates”

“...neither the Department nor Professor Chaloupka can analyse the data used and the manner in which Professor Mulligan purports to use that data for one manufacturer to assess the impact of the returns on the market as a whole”

“The multinational tobacco companies are intensively opposing the measure on several fronts, notably using international trade law and bilateral investment treaties to challenge Australia and threatening the other countries with large lawsuits and the spectre of billion-dollar financial compensations. One key legal argument used by these companies invokes the principle of proportionality, which requires that any limitation on the exercise of rights and freedom may be made only if it is suitable to achieve its aim. In spite of mounting evidence to the contrary, they claim this condition is not met in the case of plain packaging, contending that evidence of effectiveness of the measure is lacking. They even go further, resorting to the classical ad ignorantiam argument, shifting from absence-of-evidence to evidence-ofabsence. In their response to the UK Department of Health’s consultation on plain packaging, British American Tobacco (BAT) states that “the evidence to date from Australia shows that more than 18 months after its introduction, Plain Packaging has not had any effect on smoking behaviours beneficial to public health,” referring to the Roy Morgan population survey data as evidence. Similarly, JTI declared in its submission to the consultation that after 18 months, “the evidence actually emerging from Australia reinforces the fact that plain packaging does not work”, citing two studies by A. Kaul and M. Wolf published on the web-site of the University of Zurich, which “have found that plain packaging has had no effect on smoking prevalence, either among minors or adults” and a report by a UK consultancy company, all three funded by Philip Morris. A closer inspection reveals that the Roy Morgan population data cited by BAT designates the same two studies. In its response to the consultation, Philip Morris also refers to these studies, saying that “the experts found no evidence that ‘standardised packaging’ had had an effect on smoking prevalence among Australians,” adding that they “confirmed that if there had been an effect in reality … it would have been reflected in the data. These two studies are presented by one of their authors as the only papers on plain packaging “based on real-world data.”

“Altogether, we have applied quite liberal inference techniques, that is, our analysis, if anything, is slightly biased in favor of finding a statistically significant (negative) effect [...]. Nevertheless, no such evidence has been discovered. More conservative statistical inference methods would only reinforce this conclusion.”

“Rather than questioning the validity of their linear model, they simply cut off the first 42 months of observation, retaining only months 43-156 for their analysis.”

“2.2.1 The Agencies typically obtain substantial information from the merging parties. This information can take the form of documents, testimony, or data, and can consist of descriptions of competitively relevant conditions or reflect actual business conduct and decisions. Documents created in the normal course are more probative than documents created as advocacy materials in merger review. Documents describing industry conditions can be informative regarding the operation of the market ... .” (Emphasis added)

“As I’m looking at Asia Pacific, I should mention Australia, we’ve had the first six months of the plan pack environment in Australia. We’ve seen the market decline roughly 2% to 3%, so maybe not as bad as we might have anticipated”

“...as a one off decline in the ability of manufacturers of premium tobacco products to generate future economic benefits from the visual branding in which they have already invested”

“When valuing intellectual properties, it is essential to consider each of the different valuation methodologies, in the light of the information available and the specific circumstances, in order to determine the best method for ascertaining value. The methodologies commonly used to determine the value of intellectual properties are: the Cost Approach, the Income Approach, the Market Approach, and a hybrid methodology known as the Relief from Royalty Approach”

“The Court notes that the Commission has in the past held that good will may be an element in the valuation of a professional practice but the future income itself is only a “possession” once it has been earned, or an enforceable claim to it exists…The Court considers that the same must apply in the case of a business engaged in commerce. In the present case, the Applicant refers to the value of its business based upon the profits generated by the business as “good will”

“31. The combined effect of brand elements is far greater than the sum of the individual parts. Perceptually, the various brand elements of a successful brand will combine to create a “gestalt” effect: consumers develop an impression of a brand’s identity through the collective contribution of the brand elements”

“The combined effect of brand elements is critical to the success of a branded product”

“41. Without speculating on the profit which the Applicant would have achieved if the violation of the Convention had not occurred, the Court observes that he suffered a reasonable loss of business. Therefore considers it appropriate to order lump sum in compensation for the loss of future earnings. In addition, the Court considers that the violation it has found of Article 1 of Protocol No 1 in the instant case must have caused the Applicant prolonged uncertainty in the conduct of its business and feelings of helplessness and frustration, entailing some non-peculiarly damage”

