World Trade Organization Rejects U.S. Appeal, Rules that Ban on Flavored Cigarettes (But Not Menthol) is Discriminatory and Violates Trade Agreements

An appeals panel of the World Trade Organization (WTO) yesterday upheld an earlier decision of the WTO which found that the United States' ban on flavored cigarettes, with an exemption for menthol cigarettes, is discriminatory and therefore violates a number of international trade agreements.

This ruling confirms my earlier analysis, in which I concluded that: "the Family Smoking Prevention and Tobacco Control Act's ban on flavored cigarettes - including clove cigarettes - but with an exemption for menthol cigarettes does violate international trade agreements. Specifically, it violates Articles 2.1 and 2.2 of the Technical Barriers to Trade Agreement, Article 3.4 of the General Agreement on Tariffs and Trade, and Articles 5.4 and 5.5 of the Agreement on the Application of Sanitary and Phytosanitary Measures. Moreover, not only is the U.S. appeal of the WTO's decision flawed in its defense of the discriminatory treatment of menthol cigarettes vs. clove cigarettes, but the appeals brief essentially admits that the reason for the differential treatment of these products was political, not based on public health concerns."

The Rest of the Story

The rest of the story is that the hypocrisy of the national anti-smoking groups and politicians who crafted the Tobacco Act has now been thoroughly exposed. The Tobacco Act was largely a political show-piece, designed to make it look like anti-smoking groups and politicians are taking on Big Tobacco, when in fact they are protecting the domestic cigarette market.

There was no public health rationale for exempting menthol cigarettes, which are smoked by half of youth smokers and by 75% of African-American smokers, but banning chocolate, strawberry, cherry, clove, pineapple, and banana cigarettes, which were smoked by less than 0.01% of smokers.

The U.S. now has three options:

1. It can comply with the WTO ruling by repealing the ban on flavored cigarettes.

2. It can comply with the WTO ruling by extending the flavored cigarette ban to include menthol cigarettes, thus eliminating the discriminatory treatment of clove cigarettes.

3. It can ignore the WTO ruling, continue to enforce the ban on flavored cigarettes other than menthol, and risk retaliation by Indonesia.

My guess is that the U.S. will choose the third option. We have never seemed to have much trouble thumbing our noses at the rest of the world, and I don't see any reason why we would stop now.