Australia is to introduce the world's "toughest cigarette packaging laws", banning logos on the packets, in a landmark High Court ruling that could have implications for the UK.
British anti-smoking campaigners called the decision, which will see cigarettes sold in dark olive packaging, "a victory for the world" and urged the government to make the UK the next country to implement the law.
Australian Attorney-General Nicola Roxon declared a new era for tobacco laws, saying: “The message to the rest of the world is big tobacco can be taken on and beaten.
"Without brave governments willing to take the fight up to big tobacco, they’d still have us believing that tobacco is neither harmful nor addictive," she said.
"Many other countries around the world will take heart from the success of this decision today.
"Governments can take on big tobacco and win and it's worth countries looking again at what the next appropriate step is for them.''
Cigarettes will now be sold in green packaging, with no commercial logos, with pictures illustrating the health effects of smoking, including on the lungs, eyes, mouth and teeth.
Tobacco owners argued the law, which will come into force in December, was effectively an acquisition of their trademarks, with no composition offered, but the High Court rejected the challenge, saying it was not contrary to the constitution.
The tobacco companies must now pay millions in legal costs.
British American Tobacco, Philip Morris, Imperial Tobacco and Japan Tobacco argued that the law would benefit criminals, who would be easily able to sell counterfeit cigarettes on the black market.
More legal challenges are ahead, including a World Trade Organisation dispute process in Ukraine and Honduras.
The UK has held a public consultation on plans to introduce plain packaging, with more than 2,000 people responding. A YouGov poll found 62% of adults in England support the measure, with only 11% opposed.
Deborah Arnott, chief executive of anti-smoking campaigners ASH said: “Australia’s defeat of Big Tobacco is a victory for the world. There will be many more court cases but the principle is clear: the tobacco industry has no legal right to put profit before health in marketing its lethal products.
"Where Australia leads other countries will follow. Now the UK Government’s consultation on plain standardised packaging of tobacco has closed, we are well placed to be next”
If the policies are implemented, the UK would be the first EU country to have plain cigarette packaging.
Shops will be banned from displaying tobacco products in England, Wales and Northern Ireland from April 2015.
But a petition organised by smokers' lobby group Forest has 235,000 signatures from those against plain packaging.
The group's director Simon Clark, said: “There is no evidence that standardised packaging will have any health benefits. Advocates base their arguments not on facts but on speculation."
A lawyer has warned the UK could see similar legal challenges if it attempted to introduce plain packaging, despite the precedent set in Australia.
Rupert Casey, partner at Macfarlanes, said: "The decision reached today by the Australian High Court to uphold the Australian government's proposals on brand-free "plain packaging" will serve to strengthen the UK government's convictions in its proposals by providing it with a precedent demonstrating that such measures are within the government's scope of powers.
"The matter is far from over ... anyone thinking that the tobacco companies will accept that the fight is over would be clearly mistaken.
"The potential loss of brand and intellectual property value is too immense for the companies, and the legal fight between public health concerns on the one hand and destruction of brand value on the other is set to continue for years to come."
A council in England has already taken the unusual step of designating "smoke free" areas of the city, including parks and playing fields.
Blackpool is to put signs up in 13 outdoor spaces, warning people agains smoking in areas where children are playing, in an initiative by NHS Blackpool, backed by the borough council.
The signs read: "Altogether Now. To protect children, this is a designated smokefree site."
Ivan Taylor, Blackpool Council's cabinet member for health and wellbeing, said: "The idea is to protect the children who are on the playgrounds.
"I don't think it's reasonable for children who are playing to be suffering from inhaling smoke and to be influenced by seeing adults also smoking.
"We'll have to wait and see what the reaction is but I think most people would welcome the reason for it. Smoking is a killer and we need to do all we can to discourage it."
The ban is not enforceable by law. A Department of Health spokeswoman said: "There are no plans to extend the law to cover outside areas."