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Tobacco and Trade: an unhealthy and harmful marriage

On 31st May, we celebrate the World Health Organization (WHO) initiated World No Tobacco Day which this year focuses on tobacco and lung health. While the health-harmful nature of traditional tobacco products is well-evidenced, a recent analysis from EPHA Member, the European Respiratory Society (ERS) highlights why heated tobacco products promoted by the tobacco industry are so harmful to public health, and formulates some evidence-based recommendations.

In this issue we also focus on the links between international trade and public health, The tobacco industry, for example has a long history of using international (bilateral and multilateral) trade deals to force their products into new markets. In a more recent development, the industry has rolled out a strategy to systematically challenge, delay and block the implementation of smoke-free legislation and programmes by exploiting investor-to-state dispute settlement (ISDS) clauses to legally challenge any policy decisions by seeking compensation for loss of Intellectual Property and/or future revenue.  A more strategic aim of such legal challenges is to ensure ‘regulatory chill’ by intimidating governments to not consider tobacco regulation. Beyond ISDS however, there is another trade policy issue lurking in the background which has not yet caught the attention of the health policy community: rules of origin in trade agreements. EPHA’s Scientific Advisor on Trade, Gabriel Siles-Brügge outlines how big tobacco firms with global value chains prefer more lax rules of origin to accommodate their sourcing strategies.

Although trade policy is considered outside the scope of the Framework Convention on Tobacco Control Article 5.3 provisions, it does impact on health. Was the fact that tobacco was included as an Offensive Interest (OI) in the Japan-EU FTA and the EU-Mercosur deal relating to tariff reduction, non-tariff barriers (such as smoke-free legislation, packaging, labelling requirements, etc) and investment promotion and protection the result of meetings with the tobacco industry and their lobbyists? We also examine the case for the need to strengthen tobacco tax and trade policy which illustrates why tobacco is not an ordinary product and that measures already in place should  be health-focused and protected from industry interference and manipulation.

For this reason, the tobacco lobby aims to be heavily involved in the design of the investment chapters of international trade agreements, to ensure that ISDS clauses remain. The ISDS challenge has not only been used against low and middle income countries (notably Uruguay, which ultimately won an arbitration challenge brought by Philip Morris International (PMI) using the International Centre for Settlement of Investment Disputes (ICSID) mechanism, but has also been a successful tactic, from an industry perspective in dissuading developed countries, including New Zealand which has postponed introducing tobacco plain packaging for 6 years, until the outcomes of the PMI ISDS challenge against Australia.  Therefore, the European Commission’s Trade department has decided to drop ISDS by name, and propose an alternative for future trade agreements, rebranded as an Investment Court System (ICS). And as EPHA has covered, although the European Court of Justice found ICS rules in line with EU law, measures which are legal can still have unhealthy consequences. ICS may limit public health policy space by arbitration, and it will not stop tobacco, alcohol, unhealthy food companies from challenging public health laws.

Tobacco, as a particularly dangerous commercial determinant of health is a good reason for the health community to monitor and challenge international trade negotiations  to ensure true coherence between trade and public health. To this end, EPHA together with its member, the European Heart Network has developed a model public health chapter for the EU to include in its trade agreements.

In the aftermath of the European Parliament elections, taking forward this proposal would be a good, first step from the new Commission to show that it is serious about bringing the EU closer to its people, by prioritising issues people care about, such as public health – as EPHA has repeatedly pointed out – 70% of Europeans want to see more EU action on health. In light of the indicated links between trade and tobacco, isn’t it time to reconsider treating tobacco like any other ordinary product in trade negotiations, and pursue a trade policy which actually works for health?

Zoltán Massay-Kosubek is Policy Manager for Health Policy Coherence at the European Public Health Alliance. He is leading EPHA’s work on Healthy trade and he is the only public health member of the European Commission Expert Group on EU Trade Agreements

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