“56. The Court recalls that in Jahn and Others v. Germany [GC], nos. 46720/99, 72203/01 and 72552/01, § 91, it stated that “the margin of appreciation available to the legislature in implementing social and economic policies should be a wide one [and the Court] will respect the legislature's judgment as to what is 'in the public interest' unless that judgment is manifestly without reasonable foundation” (see also J.A. Pye (Oxford) Ltd and J.A. Pye (Oxford) Land Ltd v. the United Kingdom [GC], no. 44302/02, § 71, ECHR 2007 ...). It also observes that the 2004 Act was preceded by extensive public debate, including the hearings conducted by the Burns Committee. It was enacted by the House of Commons after equally extensive debate in Parliament where various proposals were considered before an outright ban was accepted. In those circumstances, the Court is unable to accept that the House of Commons was not entitled to legislate as it did or that the refusal of the Burns Report to draw any conclusions as to the suffering of animals during hunting substantially undermined the reasons for the 2004 Act. The judgment that it was in the public interest to ban hunting was, as Lord Hope observed in context of the proportionality of the hunting ban in Scotland, pre-eminently one for the House of Commons to make. 57. For the lack of compensation in the 2004 Act, the Court accepts that a ban on an activity which is introduced by legislation will inevitably have an adverse financial impact on those whose businesses or jobs are dependent on the prohibited activity (see, mutatis mutandis, C.E.M. Firearms Limited and others v. the United Kingdom (dec.), nos. 37674/97 and 37677/97, 26 September 2000). Nevertheless, the domestic authorities must enjoy a wide margin of appreciation in determining the types of loss resulting from the measure for which compensation will be made. As stated in C.E.M. Firearms Limited “the legislature's judgment in this connection will in principle be respected unless it is manifestly arbitrary or unreasonable”

“645. Turning to the substance of the applicant company’s complaints, the Court notes that in April 2004, simultaneously with the Tax Assessment proceedings, the domestic authorities initiated enforcement proceedings aimed at securing their tax claims and later recovering the sums awarded by the courts as a result of the examination of these claims. They attached the company’s assets located in Russia and later partly froze the company’s domestic bank accounts and seized the shares of the applicant company’s Russian subsidiaries. On 20 July 2004 it was decided to auction off the company’s principal production subsidiary OAO Yuganskneftegaz, in satisfaction of the company’s tax liability, which at the time amounted to RUB 106.182 billion (some EUR 3.005 billion). As a result of the proceedings with regard to the Tax Assessments 2001 and 2002, the company’s debt to the tax authorities further increased and by the time the auction of OAO Yuganskneftegaz took place in December 2004 the company already owed the tax authorities some RUB 431.259 billion (some EUR 11.061 billion). In addition to the payments resulting from the Tax Assessments 2000-2003, the company was also required to pay the bailiffs a 7% enforcement fee on the overall amount of the debt. 646. The Court notes that the authorities used a variety of measures in connection with the enforcement of the debt, such as the attachment and freezing orders, the seizure orders, the orders to pay enforcement fees and the compulsory auction procedure. Though each of these measures could be seen as a separate instance of interference with the applicant company’s rights under Article 1 of Protocol No. 1, their common and ultimate goal was to force the company to meet its tax liabilities. Accordingly, the appropriate way to analyse this part of the application is to examine the enforcement proceedings in their entirety as one continuous event. The Court further notes that the enforcement measures in question fall to be analysed under the third rule of Article 1 of Protocol No. 1, which allows the member States to control the use of property in accordance with the general interest, by enforcing “such laws as [they] deem necessary to secure the payment of taxes or other contributions or penalties”

“Exceptional circumstances”

“There is no other widely used consumer product in the world which kills half of its long term users prematurely”

“In the present case, it is not in dispute that there has been a “deprivation of possessions” within the meaning of the second sentence of Article 1 of Protocol No. 1”

“Article 17 Right to property 1. Everyone has the right to own, use, dispose of and bequeath his or her lawfully acquired possessions. No one may be deprived of his or her possessions, except in the public interest and in the cases and under the conditions provided for by law, subject to fair compensation being paid in good time for their loss. The use of property may be regulated by law in so far as is necessary for the general interest. 2. Intellectual property shall be protected”

“Everyone whose rights and freedoms guaranteed by the law of the Union are violated has the right to an effective remedy before a tribunal in compliance with the conditions laid down in this Article”

