Implications of International Investment Law for Plain Tobacco Packaging : Lessons from the Hong Kong–Australia BIT

This chapter uses the Hong Kong-Australia BIT as a case study to illustrate how plain packaging measures are likely to fare in international investment law. It examines in detail the investment claim made by Philip Morris Asia Limited ('PMA') against Australia under the BIT, including matters associated with the jurisdiction of an established arbitral tribunal, the relevance of potential local remedies and the nature of PMA's investment in Australia. In assessing Australia's options in light of the PMA claim, it is concluded that PMA likely has a relevant investment to found jurisdiction in a claim under the BIT, and that Australia would have difficulty extinguishing such a claim. In light of this, Australia may wish to consider modification of some of its BITs to clarify that the parties never intended public health measures to be caught by investor-State claims. It is further argued that the only breach of the Hong Kong-Australia BIT that PMA might be able to make out relates to expropriation, which is countered by evidence collected by the Australian government concerning the health effects of plain packaging. In the event of an adverse award against Australia, PMA may face enforcement difficulties for reasons of public policy and sovereign immunity