TPP Impending Interference
with States’ Obligations to
the WHO FCTC
Dr. Zarihah Zain
Malaysian Women’s Action for Tobacco Control & Health
Tobacco Product – Very Unique Commodity
Proven to be exceptionally harmful to life
• Causes serious/ fatal diseases (e.g. cancers, cardiovascular
diseases, respiratory diseases)
• Causes premature deaths (1 billion deaths in 21st century)
• Issues of second-hand & third-hand smoke
• SMOKE FREE AIR IS A HUMAN RIGHT
• Nicotine in tobacco is a highly addictive drug
Yet….. legal & widely available
• tobacco is the only legally available consumer product
that kills when used as intended
Tobacco Product – Very Unique Commodity
Economic Losses from Smoking
•
•
Lowered/ loss productivity
Health costs to treat tobacco-related diseases (per year)
• Australia : USD 1,353m
• Chile : USD 1,140m
• Canada : USD 2,803m
• Malaysia : USD 922m
• Mexico: USD 5,700m
• New Zealand : USD 166m
• Singapore : USD 50m
• United States : USD 96,000m
• Vietnam : USD 78m
Source: The Tobacco Atlas, 4th Edition
www.tobaccoatlas.org/cost/society/smokingCost_GDP/
WHO Framework Convention on
Tobacco Control (WHO FCTC)
Tobacco is the only legal product that has an
international treaty enacted to control the
global as well as local supply and demand
•
•
•
•
An evidence-based tool
Legally binding
Came into force in 2005
Currently has 168 signatories and 176 parties
All TPP countries, except the United States are
Parties to the FCTC. However, the US is a
Signatory since May 2004
Article 2.2 of the WHO FCTC
• Does not prevent Parties from entering
into agreements that may cover tobacco
products, BUT it requires that these be
compatible with their obligations under
the Convention and its protocols
TPP Areas in Potential Conflict
with the WHO FCTC
• Goods Chapter
• Cross Border Trade in Services Chapter
• Technical Barrier to Trade Chapter
• Investment Chapter
• Intellectual Property Chapter
• Transparency Chapter
• Regulatory Coherence
Goods Chapter
Likely TPP
Provision
• Elimination of Customs
Duties
Tobacco Control/
WHO FCTC
• It is scientifically proven
that raising tobacco tax
and prices are the most
effective short-term
strategies to reduce
demand for tobacco
• Article 6 : Parties to
implement effective price
and tax measures
Cross Border Trade in Services
Likely TPP
Provision
• Promotes liberalisation
• Bans/ restrictions may not
be permitted
Tobacco Control/
WHO FCTC
• TPP may hamper rights of
Parties to regulate
tobacco wherever/
however appropriate
• Article 13 : require
restrictions on tobacco
advertising, promotion
and sponsorship including
cross-border advertising
Technical Barrier to Trade
Likely TPP
Provision
• Avoidance of
“unnecessary obstacles”
to trade
• TPP may provide strong
grounds for tobacco
companies in investor
state dispute cases
Tobacco Control/
WHO FCTC
• There are many provisions
in the FCTC that may be
argued as TBT, e.g.
• Article 9 : Product
regulations/ control of
tobacco product contents
and emissions
• Article 11 : Packaging &
labelling
• Etc.
Investment Chapter
Likely TPP Provision
• Protects existing
investments at the time the
TPP starts operating as well
as new investments/
expanded investments after
the TPP comes into force
Tobacco Control/
WHO FCTC
• TPP may negate the rights of
Governments to effectively
protect the health of its
citizens from tobacco harm
• Rights to regulate any
entities that relate to FCTC
provisions and in response
to tobacco industry actions
that frequently identify
possible loopholes and find
new ways to get around
existing laws not guaranteed
Transparency Chapter
Likely TPP Provision
• Requires Parties to allow (to
the extent possible)
interested persons to
comment on proposed laws/
regulations etc.
Tobacco Control/
WHO FCTC
• Such TPP obligations could
provide opportunities for
pressure and evidential
material for subsequent
disputes
• The tobacco industries will
have advantages to
challenge tobacco control
measures in domestic
proceedings
WHY is it that TPP negotiation process don’t adhere to similar transparency?
Regulatory Coherence
Likely TPP
Provision
• Include regulatory impact
assessments (RIAs)
Tobacco Control/
WHO FCTC
• Provisions in this TPP
chapter pose serious
challenges to tobacco
control policies
• Extensive documentation
that needs to be
produced published to
meet RIA requirement
• Likely to restrict the
ability to regulate tobacco
Legal Costs to Government
• TTC Philip Morris, has filed a case against
Uruguay and Australia
• Legal costs to governments may come to
$45million;
• Damages/compensation awarded that
govt. has to pay the winning investor can
be US$billions.
WHO FCTC Article 5.3
Recommendations 7.1:
the tobacco industry must
not be given any
incentives to run its
business
Tobacco Control & WHO FCTC
• All TPP countries (except U.S.) have legal
obligation to implement the WHO FCTC in
their respective countries
• All responsible govt. will put the rights and
general interests of its citizens before foreign
investors’ profits
• It is most bizarre that those marketing a
product that is addictive and kills at least
50% of its consumers and others around
them should be given any privileges
To avoid potential conflict between the
TPP and the WHO FCTC as well as to
ensure freedom to enact tobacco control
measures to protect public health, FCTC
Parties in the TPP could seek a complete
carve-out tobacco from the trade
agreement in the same way that military
products, arms, narcotics/drugs, and
hazardous wastes are expressly excluded
from such agreements.
As a signatory to the WHO FCTC, the
US still have a role towards
international tobacco control through
the Clinton Order EO 13193 and
Doggett Amendment which provide
guidance on tobacco trade.
The proposed safe harbor may not
necessarily address all concerns of
the WHO FCTC .
Complete tobacco curve
out from TPP is consistent
with countries’
obligations to the
WHO FCTC
Former ASEAN Secretary General,
Dr Surin Pitsuwan:
“We should not just have
free trade, but rather fair
trade & more importantly
SAFE TRADE”