II The FCTC and its COP

The FCTC is an international framework treaty adopted by the World Health Organization in 2003.Footnote ¹ The aim of the agreement is to improve the level of global public health by addressing the risks posed by tobacco consumption. To this end, the FCTC sets certain general standards for national tobacco control policies. It intends to affect both the demand and supply of tobacco products. With respect to the demand side, the convention recommends the adoption of tax measures (Article 6), mandates the introduction of measures providing for protection from exposure to tobacco smoke (Article 8), imposes on the Parties certain obligations relating to the packaging and labelling of tobacco products (Article 11), and requires a comprehensive ban on advertising, promotion and sponsorship of tobacco products (Article 13). As far as the supply side is concerned, the convention sets several standards for the prevention of illicit trade in tobacco products (Article 15),Footnote ² requires the prohibition of sales of tobacco products to minors (Article 16), and promotes economically viable alternative activities for tobacco workers, growers, and individual sellers (Article 17).

The FCTC, being a framework treaty, remains rather general. Its basic requirements are subsequently clarified and further developed through guidelines adopted from time to time by the COP, a treaty body which is responsible for the regular review of the implementation of the convention and the promotion of its effective implementation.Footnote ³ As of today, the COP has adopted eight guidelines covering the provisions of nine articles of the convention.Footnote ⁴

The latest COP meeting was attended by 136 (out of 180) FCTC Parties. In addition, the representatives of several state non-parties, intergovernmental and nongovernmental organisations (NGOs) were also present. It is interesting to note that most of the applications for the observer status submitted by NGOs have been rejected by the COP. This group includes not only industry-related organisations (e.g., the Tobacco Vapor Electronic Cigarette Association) but also certain health advocacy groups (e.g., the Polish Cancer Patient Coalition, being a member of the European Cancer Patient Coalition). The COP has also been very strict with respect to the presence of the general public and media and decided to exclude both groups from its sessions (a move which has been criticised by some of the Parties). A special screening mechanism, which would permit the exclusion only of persons connected with the tobacco industry, was suggested for the future meetings, but no decision was eventually made in this regard.Footnote ⁵

III Developments at the COP7

Probably the most important item on the COP agenda was consideration of the report of the working group on the further development of the partial guidelines for the implementation of Articles 9 and 10 of the FCTC (concerned with the regulation of the contents of tobacco products and tobacco product disclosures).Footnote ⁶ This document, which was supposed to constitute a basis for amending the existing guidelines, turned out, however, to be quite controversial.

The working group suggested several amendments and additions. The one that proved to be the most problematic was a new section on the addictiveness of tobacco products. The guidelines provide that one of their objectives is “to support Parties in developing effective tobacco product regulation. Tobacco product regulation has the potential to contribute to reducing tobacco-attributable disease and premature death by reducing the attractiveness of tobacco products, reducing their addictiveness (or dependence liability) or reducing their overall toxicity.”Footnote ⁷ In this context, the working group proposed, as a strategy to reduce the addictiveness of tobacco products, to regulate their contents and/or emissions. According to the group this could help not only to prevent nicotine addiction/tobacco dependence, but also facilitate cessation efforts.Footnote ⁸ Although no specific measures were proposed (see below), the new language of the guidelines would obviously encourage tobacco control policies aimed at reducing the maximum allowable nicotine content in cigarettes to minimally addicting levels.

However, eventually the amendment was rejected by the Parties. One may only speculate about the reasons behind this decision of the COP7. It is possible that it considered scientific evidence on the effectiveness of such a strategy insufficient to adopt the guidelines.Footnote ⁹ This conclusion is additionally supported by the cautious approach taken by the working group itself. In particular, it failed to reach a consensus on specific policy recommendations on rules pertaining to regulation of the contents of tobacco products to reduce their addictiveness, as some of its participants felt that it was premature to develop guidelines in this respect.Footnote ¹⁰ However, it may be also the case that the stance of the FCTC Parties reflects their deeper conviction that risk reduction strategies are not a desirable option to be pursued under the Convention. The aim is to eliminate entirely the problem of tobacco addiction, rather than to minimise the harm caused by the consumption of tobacco products. This would closely correspond the approach taken by the FCTC parties with respect to ENDS, an issue to which I return below.

