Directive 2014/40/UE, also called the ‘‘European Tobacco Products Directive’’, seeks to implement the WHO’s Framework Convention on Tobacco Control of May 2003, as well as to harmonize the legislations relating to the manufacture, the presentation and the sale of tobacco products within the EU, in order to ‘‘give high importance to health protection, in particular, to reduce smoking prevalence among young people.’’ The scope of the new measures is broad: prohibition of flavorings, ingredient regulation, increasing number of warning, health and information messages, regulation of the use of the electronic cigarette…
Article 13 of the Directive prohibits the use of five types of messages on packages, specifically those that 1/ promote a tobacco product or encourage its consumption by creating an erroneous impression about its characteristics; 2/ suggest that a particular tobacco product is less harmful than others; 3/ refer to taste, smell, any flavorings or other additives; 4/ resemble a food or a cosmetic product; 5/ suggest that a certain tobacco product has improved biodegradability. Trademarks are explicitly covered and may therefore be prohibited.
The transposition of the European Tobacco Products Directive in France
Transposition Order No. 2016-623 of May the 19th, 2016 inserted Article L. 3512-21 in the Public Health Code in relation to promotional trademarks, which took over only two of the five prohibitions provided by the Directive (namely, the 1st and the 4th ones).
The Article then refers to a future regulatory text that will have to identify the prohibited ‘‘main categories of components or devices that contribute to the promotion of tobacco products.’’ This has been done by Decree No. 2016-1117 of August 14th 2016 which has inserted Article R. 3512-30 in the Public Health Code.
Article 2 of the Transposition Order lays down the measures controlling promotional trademarks through the approval order on the tobacco product prices that Article 572 of the General Tax Code provides. In other words, promotional trademarks will no longer be approved, which will lead to prevent their use.
Pursuant to the Transposition Order, the Ministry of Health has made it clear to tobacco manufacturers that the references considered as promotional will be identified and disapproved on the expiration of a period of one year for cigarettes and two years for cigars. This measure has been implemented with some hastiness by the Approval Order on Prices of February the 1st, 2017. The references ‘‘Vogue’’, ‘‘Fine’’, ‘‘Café Crème’’ have been disapproved, as well as, more broadly, references containing certain entries (slim, bio, boost, etc).
The undermining effect of trademark law
This disapproval deprives owners from using their trademarks and, eventually, expropriates them for reasons of public health.
Following a number of summary requests on grounds of abuse of authority, the Administrative Supreme Court (‘‘Conseil d’Etat’’) has decided to annul Article 2 of the Order, in its Decision No. 401536 of May the 10th, 2017, while dismissing some of the objections that were raised. In fact, ‘‘as the government neither defined the essential conditions for the exercise of that right nor did It provide
transitional measures for existing trademarks, it afforded no guarantee of protection for trademarks and company names’’. The Administrative Supreme Court has thus condemned the lack of legal guidance regarding the control of promotional trademarks.
Going still further, the Administrative Supreme Court has questioned whether the provisions of the Direction comply with the rights and fundamental freedoms, ruling that a serious question of interpretation was raised and, thus, deciding to refer several questions to the Court of Justice, registered under No. C-288/17.
The two first questions sought to determine whether the prohibition of promotional trademarks is consistent with the right of ownership, the freedom of speech, the freedom of trade as well as the principles of proportionality and legal certainty.
The Court will thus have to rule on the principle of the prohibition itself in relation to all promotional trademarks.
Is the standardization of the cigarette packages consistent with trademark law?
The third question referred to the Court of Justice does not deal with promotional trademarks, but with the standardization of the packaging of tobacco products, and, more specifically, with the conditions upon which a Member State can impose such a standardization without infringing the above-mentioned rights and fundamental freedoms.
The European Tobacco Products Directive did not contain any provision regarding the standardization of the packaging of tobacco products, but Article 24 allowed Member States to introduce it ‘‘whether it is justified on grounds of public health’’. The French Government has raised this provision in order to impose the standardization of cigarette packages through Decree No. 2016-334 of Mach the 21st, 2016.
New Article R. 3512-26 of the Public Health Code gives a limitative list of mentions that can be affixed on packages, including ‘‘the name of the trademark’’.
This provision has some consequences in the field of Intellectual Property law since it prohibits the use of every non-verbal trademark on cigarette packages, including figurative trademarks (logo or drawing) and semi-figurative trademarks (combination of a drawing and a text).
The prohibition of promotional trademarks and the standardization of the cigarette packages together could, as a result, prevent manufacturers from all the possibilities that they have to individualize their products, as it has been noted by the Administrative Supreme Court: ‘‘as soon as conditioning units are standardized […] notably by excluding figurative and semi-figurative trademarks, manufacturers, in order to meet the requirements provided by Article 13 of the Direction, will no longer be able to use a brand name and, thus, individualize their products through other distinctive signs.’’
Trademark law could eventually force the French government to bring order to its anti-smoking policy.