WT/DS435/23  
 
25 July 2018  
(18-4720) Page: 1/6 
  Original: English  
 
AUSTRALIA – CERTAIN MEASURES CON CERNING TRADEMARKS,  
GEOGRAPHICAL INDICAT IONS AND OTHER PLAIN  PACKAGING REQUIREMEN TS 
APPLICABLE TO TOBACC O PRODUCTS AND PACKA GING  
NOTIFICATION OF AN A PPEAL BY HONDURAS UN DER ARTICLE 16.4 AND  ARTICLE 17  
OF THE UNDERSTANDING  ON RULES AND PROCEDU RES GOVERNING THE  
SETTLEMENT OF DISPUT ES (DSU), AND UNDER RULE 20(1) OF THE  
WORKING PROCEDURES F OR APPELLATE REVIEW  
The following communication, dated 19 July 2018 , from the delegation of Honduras, is  being 
circul ated to Members.  
 
_______________  
 
 
Pursuant to Articles 16.4 and 17 of the Understanding on Rules and Procedures Governing the 
Settlement of Disputes ("DSU") and Rule 20 of the Working Procedures for Appellate Review 
(WT/AB/WP/6, 16 August 2010) ("Working  Procedures"), Honduras hereby notifies the Dispute 
Settlement Body ("DSB") of its decision to appeal certain issues of law and legal interpretation in 
the Panel Report in Australia – Certain Measures Concerning Trademarks, Geographical Indications 
and Oth er Plain Packaging Requirements Applicable to Tobacco Products and Packaging 
(WT/DS435)  ("Panel Report").  
Pursuant to Rules 20(1) and 21(1) of the Working Procedures, Honduras files this Notice of Appeal 
together with its Appellant Submission with the Appe llate Body Secretariat.  
Pursuant to Rule 20(2)(d)(iii) of the Working Procedures,  this Notice of Appeal includes an 
indicative list of the paragraphs of the Panel Report containing the alleged errors, without 
prejudice to Honduras' ability to rely on other  paragraphs of the Panel Report in its appeal.  
Honduras seeks the Appellate Body's review of the Panel's conclusions that Honduras has not 
demonstrated that Australia's Tobacco Plain Packaging measures, as identified in Honduras' 
request for the establish ment of a panel (the "TPP measures" or "plain packaging measures"), are 
inconsistent with Australia's obligations under Articles 20 and 16.1 of the Agreement on 
Trade -Related Aspects of Intellectual Property Rights ("TRIPS Agreement");1 and Article 2.2 of the 
Agreement on Technical Barriers to Trade ("TBT Agreement").2  
In particular, Honduras has identified the following errors of law and legal interpretation, including 
the failure of the Panel to make an objective assessment of the matter as required by A rticle 11 of 
the DSU.  
I. REVIEW OF THE PANEL' S FINDINGS UNDER THE  TRIPS AGREEMENT  
 1. The Panel's interpretation and application of the term "unjustifiably" in 
Article 20 of the TRIPS Agreement is in error  
Honduras appeals the Panel's finding that Hondura s has not demonstrated that the TPP measures 
are inconsistent with Article 20 of the TRIPS Agreement since this finding is based on an erroneous 
                                                
1 Panel Report, paras. 8.1(d) and (e).  
2 Panel Report, para. 8.1(a).  WT/DS435/23  
 
- 2 - 
 
  legal interpretation of the term "unjustifiably" in Article 20. In addition, and in the alternative, the 
Panel' s application of Article 20 of the TRIPS Agreement to the plain packaging measures 
constitutes an error of law.  
First, the Panel's interpretation of the term "unjustifiably" as referring to "good reasons" sufficient 
to support special requirements encumbering the use of a trademark is in error.3 The Panel fails to 
interpret the term "unjustifiably" on the basis of its ordinary meaning, in the context of Section  2 
of the TRIPS Agreement on trademarks, and in the light of the object and purpose of the  
TRIPS  Agreement. In addition, the Panel errs in law in its analysis by finding that paragraph 5 of 
the Doha Declaration on the TRIPS Agreement and Public Health constitutes a subsequent 
agreement under Article 31.3(a) of the Vienna Convention on the Law o f Treaties.4 
Second, and in the alternative, should the Appellate Body find that the Panel's legal interpretation 
was correct, the Panel errs in law in the application of Article 20 of the TRIPS Agreement to the 
plain packaging measures.5 In particular, am ong others:  
 The Panel errs in its failure to focus the analysis on the impact on the distinguishing 
function of a trademark.6  
 The Panel errs in its application of Article 20 of the TRIPS Agreement to the product as 
its finding are focused on the packagin g only.7  
 The Panel errs in its examination of available alternative measures that are less 
trademark encumbering while providing an equivalent contribution;8  
 The Panel errs by relying on non -covered agreements to justify the plain packaging 
measures.9  
Honduras requests the Appellate Body to reverse the Panel's findings under Article 20 of the 
TRIPS  Agreement, which are vitiated by the above errors of law and legal interpretation,10 and 
thus to declare moot and of no legal effect the Panel's findings that  Honduras has not 
demonstrated that the TPP measures are inconsistent with Article 20 of the TRIPS Agreement.11 
 2. The Panel's interpretation and application of the "rights conferred" under 
Article 16.1 of the TRIPS Agreement is in error  
Honduras appeals the Panel's finding that Honduras has not demonstrated that the TPP measures 
are inconsistent with Article 16.1 of the TRIPS Agreement.12 This finding is based on an erroneous 
legal interpretation of the "rights conferred" by Article 16.1 and the related ob ligation on Members 
to ensure the minimum guaranteed level of protection for trademark owners, and is vitiated by an 
error of law in the application of Article 16.1 of the TRIPS Agreement to the plain packaging 
measures.  
First, the Panel's interpretation of Article 16.1 of the TRIPS Agreement on the "rights conferred" to 
trademark owners is in error, as the Panel fails to interpret this provision in good faith, based on 
the ordinary meaning of all of the terms used, in their context, and in the light of th e object and 
purpose of the TRIPS Agreement.13 The Panel's erroneous approach led to a number of related 
errors of law, including among others the following:  
                                                
