Philip Morris Brands SARL et al. v. Secretary of State for Health

Case C-547/14
Download Judgment: English
Country: United Kingdom
Region:
Year: 2006
Court: Court of Justice of the European Union (Second Chamber)
Tags: Child and adolescent health: Child development, Freedom of Expression, Health information, Public safety, Right to Access to Information, Right to Health, tabacco

The case before the Court of Justice of the European Union (“CJEU”) arose in the form of a request from the High Court of England and Wales. The request was made for a preliminary ruling on various questions relating to the validity of Directive 2014/40/EU on the approximation of the laws, regulations and administrative provisions of the Member States concerning the manufacture, presentation and sale of tobacco and related products (the “Directive”), which the Member States were obliged to implement subject to certain transitional measures, on or before 20 May 2016. The case came before the High Court of England and Whales in the form of a judicial review brought by Philip Morris and British American against the “intention and obligation” of the Secretary of State for Health to implement the Directive.
The High Court referred numerous questions to CJEU, some of which were found to be inadmissible by the CJEU for a preliminary ruling. The referred questions challenge the validity of various provisions of the Directive on grounds of the violation of the principle of proportionality; infringement of Article 11 of the Charter of Fundamental Rights of the European Union (the “Charter”) which protects freedom of expression; and infringement of Article 114 of the Treaty on the Functioning of the European Union (“TFEU”) which enables the European Parliament and Council to adopt the measures which have as their object the establishment and functioning of the internal market.
The applicants in the judicial review before the High Court argued that the directive was invalid, in whole or in part. The ground was an infringement of Articles 114 TFEU, 290 TFEU and 291 TFEU which sets out the scope of the EU’s authority to legislate and the principles of law in the nations coming under the European Union, the principles of proportionality and subsidiarity. The Article 11 of the Charter of Fundamental Rights of the European Union (‘the Charter’) enshrines certain political, social, and economic rights for European Union (EU) citizens and residents into EU law.
The CJEU ruled in favor of the Respondent upholding all aspects of the TPD and noted that the EU may act to prevent obstacles to the trade of tobacco products while also ensuring a high level of public health protection.

The CJEU analyzed the various arguments presented by both the parties and gave the following rulings:
- The court held that Article 24(2) of the TPD, which dealt with regulations pertaining to the packaging of tobacco products, was valid as this article was in compliance with the aim of Article 114 of the TFEU which was to “achieve the objective of improving the conditions for the functioning of the internal market”.

- The court held that Article 24(3) of the TPD on the prohibition of a certain unlawful category of tobacco by the Member States was valid. The court noted that Article 24(3) was not covered by harmonization measures in the TPD and therefore, was not subject to rules under Article 114 of the TFEU.

- The court held that Chapter II of Title II (labeling and packaging) of the TPD was valid. Chapter II of Title II harmonized standards of the labeling and packaging and such provisions were authorized under Article 114 of the TFEU since they were designed to promote the functioning of the internal market.

- The court held that Article 7 of the TPD, which regulated the characterizing flavor of tobacco products, was valid since the characterizing flavor may increase the addictiveness of tobacco products. In order to prevent impairment of free movement as well as to protect public health, Article 7 was properly adopted on the basis of Article 114 of the TFEU.

- The court held that Article 18 of the TPD was valid as on the one hand, it provided that the Member States may prohibit cross-border distance sales of tobacco products so as to protect people’s health especially the young people; while on the other hand, it set out rules applicable to all Member States which did not prohibit such sales. Such provisions were within the scope of discretion granted by Article 114 of the TFEU to the EU legislature to decide which aspects of cross-border distance sales should be harmonized.

- The court held that Article 13(1) of the TPD, which regulated the labeling of tobacco products, was valid. TPD was intended to facilitate the smooth functioning of the internal market based on a high level of protecting human health, especially for young people. Display of certain information would be misleading and encourage the consumption of tobacco products no matter if such information was accurate. Therefore, such a strict interpretation was consistent with the purpose of TPD.

Article 13(1) of the TPD also did not violate Article 11 of the Charter or the principle of proportionality. Although Article 11 of the Charter affirmed the freedom of expression and information, including freedom of using labeling and packaging and Article 52(1) provided that the limitation on exercise of freedoms must comply with the principle of proportionality, the court held that: (i) Article 13(1) did not impair the essence of a business’s freedom of expression because labeling of products only constituted one part of the communication; (ii) such interference was made to pursue an objective of general interest recognized by EU, which was to protect public health; and (iii) the second sentence of Article 35 of the Charter also required a high level of human health protection. The court noted that human health protection weighed over the interests claimed under Article 11. Such prohibition was valid and reasonable.

“A high level of protection of that kind requires that consumers of tobacco products, who are a particularly vulnerable class of consumers because of the addictive effects of nicotine, should not be encouraged to consume those products by means of, albeit factually accurate, information, which they may interpret as meaning that the risks associated with their habits are reduced or that the products have certain benefits.” (Para 144)

“[T]he interference with the freedom of expression and information that has been found to exist meets an objective of general interest recognized by the European Union, namely, the protection of health. Given that it is undisputed that tobacco consumption and exposure to tobacco smoke are causes of death, disease, and disability, the prohibition laid down in Article 13(1) of Directive 2014/40 contributes to the achievement of that objective in that it is intended to prevent the promotion of tobacco products and incitements to use them.” (Para 152)