“Explanation on Article 17 — Right to property This Article is based on Article 1 of the Protocol to the ECHR: ‘Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law. The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties. This is a fundamental right common to all national constitutions. It has been recognised on numerous occasions by the case-law of the Court of Justice, initially in the Hauer judgment (13 December 1979, [1979] ECR 3727). The wording has been updated but, in accordance with Article 52(3), the meaning and scope of the right are the same as those of the right guaranteed by the ECHR and the limitations may not exceed those provided for there. Protection of intellectual property, one aspect of the right of property, is explicitly mentioned in paragraph 2 because of its growing importance and Community secondary legislation. Intellectual property covers not only literary and artistic property but also inter alia patent and trade mark rights and associated rights. The guarantees laid down in paragraph 1 shall apply as appropriate to intellectual property”

“Article 52 Scope of guaranteed rights 1. Any limitation on the exercise of the rights and freedoms recognised by this Charter must be provided for by law and respect the essence of those rights and freedoms. Subject to the principle of proportionality, limitations may be made only if they are necessary and genuinely meet objectives of general interest recognised by the Union or the need to protect the rights and freedoms of others. 2. Rights recognised by this Charter which are based on the Community Treaties or the Treaty on European Union shall be exercised under the conditions and within the limits defined by those Treaties. 3. In so far as this Charter contains rights which correspond to rights guaranteed by the Convention for the Protection of Human Rights and Fundamental Freedoms, the meaning and scope of those rights shall be the same as those laid down by the said Convention. This provision shall not prevent Union law providing more extensive protection”

“92 Furthermore and above all, protection of the fundamental right to respect for private life at EU level requires derogations and limitations in relation to the protection of personal data to apply only in so far as is strictly necessary (judgment in Digital Rights Ireland and Others, C-293/12 and C-594/12, EU:C:2014:238, paragraph 52 and the case-law cited). 93 Legislation is not limited to what is strictly necessary where it authorises, on a generalised basis, storage of all the personal data of all the persons whose data has been transferred from the European Union to the United States without any differentiation, limitation or exception being made in the light of the objective pursued and without an objective criterion being laid down by which to determine the limits of the access of the public authorities to the data, and of its subsequent use, for purposes which are specific, strictly restricted and capable of justifying the interference which both access to that data and its use entail (see, to this effect, concerning Directive 2006/24/EC of the European Parliament and of the Council of 15 March 2006 on the retention of data generated or processed in connection with the provision of publicly available electronic communications services or of public communications networks and amending Directive 2002/58/EC (OJ 2006 L 105, p. 54), judgment in Digital Rights Ireland and Others, C-293/12 and C-594/12, EU:C:2014:238, paragraphs 57 to 61). 94 In particular, legislation permitting the public authorities to have access on a generalised basis to the content of electronic communications must be regarded as compromising the essence of the fundamental right to respect for private life, as guaranteed by Article 7 of the Charter (see, to this effect, judgment in Digital Rights Ireland and Others, C-293/12 and C-594/12, EU:C:2014:238, paragraph 39). 95 Likewise, legislation not providing for any possibility for an individual to pursue legal remedies in order to have access to personal data relating to him, or to obtain the rectification or erasure of such data, does not respect the essence of the fundamental right to effective judicial protection, as enshrined in Article 47 of the Charter. The first paragraph of Article 47 of the Charter requires everyone whose rights and freedoms guaranteed by the law of the European Union are violated to have the right to an effective remedy before a tribunal in compliance with the conditions laid down in that article. The very existence of effective judicial review designed to ensure compliance with provisions of EU law is inherent in the existence of the rule of law (see, to this effect, judgments in Les Verts v Parliament, 294/83, EU:C:1986:166, paragraph 23; Johnston, 222/84, EU:C:1986:206, paragraphs 18 and 19; Heylens and Others, 222/86, EU:C:1987:442, paragraph 14; and UGT-Rioja and Others, C-428/06 to C-434/06, EU:C:2008:488, paragraph 80).”

