Brand Restrictions: Changing the Conversation

Bruce MacPherson, INTA’s Chief Policy Officer and staff liaison for the Association’s 2017 Brand Restrictions Presidential Task Force, has been working on the topic of “brand restrictions” in its various forms as part of the advocacy group for over a decade.

The term “brand restrictions” encompasses a number of types of legislation and policies, such as plain packaging, standardized packaging, and laws introduced to ban or reduce the use of characters (which are trademarks) on packaging.

The Task Force was established to tackle this high-priority issue by exploring how INTA can weigh in most effectively. Burkhart Goebel (Hogan Lovells International, Spain), Task Force Co-Chair, says: “Based on our discussions, the Task Force hopes to provide guidance to INTA on ways to better work with policymakers to strike a balance between public health policy and government-sanctioned IP rights.”

This is exactly what the Task Force has done—all its members have thrown themselves into this initiative “with energy and enthusiasm,” says Kathryn Park (General Electric Company, USA), the other Co-Chair of the Task Force.

International Outlook

Since Australia’s implementation of plain packaging for tobacco products in 2012, more countries, particularly those with advanced economies, are hopping on the bandwagon.

These other countries are encouraged by the World Health Organization (WHO), which has been the main driver of the issue for more than ten years, Mr. MacPherson explains.

The United Kingdom is one example where, in April this year, the UK Supreme Court refused to allow an appeal from the tobacco industry, in a final domestic decision on the recently implemented plain packaging requirements.

Since May 21, all cigarettes sold in the United Kingdom must have standardized packaging—colored olive green, with large images of health warnings covering 65 percent of the front and back of every

One Task Force finding so far reveals that legislation to date is often based on emotions and faulty data. For example, the Task Force has found that data in the Australian situation was not sufficiently vetted for control purposes, explains Mr. Goebel.

Studies undertaken some three years after the plain packaging law came into effect showed little impact on the behavior of smokers (a reduction of about 0.5 percent), he adds.

Although the tobacco industry immediately comes to mind when plain packaging is brought up, it’s not the only industry that is being targeted: the food and drinks sector is also now in the sights of public health groups.

“Today, brand owners whose products are targeted by well-intentioned but sometimes misguided health activists are facing an increasingly ominous threat to the use of their distinctive trademarks,logos, and other distinguishing indicia,” explains Mr. Goebel.

Standing up for Brand Owners

INTA stepped up its advocacy against plain packaging when the Australian legislation was introduced in 2011, says Ms. Park. Volunteer committees, especially those dealing with legislation and regulation, devoted hundreds of hours to analyzing proposed legislation, and preparing statements for the Association to submit in more than 15 countries.

INTA also submitted an amicus brief to the World Trade Organization’s Dispute Resolution Panel dealing with the Australian legislation. The panel’s decision is expected soon and leaks of the draft decision indicate that it favors Australia.

Mr. MacPherson explains that those advocating plain packaging have turned their gaze to dealing with obesity, suggesting brand and labeling restrictions for sugary drinks and highly salted foods. People on the health side of this debate seem to have a stronger voice politically and are getting a better reception from policymakers, he observes.

Mr. MacPherson hastens to add that although these are noble objectives, a more balanced approach to the issue is necessary. The key issue is how to get policymakers to consider all aspects of an issue, not just the emotional arguments, explains Ms. Park.

Mr. MacPherson adds: “There should be serious consideration of what it means to do something that will restrict or even take away basic IP rights and consumer choice.

“It’s important to focus on the things that IP brings to the economy, such as employment and innovation, and how this improves the wellbeing of consumers and citizens.”

Historically, INTA’s primary approach to the issue has been to make formal submissions and to reach out to other IP organizations.

But in 2015, INTA’s Board of Directors adopted a resolution on the issue which raised the Association’s visibility and strengthened the Board’s resolve in taking direct action. The question is what level of response is needed by INTA and brand owners that is commensurate to the growing threat of brand restrictions.

Economic Impact

Ms. Park says that the Task Force is considering whether it would be beneficial for a study to be conducted on the economic impact that these restrictions have and, more importantly, on jobs and the economic well-being of a country’s citizens.

“In the past our message has been more legal, focusing on national and international law. But the issue has to be discussed using a different approach,” says Mr. MacPherson, adding that, ultimately, it probably needs to be addressed from a holistic economic perspective.

One way of doing this is working with chambers of commerce and other trade associations so they can engage with policymakers and stakeholders.

“We have to make sure people understand that we’re talking about what IP brings to the party, respect for IP rights, and a balanced approach” according to Ms. Park.

Finding the Right Message

As for the future of brand restrictions, it’s not so clear, explains Mr. Goebel.

“It depends in large part on the ability of brand owners to make their voices heard without seeming insensitive to health concerns that policymakers are trying to address,” he says.

"Brands enable free choice of informed consumers. They are the backbone of any economy based on competition and choice. They should not be interfered with lightheartedly."

Ms. Park concludes: “It will take a lot of coordination among the IP and trade groups and even those who support consumer choice, to slow down, let alone stop, the juggernaut that was set in motion by WHO some 12 years ago.”

What’s Next?

The Brand Restrictions Presidential Task Force will be making an interim report to the Association’s Board at the 2017 Annual Meeting. Once the Task Force has feedback from the Board, it plans to focus on some key recommendations dealing with messaging and data development to be made in a final report in September 2017.

The objective of the Task Force is to make these recommendations to INTA, which the Association—working with bodies such as the Impact Studies Committee or the Communications and External Relations staff—will then consider whether and how to implement.