“As regards (i) the appropriateness of large combined health warnings, the Guidelines for Implementation of Article 11 of the FCTC explain, in point 7, that, in comparison with small, text-only health warnings, larger warnings with pictures are more likely to be noticed, better communicate health risks, provoke a greater emotional response and increase the motivation of tobacco users to quit and to decrease their tobacco consumption. Such warnings are also more likely to retain their effectiveness over time and are particularly effective in communicating health effects to low-literacy populations, children and young people.” (Para 204)

Article 9 of the TFEU “In defining and implementing its policies and activities, the Union shall take into account requirements linked to the promotion of a high level of employment, the guarantee of adequate social protection, the fight against social exclusion, and a high level of education, training and protection of human health.” Article 26 of the TFEU: (1) “The Union shall adopt measures with the aim of establishing or ensuring the functioning of the internal market, in accordance with the relevant provisions of the Treaties. (2) The internal market shall comprise an area without internal frontiers in which the free movement of goods, persons, services and capital is ensured in accordance with the provisions of the Treaties. (3) The Council, on a proposal from the Commission, shall determine the guidelines and conditions necessary to ensure balanced progress in all the sectors concerned.” Article 114 of the TFEU: (1) “Save where otherwise provided in the Treaties, the following provisions shall apply for the achievement of the objectives set out in Article 26. The European Parliament and the Council shall, acting in accordance with the ordinary legislative procedure and after consulting the Economic and Social Committee, adopt the measures for the approximation of the provisions laid down by law, regulation or administrative action in Member States which have as their object the establishment and functioning of the internal market. … (3) The Commission, in its proposals envisaged in paragraph 1 concerning health, safety, environmental protection and consumer protection, will take as a base a high level of protection, taking account in particular of any new development based on scientific facts. Within their respective powers, the European Parliament and the Council will also seek to achieve this objective.” - Article 168(1) of the TFEU: “A high level of human health protection shall be ensured in the definition and implementation of all Union policies and activities.Union action, which shall complement national policies, shall be directed towards improving public health, preventing physical and mental illness and diseases, and obviating sources of danger to physical and mental health. Such action shall cover the fight against the major health scourges, by promoting research into their causes, their transmission and their prevention, as well as health information and education, and monitoring, early warning of and combating serious cross-border threats to health. The Union shall complement the Member States' action in reducing drugs-related health damage, including information and prevention.” - Article 11 of the Charter (Freedom of Expression and Information): “Everyone has the right to freedom of expression. This right shall include freedom to hold opinions and to receive and impart information and ideas without interference by public authority and regardless of frontiers.” Article 35 of the Charter (Health Care): “Everyone has the right of access to preventive health care and the right to benefit from medical treatment under the conditions established by national laws and practices. A high level of human health protection shall be ensured in the definition and implementation of all Union policies and activities.” Article 52(1) of the Charter: “Any limitation on the exercise of the rights and freedoms recognised by this Charter must be provided for by law and respect the essence of those rights and freedoms. Subject to the principle of proportionality, limitations may be made only if they are necessary and genuinely meet objectives of general interest recognised by the Union or the need to protect the rights and freedoms of others.” Article 24(2) of the TPD: “This Directive shall not affect the right of a Member State to maintain or introduce further requirements, applicable to all products placed on its market, in relation to the standardisation of the packaging of tobacco products, where it is justified on grounds of public health, taking into account the high level of protection of human health achieved through this Directive. Such measures shall be proportionate and may not constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States. Those measures shall be notified to the Commission together with the grounds for maintaining or introducing them.” Article 24(3) of the TPD: “A Member State may also prohibit a certain category of tobacco or related products, on grounds relating to the specific situation in that Member State and provided the provisions are justified by the need to protect public health, taking into account the high level of protection of human health achieved through this Directive. Such national provisions shall be notified to the Commission together with the grounds for introducing them. The Commission shall, within six months of the date of receiving the notification provided for in this paragraph, approve or reject the national provisions after having verified, taking into account the high level of protection of human health achieved through this Directive, whether or not they are justified, necessary and proportionate to their aim and whether or not they are a means of arbitrary discrimination or a disguised restriction on trade between the Member States. In the absence of a decision by the Commission within the period of six months, the national provisions shall be deemed to be approved.” Article 7 of the TPD (Regulation of Ingredients): “Member States shall prohibit the placing on the market of tobacco products with a characterising flavor.” Article 18 of the TPD (Cross-border distance sales of tobacco products): “Member States may prohibit cross-border distance sales of tobacco products to consumers. Member States shall cooperate to prevent such sales. Retail outlets engaging in cross-border distance sales of tobacco products may not supply such products to consumers in Member States where such sales have been prohibited. Member States which do not prohibit such sales shall require retail outlets intending to engage in cross-border distance sales to consumers located in the Union to register with the competent authorities in the Member State, where the retail outlet is established, and in the Member State, where the actual or potential consumers are located. Retail outlets established outside the Union shall be required to register with the competent authorities in the Member State where the actual or potential consumers are located.” Article 13(1) of the TPD: “The labeling of unit packets and any outside packaging and the tobacco product itself shall not include any element or feature that: (a) promotes a tobacco product or encourages its consumption by creating an erroneous impression about its characteristics, health effects, risks or emissions; labels shall not include any information about the nicotine, tar or carbon monoxide content of the tobacco product; (b) suggests that a particular tobacco product is less harmful than others or aims to reduce the effect of some harmful components of smoke or has vitalising, energetic, healing, rejuvenating, natural, organic properties or has other health or lifestyle benefits; (c) refers to taste, smell, any flavourings or other additives or the absence thereof; (d) resembles a food or a cosmetic product; (e) suggests that a certain tobacco product has improved biodegradability or other environmental advantages.”
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