PJ Carroll & Company Ltd and Another v The Minister for Health and Others
| Jurisdiction | Ireland |
| Judge | Mr Justice Cian Ferriter |
| Judgment Date | 11 September 2023 |
| Neutral Citation | [2023] IEHC 669 |
| Court | High Court |
| Docket Number | Record No. 2022/1085 JR |
and
[2023] IEHC 669
Record No. 2022/1085 JR
THE HIGH COURT
JUDICIAL REVIEW
Judgment of Mr Justice Cian Ferriter delivered this 11 th day of September 2023
In these proceedings, the applicants challenge the State's transposition of an EU delegated directive concerning tobacco regulation, being Commission delegated directive (EU) 2022/2100 (the “delegated directive”). The applicants contend that the delegated directive is invalid as a matter of EU law on the basis that the European Commission (“the Commission”) in passing the delegated directive exceeded the powers delegated to it under under the provisions of Directive 2014/40/EU (the “Tobacco Products Directive” or “TPD”), contrary to Article 290 TFEU.
The terms of the delegated directive were transposed into Irish law, subsequent to the commencement of these proceedings, by S.I .335 of 2023 (the European Union (Manufacture, Presentation and Sale of Tobacco and Related Products) (Amendment) Regulations 2023) (“the 2023 Regulations”), which amended the European Union (Manufacture, Presentation and Sale of Tobacco Related Products) Regulations 2016 (SI 271 of 2016) (“the 2016 Regulations”) which in turn had transposed the provisions of the Tobacco Products Directive into Irish law. The 2023 Regulations amend the 2016 Regulations by providing that certain exemptions from prohibition on ingredients and certain packaging information and warning requirements (found in articles 7(12) and 11(6) of the TPD) do not apply to “heated tobacco products”. “Heated tobacco products” (“HTPs”) are defined in the delegated directive as essentially involving products which are “ heated to produce an emission containing nicotine and other chemicals, which is then inhaled by user(s)”. The 2023 Regulations stand to come into operation on 23 October 2023.
The principal relief sought in these judicial review proceedings is a declaration that the 2023 Regulations transposing the delegated directive into Irish law are ultra vires the powers conferred by s. 3 of the European Communities Act 1972 (as amended) and contrary to Article 15.2.1 of the Constitution. The applicants seek that declaration on the basis that the delegated directive is invalid as a matter of EU law and, therefore, the 2023 Regulations purporting to implement the delegated directive are also invalid. Accordingly, the essential issue in the proceedings is the validity or otherwise of the delegated directive.
The applicants invite the Court to request a preliminary ruling from the Court of Justice of the European Union (the “CJEU”) as to the validity of the delegated directive on the basis that the determination of that question is essential to the determination of these proceedings, it being common case that this Court has no jurisdiction to declare an EU act invalid.
The applicants are part of the British American Tobacco group of companies (“BAT”). BAT says that, while historically its main focus was on traditional tobacco products, it is increasingly focused on the development and sale of “non-combustible alternatives to conventional cigarettes for adult smokers who would otherwise continue to smoke”. This includes the development and sale of heated tobacco products both globally and within the EU.
The applicants' heated tobacco products are said by them to be non-combustible products which do not involve the burning of tobacco; rather, the tobacco in the heated tobacco product device is heated. BAT's heated tobacco device is marketed in the EU under the brand named “glo”. A user operates glo by inserting into the device a specially designed rod which the applicants say contains approximately half of the tobacco of a conventional cigarette. This tobacco rod is then heated without combustion, producing a nicotine-containing aerosol which the user inhales and exhales. The glo product is currently being sold in 14 countries within the EU. The applicants maintain that heated tobacco products, while containing tobacco, have a reduced risk profile relative to cigarettes.
The first named applicant is responsible for the importation, distribution and sale of BAT's tobacco products in Ireland. The first named applicant plans to market and sell heated tobacco products in Ireland, including those with “characterising flavours” (a concept defined in the TPD) and/or with components containing flavourings. For ease, I will refer to heated tobacco products with characterising flavours and/or with components containing flavourings as “flavoured heated tobacco products” or “flavoured HTPs”.
