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Malaysia Gov’t plans to introduce plain packaging for tobacco

PETALING JAYA: The Health Ministry plans to introduce generic packaging for tobacco products with the aim of reducing brand recognition and ultimately reducing overall consumption, Malay Mail Online reported today.

According to the report, the Health Ministry’s director for the disease control division Dr Chong Chee Keong, said plain packaging would greatly impact the prevalence of smoking among new and light smokers.

Chong said there were plans to introduce the plain packaging using standardised colours and fonts in stages but that no specific date had been set as yet.

When asked if the Trans-Pacific Partnership Agreement (TPPA) would affect the plan, Chong said the treaty had yet to be tested.

In 2012, Australia became the first nation to mandate plain packaging for cigarettes, in a bid to reduce smoking rates among its citizens.

Other nations that adopted the move later were France and Britain, much to the unhappiness of big tobacco firms including Philip Morris International, British American Tobacco, Imperial Tobacco and Japan Tobacco International.

These firms have since launched legal challenges against such laws, arguing the move had impinged on their trademark intellectual property.

In Australia, four tobacco firms including Philip Morris lost their legal challenges against the law.

TTIP: EU offered 97% cut on US tariffs, secret papers show

The TTIP negotiations entered a decisive phase on 15 October 2015. That’s when US and EU negotiators laid their cards on the table, exchanging offers for tariff reductions. Up until then, the US had only broached hypothetical reductions; now they were openly offering to reduce 87.5 percent of all tariffs to zero.

That was more than the EU expected. European negotiators had to come up with a better offer or risk derailing the deal. A week later, they came up with a new deal: cutting 97 percent of tariffs to zero.

The EU’s secret offer, which website Correctiv has seen in its entirety, is made up of 181 pages of densely-printed text. It’s got almost 8,000 categories: every species of fish, every chemical has its own tariff category. Importing a parka? Its tariff will depend on whether it’s wool, or polyester for example.

Trade deals are like poker games. Europe’s big offer comes with a big hope: that the US will open up its public bidding process to European firms. That way, European construction companies like Hochtief could bid on contracts to build US highways, or BMW could sell cop cars to American sheriffs.

Meat is ‘underdog’

For the first time, the tariff offer makes clear what TTIP might do for consumers. Remove duties, and prices tend to drop. With tariffs on parts gone, cars could get cheaper. Per part, tariffs add just a few cents on the euro, but altogether European car manufacturers could save a billion euros each year, according to German Association of the Automotive Industry calculations. Manufacturers could then pass the savings on to consumers.

Some duties are levied on foodstuffs. Right now, peppers from the US have an import tariff of up to 14 percent. Fish caught on US coastlines are charged up to 25 percent; raspberries 9 percent. Take those away, and it could make economic sense for American food producers to export to the EU – putting domestic farmers under pressure.

Grain and meat, on the other hand, are largely left out of the reductions for now. “The meat industry is definitely an underdog,” says Pekka Pesonen, general secretary of the European Farmers Association (COPA-COGECA). Animal feed is produced much more cheaply in the US than in the EU. And for products like meat, “there are a lot of reasons it’s complicated to fully liberalise trade,” Pesonen says – animal welfare is more regulated in Europe, and using growth hormones is forbidden.

Opening the agricultural market completely would be difficult for Europe’s small family farms in particular, as they already struggle to compete against industrial-scale farms. That means the back-and-forth over grain and meat is likely to continue.

But the EU has to make a few offers here, too, because the US is eager to see the European agricultural market open up a bit. Pork or seed corn, for example, could be offered up for tariff cuts. The EU has yet to decide when the tariff cuts come into effect. The process is alarming for farmers, who aren’t eager to have their products used as negotiation tools.

Privileged industries

Both sides have placed conditions on their offers. There are 19 pages of tariffs on clothing, for everything from parkas to shoes, overalls and yarn. Tariffs hover between 9 and 12 percent, but the EU is offering total cuts, with an “R” for “reciprocity”. In other words, we’ll cut ours only if you cut yours. The US, on the other hand, has made clear that cuts on textiles depend on opening a discussion over country-of-origin labels.

For example, if a shirt is sewn in Vietnam but packaged in the US, is it “Made in Vietnam” or “Made in the USA”? Once that’s worked out, it’ll be possible to discuss whether the new duties apply to that shirt or not.

Take a look at the EU’s confidential offer and it’s clear some industries have been privileged. Next to the many zeroes on the list are phase-in periods of three or seven years. Some aluminium products, for example, won’t be allowed into the EU duty-free for seven years.

Hydraulic motors, too, have a grace period. Duties on LCD monitors won’t go down immediately; consumers will have to wait seven years for import duties to drop. That, in theory, will give these industries time to adjust to competition. But these measures are still being negotiated.

Thus far, access to the specifics of the TTIP deal was limited to a small circle: Negotiators, government officials, the US Congress, the EU Parliament and 600-odd “trade advisers” in the US.

Public procurement promise

The tariff offer is a milestone for TTIP. Without concrete tariff reductions, concluding a trade deal would be impossible. In theory, such arrangements have to be handled by the World Trade Organisation (WTO); bilateral deals are, technically, forbidden by the WTO. Other states could file to have the deal overturned.

But there’s an exception in the WTO rules: Article 24 of the General Agreement on Trade and Tariffs (GATT) states that a deal like TTIP is allowed when both sides drop their tariffs substantially and show that they’re making trade easier. Both the EU and the US have just done that.

The EU is now waiting for the US to offer a substantial deal on public procurement. In a 15 September report obtained by Correctiv, the EU Commission says “it definitely expects that the US will offer to open public procurement at a future point in time, in exchange for the revised tariff offer”.

