An attempt by tobacco giant Philip Morris to challenge Australia's plain packaging laws has been thrown out by an international tribunal.
The Permanent Court of Arbitration on Friday rejected the case, unanimously agreeing with Australia's argument it had no jurisdiction to hear the claim.
It means the arbitration is over, other than proceedings related to the recovery of Australia's costs.
Philip Morris Asia may seek to institute an appeal in Singapore, but it's understood the federal government has legal advice suggesting it too is unlikely to be successful.
Rural Health Minister Fiona Nash, who is responsible for tobacco policy, welcomed the decision.
"Plain packaging is a legitimate public health measure which is consistent with Australia's international legal obligations," she said.
The Public Health Association of Australia says the ruling is the "best Christmas present", but Philip Morris says it will review the decision to determine any further action.
"There is nothing in today's outcome that addresses, let alone validates, plain packaging in Australia or anywhere else," Philip Morris International senior vice president Marc Firestone said.
"It is regrettable that the outcome hinged entirely on a procedural issue that Australia chose to advocate instead of confronting head on the merits of whether plain packaging is legal or even works."
The company believes plain packaging laws breach foreign investment protections the Australian government guaranteed in its trade agreement with Hong Kong, which contains an investor state dispute settlement mechanism.
Challenges to Australia's plain packaging laws were still being considered by the World Trade Organisation, while courts in Europe were also assessing the laws, it said.
Australia was the first country to introduce plain packaging laws, and others including France, Ireland and the UK are following suit.
Professor Mike Daube, who chaired the government expert committee that recommended the laws, said the federal government, and former Labor health minister Nicola Roxon, who led the charge for plain packaging, should feel vindicated.
"I've worked in tobacco for over 40 years and I've not seen the tobacco industry fighting something as ferociously as this before," he told AAP.
Big tobacco companies will no doubt continue using legal processes to frighten other countries from introducing plain packaging, but they will keep losing, he believes.
Smoking rates and tobacco sales are falling and plain packaging would eventually become the norm worldwide, he said.
Former Labor treasurer Wayne Swan also welcomed the decision, having appeared before the tribunal on behalf of the government.
Opposition health spokeswoman Catherine King said the result was fantastic vindication for former Labor health ministers Ms Roxon and Tanya Plibersek who introduced the laws.