The second named applicant is a UK company which sells BAT's heated tobacco products to other companies in the BAT group which then act as the second named applicant's distributors in the EU Member State markets in which they operate. The second named applicant plans to supply the first named applicant with flavoured heated tobacco products for marketing and sale in Ireland.
The notice parties are all companies in the Philip Morris International group (“PMI”), another major international tobacco group. Together, BAT and PMI are responsible for the sale of virtually all of the HTPs in the EU. The notice parties were joined as notice parties to the proceedings by order of this Court of 22 March 2023, following a contested application. PMI has a significant market share of the HTP market in the EU. PMI currently has a significant commercial presence in Ireland through its conventional tobacco products and says that it has plans to market HTPs in Ireland in the future.
For ease, I will refer to the respondents as “the State”.
While the question of the applicants' standing to maintain those proceedings was put in issue in the State's opposition papers, that objection was not pursued at the hearing.
The first named applicant says it has invested significantly in the commercialisation of e-cigarettes in Ireland and currently holds approximately 10% of the Irish market for e-cigarettes. It has begun taking steps to commercialise heated tobacco products in Ireland, including flavoured heated tobacco products. It made pre-budget submissions to the Irish Government in relation to the tax treatment of, inter alia, heated tobacco products in 2021 and 2022. On 1 November 2020, the second named applicant submitted the requisite product notifications under regulation 24 of the 2016 Regulations to the “EU Common Entry Gate” system thereby paving the way for the introduction by it of HTPs in Ireland. The six-month clearing period under the product notification system expired on 1 May 2023.
I am satisfied that the applicants have standing to maintain these proceedings. They have taken proactive steps towards distributing and selling heated tobacco products for sale in the Irish market. The transposition of the delegated directive “ has or is imminently in danger of affecting [the applicants'] interests so as to cause or potentially cause injury or prejudice” to use the formulation of Clarke and O'Malley JJ in Grace v. An Bord Pleanála [2017] IESC 10 at para. 5.4.
PMI says that the transposition by Ireland of the delegated directive will severely impact its plan to market HTPs in Ireland, and that the implementation of the delegated directive across the EU will have a seismic effect on a major part of its European business. I accept also that the notice parties have sufficient standing to join in support of the applicants' case in the circumstances.
In order to put the issues in these proceedings in context, it is necessary to set out the background to the TPD and the provisions of the TPD of most relevance to the issues in these proceedings.
The TPD was enacted on 3 April 2014 and its measures were required to be brought into force in member states by 20 May 2016. The TPD replaced an earlier directive dealing with tobacco products, being Directive 2001/37/EC.
The objective of the TPD is set out in article 1 as being to approximate the laws, regulations and administrative provisions of the Member States concerning a wide range of aspects of tobacco products including their ingredients and emissions; aspects of labelling, packaging and health warnings; the prohibition of tobacco for oral use; cross-border distance sales; the notification of novel tobacco products and the placing on the market and labelling of e-cigarettes and herbal cigarettes. All of this is “ in order to facilitate the smooth functioning of the internal market for tobacco and related products, taking as a base a high level of protection of human health, especially for young people, and to meet the obligations of the Union under the WHO Framework Convention for Tobacco Control (‘FCTC’)”.
The definition of the “tobacco products” to which the TPD is directed is very wide: ‘tobacco products’ are defined in article 2(4) as “ products that can be consumed and consist, even partly, of tobacco, whether genetically modified or not”.
The health concerns in relation to tobacco products, and the consequent need to reduce smoking among young people, animate the provisions of the TPD. This is reflected in recital 8 which notes that “ a high level of health protection should be taken as a base for legislative proposals and, in particular, any new developments based on scientific facts should be taken into account. Tobacco products are not ordinary commodities and in view of the particularly harmful effects of tobacco on human health, health protection should be given high importance, in particular, to reduce smoking...
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