That report also indicated that the US “promised to make a proposal regarding public procurement for the first time” when the EU and US put forth their symmetrical tariff reductions, eliminating 97 percent of all tariffs.

Public bids are a major TTIP sticking point. The EU wants the US to finally open its markets to allow firms like Hochtief or BMW to compete when cities put out a call for bids on a new building or fleet of cars. The US is less than eager, because that would subject domestic companies – which are already allowed to bid on projects in the EU – to increased competition.

The 12th round of negotiations started on Monday in Brussels. However, last Thursday the EU Commission indicated that it did not expect a comprehensive offer from the US, and other sources suggested the US would not propose anything concrete before the end of the week.

Justus von Daniels and Marta Orosz are reporters with the non-profit newsroom This text is published in cooperation with

Exclusive: Legal fight looms for government over plain tobacco packaging

British American Tobacco has confirmed to ONE News that it will explore “all possible legal avenues” to fight the legislation, which will be debated later this year after a delay due to legal action against Australia’s government by another tobacco company.

However, Prime Minister John Key says he is not worried about the impending legal fight.

The case against Australia, brought by Philip Morris, failed, but there is still a World Trade Organisation case pending.

Both British American Tobacco and Philip Morris say forcing them to adopt plain packaging on their products breaches copyright.

ONE News also understands that the government is waiting for the Trans Pacific Partnership Agreement to be ratified, because it contains a clause that allows the government to make any changes to public health law it pleases without fear of reprisals like this.

Neither of the companies would comment on the issue, but they claim there is no evidence plain packaging reduces smoking rates, and say the government should be cracking down on home-grown tobacco instead.

The government is working towards the goal of New Zealand being smokefree by 2025.

The War on Tobacco Makes It Into the TPP Free Trade Deal

This month, the United States and 11 other countries signed the Trans-Pacific Partnership (TPP), a regional trade deal that is the centerpiece of U.S. international economic policy and President Obama’s pivot toward Asia.

Now the deal goes to Congress for approval, where opposition is rising. One hot topic in the congressional debate isn’t about what the TPP includes, but what it excludes.

The TPP is the first U.S. trade deal to exempt anti-smoking measures from the lawsuits that investors may bring under the agreement.

Tobacco companies, business groups and Republican lawmakers oppose this carve-out, arguing it undermines the investor-state dispute settlement (ISDS) system and will lead to health exceptions in future trade deals for other consumer goods such as alcohol and sugar.

Trade critics and Democrats welcome the carve-out for tobacco control measures but argue the need for that exception underscores the threat that investor-state disputes pose to other public health and environmental regulations, which aren’t carved out.

If protection for anti-smoking rules seems like small beer in the decision to approve a 12-country trade deal that took eight years to negotiate, that’s because it is. The U.S. cigarette industry long ago shifted most of its manufacturing (and the associated jobs) overseas, and agricultural tobacco production is not included in the TPP carve-out.

But if construed as an issue about ISDS generally, the stakes become higher. The margins for approving trade deals in Congress are razor thin.

To move the TPP closer to congressional passage, President Barack Obama’s administration need not reopen the trade talks to eliminate the carve-out for tobacco or extend it to other areas. But the White House must do a better job addressing the misperceptions that have arisen about the extraordinary nature of the tobacco carve-out and its implications for the potential threat that investment disputes may still pose for other health and environmental regulations.

Exceptions Are the Rule in Trade Agreements

Readers might understandably conclude from the controversy over the tobacco carve-out that exceptions are, well, exceptional in the TPP. The opposite is true.

At nearly 2,700 pages, the TPP may be the longest, most complex, and exception-filled trade agreement ever negotiated. There are exceptions to general principle (Art. 2.4.1), exceptions to exceptions (Art 2.4.7), explicit exclusions (Art. 9.11), implicit exclusions (Annex 15-A), grandfathering (Annex 18-B), optional undertakings (Art. 25.4.1), clarifications (Art. 13.2.3), caveats Art. 11.1), limiting rules of application (Art. 11.2.2-5), and, of course, carve-outs (Annex 17-D; Art. 16.9; Art. 9.7.6). Exceptions appear in nearly every chapter of the TPP, including its preamble.

The number of exceptions in U.S. trade agreements has increased over the last two decades and is a reason for the expanding length of these deals. For all the attention given to the 1994 North American Free Trade Agreement (NAFTA), it is fewer than 400 pages. This proliferation of exceptions is seen in European Union and Canadian trade deals, as well.

These changes reflect the expanding aims of trade liberalization. The traditional barriers to international commerce—tariffs and quotas—have declined dramatically over the last several decades.

As a result, governments seeking freer trade have shifted their focus to other areas like investment, services, procurement rules, regulatory cooperation and intellectual property.

But as governments have sought deeper cooperation, they have also tried to preserve space for existing legal commitments, retain regulatory independence and reassure trade-wary constituents.

Exceptions are the direct result of this careful balancing act.

In many cases, the exceptions reflect the particular subject matter excluded rather than any trade-specific concerns. Most trade deals exclude national security and tax rules. Some exclude firearms and munitions.

The TPP exempts from dispute settlement any matters related to the Treaty of Waitangi, a treaty between the U.K. and New Zealand’s Maori chiefs. Compulsory licenses, which often involve pharmaceutical patents, are the subject of a World Trade Organization declaration and exempted from the expropriation claims that investors may bring under the TPP.

Why Tobacco Is Different

The tobacco carve-out is similar to the other exceptions in the TPP. It reflects the particular status of tobacco in international law and established U.S. trade policy, and was negotiated and included at the insistence of TPP member countries.

