In response to last week’s plans by the government to restrict cigarette packaging to plain and standardised designs, the cigarette industry has warned that it will protect its intellectual property rights and claim compensation from the government. I saw a figure of $3 billion as a possible amount for that compensation. The government has denied that compensation would be needed. So who has the better case?
In my view, the government has the stronger position. No one is disputing that the government can restrict the appearance of packaging for goods; it already does this. But the government must pay compensation if it takes control over any property, and in this case the cigarette companies are complaining that they are losing some of their intellectual property rights, primarily their trademark and copyright intellectual property of their present cigarette packaging.