Uruguay: The little country that changed tobacco laws

Uruguay won a major case against Philip Morris in a World Bank ruling that could embolden other small countries that want to deter tobacco use.

The Latin American nation of Uruguay, with a GDP of $50 billion, went up against a tobacco company that takes in $80 billion annually – and won, ruled an international court on Friday.

Uruguay is a small country that impacts world politics only rarely. But that is precisely the point, say its allies in the fight against tobacco.

“The lesson here is that when a small country like Uruguay gets attacked, the public health community around the world will rally behind them so that these countries don’t have to fight these cases alone," Matthew L. Myers, president of the Washington, D.C.-based Campaign for Tobacco-Free Kids, tells The Christian Science Monitor.

That Uruguay triumphed so completely in its litigation against Philip Morris International – the court even ordered Philip Morris to pay Uruguay's court costs – suggests packaging laws for tobacco have friends in high places.

“What the tobacco companies do in these cases is just hunker down and look ugly and say, ‘We’re going to spend more money than you’ve got,’ ” Stanton Glantz of the Center for Tobacco Control Research and Education told the Monitor in May. “So the train of losses will embolden other countries to not be so frightened.”

The case was a risky one for Uruguay, Mr. Myers says. Some suggested Philip Morris would bankrupt the country if the government refused to settle a lawsuit over cigarette packaging regulation out of court, but Michael Bloomberg, three-term New York City mayor and founder of Bloomberg Philanthropies, promised the country financial support for court fees. 

In 2015, a fund was established through the Campaign for Tobacco-Free Kids to help smaller countries fight for their anti-tobacco laws in court. Bloomberg Philanthropies and the Bill & Melinda Gates Foundation contributed money, meaning future efforts by tobacco companies to litigate restrictive packaging laws could become cases of billionaires fighting billionaires.

“It shows countries everywhere that they can stand up to tobacco companies and win,” Mr. Bloomberg said in a press release. “No country should ever be intimidated by the threat of a tobacco company lawsuit, and this case will help embolden more nations to take actions that will save lives.”

With this decision, the court upheld two strict laws on cigarette packaging. Throughout the seven years of litigation, Uruguay has required graphic warnings about the health dangers of tobacco to cover 80 percent of the cigarette pack, both front and back. It also limits each company to a single pack design, undercutting color-coded brands and use of words such as “light,” and forcing the company to pull seven of its twelve brands off Uruguay’s shelves, the Financial Times reported.

“We’ve never questioned Uruguay’s authority to protect public health,” Marc Firestone, general counsel at Philip Morris, told the Associated Press. “The arbitration concerned an important, but unusual, set of facts that called for clarification under international law, which the parties have now received.”

The debate around tobacco marketing has moved into the judicial sphere, where governments and tobacco companies are fighting cases around both domestic trademark laws and international trade agreements. This marks the second case this summer in which a government has won the right to restrict tobacco packaging in court. The first nation to win such a case was Australia, and then in May a British court upheld the government's right to require plain, green packaging on cigarette cartons, the Monitor has reported previously.

“Because Australia was successful, the UK was successful, and because the UK was successful the EU can be successful, and because of this whole cascading impact, you see a lot of countries going above and beyond,” Timothy Mackey, a professor specializing in health law at the University of California San Diego, told the Monitor at the time. 

The most immediate impact could come from Latin America itself, Meyers says, where governments in Uruguay and Chile have been weighing the implications of even stricter laws to require unadorned, uniform packaging plain on cigarette cartons. The court's decision could embolden these countries to further regulate the tobacco industry inside their borders.