Why should tobacco be different from any other product in U.S. trade?

To start, tobacco is the only legal consumer good that has a binding international treaty dedicated to its control and prevention. One hundred and eighty countries have ratified the Framework Convention on Tobacco Control (FCTC), making it one of the most widely subscribed treaties in the world.

This convention entered into force in 2005 and, like nearly all treaties concluded since that time, the U.S. Congress has yet to ratify it. The United States has signed the convention, however, and is fully compliant with its terms and participates in its meetings.

All 11 of the other TPP countries have ratified and are legally bound to adopt the measures prescribed by the convention. The tobacco control measures carved out in the TPP match the measures mandated in the FCTC and its implementation guidelines.

Tobacco is also the only legal consumer product with a binding U.S. executive order, signed in 2001 and still in force, prohibiting U.S. executive branch agencies from promoting its sale or export.

That order states that U.S. trade initiatives cannot be used to restrict governments’ tobacco marketing and advertising regulations, unless those regulations unfairly favor domestic tobacco products.

This executive order, issued pursuant to the president’s constitutional authority to conduct foreign affairs, operates with the full force of U.S. law.

The need to ensure that trade and investment disputes do not interfere with the tobacco control measures mandated in international law and protected in established U.S. trade policy arose with a recent shift in tobacco industry tactics.

In 2010, Philip Morris International, a Swiss corporation, began filing investment cases to block cigarette labeling and advertising laws. Cases were filed against Australia, Norway and Uruguay and threatened against poorer nations including Togo, Namibia and the Solomon Islands.

The cases generated millions of dollars in legal costs for defending governments and delayed implementation of public health laws. Uruguay would have had to drop its law had Michael Bloomberg, the former mayor of New York, not read about the case and funded its defense.

The Philip Morris lawsuits sparked widespread outcry. Tobacco use is one of the world’s leading causes of death, killing nearly twice as many people annually than HIV/AIDS, malaria and tuberculosis combined. Most of those deaths occur in poorer countries, where tobacco consumption is still growing.

Malaysia, a country in the TPP talks, demanded that tobacco be excluded from the deal entirely. The parties to the TPP settled instead on the tobacco carve-out. It enables TPP members that wish to adopt tobacco controls pursuant to the FCTC to do so without the looming threat of investment disputes. But the carve-out does not exclude tobacco farmers, who are not the target of the FCTC, from the benefits of the TPP.

Broader Implications

The Obama administration has done itself a disservice by not making the basis for the tobacco carve-out clearer. It has allowed cigarette companies to mobilize opposition by characterizing the carve-out as a campaign against ISDS that will eventually implicate products from other industries. It has also undermined the White House’s efforts to ease the public’s concerns with ISDS, which do not end with tobacco.

The TPP specifically respects the legitimacy of environmental, health and safety regulations and includes stricter limits on ISDS claims, but the value of these provisions are discounted by those citing the tobacco carve-out as proof the changes are not protective enough.

In the end, the TPP tobacco carve-out says a lot about the special role of tobacco in U.S. and international law, but less about investment disputes generally. It is an exception motivated by a unique combination: a widely subscribed treaty binding all other TPP countries, an executive order mandating U.S. trade policy, and a pattern of tobacco industry abuse in the face of a proven public health threat. It is a constellation of factors unlikely to reoccur in other health and environmental areas.

If the White House hopes to move the TPP toward congressional passage, it will need to make this argument much more forcefully. Otherwise, the TPP may have to wait to be part of the next president’s legacy, if it happens at all.

Thomas J. Bollyky is Senior Fellow for Global Health, Economics, and Development at the Council on Foreign Relations

35 Health Groups Urge Congress to Support TPP Provision Protecting Health Measures from Tobacco Industry Attacks

WASHINGTON, Feb. 3, 2016 /PRNewswire-USNewswire/ — As the United States and 11 other countries prepare to sign the Trans-Pacific Partnership (TPP) trade agreement later today, 35 leading public health and medical groups today urged Congress to support a TPP provision that protects life-saving tobacco control measures from tobacco industry legal attacks under the agreement.

Specifically, the TPP tobacco provision gives governments the option to exclude tobacco control measures from being challenged under the Investor-State Dispute Settlement (ISDS) process. Tobacco companies have used ISDS provisions in other trade and investment agreements to challenge tobacco control measures adopted by Australia and Uruguay and threatened to do so against other countries.

“The provision will protect the rights of current and future TPP participating nations to adopt public health measures that reduce tobacco use without fear of facing lengthy and expensive trade disputes initiated by tobacco companies. Our organizations consider this to be a historic and meaningful step forward for global trade and investment agreements that will help to protect public health and reduce the death and disease caused by tobacco products,” the health groups wrote in a letter to members of the U.S. House and Senate.

Participating countries are scheduled to sign the Trans-Pacific Partnership at 5:30 pm today in Auckland, New Zealand (11:30 am Thursday local time).

The letter states that the provision protecting tobacco control measures is necessary for several reasons:

  • Tobacco products are the only consumer products that kill when used as intended. Globally, tobacco kills about six million people each year and is projected to kill one billion people this century unless governments take strong action to prevent it. Tobacco use kills nearly 500,000 people in the U.S. each year.
  • Tobacco is subject to an international health treaty (the Framework Convention on Tobacco Control), which the U.S. has signed and 180 countries have ratified. The treaty obligates countries to implement effective measures to reduce tobacco use.
  • The tobacco industry has abused ISDS provisions in trade and investment agreements to challenge countries’ tobacco control efforts and to intimidate other countries from adopting such policies.

