TOBACCO CONTROL LAWS

Honduras v. Dominican Republic

Honduras challenged the Dominican Republic's general measures relating to import and sale of imported cigarettes, including a stamp requirement, import surcharges, foreign exchange fees, a consumption tax, and a bond requirement. A WTO Panel found that the stamp requirement, the transitional surcharge, the foreign exchange fee, and the selective consumption tax each violated international trade law. However, the Panel found that Honduras did not demonstrate that the bond requirement imposed on cigarette importers violates international trade law.

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Honduras v. Dominican Republic, WT/DS302/P/R, World Trade Organization (WTO) Panel Report (2004).

  • Dominican Republic
  • Nov 26, 2004
  • World Trade Organization Panel
View Case History

Parties

Plaintiff Honduras

Defendant Dominican Republic

Third Party

  • Chile
  • China
  • El Salvador and Nicaragua
  • European Communities
  • Guatemala
  • United States

Legislation Cited

Decree 130-02

Decree 646-03

Decree 693-03

Decree 79-03

Tax Code (Código Tributario de la República Dominicana)

International/Regional Instruments Cited

WHO Framework Convention on Tobacco Control (WHO FCTC)
General Agreement on Tariffs and Trade 1994 (GATT)

Related Documents

None

Type of Litigation

Challenge to Government Policies Relating to Tobacco Control/Public Health
Tobacco companies or front groups may challenge any legislative or regulatory measure that affects their business interests. Unlike public interest litigation, these cases seek to weaken health measures. These cases frequently involve the industry proceeding against the government. For example, a group of restaurant owners challenging a smoke free law as unconstitutional.
Trade Panel/Investment Tribunal/Arbitration
Governments may bring complaints before intergovernmental bodies on tobacco-related issues. For example, one country may complain that another country’s tax regime discriminates against its exported tobacco products. In some cases, a treaty may allow a private party to file a complaint against a government before an intergovernmental body.

Tobacco Control Topics

Price and Tax Measures
Tax or price measures, including tax- and duty-free regulation. (See FCTC Art. 6)
Illicit Trade
Measures relating to illicit trade, including smuggling, illicit manufacturing and counterfeiting. (See FCTC Art. 15)

Substantive Issues

Right to Commerce
A violation of the right to carry on trade, business, or profession of a person’s choice. This right may also be called the right to free enterprise or economic freedom. The industry may argue that a business should be able to conduct its business without government regulation, including whether or not to be smoke free.
Trade Violation
A claim of an infringement of any international trade agreement, including General Agreement on Tariffs and Trade (GATT), Technical Barriers to Trade (TBT), Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), or bilateral treaties.
Encourage Illicit Trade
Regulatory measures may lead to an increase in illegal sales, such as counterfeit products. The industry may also argue that such illicit trade will reduce tobacco tax revenue.

Type of Tobacco Product

None

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