In this case it was through a smaller free trade agreement with Hong Kong that Philip Morris was able to sue the Australian gov for lost future profits. The case was started years ago and is now getting to the nitty gritty. So far Australia's legal bills are about $50million. Wasted money that could have been spent on the Australian community.
Remember, the laws were put in place for the benefit of Australian's health to discourage smoking. Huge flow on effects too with hospitals and the medical profession not having to use resources for cancer caused by smoking.
However that means nothing for Philip Morris who appear to have no conscience. The health of Australians doesn't matter. All that matters to them are their profit $. Money. Hence they are suing Australia for the loss of profits.
Australia has succeeded in getting the case split into two. The first part will decide whether Philip Morris Asia has a right to bring the case.
Philip Morris Asia bought Philip Morris Australia Limited in early 2011 as the plain packaging legislation was being prepared. Australia is arguing this means it can't claim that the law hurt it, because it bought the company "in full knowledge" of Australia's intentions.
If Australia fails in September it will continue to fight the case, calling former health minister Nicola Roxon and her then departmental secretary Jane Halton as witnesses.
Philip Morris has been able to bring the case despite losing an appeal against Australia's laws in the High Court because of a so-called investor-state dispute settlement clause in an obscure Hong Kong Australia investment agreement.
Such clauses have been included in two of Australia's recently concluded free trade agreements, with Korea and China. They allow foreign corporations (but not local corporations) to sue for expropriation.
Such cases were rare until the early 1990s, but the Productivity Commission says there were 42 worldwide last year. Read more
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