“The conditions on which a limitation on the exercise of the right to property may be accepted 77 Article 52(1) of the Charter on Fundamental Rights provides, first, that ‘[an]y limitation on the exercise of the rights and freedoms recognised by [the Charter on Fundamental Rights] must be provided for by law and respect the essence of those rights and freedoms’, and, second, that ‘[s]ubject to the principle of proportionality, limitations may be made only if they are necessary and genuinely meet objectives of general interest recognised by the [European] Union or the need to protect the rights and freedoms of others.’ 78 It follows from that article that, to be held to comply with EU law, a limitation on the exercise of the right to property must, in any event, satisfy three conditions. 79 First, the limitation must be ‘provided for by law’ (see, to that effect, Case C-407/08 P Knauf Gips v Commission [2010] ECR I-6375, paragraph 91). In other words, the measure in question must have a legal basis. 80 Secondly, the limitation must refer to an objective of public interest, recognised as such by the European Union. Included in those objectives are those pursued in the context of the Common Foreign and Security Policy (‘CFSP’), and referred to in Article 21(2)(b) and (d) TEU, namely to support democracy, the rule of law and human rights as well as sustainable development of developing countries with the essential objective of eradicating poverty. 81 Thirdly, the limitation may not be excessive. First, it must be necessary and proportional to the aim sought (see, to that effect, Case C-84/95 Bosphorus [1996] ECR I-3953, point 26; Kadi and Al Barakaat International Foundation v Council and Commission, paragraph 75 above, paragraphs 355 and 360). Second, the ‘essential content’, that is, the substance, of the right or freedom at issue must not be impaired (see, to that effect, Nold v Commission, paragraph 75 above, paragraph 14, and Kadi and Al Barakaat International Foundation v Council and Commission, paragraph 75 above, paragraph 355).”

“149. As regards the validity of the Directive in respect of the right to property, the Court has consistently held that, while that right forms part of the general principles of Community law, it is not an absolute right and must be viewed in relation to its social function. Consequently, its exercise may be restricted, provided that those restrictions in fact correspond to objectives of general interest pursued by the Community and do not constitute a disproportionate and intolerable interference, impairing the very substance of the rights guaranteed (see, in particular, Case 265/87 Schräder [1989] ECR 2237, paragraph 15; Case C-280/93 Germany v Council [1994] ECR I-4973, paragraph 78, and Case C-293/97 Standley and Others [1999] ECR I-2603, paragraph 54). 150. As paragraphs 131 and 132 above make clear, the only effect produced by Article 5 of the Directive is to restrict the right of manufacturers of tobacco products to use the space on some sides of cigarette packets or unit packets of tobacco products to show their trade marks, without prejudicing the substance of their trade mark rights, the purpose being to ensure a high level of health protection when the obstacles created by national laws on labelling are eliminated. In the light of this analysis, Article 5 constitutes a proportionate restriction on the use of the right to property compatible with the protection afforded that right by Community law.” (Emphasis added)

“... it is only if normal usage is no longer possible as a result of provisions of public law that a situation can arise in which the substance of the right is affected by reason of those provisions”

“…then they are unlawful per se and no proportionality analysis falls to be conducted”

“WHEREAS divers Persons are holden in Slavery within divers of His Majesty's Colonies, and it is just and expedient that all such Persons should be manumitted and set free, and that a reasonable Compensation should be made to the Persons hitherto entitled to the Services of such Slaves for the Loss which they will incur by being deprived of their Right to such Services ...”

“Article 16 Freedom to conduct a business The freedom to conduct a business in accordance with Community law and national laws and practices is recognised”

“(9) To the extent that any provision of the Trade Marks Act 1994 mentioned in this regulation (a “relevant provision”) applies to international trade marks (UK) (whether by virtue of that Act, the Trade Marks (International Registration) Order 2008 or otherwise, and whether with or without modifications), then provision made by this regulation in relation to that relevant provision shall also apply (with any necessary modifications) to international trade marks (UK).”

“2. This Regulation shall, unless otherwise provided for, not affect the right to bring proceedings under the civil, administrative or criminal law of a Member State or under provisions of Community law for the purpose of prohibiting the use of a Community trade mark to the extent that the use of a national trade mark may be prohibited under the law of that Member State or under Community law.”

“The provisions of this Regulation shall be without prejudice to any provisions of Community law or of the law of the Member States concerned relating to unregistered designs, trade marks or other distinctive signs, patents and utility models, typefaces, civil liability and unfair competition.”

“(31) This Regulation does not preclude the application to designs protected by Community designs of the industrial property laws or other relevant laws of the Member States, such as those relating to design protection acquired by registration or those relating to unregistered designs, trade marks, patents and utility models, unfair competition or civil liability”

“None of the parties should be subjected to a probatio diabolica: that is to say, compelled to prove something which cannot be proved or can only be proved with the utmost difficulty.”