3 Panel Report, paras. 7.2394 -7.2396, 7.2430, and related paras. 7.2439 -7.2442, and 7.2492 -7.2508.  
4 Panel Report, paras. 7.2409 -7.2411.  
5 Panel Report, paras. 7.2556 -7.2574, 7.2586 -7.2589, and 7.2590 -7.2606.  
6 See, e.g. Panel Report, paras. 7.2569 -7.2571, and 7.2604 -7.2606.  
7 See, e.g. Panel Report, para. 7.2570.  
8 See, e.g. Panel Report, paras. 7.2600 -7.2601.  
9 See, e.g. Panel Report, paras. 7.2595 -7.2596, and 7.2604.  
10 See, e.g. Panel Report, paras. 7.2393 -7.2431, and 7.2556 -7.2606.  
11 Panel Report, para s. 7.2606, and 8.1(e).  
12 Panel Report, para. 8.1(d).  
13 Panel Report, paras. 7.1966 -7.2032, and 7.2051.  WT/DS435/23  
 
- 3 - 
 
   The Panel errs in finding that Article 16.1 of the TRIPS Agreement does not protect 
the distinctive ness of a trademark.14  
 The Panel errs in finding that Article 16.1 of the TRIPS Agreement is not engaged and 
can therefore not be violated unless there is a risk of actual confusion.15  
Second, the Panel errs in its application of Article 16.1 of the TRIPS Agreement to the plain 
packaging measures as it does not consider it necessary to address the relevant question of 
whether the plain packaging measures reduce the distinctiveness of the trademark and its scope of 
protection such that the level of protectio n falls below the minimum level that Members are 
required to guarantee under Article 16.1 of the TRIPS Agreement.16 The Panel's erroneous exercise 
of judicial economy is an error of law. In addition, as a result of this false exercise of judicial 
economy, t he Panel also fails to comply with its obligation under Article 11 of the DSU to make an 
objective assessment of the matter.  
Honduras requests the Appellate Body to reverse the Panel's findings which are vitiated by the 
above errors of law and legal interp retation, and thus to declare moot and of no legal effect also 
the Panel's finding that Honduras has not demonstrated that the TPP measures are inconsistent 
with Australia's obligations under Article 16.1 of the TRIPS Agreement.17  
II. REVIEW OF THE PANEL' S FINDINGS UNDER ARTIC LE 2.2 OF THE TBT AG REEMENT  
Honduras appeals the Panel's finding that Honduras has not demonstrated that the plain packaging 
measures are inconsistent with Article 2.2 of the TBT Agreement.18 The Panel's finding is vitiated 
by a number of errors of law and legal interpretation with respect to each aspect of the enquiry 
under Article 2.2 of the TBT Agreement relating to (1) the trade -restrictive nature of the plain 
packaging measures; (2) the d egree of contribution by the plain packaging measures to the 
legitimate objective of Australia; and (3) the availability of less trade -restrictive alternative 
measures that provide an equivalent contribution to that legitimate objective.  
 1. The Panel's in terpretation of the term "trade -restrictive" in Article 2.2 of the 
TBT Agreement and its application to the TPP measures is in error  
The Panel errs in its interpretation and application of the term "trade -restrictive" in Article 2.2 of 
the TBT Agreement , and Honduras therefore requests the Appellate Body to modify the Panel's 
conclusion that the plain packaging measures are trade restrictive.19 In particular, among others, 
the Panel commits the following errors of law and legal interpretation:  
 The Panel errs  in its finding that a modification or distortion of conditions of 
competition or the competitive opportunities for imported products is only a "trade" 
distortion if it de jure  restricts imports or is discriminatory in nature.20  
 The Panel errs in imposing a different and higher evidentiary standard of 
demonstrating actual trade effects for measures that are not challenged as being 
discriminatory in nature and by thus requiring that evidence must be adduced of 
actual trade effects of the plain packaging meas ures on prices and sales to 
demonstrate that this distortion amounts to a restriction on trade.21 
                                                