“The tobacco industry’s behavior is a real and direct threat to public health around the world and justifies the TPP tobacco control provision,” the health groups wrote.

The letter also points out that the TPP tobacco provision addresses the behavior of tobacco manufacturers and is not aimed at tobacco growers.

“The provision does not and is not intended to interfere with the livelihood of tobacco leaf growers. It is unfortunate that the tobacco industry and its allies use the age-old strategy of raising the alarm of the tobacco growers to protect the tobacco manufacturing industry interest in addicting new consumers. The fact is that tobacco growers stand to gain benefits under the TPP, such as tariff reductions, which those advocating for protection of the tobacco companies simply ignore,” the letter states.

Here is a full list of groups signing the letter:

Action on Smoking & Health
American Academy of Family Physicians
American Academy of Oral and Maxillofacial Pathology
American Academy of Oral Medicine
American Academy of Otolaryngology—Head and Neck Surgery
American Academy of Pediatrics
American Association for Respiratory Care
American Cancer Society Cancer Action Network
American College of Chest Physicians
American College of Physicians
American College of Preventive Medicine
American Congress of Obstetricians and Gynecologists
American Dental Hygienists’ Association
American Heart Association
American Lung Association
American Medical Association
American Psychological Association
American Public Health Association
American Society of Clinical Oncology
American Thoracic Society
Americans for Nonsmokers’ Rights
Association of Schools and Programs of Public Health
Association of State and Territorial Health Officials
Campaign for Tobacco-Free Kids
Community Anti-Drug Coalitions of America
March of Dimes
National African American Tobacco Prevention Network
National Association of County & City Health Officials
National Network of Public Health Institutes
Prevention Institute
Society for Cardiovascular Angiography and Interventions
Society for Public Health Education
Society for Research on Nicotine and Tobacco
The University of Texas MD Anderson Cancer Center
Trust for America’s Health

Malaysia’s lower house of parliament passes contentious Trans-Pacific Partnership bill

The lower house of Malaysia’s parliament passed a bill allowing the country to participate in the Trans-Pacific Partnership on Wednesday, clearing a crucial hurdle for the government to sign the free trade pact next month.

In the chamber in which the ruling National Front coalition controls nearly two-thirds of the 222 seats, the bill was approved after two days of heated debate, with 127 legislators voting for versus 84 against.

International Trade and Industry Minister Mustapa Mohamad, who tabled the motion on Tuesday seeking approval from the lower house to allow the government to sign and ratify the deal, assured the legislators that Malaysian social agendas will not be compromised.

“The TPP will not change our economic model,” he said in a speech before voting began.

In reference to the mix of capitalism and socialism that Malaysia practices, he said: “We will continue to have the ‘bumiputera’ policy, social enterprises.”

“Bumiputera” or “prince of soil” refers mainly to the ethnic Malays, who make up some 60 per cent of the country’s 29 million population and who enjoy special privileges through the state’s affirmative-action policy due to the perception that they are still weak economically compared to the minority ethnic Chinese.

The “bumiputera” issue is particularly sensitive to Prime Minister Najib Abdul Razak, whose party, the United Malays National Organisation, depends heavily on the Malay voting bloc.

The opposition’s main arguments revolved around fear of the government losing sovereignty especially over the investor-state dispute settlement chapter and the “bumiputera” policy, which comes under the government procurement and state-owned enterprise chapters. They also spoke out over concern that the price of medicine will rise as a result of a longer patent-protection period under the intellectual property rights chapter.

But Mustapa said the TPP recognised the “bumiputera” policy and the country is given a longer transition period and higher thresholds in certain sectors in order to allow the Malays to play catch up.

Outside parliament, a dozen or so activists bearing placards with slogans such as “Malaysia Is Not For Sale” and “TPP Agenda Amerika” camped out overnight in a show of protest against the TPP.

Nashita Md Noor, a 50-year-old social activist, believed Malaysia is not ready for the TPP.

“It is the big companies that will benefit, not the people. Also, the TPP will open the door for big multinational companies to come in and our local small businesses will lose out,” she said.

Although aware she is fighting a futile battle to thwart the deal, Nashita said, “It’s symbolic that there are people brave enough to fight the current government who are not doing anything good.”

According to a World Bank report released earlier this month, Malaysia, Vietnam and Japan will reap significant double-digit bumps in their exports by joining the TPP.

The TPP will open the door for big multinational companies to come in and our local small businesses will lose out

Social activist

It said the TPP will boost Malaysia’s exports by 20 per cent in 2030 while its gross domestic product will rise by 8 per cent. This is in sharp contrast to the United States, the largest economy in the 12-member bloc, which it said will see a gain of only 0.4 per cent in its GDP.

The TPP negotiations were concluded last October after five years of intense wrangling.

Besides Malaysia and the United States, others in the pact are Australia, Brunei, Canada, Chile, Japan, Mexico, New Zealand, Peru, Singapore and Vietnam, which together account for about one-third of global economic output.

With the passage of the deal in the lower house, it will be brought for deliberation and voting in the Senate on Thursday, where it is expected to be easily passed since the National Front also dominates the upper chamber.

The 12 member countries are scheduled to sign the trade pact on February 4 in Auckland, New Zealand. After which, the government has two year to ratify the pact.

Mustapa has said Malaysia still needs to amend 17 laws involving customs, intellectual property rights, labour, among others, to ensure “best practices” under the TPP.

