Reality Check: Sanders on Big Tobacco vs. Uruguay

By Chip Grabow, CNN

Sanders was asked by voter Dave Sprung — who said his dad had died of lung cancer — what reforms he would put in place on cigarette smoking. Sanders sympathized with Sprung, saying his father too died young and that cigarette smoking contributed to that.

Among other things, Sanders said he would take on the tobacco companies who, he said, “peddle cigarettes to kids in other parts of the world.” Sanders went on to talk about a trade issue over which Philip Morris International, one of the largest tobacco companies in the world, sued Uruguay. “And you know why they sued Uruguay?” Sanders asked, “Because their President was an oncologist, felt very strongly about this issue, worked very hard for tobacco prevention. And Phillip Morris said you are denying our company future profits.”

So, did Philip Morris actually sue the government of Uruguay? Indeed it did, indirectly. It filed with the international trade arbitration branch of the World Bank. The tobacco company took issue with Uruguay’s policy of implementing prominent health warnings that covered half a pack of cigarettes. In 2006, President Tabare Vazquez, a physician, had begun new public health initiatives to reduce smoking. He banned smoking in enclosed places, and then in 2008, introduced a new law calling for the larger health warnings on packs of cigarettes. In 2009, the Uruguayan government further increased the size of those warning labels. It also limited tobacco companies from selling more than one brand. And in 2010, Uruguay raised cigarette taxes to 70% of the pack’s price.

In 2010, Philip Morris started legal action appearing before the World Bank’s International Center for Settlement of Investment Disputes. Suing for $25 million in damages, Philip Morris argued Uruguay’s tobacco measures caused the cigarette maker to suffer “substantial losses” by restricting sales to just one brand and imposing larger warning labels preventing its trademarks being displayed properly.

According to the International Center for Settlement of Investment Disputes, the status of the case is still pending. But we have a verdict on Sanders’ claim: True.

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