14 See, e.g. Panel Report, paras. 7.2005 -7.2016.  
15 See, e.g. Panel Report, paras. 7.2000, and 7.2010.  
16 Panel Report, paras. 7.2015, and 7.2032.  
17 Panel Report, para. 8.1(d).  
18 Panel Report, paras. 8.1(a), and 7.1724 -7.1732.  
19 Panel Report, paras. 7.1071 -7.1089, and 7.1160 -7.1255.  
20 Panel Report, paras. 7.1166 -7.1168, 7.1196 -7.1197, 7.1214 -7.1218, and 7.1255.  
21 Panel Report, paras. 7.1074 -7.1075, 7 .1166, 7.1208, and 7.1255.  WT/DS435/23  
 
- 4 - 
 
   2. The Panel's application of the legal standard with respect to the degree of 
contribution to the TPP measures is in error  
The Panel errs in its application of the legal standard for assessing the degree of contribution of 
the plain packaging measures.22 In particular, among others, the Panel commits the following 
errors:  
 The Panel errs by examining the degree of contribution of the measures to the specific 
"mechanisms" by which the measures were expected to achieve the objective rather 
than by examining the degree of contribution to the fulfilment of the legitimate 
objective as identified.23  
 The Panel errs when failing to examine the "actual" contribution of t he plain packaging 
measures instead basing its finding on unsubstantiated speculation about an uncertain 
future impact of the measures "over time" without any qualitative or quantitative 
projections supported by sufficient evidence.24 
 The Panel errs by not determining the degree of contribution of the challenged plain 
packaging measures themselves.25 
 The Panel errs in its application of the legal standard it set for itself for examining the 
evidence.26  
Honduras requests the Appellate Body to reverse the Panel 's findings on the degree of contribution 
of the plain packaging measures since these are vitiated by the above errors of law and legal 
interpretation.27 
 3. The Panel errs in law in its interpretation and application of Article 2.2 of the 
TBT Agreement wit h respect to the availability of less trade -restrictive 
alternative measures  
The Panel errs in its interpretation and application of Article 2.2 of the TBT Agreement with respect 
to the availability of less trade -restrictive alternative measures that provi de an equivalent 
contribution to the legitimate objective.28 In particular, among others, the Panel commits the 
following legal errors:  
 The Panel errs in its interpretation and examination of whether the alternative 
measures that were presented by Honduras were less "trade restrictive" by failing to 
examine their impact on the conditions of competition and on competitive 
opportunities, instead unduly focusing on their degree of contribution to the 
objective.29  
 The Panel errs in its interpretation and application of the legal standard for assessing 
whether the alternative measures provided an "equivalent" contribution to the 
challenged measures. In particular:  
o The Panel fails to examine the degree of contributio n of the proposed alternative 
measures in light of the legitimate objective as identified;30 
                                                
22 Panel Report, paras. 7.483 -7.1045.  
23 See, e.g. Panel Report, paras. 7.1024 -7.1034.  
24 Panel Report, para. 7.1044.  
25 See, e.g. Panel Report, paras. 7.974, 7.1036, and 7.1043.  
26 See, e.g. Panel Report, paras. 7.499, 7.622, 7.643 -644, 7.660, 7.695, and 7.697.  
27 Panel Report, paras. 7.1024 -7.1045, and 7.1724 -7.1732.  
28 Panel Report, paras. 7.1362 -7.1723, and 7.1724 -7.1732.  
29 See, e.g. Panel Report paras. 7.1411 -7.1417 (MLPA); and 7.1490 -7.1495 (Taxation increase).  
30 See, e.g. Panel Report, paras. 7.232. (Defining the legitimate objective); 7.1459 -7.1460, 7.1464, 
7.1468 -1471 (MLPA); and 7.1526 -7.1527, 7.1531, 7.1542 -7.1545 (Taxation increase).  WT/DS435/23  
 