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AmCham suggests Hong Kong join Trans-Pacific Partnership

In submission to upcoming Policy Address 2016, chamber says city should consider participating in pact as non-sovereign party or observer

The American Chamber of Commerce suggests Hong Kong consider joining the Trans-Pacific Partnership and matching trading services within the pact to relevant areas under the mainland’s “One Belt One Road” initiatives.

The suggestion was made in the chamber’s submission to the upcoming Policy Address 2016, to be delivered by Chief Executive Leung Chun-ying next Wednesday.

The chamber said Hong Kong would benefit by adopting an international approach to capture opportunities offered by the mainland’s “One Belt, One Road” initiatives and the China-led Asian Infrastructure Investment Bank.

“AmCham submits that the government work closely with mainland authorities to elucidate the policy framework under which Hong Kong enterprises may participate,” it said.

Acknowledging Hong Kong’s role in linking up the region, the chamber suggests the city consider joining the TPP as a non-sovereign party or as an observer, and actively exploring the potential of matching trading services and goods within the pact to relevant areas under the “One Belt, One Road” initiatives.

The chamber’s submission includes recommendations on 10 policy areas, from Hong Kong-China relations, business climate, education and labour, to environment, financial services and intellectual property.

It welcomed the city’s being ranked as the freest economy for years, but said the government should be cautious of over-regulation that may hinder the city’s open and free market economy.

It also suggested that Hong Kong attract talent by raising the profile of vocational training, relaxing immigration provisions to allow mainland and overseas students to study in international business schools.

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TransCanada Sues the US for Rejecting Keystone XL; Will This Be the New Normal Under TPP?

On Wednesday, TransCanada Corporation filed a lawsuit in US federal court alleging President Obama’s rejection of the Keystone XL pipeline exceeded his power under the US Constitution. TransCanada also filed legal action under the North American Free Trade Agreement, or NAFTA, claiming the pipeline permit denial was “arbitrary and unjustified.” It’s seeking $15 billion as part of its NAFTA claim. TransCanada’s lawsuit comes just days before President Obama’s final State of the Union address, where he’s anticipated to tout his controversial Trans-Pacific Partnership, or TPP, deal. The secretive trade pact between the United States and 11 Pacific Rim nations could govern up to 40 percent of the world’s economy. After TransCanada announced its lawsuit on Wednesday, the group Friends of the Earth released a statement saying, “This is why Friends of the Earth opposes the Trans-Pacific Partnership and other trade agreements, which allow companies and investors to challenge sovereign government decisions to protect public health and the environment.” For more, we’re joined by Lori Wallach, the director of Public Citizen’s Global Trade Watch.


This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: TransCanada Corporation has sued the US government over its rejection of the Keystone XL pipeline. On Wednesday, it filed a lawsuit in US federal court alleging President Obama’s rejection of the pipeline exceeded his power under the US Constitution. TransCanada also filed legal action under NAFTA, the North American Free Trade Agreement, claiming the pipeline permit denial was, quote, “arbitrary and unjustified.” It’s seeking $15 billion as part of its NAFTA claim.

President Obama rejected the cross-border crude oil pipeline in November, after years of review and one of the most vocal grassroots campaigns this country has seen in decades. At the time, he said approving Keystone would undermine global efforts to stop climate change.

PRESIDENT BARACK OBAMA: America is now a global leader when it comes to taking serious action to fight climate change. And frankly, approving this project would have undercut that global leadership. And that’s the biggest risk we face: not acting. Today, we’re continuing to lead by example, because, ultimately, if we’re going to prevent large parts of this Earth from becoming not only inhospitable but uninhabitable in our lifetimes, we’re going to have to keep some fossil fuels in the ground, rather than burn them and release more dangerous pollution into the sky.
AMY GOODMAN: The Keystone XL pipeline would have sent 830,000 barrels of crude every day from Alberta’s oil sands to refineries on the US Gulf Coast. TransCanada’s lawsuit comes just days before President Obama’s final State of the Union address, where he’s anticipated to tout his controversial Trans-Pacific Partnership, or TPP, deal. The secretive trade pact between the United States and 11 Pacific Rim nations could govern up to 40 percent of the world’s economy. After TransCanada announced its lawsuit Wednesday, the group Friends of the Earth released a statement saying, quote, “This is why Friends of the Earth opposes the Trans-Pacific Partnership and other trade agreements, which allow companies and investors to challenge sovereign government decisions to protect public health and the environment.”

Well, Democracy Now! invited TransCanada to join us on the show today, but the company declined, citing pending litigation. In a statement, it said, quote, “TransCanada has undertaken a careful evaluation of the Administration’s action and believe there has been a clear violation of NAFTA and the US Constitution in these circumstances.”

Well, for more, we go to Washington, DC, where we’re joined by Lori Wallach, director of Public Citizen’s Global Trade Watch, the author of The Rise and Fall of Fast Track Trade Authority.

Lori, welcome back to Democracy Now! Talk about your reaction to the TransCanada suit.

LORI WALLACH: Well, what it boils down to is a foreign corporation deciding that the US taxpayers ought to give them $15 billion because they don’t like the outcome of our government decision that this pipeline was bad for our country and bad for the environment. And where they’re going to get this money extracted from us is an extrajudicial – not US court, not US law – forum: the investor-state tribunal allowed under NAFTA. And the US has faced about a dozen of these attacks under NAFTA, all from Canada, but we have 50 agreements that have this outrageous system. Hardly any of those countries with those agreements actually have investors here. So, up to now, we haven’t lost one of these cases; however, the Trans-Pacific Partnership, overnight, if implemented, would double our liability. Right now, 50 agreements, about 9,000 companies are cross-registered from one of those countries that we have the agreement with operating in the US to attack our laws in these tribunals. Overnight, the TPP would give 9,500 more companies – big multinationals from Japan, in banking, in manufacturing, mining firms from Australia – the right to do this. So this case, hopefully, is like the canary in the coal mine letting us know what we’d be getting into.

