Protection of Public Health Under the Model Bilateral Investment Agreement (BIT) of Thailand: The Case of Tobacco

Abstract

This article deals with the issue of the protection of public health under the Model Bilateral Investment Treaty (BIT) of Thailand with regard to tobacco. The author briefly introduces a dispute between Thailand and the Philip Morris Group tobacco company. The author also explains the concept of public health in Thailand and its internal public health measures aiming to reduce the consumption of tobacco products with respect to WHO standards and Thai fiscal and customs measures. In the BIT Model of Thailand the phrase “Public Interest Protection” is used instead of “Public Health Protection”. Therefore, when this issue is interpreted, it is not clear whether “Public Interest Protection” has the same meaning as “Public Health Protection”. As BIT will mostly be interpreted in terms of trade and investment, it usually does not cover public health protection. As a result, the public health protection measures of Thailand are problematic. For example, tax and fiscal measures are ineffective methods of enforcement because they are viewed as trade barriers, which breaches WTO principles. This ambiguity and conflict in the public health protection of Thailand increases the risk of legal action by cigarette companies such as Phillip Morris, which may take legal action in arbitration with regard to BIT. Hence, to solve this problem, the BIT model of Thailand should be reformed and re-negotiated. For instance, BIT should include exceptions for investment protection involved with tobacco products.The author analyzes measures to reduce the consumption of tobacco in response to public health concerns. The author considers problems in the model BIT of Thailand, in particular tax and fiscal measures, the protection of investments, and the expropriation of trademark in violation of the principles of investment protection. The author also recommends reform of the Thai model BIT concerning the protection of public health.