The working group was more successful with regard to its conclusions on the regulation of tobacco products design features, related to their attractiveness. The COP decided to insert this section into the guidelines, but in a substantially amended form. In particular, a reference to reduced circumference cigarettes (i.e. slims and superslims) and capsules in cigarette filters (provided by the working group as specific examples of features that increase the attractiveness of tobacco products and which should be either regulated on prohibited) was removed from the policy recommendations.Footnote ¹¹ Although no information is publicly available on the discussion that took place at the COP7, one may rationally assume that at least some of the Members of the EU, alongside the other Parties, were against the explicit mention of slim cigarettes in the recommendations. The European Commission, in its initial draft of the Tobacco Products Directive,Footnote ¹² also planned to introduce a sales ban on slim cigarettes, but due to strong opposition from a number of the Member States (motivated mainly by economic reasons), it eventually dropped this proposal.

Last but not least, the COP included in the guidelines, on the recommendation of the working group, a passage on analytical laboratory methods for the testing and measuring of the contents of tobacco products, developed by the WHO.Footnote ¹³

In this context, it worth noting that although FCTC guidelines are not legally binding instruments, their significance should not be underestimated. From the point of view of public international law, they can be classified as either: (i) a subsequent agreement between the parties regarding the interpretation of the treaty or the application of its provisions; or (ii) a proof of subsequent practice in the application of the treaty, which establishes the agreement of the parties regarding its interpretation. Both elements have to be taken into account, as required by Article 31.3 of the Vienna Convention on the Law of Treaties,Footnote ¹⁴ when interpreting specific provisions of the FCTC. As a consequence, guidelines may not only indirectly shape but in many instances give actual normative content to the very general prescriptions provided by the Convention. Moreover, in the specific context of law of the World Trade Organization (WTO), most of the FCTC guidelines, as I have argued elsewhere, can be classified as international standards as understood by the Agreement on Technical Barriers to Trade.Footnote ¹⁵ Such a qualification allows one to rely on the presumption provided by Article 2.5 of the agreement and to consider national measures conforming to such standards as not creating unnecessary obstacles to international trade. However, even if one disagrees with the classification of guidelines as international standards (note that none of the WTO panels has yet come to such a conclusion), they can still be relevant in the WTO context as a form of factual reference. In particular, they may help to make certain factual determinations relating to the existence of specific health risks, the contribution of a measure to achievement of a state’s regulatory goal, and the availability of alternative measures.Footnote ¹⁶ Such an approach is justified by the fact that both the FCTC and its guidelines are based on reliable and up-to-date scientific evidence. Consequently, they can help WTO panels to assess the probative value of various claims made by the parties to a dispute.Footnote ¹⁷ It is also worth noting that a similar approach was recently adopted by the investment tribunal in the dispute between Philip Morris and Uruguay.Footnote ¹⁸

Seen from this perspective, the inclusion/non-inclusion in the guidelines of, for example, reduced circumference cigarettes may be of significant importance. Once they are in, WTO Members (or host states when it comes to investment disputes) receive an additional legal shield against legal challenges instituted within the organisation or in front of an investment tribunal. Of course, the removal of a reference to slim cigarettes is not necessarily critical for such regulations. It may still be argued that the more general language used in the guidelines, which refers only to the attractiveness of product design features, is sufficiently broad to include modified circumferences of cigarettes. Yet it is also true that more explicit language would reduce existing uncertainties and could constitute an important incentive for the Parties to adopt relevant regulations.