- 5 - 
 
  o The Panel errs by requiring that the alternative measures provide an identical 
contribution as a "substitute" to the challenged measures, rather than an 
"equivalent " contribution;31  
o The Panel errs by requiring a greater degree of contribution by the proposed 
alternatives;32 and 
o The Panel errs when applying a different standard for assessing equivalence 
depending on whether a measure is part of a suite of measures.33   
Honduras requests the Appellate Body to reverse the Panel findings on the availability of less trade 
restrictive alternative measures which are vitiated by the above errors of law and legal 
interpretation.34  
III. REVIEW OF THE PANEL' S ASSESSMENT OF THE EVIDENCE ON THE DEGREE OF 
 CONTRIBUTION OF THE TPP MEASURES  
Honduras requests the Appellate Body's review of the assessment the Panel made of the evidence 
that was presented on the degree of contribution of the plain packaging measures to the 
achievement of A ustralia's identified legitimate objective. Honduras submits that the Panel fails to 
conduct an "objective examination" of the evidence on the plain packaging measures' contribution 
to the objective of reducing the use of tobacco products in violation of i ts obligation under 
Article  11 of the DSU. In particular, among others:  
 The Panel fails to provide a reasoned and adequate explanation of how the facts 
before it supported the conclusion that the plain packaging measures were apt to, and 
do, make a meaning ful contribution to their legitimate objective because, inter alia : 
o The Panel's own findings on actual smoking behaviour, proximal and distal 
outcomes do not support its conclusion.35  
o The Panel's intermediate findings on the effect of the plain packaging measures 
are not based on the totality of the evidence on the record and are not supported 
by a reasoned and adequate explanation;  
o The Panel's findings on the effects of the measures " over time" are not based on 
any quantitative or qualitative analysis or reasoned explanation supported by 
sufficient evidence;  
o The Panel's intermediate findings on the relevance of the behavioural science 
theories are internally inconsistent and not suppor ted by a reasoned and 
adequate explanation;  
o The Panel's findings on the contribution of the measures to the reduction in cigar 
smoking do not have a sufficient basis in the evidence on the record and are not 
supported by a reasoned and adequate explanatio n.  
 The Panel disregards, ignores and misrepresents the evidence presented by the 
complainants.  
                                                
31 See, e.g. Panel Report, paras. 7.1455 -7.1461, 7.1464 (MLPA); and 7.1526 -7.1527, 7.1529, 7. 1531 
(Taxation increase).  
32 See, e.g. Panel Report, paras. 7.1376, 7.1391, 7.1461, 7.1528, and 7.1721 -7.1722.  
33 Panel Report, paras. 7.1376 -7.1391.  
34 See, e.g. Panel Report, paras. 7.1468 -7.1471 (MLPA); 7.1542 -7.1545 (Taxation increase); and 7.1724 -
7.1732 (Overall conclusion).  
35 Panel Report, paras. 7.945 -7.958 and Appendix A (Proximal outcomes); 7.959 -7.963 and Appendix B 
(Distal outcomes); 7.968 -7.972 and Appendix C (Smoking prevalence); paras. 7.973 -7.979 and Appendix D 
(Consumption and sales impact); 7. 980-7.986 and 7.1024 -7.1045 (Overall conclusions); see also Panel 
Report: Appendix A, paras. 86-87; Appendix B, paras. 120 -121; Appendix C, paras. 123 -124; and Appendix D, 
paras. 137-138 (leading to the unqualified finding in para. 7.1043 of the Panel Repo rt on actual smoking 
behaviour ). WT/DS435/23  
 
- 6 - 
 
   The Panel fails to examine the evidence on contribution in an even -handed manner 
and applies a double standard of proof in favour of Australia.  
 The Panel  fails to respect the due process rights of the parties by not exercising its 
authority under Article 14.2 of the TBT Agreement or Article 13 of the DSU to appoint 
a technical expert and by instead relying on a "ghost expert" raising alleged 
"robustness" concerns  not identified by any of the parties without ever offering the 
parties an opportunity to comment on or subsequently review the concerns and 
methodologies of this ghost expert.  
Honduras therefore requests the Appellate Body to reverse the Panel's findings  and conclusions 
relating to the degree of contribution of the measures in the Panel Report and its Appendices,36 as 
such findings were not the result of an objective assessment of the matter. The failure to 
objectively assess the evidence vitiates the Pane l's findings on the degree of contribution of the 
measures and thus its findings under Article 2.2 of the TBT Agreem ent and Article 20 of the 
TRIPS  Agreement, which should therefore be reversed.  
For this reason as well, Honduras requests the Appellate Bod y to declare moot and of no effect the 
Panel's findings that Honduras has not demonstrated that the TPP measures are inconsistent with 
Australia's obligations under Article 2.2 of the TBT Agreement,37 and the related finding that 
Honduras has not demonstrat ed that the TPP measures are inconsistent with Australia's obligations 
under Article 20 of the TRIPS agreement.38 
__________  
                                                
36 Panel Report, paras. 7.1024 -7.1045 and Appendices.  
37 Panel Report, paras. 7.1732, and 8.1(a).  
38 Panel Report, paras. 7.2606, and 8.1(e).