AMY GOODMAN: In May, President Obama delivered a speech at Nike in Beaverton, Oregon, where he defended the pending Trans-Pacific Partnership trade deal.

PRESIDENT BARACK OBAMA: Critics warn that parts of this deal would undermine American regulation, food safety, worker safety, even financial regulations. This – they’re making this stuff up. This is just not true. No trade agreement is going to force us to change our laws.
AMY GOODMAN: President Obama also said the TPP improves on NAFTA.

PRESIDENT BARACK OBAMA: When you ask folks, specifically, “What do you oppose about this trade deal?” they just say, “NAFTA.” NAFTA was passed 20 years ago. That was a different agreement. And in fact, this agreement fixes some of what was wrong with NAFTA by making labor and environmental provisions actually enforceable. I was just getting out of law school when NAFTA got passed.
AMY GOODMAN: Lori Wallach, your response to President Obama? He was speaking at Nike headquarters.

LORI WALLACH: Well, first of all, the making stuff up comment is going to have to get shelved, because not only is this attack by TransCanada on our domestic, democratic government decision not to have a pipeline the exact kind of case he said couldn’t possibly happen – well, it just did, $15 billion being demanded by a – from a tribunal of three private sector attorneys, because this investor-state system, it’s not judges. There are no conflict-of-interest or impartiality rules. These are folks who rotate between one day suing a government for a corporation and the next day being the judge. And they all hear cases amongst themselves. They call themselves “the club.” And there’s no outside appeal, and there’s no limit on how much money they can order a government to pay. And if a government doesn’t pay, by the way, the company has the right to seize government assets – seize government assets – to extract our tax dollars. So, number one, this case is exactly the kind of case President Obama said folks were making things up when they were worried about this. Well, now it’s happened.

But this follows one month after the US Congress, because the WTO threatened billions in trade sanctions, gutted another consumer law. Hate to tell folks, if they didn’t notice in the grocery store, but those customer meat – the country-of-origin labels we all use to figure out where our meat comes from, the WTO said we couldn’t have those anymore. And so, Congress, at the face of these sanctions, said, “Oh, better get rid of that law.” So, two examples, live and real, compared to what President Obama promised.

But more broadly about the TPP, here’s the thing folks need to know. The actual language that TransCanada is using in this case, because they filed a brief, is the same language that, word for word, is replicated in TPP. So there are bells and whistles that have been changed between the investor-state language in NAFTA and TPP. In many ways, actually, TPP expands investor-state. It allows more kinds of challenges. Hell, it even allows challenges of government contracts for foreign companies’ concessions on natural resources in foreign land. That was not in NAFTA. However, the actual claims being made by TransCanada, that language is word for word in the TPP. And you can see the analysis of that on our website, You can look at the text now and use our analysis as basically a guided tour.

AMY GOODMAN: Lori, can you explain why they’re asking $15 billion?

LORI WALLACH: So, this is a question a lot of folks asked me yesterday: “Well, wait a minute, this is supposed to” – everyone who’s read the newspaper. “This is a $3 billion pipeline. How the heck can they be asking for $15 billion from us taxpayers?” And the answer is, under the outrageous investor-state system, not only can a foreign corporation get all these special rights – go around our courts, go around our laws and demand compensation – but they don’t just get money for what they’ve spent on a project, they get to get compensated for expected future profits. Yep, they are calculating – and the brief goes through this – what they think they would have made in the future for the lifetime of the pipeline had it been allowed. And that’s what we taxpayers are supposed to give them, because we had a democratic decision of our government that their commercial project wasn’t in the national interest. That’s the $15 billion.

AMY GOODMAN: Lori, can you talk about how trade rules have affected how countries can deal with climate change? Like in, what, 2014, the US launched a WTO challenge against India’s solar incentives.

LORI WALLACH: So, there’s been really terrific work done on this by Sierra Club, NRDC, If you go to their websites, for instance, Sierra Club has a terrific report that goes systematically through all the ways that our trade rules have undermined the efforts both to counter climate chaos, but also some of the adaptations, the efficiencies in energy policy we’d like to take on. And the overarching sum of it is, there are three problems.

One problem is, once we have a trade agreement with a country, we’re no longer allowed to stop exports of, for instance, liquid natural gas. It’s just deemed mandatory that we continue to send out energy. So, to the extent part of the answer to the climate disaster is we need to keep some carbon-based fuels not being processed and shipped around, we lose the right, as a policy, to do that. It’s considered zero quota. We’re not allowed to limit trade.

Number two, the nontrade regulatory limits in all these trade agreements – because, you know, the rule is, every country has to change its domestic laws to meet all these nontrade rules. TPP has got 30 chapters. Only six have to do with trade. There’s a whole chapter on services, and it covers energy services. For instance, it does not allow you, in your policies, to discriminate between how you regulate, say, fossil fuels versus wind or solar. If it’s fuel, it’s fuel. And there’s a whole set of specific constraints around those kind of energy and conservation policies.

And then, the third thing it does is it limits the kind of procurement policies you can have. So, typically, the government is the cutting edge in using our tax dollars when they’re buying things for government to set up a market. So, you know, the car efficiency standards, fuel efficiency standards, we all know there’s CAFE standards in our cars when we buy them. That started as a government program for the government fleet, so that the companies had a market to try and make efficient cars. So, right now, for instance, we have something called renewable portfolio standards, where when the government buys energy, a certain percentage has to be from renewable sources. Those kind of conditionalities are limited in the procurement chapter of an agreement like the TPP. So, basically, it hits, for the fuel industry – that’s why they love it – on all grounds, in handcuffing governments with their policy options.