During its seventh meeting the COP also considered an expert report on ENDS.Footnote ¹⁹ The document was prepared by the WHO at the request of the COP6.Footnote ²⁰ It contains updated information on the health impact of ENDS and Electronic Non-Nicotine Delivery Systems (ENNDS), their potential role in tobacco cessation and their impact on tobacco control efforts. It also assesses available policy options for regulating such products. Overall, the report takes a very cautious (one may even say overly cautious) stance. While it notes on several occasions that ENDS are generally less toxic than cigarette smoke,Footnote ²¹ it also identifies a number of health risks connected with ENDS use (e.g. risks resulting from the presence of different chemical substances, including nicotine, in the aerosol). At the same time, the report highlights the limited scientific knowledge on various aspects of ENDS use. According to the report this is particularly true with respect to the health effects of the heated and inhaled flavourants used in the e-liquids, the long-term effects of ENDS use, the risks posed by passive exposure to exhaled aerosol, the effectiveness of ENDS as a smoking cessation aid, and the potential correlation between ENDS use and subsequent smoking initiation. The report also notes the growing engagement of transnational tobacco companies in this market segment and identifies this development as a one of the major threats to effective tobacco control policies. In this context, the report warns that these companies may be interested in the ENDS market in order to:

It is therefore not surprising that the report identifies a total ban on the importation, sale, and distribution of ENDS/ENNDS as a default regulatory option for states. For those countries which decide to permit sales of ENDS, it proposes a set of specific control policies. This regulatory toolkit includes various measures, such as restriction on the sale of ENDS to minors, advertising bans, taxes (to make these products less affordable for minors), regulations on flavours (again to make them less attractive for minors), disclosure obligations with respect to product content, labelling (including mandatory health warnings), and restrictions on vaping in public places. Overall, the policies proposed by the WHO in its report are very similar to those which are required for tobacco products under the FCTC.

The COP fully endorsed the recommendations provided in the report (“invit[ed] Parties to consider”), including full prohibition of the manufacture, importation, distribution, sale and use of ENDS. It should be noted that this decision is in line with the previous approach taken by the COP.Footnote ²³ Both the WHO and FCTC still remain sceptical about any positive aspects of this new category of products.

It is clear that various scientists genuinely disagree about ENDS. This disagreement is, however, not visible in the WHO report, which excessively concentrates on risks connected with their use rather than opportunities provided by such products. Although it confirms that ENDS are less toxic than cigarettes, it overemphasises (at least in terms of the length of discussion) potential risks. At the same time, it fails to contextualise its analysis by not comparing the ENDS-related risks with those that are posed by conventional smoking. The report highlights on several occasions the limited scientific knowledge on ENDS, but this does not prevent it from making rather strong statements on the negative consequences of ENDS use. It is worth noting that the report was heavily criticised by a group of prominent scholars in health policy (none of them connected with the tobacco industry).Footnote ²⁴ The authors condemned, among the other things, the inadequate comparisons with smoking, the misrepresentation of second-hand ENDS vapour risks, and discounted evidence that ENDS do help smokers quit, and also mischaracterisation of the ENDS market and role of tobacco transnationals. These scholars also criticise, rightly in my opinion, the identification of a total prohibition as a default regulatory option. In this context they bitterly observe that “[t]he merits of prohibition are exceedingly poor given the pervasive availability of cigarettes in all jurisdictions. WHO should not be endorsing prohibitions, explicitly or implicitly. It is unethical to deny smokers much lower risk options than cigarettes, and there is no scientific support for ENDS prohibition as a public health intervention. The WHO’s framing suggests that a prohibition is something for Parties to progress towards and should not be undone once done.”Footnote ²⁵ It remains to be seen whether the approach of the WHO and FCTC will change in the future. There is a chance for this as there are many new studies on ENDS in the pipeline.Footnote ²⁶

