THE Supreme Court (SC) has ruled that the Department of Health (DOH) has no authority to regulate the promotion schemes of tobacco firms.
In an 11-page decision penned by Associate Justice Estela Perlas-Bernabe, the SC’s First Division affirmed the decision of the Court of Appeals (CA) in 2011, which granted the petition filed by two giant tobacco companies—Philip Morris Philippines Manufacturing Inc. (PMPMI) and intervenor Fortune Tobacco Corp.—seeking to nullify the resolution issued by the DOH prohibiting the tobacco industry from conducting promotional activities in accordance with Republic Act (RA) 9211, or the Tobacco Regulation Act of 2003.
The SC said it agrees with the appellate court that it is the Inter-Agency Committee (IAC)-Tobacco that has exclusive power and function to administer and implement provisions of RA 9211 and not the DOH.
It did not give weight to the claim of the DOH that its authority to rule upon applications for sales-promotion permits emanates from Article 116 in relation to Article 109 of RA 7394, or the Consumer Act of the Philippines.
The said provisions states: “No person shall conduct any sales campaigns, including beauty contest, national in character, sponsored and promoted by manufacturing enterprises without first securing a permit from the concerned department at least 30 calendar days prior to the commencement thereof….”
But the High Tribunal noted that the same provision has been repealed by RA 9211, which created the IAC-Tobacco. Under the same provision, IAC-Tobacco will have exclusive power and function to administer and implement the provisions of RA 9211, including promotion regulation.
“After a meticulous examination of the…pertinent provisions of RA 7394 and RA 9211, the Court finds that the latter law impliedly repealed the relevant provisions of the former with respect to the authority of the DOH to regulate tobacco sales promotions,” the SC said in denying the DOH’s petition seeking the reversal of the CA ruling.
“In fine, the Court agrees with the CA that it is the IAC-Tobacco, and not the DOH, which has the primary jurisdiction to regulate sales promotion activities…,” it added.
Thus, the Court ordered the remand of the permit applications filed by PMPMI for its tobacco sales promotions to the IAC-Tobacco for appropriate action.
Concurring with the ruling were Associate Justices Teresita Leonardo-Castro, Lucas Bersamin and Jose Portugal Perez.
Prior to the controversy, PMPMI, through the advertising agency the PCN Promopro, and invoking the provisions of the Consumer Act of the Philippines, applied for a sales-promotion permit before the Food and Drug Administration (FAD) for the tobacco company’s “Gear Up Promotional Activity” in November 2008.
PMPMI was later verbally informed by the FAD that there is a DOH memorandum supposedly prohibiting tobacco companies from holding any form of tobacco promotion in the country.
Meanwhile, on November 28, 2008, PMPMI, through another advertising agency, the Arc Worldwide Philippines Co., also applied for a promotional permit for its “Golden Stick Promotional Activity.”
The FAD again denied PMPMI’s permit application for promotional activities, citing an instruction from the DOH that since July 1, 2008, all promotions, advertisements and sponsorships of tobacco products are already prohibited.
The PMPI appealed the FAD’s denial of its permit application for promotional activities with the DOH.
In a decision dated April 30, 2009, the DOH denied PMPMI’s appeal along with all similar actions filed by other tobacco companies.
This prompted PMPMI to immediately elevate the case before the CA, considering that the issue involved a legal question.
Meanwhile, Fortune Tobacco moved to intervene in the case on the ground that it has a direct and immediate legal interest in the outcome of the petition, being engaged in a business similar to PMPMI.
In ruling in favor of the tobacco industry, the CA held that the DOH and FAD committed grave abuse of discretion in declaring that all promotions, advertisements and sponsorships of tobacco products are already prohibited starting July 1, 2008, as mandated under RA 9211.
The appellate court noted that Section 22 of RA 9211 (Ban on Advertisements) prohibits all forms of tobacco advertisements in mass media, “except tobacco advertisements placed inside the premises of point-of-sale establishments.”
On the other hand, Section 23 of RA 9211 allows tobacco promotions, with some restrictions, such as it should be directed to persons at least 18 years old; all stalls, booths and other display concerning tobacco promotions must be limited to point-of-sale of adult-only facilities; telephone communications concerning promotional offers, programs or events must include a recorded health warning message; and several others.
Furthermore, the CA declared that the DOH has no authority to enforce the provisions of RA 9211.
It noted that Section 29 of the Tobacco Regulation Act states that IAC-Tobacco shall have the exclusive power and function to administer and implement the provisions of the said law.
The IAC-Tobacco is chaired by the secretary of the Department of Trade and Industry, with the DOH secretary as vice chairman.