Australia tobacco clash reverberates in EU trade talks

Tribunal decision could undermine opposition to TTIP.

The end of a complex court case on the other side of the world could wreak havoc on a campaign in Europe against a proposed trade deal between the EU and the United States.

An international arbitration tribunal in December 2015 wound up a four-year dispute between the Australian government and tobacco company Philip Morris by announcing it was unable to rule on the matter — effectively siding with Australia’s position in the dispute.

The case has resonated in Europe, where for some time opponents of the proposed Transatlantic Trade and Investment Partnership (TTIP) have used the legal challenge as a cautionary tale against signing investment deals.

Philip Morris used an obscure investment agreement which Australia signed with Hong Kong in 1993 in an attempt to scuttle Australia’s “plain packaging” tobacco legislation, which has removed all branding from cigarette packets sold in the country.

But Australia’s ability to fend off the legal challenge could undermine the argument that legal provisions contained in international investment agreements leave legitimate legislative reform vulnerable to big corporations.

“It will be back to the drawing board for anti-TTIP campaigners,” said Hosuk Lee-Makiyama, director of the European Center for International Political Economy, adding that the parallels between Australia’s deal with Hong Kong and TTIP had always been overstated.

“Philip Morris was only able to sue Australia because of a technicality,” Lee-Makiyama said. “In free-trade agreements you always include an exception for public health, which Australia forgot to do. This entire case was the result of a drafting error by Australian negotiators.”

However, anti-tobacco campaigners in Brussels say the decision by the Permanent Court of Arbitration in Singapore does nothing for TTIP’s credibility.

“The arbitration court declined to hear the case on the grounds that it was not competent, as Philip Morris had shifted its commercial identity during the course of the case,” said Catherine Hartmann, vice president of the European Public Health Alliance.

“There is nothing in the outcomes of the arbitration attempt that validates or questions plain packaging in Australia or anywhere else,” Hartmann said.

Tobacco wars

The clash between Philip Morris and the Australian federal government began in 2011, when health authorities in Canberra drafted legislation to remove all branding from tobacco packets. The laws, designed to discourage people from taking up smoking, were implemented at the end of 2012.

The legislation was a world first and Philip Morris Asia Limited, a Hong Kong-based subsidiary of the tobacco company, launched a legal challenge. The company argued that the laws “forced removal of trademarks and other valuable intellectual property.”

The legal action was possible because the agreement between Australia and Hong Kong contained an “investor-state dispute settlement” provision (ISDS), an arbitration mechanism which enables investors to take legal action if they feel their interests have been harmed by government policy.

In 2012 the High Court of Australia, the country’s supreme court, found against Philip Morris, arguing the plain packaging legislation was not in violation of the constitution. The tobacco company then took its concerns to the international arbitrator, which effectively ruled against Philip Morris.

Yet Nina Renshaw, the secretary general of the European Public Health Alliance, is adamant the risks of industry using ISDS to challenge health reforms remain.

“The inclusion of an ISDS … in an EU agreement could raise the likelihood of such cases being brought against all kinds of public interest and health protecting policies in the future,” Renshaw said.

In an unusual alliance, Philip Morris agreed with anti-tobacco campaigners. Company vice president Marc Firestone argued that the Australian government’s win was “entirely procedural” with no bearing on either the merits of plain packaging legislation or the ISDS itself.

However, Lee-Makiyama said opposition in Europe to both ISDS and TTIP is based not on fact but misconceptions about American corporate culture.

“This is coming from business interests that are concerned with American market share and from outdated ideas of multinational corporations which may have been OK in the 1920s but are meaningless today,” Lee-Makiyama said.

“Opposition to the ISDS in Europe is also coming from national governments like Germany, which do not want a legal mechanism to stop them discriminating against foreign investors,” he said.

Packaging problems

The controversy has fed into a broader lobbying clash between the tobacco industry and anti-smoking campaigners in Europe, where plain packaging legislation is being hotly contested.

The EU’s revised Tobacco Products Directive, which entered into force in 2014, steered clear of plain packaging reforms after the European Commission came under pressure from the tobacco industry. However, the directive allowed EU member countries to adopt national plain packaging laws.

A number of EU governments have now done so. In December 2015, France passed tobacco legislation and will start to introduce plain packaging in May 2016.

However, the tobacco industry is maintaining its opposition to such laws. Australia’s legislation is also being challenged by a number of tobacco-producing countries at the World Trade Organization.

Meanwhile, on the other side of the Atlantic the EU’s soul-searching over the implications of an ISDS is being observed with interest by those opposing the inclusion of an arbitration mechanism in TTIP on the grounds that it is unnecessary.

“A company entering into a contract with a foreign government can accomplish the same objectives as an ISDS simply by insisting on including an arbitration clause,” said Dan Pearson from the Washington-based Cato Institute, a libertarian think-tank.

“Business associations in the U.S. would support TTIP without an ISDS because the reality is that they don’t need it,” Pearson said. “It mystifies me that the Obama administration has placed so much emphasis on an ISDS.”

This article was corrected to clarify details of the 2012 Australian High Court finding.

It’s Been A Bad Year For Big Tobacco

Cigarette companies found themselves the targets of tighter regulations and lawsuits.

Anti-smoking activists have for years targeted the global behemoths that control the tobacco industry — and this year they made headway. Some of the largest tobacco companies suffered financial and PR setbacks in a series of lawsuits, and anti-smoking initiatives worldwide are further curbing their power.

