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Uruguay was described as a "laboratory of confrontation" with Big Tobacco by its president, Jose Mujica.
Philip Morris International Inc., the world's second-biggest cigarette company after the state-controlled China National Tobacco Corp., is pursuing a claim before World Bank arbitrators alleging that Uruguay is violating its trade agreement with Switzerland by requiring that anti-smoking warnings cover 80% of cigarette packages.
Mujica said the trade violation claim seeks to "complicate the life and sovereignty of a small nation that has the boldness to defend itself and try to defend the health of its people."
He said Uruguay will maintain its anti-smoking laws despite the pressure.
Global tobacco control treaty
The president spoke at the opening of a summit representing 170 countries that have signed a global tobacco control treaty established in 2003.
The summit's goal is to analyse and support policies that reduce smoking globally. The meeting is sponsored by the World Health Organisation (WHO), which says tobacco kills five million people a year around the world.
Lobbyists protest
Tobacco lobbyists set up a tent outside the hotel in protest, saying organisers had denied their request to participate as observers.
"The objective is to show the terrible impact the approval of these articles will have on millions of small and mid-size growers around the world," the International Association of Tobacco Producers said in a statement.
Signatory countries promise to apply laws, policies and programs to reduce smoking and protect their citizens from second-hand smoke.
Uruguay has been a leader, banning smoking in all enclosed public spaces and requiring that graphic warnings about smoking's health consequences appear over 80% of each cigarette package.
"Tobacco, like war, produces deaths among citizens around the world while enriching a few," said Mujica's predecessor Tabare Vazquez, an oncologist who introduced anti-tobacco policies during his tenure.
He accused Philip Morris of trying to punish Uruguay and thus intimidate other countries from following the same path, but said "we are not afraid, and we aren't going to sell out."
Uruguay is not alone
Philip Morris International, with offices in New York and in Lausanne, Switzerland, announced last month that its cigarette shipments grew 4.5% from last year's third quarter to 229.2 billion sticks, with large gains in Asia, despite falling shipments in Europe, the Middle East and Africa and Latin America and Canada.
Altria Group Inc. in Richmond, Virginia, owner of Philip Morris USA, spun off Philip Morris International in 2008.
Altria is the largest US cigarette seller.
(Sapa, Raul O. Garces, November 2010)
