Australian Government’s Attack on Trademarks Just Plain Wrong

In what could set a very dangerous precedent for the protection of intellectual property rights, the Australian government today announced, in what is fittingly described as the "world’s most draconian anti-smoking laws," that beginning January 2012 cigarettes will be sold in plain packages prohibiting any use of brand imagery.

If enacted, this proposal would not only usher in a new era of nanny-stateism in Australia, but would represent one of the most serious attacks on intellectual property rights seen in developed countries in recent years.

As I have written previously, plain packaging legislation would clearly violate the intellectual property rights of companies, through forbidding them from displaying their trademarks and thereby differentiating their products on the basis of said trademark. Private property rights ought to be sacrosanct in any democratic country. The right to own and enjoy property is a fundamental part of rights of people, and indeed we consider it an extension of human rights. The protection of property, both physical and intellectual, is critical to economic development, and is the most important guarantee of freedom we have.

Tobacco companies have created significant intellectual property rights through their trademarks, as demonstrated in the significant degree of ‘brand loyalty’ in the market, and plain packaging legislation would significantly erode the value of these property rights. By denying tobacco companies their right to use their trademark to identify their product, this Bill strikes at the very core principles of corporate identity and consumer information that the modern western economies are based upon. As such, it not only violates the legal rights of the companies affected, but furthermore sets a very dangerous principle for the future of a government unwilling to honor or respect intellectual property rights. And this doesn’t even begin to note how important trademarks are to prevent counterfeiting.

Once we accept the premise that a government can strip a company of its intellectual property rights at whim, we embark upon a very slippery slope, with potentially disastrous economic consequences.

The Property Rights Alliance wrote an extensive submission to the Australian Senate on this matter, which you can download