Luxembourg, 12/09/2002 (Agence Europe) - In a press release issued in Geneva, cigarette manufacturer Japan Tobacco says it is disappointed with the conclusions of Advocate General Geelhoed that the 2001 European Directive on cigarette manufacturing is compatible with European law (see Europe of 11 September, p.16).
According to Japan Tobacco, the Advocate General fails to recognise the importance of a global brandname on the market or the size of the investment JT has made in its Mild Seven brand. It claims that Leenert Geelhoed has failed to take into account the possibility of passing less stringent legislation, and has deprived brandname owners of the use of their brands in violation of copyright laws.
JT International, subsidiary of Japan Tobacco Inc. JT International SA manufactures cigarettes in its factory in Germany and distributes them to the 15 EU Member States. It owns the Mild Seven trademark which it claims is the second largest cigarette brand in the world. Sales of Mild Seven represent more than 40% of JT Inc's total sales. JT got involved in the appeal by British American Tobacco and Imperial Tobacco to try and have the EU directive repealed.
JT explained that its grievances only cover Article 7 of the directive, with regard to its brand Mild Seven. Article 7 stipulates: "With effect from 30 September 2003, and without prejudice to Article 5(1), texts, names, trade marks and figurative or other signs suggesting that a particular tobacco product is less harmful than others shall not be used on the packaging of tobacco products."
Advocate General Geelhoed discussed the Japan Tobacco case at length: The indications which Article 7 prohibits do not contain objective information but rather mislead smokers by suggesting that a particular tobacco product is less harmful than other products." He adding: "A provision of this kind strikes me as being, in the general sense, an appropriate means by which to protect public health" and "the measures referred to are nowhere close to constituting a disproportionate and unreasonable interference with the right to property", hence Article 7 is compatible with intellectual property rights.
Can the cigarette manufacturers case really be heard?
The Court of Justice will issue its ruling in the next few months, unless it decides that the questions referred to it by the High Court (in the UK) cannot be heard, which is what the European Commission and France are requesting. The manufacturers took advantage of a specific characteristic of English law to oppose the British government's plans to transpose the EU directive into national law, turning to the High Court in London which, in order to get all the information required to pass judgement, asked the Court of Justice whether the directive was valid. The Commission and France argue that agreeing to answer the High Court's questions would pervert the proper avenues of legal redress set out in the EC Treaty since the directive has not yet come into force. The Advocate General argues in favour of the cigarette manufacturers' appeal being heard.
Another Japan Tobacco appeal, at the Court of First Instance
Japan Tobacco did not wait for the case launched by British American Tobacco and Imperial Tobacco before taking on Article 7 of the EU directive. In September 2001, it launched a case calling directly for Article 7 to be repealed on the grounds that it is an obstacle to the use of their brandnames in the EU. Its arguments are the same, viz. that the legal basis of the directive is incorrect; Article 7 violates its intellectual property rights; etc. Lawyers argue that Japan Tobacco, here too, must prove that it is individually concerned by the wording of Article 7.