legal battle

Marlboro-maker Philip Morris ordered to pay Australian government millions after losing lawsuit

It wanted the South Pacific country to withdraw its laws that made unappealing packaging mandatory for cigarettes.

The Permanent Court of Arbitration on Monday ordered tobacco company Philip Morris to pay the Australian government millions of dollars. It also ruled against the Marlboro manufacturer’s lawsuit that had sought the withdrawal of Australia’s packaging laws.

In 2012, the Australian government was the first in the world to order that cigarettes be sold in unappealing packets with graphic health warnings, BBC reported.

The Singapore-based court has ordered the company to pay the government’s legal costs in addition to an undisclosed arbitration fee. The exact amount is not known as it has been redacted from the ruling. Experts estimate it to be around AU$50 million (approximately Rs 288 crore), the Sydney Morning Herald reported.

Philip Morris manufactures Marlboro and Longbeach cigarettes. It had moved the Singapore-based international court using a provision in the Hong Kong-Australia investment treaty known as the investor-state dispute settlement. The court had dismissed the case in 2015, labelling it as an “abuse of rights”.

While the legal representatives of Philips Morris argued that the fees were extensive, the court refuted its claims. “The tribunal does not consider that any of these costs claimed by the respondent were unreasonable,” it said.

“This thing should never have been in the court in the first place,” said former Australian treasurer Wayne Swan, who had helped draft the plain-packaging laws. The Australian government had ordered Swan to submit evidence during secret hearings in 2015.

In August 2016, the company had lost lost a six-year battle to block Uruguay’s stringent rules on warning labels on cigarette packets. It was the first tobacco company to take on a country in an international court.

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