“45. In accordance with Article 207(1) TFEU, ‘[t]he common commercial policy shall be based on uniform principles, particularly with regard to changes in tariff rates, the conclusion of tariff and trade agreements relating to trade in goods and services, and the commercial aspects of intellectual property, foreign direct investment, the achievement of uniformity in measures of liberalisation, export policy and measures to protect trade … The common commercial policy shall be conducted in the context of the principles and objectives of the Union’s external action.’ 46. That provision, which entered into force on 1 December 2009, differs noticeably from the provisions it essentially replaced, in particular those in Article 133(1), (5), first subparagraph, (6), second subparagraph, and (7) EC. 47. It differs even more from the provision that was in force when the TRIPs Agreement was concluded, namely Article 113 of the EC Treaty (subsequently, after amendment, Article 133 EC). Paragraph 1 of that article stated that ‘[t]he common commercial policy shall be based on uniform principles, particularly in regard to changes in tariff rates, the conclusion of tariff and trade agreements, the achievement of uniformity in measures of liberalisation, export policy and measures to protect trade’. Commercial aspects of intellectual property were mentioned neither in that paragraph nor in any other paragraph of Article 113. 48. In view of that significant development of primary law, the question of the distribution of the competences of the European Union and the Member States must be examined on the basis of the Treaty now in force (see, by analogy, Opinion 1/08 [2009] ECR I-11129, paragraph 116). Consequently, neither Opinion 1/94 ([1994] ECR I-5267), in which the Court established in relation to Article 113 of the EC Treaty which provisions of the TRIPs Agreement fell within the common commercial policy and hence the exclusive competence of the Community, nor the judgment in Merck Genéricos – Produtos Farmacêuticos, defining, at a date when Article 133 EC was in force, the dividing line between the obligations under the TRIPs Agreement assumed by the European Union and those remaining the responsibility of the Member States, is material for determining to what extent the TRIPs Agreement, as from the entry into force of the FEU Treaty, falls within the exclusive competence of the European Union in matters of the common commercial policy. The concept of ‘commercial aspects of intellectual property’ 49. In accordance with Article 207(1) TFEU, the common commercial policy, which under Article 3(1)(e) TFEU falls within the exclusive competence of the European Union, relates inter alia to ‘the commercial aspects of intellectual property’. 50. As follows from that provision, in particular the second sentence which states that the common commercial policy is within the context of ‘the Union’s external action’, that policy relates to trade with non-member countries, not to trade in the internal market. 51. It is also common ground that the mere fact that an act of the European Union, such as an agreement concluded by it, is liable to have implications for international trade is not enough for it to be concluded that the act must be classified as falling within the common commercial policy. On the other hand, a European Union act falls within the common commercial policy if it relates specifically to international trade in that it is essentially intended to promote, facilitate or govern trade and has direct and immediate effects on trade (Opinion 2/00 [2001] ECR I-9713, paragraph 40; Case C-347/03 Regione autonoma Friuli-Venezia Giulia and ERSA [2005] ECR I-3785, paragraph 75; and Case C-411/06 Commission v Parliament and Council [2009] ECR I-7585, paragraph 71). 52. It follows that, of the rules adopted by the European Union in the field of intellectual property, only those with a specific link to international trade are capable of falling within the concept of ‘commercial aspects of intellectual property’ in Article 207(1) TFEU and hence the field of the common commercial policy. 53. That is the case of the rules in the TRIPs Agreement. Although those rules do not relate to the details, as regards customs or otherwise, of operations of international trade as such, they have a specific link with international trade. The TRIPs Agreement is an integral part of the WTO system and is one of the principal multilateral agreements on which that system is based. 54. The specific character of the link with international trade is illustrated in particular by the fact that the Understanding on Rules and Procedures governing the settlement of disputes, which forms Annex 2 to the WTO Agreement and applies to the TRIPs Agreement, authorises under Article 22(3) the crosssuspension of concessions between that agreement and the other principal multilateral agreements of which the WTO Agreement consists. 55. Moreover, when providing in Article 207(1) TFEU that the ‘commercial aspects of intellectual property’ are now fully part of the common commercial policy, the authors of the TFEU Treaty could not have been unaware that the terms thus used in that provision correspond almost literally to the very title of the TRIPs Agreement. 56. The existence of a specific link between the TRIPs Agreement and international trade justifying the conclusion that the agreement falls within the field of the common commercial policy is not rebutted by the argument of the governments which took part in the oral proceedings that at least the provisions of Part II of the TRIPs Agreement, concerning the availability, scope and use of intellectual property rights, which include Article 27 of the agreement, fall within the field of the internal market, by virtue in particular of Articles 114 TFEU and 118 TFEU. 57. That argument does not take sufficient account of the objective of the TRIPs Agreement in general and Part II of the agreement in particular. 58. The primary objective of the TRIPs Agreement is to strengthen and harmonise the protection of intellectual property on a worldwide scale (Case C-89/99 Schieving-Nijstad and Others [2001] ECR I-5851, paragraph 36). As follows from its preamble, the TRIPs Agreement has the objective of reducing distortions of international trade by ensuring, in the territory of each member of the WTO, the effective and adequate protection of intellectual property rights. Part II of the agreement contributes to attaining that objective by setting out, for each of the principal categories of intellectual property rights, rules which must be applied by every member of the WTO. 59. Admittedly, it remains altogether open to the European Union, after the entry into force of the TFEU Treaty, to legislate on the subject of intellectual property rights by virtue of competence relating to the field of the internal market. However, acts adopted on that basis and intended to have validity specifically for the European Union will have to comply with the rules concerning the availability, scope and use of intellectual property rights in the TRIPs Agreement, as those rules are still, as previously, intended to standardise certain rules on the subject at world level and thereby to facilitate international trade. 60. Consequently, as the Commission observes, to regard the rules on patentable subject-matter in Article 27 of the TRIPs Agreement as falling within the field of the common commercial policy rather than the field of the internal market correctly reflects the fact that the context of those rules is the liberalisation of international trade, not the harmonisation of the laws of the Member States of the European Union. 61. In the light of the above considerations, the answer to the first part of Question 1 is that Article 27 of the TRIPs Agreement falls within the field of the common commercial policy”