The COP traditionally discussed the problems relating to the relationship between trade and investment obligations and the implementation of FCTC standards. The basis for this discussion was a very interesting report prepared by the FCTC Secretariat.Footnote ²⁷ The report notes the recent successes of states in defending their tobacco control measures (i.e. Philip Morris Brands v Uruguay and Philip Morris Asia v Australia), but remains very cautious about the future developments (due to the fragmentation of the investment arbitration system). The report also identifies provisions on “regulatory cooperation” or “regulatory coherence” in new trade and investment agreements as a potential gateway for the tobacco industry into regulatory processes. Another area to which the states should pay special attention relates to the protection of intellectual property rights (particularly when it comes to health warnings and labelling requirements). In this context, the report suggests various policy options available to states. These include: carve-out clauses for tobacco products, tobacco-related economic activity, and regulatory actions; a denial of benefit clause which limits the scope of the Investor-State Dispute Settlement (ISDS) system;Footnote ²⁸ a public policy carve-out clause or clarifications of substantive investment obligations by indicating that specific tobacco control measures do not violate them. Last but not least, the report indicates that abandoning or replacing ISDS with domestic dispute resolution or State-State dispute settlement is a potential option.Footnote ²⁹

It is difficult to agree with some proposals put forward by the FCTC Secretariat, as they have serious systemic implications that go beyond the specific context of tobacco control. Note that investment disputes relating to tobacco control measures constitute only a small fraction of cases decided by various investment tribunals (most of which really involve protection of legitimate rights of foreign investors). Abandoning the ISDS, as a form of shielding sovereign rights of states in the area of tobacco control, is therefore like throwing the baby out with the bathwater. Moreover, as the report admits itself, two major investment arbitration cases, mentioned above, that related to tobacco control measures actually uphold the right of states to regulate (although in one case the decision was based on procedural grounds). Both awards clearly show that investment tribunals can properly handle delicate matters at the intersection of public health and economic freedom and protection of proprietary rights. As correctly noted by one scholar “contrary to conventional wisdom international courts and tribunals can play a central role in advancing and enhancing complex national, regional, and global regulations rather than eroding sovereign regulatory space.”Footnote ³⁰

Even the less extreme proposals put forward by the FCTC Secretariat in its report are problematic. Note that singling out one specific product from trade and investment treaties undermines the significance of the general safeguards (e.g. the health exception) which are conventionally included in such agreements. It also prioritises, in a rather arbitrary fashion, one specific risk over others. In addition, such an approach may give rise to slippery slope concerns. Some commentators (as well as business circles) fear that once an exemption for a specific harmful commodity is established, a precedent is created for similar exclusions of other products which possess some negative externalities.Footnote ³¹ A better approach, and one that could address the systemic concerns expressed by the critics of the current economic arrangements, would be the modification of safeguard clauses so they can guarantee sufficient regulatory space for states with respect to various categories of legitimate national policies.

Fortunately, the COP decision on trade and investment issues is rather limited in scope. It only calls on the FCTC Parties to increase coordination and cooperation between the trade/investment and health departments within the national governments (particularly in the context of negotiation of new trade and investment agreements). It also instructs the FCTC Secretariat to collect relevant information on national best practices with respect to safeguarding public health measures under trade and investment agreements, international legal challenges of tobacco control measures (the most important of which is probably a decision of a WTO panel in the dispute over the Australian plain packaging lawFootnote ³² ), and the categories of tobacco control measures that are most frequently targeted by the tobacco industry. The Secretariat is expected to report on these issues at the COP8.Footnote ³³

In addition, the COP dealt with various other issues. This particularly included the consideration of the report on the implementation of Article 5.3 of the FCTC (i.e. protecting health policies from commercial and other vested interests of the tobacco industry). In this context, the COP requested the FCTC Secretariat to establish a so-called ‘Knowledge Hub’ for Article 5.3 that would be responsible for coordination of the work of experts and assist the parties in developing various strategies that prevent interference from the tobacco industry.