Consumer Product Safety Regulation and Investor-State Arbitration Policy and Practice after Philip Morris Asia v Australia
Luke R. Nottage
University of Sydney - Faculty of Law; University of Sydney - Australian Network for Japanese Law
Australian Product Liability Reporter, Vol. 22 , No. 1&2, pp. 154-158, 2011
Sydney Law School Research Paper No. 12/26
This paper sets in context the notice of claim lodged on 27 June 2011 against Australia by Philip Morris Asia (PMA), a Hong Kong subsidiary of the tobacco giant, pursuant to the 1993 “Agreement between the Government of Australia and the Government of Hong Kong for the Promotion and Protection of Investments”. PMA mainly alleged that Australia’s Tobacco Plain Packaging Bill 2011 would amount to “expropriation” of its trademarks and a violation of “fair and equitable treatment” obligations under the treaty. The Bill was subsequently enacted, resulting in a treaty-based investor-state arbitration (ISA) claim being lodged on 21 November 2011 (available via the Attorney-General Department’s website).
The paper first briefly outlines Australia’s investment treaties and some key legal issues likely to arise. It then assesses the impact of PMA’s claim on some earlier policy debate in Australia over whether its treaties should provide ISA protections for foreign investors. This claim seems to have been a major factor behind the “Gillard Government Trade Policy Statement” (April 2011) declaring that all future treaties would not incorporate ISA provisions, even with developing country partners. This marks a significant policy shift and goes beyond the 2010 recommendations of the Australian government’s Productivity Commission, even though the latter’s theory and evidence for blowing cold on ISA has been subject to significant critical commentary. More targeted evidence-based reforms to the ISA system, including some outlined in this paper, are preferable to its outright rejection. Yet the PMA claim appears to have made it even more difficult to explore such options, further complicating Australia’s negations of bilateral and regional treaties like the Trans-Pacific Partnership Agreement (TPP).
Number of Pages in PDF File: 8
Keywords: : international arbitration, international investment law, international economic law, free trade agreements (FTAs), Asian law, Commonwealth law, dispute resolution
JEL Classification: K10, K13, K30, K33
Date posted: April 18, 2012