“The nature of goods or services to which a trade mark is to be applied shall in no case form an obstacle to registration of the trade mark”

“...once a mark has been registered its proprietor has the right to use it as he sees fit...”

“Where a trader, in an advertisement for his own goods or services, uses a registered trade mark owned by a competitor for the purpose of comparing the characteristics (and in particular the price) of goods or services marketed by him with the characteristics (and in particular the price) of the goods or services marketed by the competitor under that mark in such a way that it does not cause confusion or otherwise jeopardise the essential function of the trade mark as an indication of origin, does his use fall within either (a) or (b) of Article 5[(1)] of Directive 89/104?” viii) Finally, as to the submission that TRIPS incorporates an immutable and unyielding principle of non-discrimination as between different categories of goods and services there is nothing in TRIPS or Article 15(4) to this effect. considered a “limited” right: citing Canada – Patent Protection of Pharmaceutical Products WT/DS/114/R. That case concerned Article 30 TRIPS and was brought by the EU and alleged that Canada, by allowing manufacturing and stockpiling of pharmaceutical products without the consent of the patent holder during the six months immediately prior to the expiration of the 20-year patent term by virtue of the provisions of Section 55.2(2) and 55.2(3) of the Patent Act together with the Manufacturing and Storage of Patented Medicines Regulations, violated its obligations under Article 28.1 together with Article 33 of the TRIPS Agreement. Article 30 is entitled “Exceptions to Rights Conferred”; it is in different terms to Article 17, albeit that it includes the expression “limited exception” (as in Article 17) and it provides: “ Members may provide limited exceptions to the exclusive rights conferred by a patent, provided that such exceptions do not unreasonably conflict with a normal exploitation of the patent and do not unreasonably prejudice the legitimate interests of the patent owner, taking account of the legitimate interests of third parties.”

“Option 1 plus: 1) The tobacco labelling and packing and the tobacco product itself shall not include any promotional and misleading elements (e.g. misleading colours, symbols, slim FMC)…”

“To implement the comprehensive ban laid down in Articles 13.1 and 13.2 of the Convention, Parties should ban advertising, promotion and sponsorship as defined in Article 1(c) and (g) of the Convention. Article 1(c) defines “tobacco advertising and promotion” as “any form of commercial communication, recommendation or action with the aim, effect or likely effect of promoting a tobacco product or tobacco use either directly or indirectly”

“in relation to the presentation and the packaging, including colours, of tobacco product…”

“This Directive shall not affect the right of a Member State to maintain or introduce further requirements, applicable to all products placed on its market, in relation to the standardisation of the packaging of tobacco products…”

“Tipping colour affects consumer perceptions of [full flavour low tar] products…the cork tipped product was perceived as stronger and having more tobacco taste than the white tipped product…These results are consistent with previous research…indicating that cork tipping enhances strength and decreases mildness perceptions… Modifications need to be made which reduce harshness and increase mildness and smoothness perceptions”