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Agio, British American Tobacco et alia v. The State of The Netherlands

2011 December 1
by Hein Kernkamp

Court: Netherlands Supreme Court
Date: November 25, 2011
LJN Number: BS8874

Case: Petrol stations in The Netherlands sell cigars produced by Agio Sigarenfabrieken, British American Tobacco and other tobacco companies. Owners of petrol stations receive financial incentives by the cigar companies to display their products on the counter, in a specific dispenser (provided by the tobacco companies) to hold the cigar boxes. The State deems this practice to be in violation of tobacco laws, especially those laws regarding advertisements for tobacco products. Advertising of tobacco products is strictly prohibited in The Netherlands, and displaying tobacco products (including cigars) by resellers is only allowed as far as it concerns the "regular presentation" of these products. In the past, the State of The Netherlands has fined tobacco companies for these practices in petrol stations.

The tobacco companies have therefore asked the court to establish that this regular presentation includes the displaying of cigars on the counter of petrol stations in a specific dispenser, and also to establish that the State's interpretation of "regular presentation" is too narrow. The court of first instance has ruled in favor of the tobacco companies; however, the appeals court has denied the claims of the tobacco companies.

Held: The Supreme Court agrees with the decisions made by the Court of Appeals. "Regular presentation" excludes all commercial marketing, promotion, sponsorship and advertisements of tobacco products. In this case, cigar boxes were displayed in a dispenser provided by the tobacco company. Petrol stations are paid to display these dispensers on their counters, in favor of other brands. Therefore, it is deemed a form of promotion or advertising for the particular brand of cigar on display. Dutch tobacco laws only allow for the display of cigar boxes as long as the sole purpose is to show what particular products are sold by a particular reseller, and at what price. Any other means of displaying tobacco products, including the displaying in dispensers as was the matter here, is therefore illegal. The court of appeals has therefore correctly rejected the claim by the tobacco companies.

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