http://m.smh.com.au/national/health/the-display-that-cost-a-retailer-400000-20120602-1zohs.html
At what point do air travellers leave NSW? Once they have passed the immigration checkpoint or when their plane crosses the border? This question became the central point of conjecture in a landmark legal case that has cost Sydney Airport’s duty-free retailer a record A$400,000 fine for displaying cigarettes against state tobacco laws.
The NSW Department of Health took the owner of Downtown Duty Free to court after an inspector found more than 250 cartons of cigarettes on display in its ”airside” outlet, the Mega B walkthrough store, in December 2009. Downtown Duty Free insisted the departures area is a ”Commonwealth place”; the department argued that while the federal government regulates the airport, NSW laws apply inside.
Three subsequent inspections up to March last year found tobacco products, including cigars, displayed on open shelving at Mega B.
The department found the displays breached the Public Health (Tobacco) Act 2008 and its stringent rules against advertising tobacco.
Supreme Court documents show the Zurich-based Nuance Group, the owner of Downtown Duty Free – which eventually pleaded guilty to breaking the law – said section 16 of the act did not apply on constitutional grounds. Section 16 states a person ”must not, in New South Wales … display a tobacco advertisement”.
The company argued the store was not in NSW for regulatory purposes and should therefore be regulated by the Commonwealth Tobacco Act. Its compliance officer believed that under that law tobacco could be displayed in a certain format and remain within the law. Photos taken by a health inspector, Michael Cassidy, show the store placed health warnings above the displays.
In advice to the court, experts from the department of the NSW Attorney-General, Greg Smith, advised that Nuance Group was mistaken. ”If Nuance’s submission were to be accepted, it would follow that it was lawful under the Commonwealth Tobacco Act to promote or publicise tobacco products through the use of large-scale collages or sculptures composed entirely of tobacco packaging.”
Mr Smith’s department said it was ”untenable” to suggest the federal law operated to the exclusion of the state law in any case, saying the ”legislative intention was plainly that the two schemes operate in parallel”.
Justice Peter Hall found the department had proved the walkthrough outlet was a ”public place” in NSW and open to airside workers.
In fining Nuance $337,500 plus $50,000 in legal costs to the department, he said a warning of deterrence must be sent to tobacco retailers. Nuance declined requests for comment.