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Balderas Woolrich v. Mexico [Mexico] [March 28, 2011]
The plaintiff, a Mexican national, presented an appeal for legal protection, arguing that 1) certain modifications and derogations of the General Health Law (Ley General de Salud) in favor of tobacco consumption constitute a violation of the constitutional right to health and of the American Convention on Human Rights and 2) the present tobacco control law, General Law for Tobacco Control (Ley General para el Control del Tabaco), does not establish sufficient protections for the right to health and does not comply with the minimum levels of protection required by the Framework Convention on Tobacco Control. Although the Court determined that the claims do affect the legal interest of the plaintiff and recognized the right to health, the Court dismissed the case on procedural grounds.
Winsa S.A. v. Mexico [Mexico] [June 29, 2009]
A Mexican food establishment, Winsa, filed an appeal for legal protection, claiming the Law Regulating Commerce in the Federal District (Ley para el Funcionamiento de Establecimientos Mercantiles en el Distrito Federal) was unconstitutional and violated the Mexican Constitution, which guarantees the right to equal protection. The articles at issue mandate that places selling food and drinks to the public for local consumption must be free of all tobacco smoke. The Court held that since these articles applied to all commercial establishments and there was no discrimination, the articles were not in violation of the Constitution.
Hamdan Amad, Faudi, et al. v. Mexico [Mexico] [June 29, 2009]
The plaintiffs, a group of Mexican citizens, presented an appeal for legal protection claiming that, as persons addicted to smoking, the smoke-free laws violated their constitutional rights by making all closed public spaces smoke-free. The Court dismissed the claim finding that the plaintiffs' addiction to tobacco did not justify their smoking in closed public spaces and that they had the freedom to smoke in other spaces.
Operadora de Centros de Espectáculos, S.A. de C.V. v. Mexico [Mexico] [January 29, 2009]
The plaintiff, an entertainment firm, requested an appeal for legal protection against a clause in a law on commercial establishments, which prohibits the sale of tobacco in entertainment venues. The plaintiff claimed this provision violated the right to commerce. The Court found that the law did violate the right to commerce because the limitation violated the principle of proportionality and necessity.
Comercial Hotelera Mexicana de Occidente, S.A. v. Mexico [Mexico] [September 28, 2008]
The plaintiff, Comercial Hotelera Mexicana de Occidente, S.A. de C.V., a Mexican hotel chain, filed an appeal for legal protection against Article 10(XV) of the Law for the Operation of Commercial Establishments in the Federal District (Ley para el Funcionamiento de Establecimientos Mercantiles del Distrito Federal), a clause that prohibits the sale of tobacco and all its derivatives in commercial establishments in both the hotel and restaurant industry. The plaintiff argued that this clause violated the right to commerce found in Article 7 of the Mexican Constitution. The Court found that the law did violate the right to commerce because the prohibition only applies to a few commercial establishments. Because the law did not regulate any other industries, the Court concluded that the law was discriminatory and constituted an unjustifiable and inefficient means of decreasing tobacco consumption.
Televisión Azteca, S.A. de C.V. v. Mexico [Mexico] [December 20, 2004]
The plaintiffs presented an appeal for legal protection, alleging that an article of the General Health Law violated the right to a hearing. The Ministry of Health had issued this article to regulate the advertisement of tobacco and alcoholic beverages. The Court found that the law had followed the administrative procedures necessary for sanitary control and public health laws, holding that the Ministry of Health is competent to create such a regulation and dismissed the plaintiff's claim.
Philip Morris México, S.A. de C.V. v. Mexico [Mexico] [May 19, 2004]
Philip Morris Mexico presented an appeal for legal protection claiming that an advertising regulation exceeded the scope of the originating law. The law establishes that the Ministry of Health must authorize any advertisement or promotion regarding health-related products, such as alcohol and tobacco. The regulation states that this authorization is necessary not only for tobacco products, but for any products pertaining to a tobacco brand. The Court held that the regulation does not exceed the scope of the law because indirect advertisement and the use of brands can lead to the consumption of products like tobacco that are harmful to people's health.
Feldman v. Mexico [Mexico] [December 16, 2002]
The claimaint, a US citizen and permanent resident of Mexico, operated a cigarette exporting business from Mexico. He sought damages from Mexico, alleging that various government taxation measures had resulted in a creeping expropriation of his property in contravention of Article 1110 of the North American Free Trade Agreement (NAFTA). The claimant further alleged that Mexico's taxation measures violated NAFTA Articles 1102 (national treatment) and 1105 (minimum level of treatment).
The facts of the case are somewhat convoluted; essentially, at all material times Mexico imposed a tax on the domestic sale and production of cigarettes, but no tax exported cigarettes. Domestic producers and re-sellers of cigarettes were still required to pay the tax, but were entitled to a rebate on export.
Due to industry agreements in the domestic market, the claimant's company was not able to buy cigarettes directly from producers but was forced to purchase them from bulk sellers such as Walmart. The cigarettes purchased by the company included the amount of the domestic tax, but the claimant was not always able to obtain the rebate on export because the invoices it supplied did not separately identify the amount of the tax. This led to a long-running dispute with the Mexican government: at various times the company was paid rebates notwithstanding the deficient invoices; at other times it was not. The law always remained the same but the enforcement of it changed from time to time. Finally, in December 1997, the law was amended to bar rebates to cigarette resellers such as the claimant's company, limiting rebates to the "first sale" in Mexico.
The Tribunal found that Mexico's taxation measures did not result in an indirect expropriation of the claimant's property because, amongst other things, the taxation measures were within the police power of the state: not every business problem experienced by an investor amounts to an expropriation. Further, neither NAFTA nor customary international law required Mexico to permit a "grey market" in cigarettes. The taxation measure could be rationally explained as directed to discouraging smuggling back into Mexico and to maintain high cigarette taxes to discourage smoking.
Notwithstanding that the claimant was unsuccessful on the expropration claim, the Tribunal found in his favor on the national treatment claim. The Tribunal found that there were domestic resellers in like circumstances with the claimant that were accorded more favorable treatment, because they were granted rebates at a time when the claimant was refused them. The claimant was accordingly awarded $9,464,627.50 Mexican pesos in damages, plus interest.
Note that Tribunal Member Mr Jorge Covarrubias Bravo dissented from this decision. The dissenting opinion, the Spanish language version of this decision, and other related decisions, are all uploaded here under "Related Documents".