Here are the losses big tobacco suffered this year:

Packs of Philip Morris International Inc. Marlboro Menthol cigarettes in the new packaging are arranged for a photograph at a tobacco store in Melbourne, Australia, on Monday, Oct. 1, 2012. Tobacco products complying with the world?s first plain-packaging laws have started arriving in stores, as an Oct. 1 manufacturing ban on the country's A$10 billion ($10 billion) tobacco industry comes into force. Photographer: Carla Gottgens/Bloomberg via Getty Images

Packs of Philip Morris International Inc. Marlboro Menthol cigarettes in the new packaging are arranged for a photograph at a tobacco store in Melbourne, Australia, on Monday, Oct. 1, 2012. Tobacco products complying with the world?s first plain-packaging laws have started arriving in stores, as an Oct. 1 manufacturing ban on the country’s A$10 billion ($10 billion) tobacco industry comes into force. Photographer: Carla Gottgens/Bloomberg via Getty Images

Australia Can Keep Its Plain Cigarette Packaging

The Australian government won a major lawsuit against Philip Morris this week. It can continue using plain packaging — logo-less packaging that is the same for all tobacco brands — on cigarette packs sold across the country.

Australia introduced “the world’s toughest laws on tobacco promotion” in 2011, according to then-health minister Nicola Roxon. That year the government voted to implement packaging that, instead of logos, displays the frightening illnesses associated with smoking.

Philip Morris Asia unsuccessfully sued the Australian government in 2011, claiming that the law violated a trade agreement between Australia and Hong Kong.

The UK, France and Ireland Will Use Standardized Packaging, Too

Several countries have followed suit on Australia’s anti-smoking measures. Britain and Ireland approved plain packaging laws in March.

France’s parliament also approved a law Thursday that will place plain packaging on all cigarettes sold in the country starting in May 2016. The products’ brand name will only appear in small type.

The country has made several attempts to diminish its large number of smokers. In 2008, it prohibited smoking in enclosed public spaces like restaurants and bars. In October, the city of Paris also raised the fine for dropping a cigarette butt into the street to 68 euros.

Boston Raises Age For Buying Tobacco To 21

Boston’s board of health voted last week to raise the tobacco purchasing age from 18 to 21 in an effort to prevent teen smoking.

Boston followed the lead of many other cities and towns across Massachusetts that had already increased the age limit. “These changes send a strong message that Boston takes the issue of preventing tobacco addiction seriously,” Boston mayor Marty Walsh said.

New International Trade Laws Block Tobacco Companies From Suing Countries

The Trans-Pacific Partnership, a trade agreement between the U.S. and 11 countries in the Pacific Rim, ruled in October that tobacco is exempt from Investor-State Dispute Settlement rules. In other words, tobacco companies will no longer be able to challenge TPP member countries’ anti-smoking measures the way that Philip Morris did in Australia in 2011.

Anti-tobacco lobbyists and a few senators helped make it happen. “It was time to take action to get trade agreements to stop treating tobacco like it’s just another product and the tobacco industry like any other business,” said Gregg Haifley, federal relations director of the American Cancer Society Cancer Action Network.

The FDA Forced One Tobacco Company To Stop Selling Several Products

The Food and Drug Administration banned R.J. Reynolds from selling four different types of cigarettes in September — Camel Crush Bold, Pall Mall Deep Set Recessed Filter, Pall Mall Deep Set Recessed Filter Menthol and Vantage Tech 13 cigarettes.

The company changed the product ingredients so that they no longer complied with a 2007 federal health law, The Hill reported. The products “fail[ed] to meet the public health bar set forth under law,” explained Mitch Zeller, director of the FDA’s Center for Tobacco Products.

A Jury Imposed $35 Million In Damages On That Same Tobacco Company

R.J. Reynolds was also at the center of a lawsuit in Florida after Garry O’Hara, a U.S. Air Force sergeant who earned the Bronze Star, died of lung cancer in 1996, at the age of 50. O’Hara’s family’s lawyers argued that the company masked the risks associated with smoking for years.

A Florida jury awarded the family $34.7 million in damages in September.

The company tried to argue that the executives responsible for decisions at the time are no longer around. “The R.J. Reynolds leadership that you heard about, they’re gone. … Those people who stood up before Congress and raised their hand, they’re gone,” David Monde, a lawyer for R.J. Reynolds, said in court.

Shady Activity Uncovered Within A Big UK Tobacco Company

The BBC conducted an investigation into British American Tobacco and found that the company bribed politicians and civil servants in East African countries in an effort to “undermine anti-smoking legislation.”

One BAT employee, the BBC said, illegally paid a civil servant in Burundi in exchange for a copy of the country’s Tobacco Control Bill.

The BAT said it was the target of false accusations.

“Our accusers in this programme left us in acrimonious circumstances and have a vendetta against us, clearly demonstrated by the false picture they present of how we do business,” it said in a statement.

The company could face prosecution in the U.K. and the U.S.

Three Cigarette Companies Ordered To Pay CA $15 Billion To Canadian Smokers

Two separate lawsuits, filed by Canadians sickened from smoking and Canadians unable to quit smoking, culminated in the country’s biggest class-action lawsuit to date.

Three tobacco companies — Imperial Tobacco; Rothmans, Benson & Hedges and JTI-Macdonald — were accused of lying to consumers about the health risks associated with their products. They were ordered earlier this year to pay $15 billion (about $10.8 billion USD) to the plaintiffs.

All three companies said they planned to appeal the decision, claiming that Canadians are well-versed in the risks of smoking.