Australia has won a clear victory in a major trade dispute over its pioneering tobacco packaging law, with a panel of judges at the World Trade Organisation (WTO) rejecting arguments brought by Cuba, Indonesia, Honduras and the Dominican Republic.

Key points: The win for Australia effectively gives a green light for other countries to roll out similar laws

The win for Australia effectively gives a green light for other countries to roll out similar laws Gillard government launched world first plain packaging laws in 2011

Gillard government launched world first plain packaging laws in 2011 Honduras says it will appeal decision, claiming that there are errors in the ruling

In its ruling, the WTO panel said Australia's "plain packaging" law contributed to improving public health by reducing use of and exposure to tobacco products, and rejected claims that alternative measures would be equally effective.

The ruling, which is expected to be appealed, also rejected the complainants' argument that Australia's law unjustifiably infringed tobacco trademarks and violated intellectual property rights.

The win for Australia effectively gives a green light for other countries to roll out similar laws. It could also have implications for alcohol and junk food packaging.

Australia's law goes much further than the advertising bans and graphic health warnings seen in other countries.

Introduced in December 2012 during the Gillard government, the law bans logos and distinctive-coloured cigarette packaging in favour of drab olive packets that look more like military or prison issue, with brand names printed in small standardised fonts.

Studies have shown that the law is an effective measure in reducing smoking numbers.

Honduras flags an appeal

The World Health Organisation (WHO) welcomed Australia's victory, saying the ruling by the WTO was likely to accelerate implementation of "plain packaging" laws around the globe.

"The ruling clears another legal hurdle thrown up in the tobacco industry's efforts to block tobacco control and is likely to accelerate implementation of plain packaging around the globe," the WHO said in a statement.

It said six other countries had brought in plain packaging laws — Hungary, Ireland, France, New Zealand, Norway and Britain — while another six had passed laws yet to be implemented — Burkina Faso, Canada, Georgia, Romania, Slovenia and Thailand.

"A number of other countries are examining the policy," the WHO added.

But Honduras, one of the four complainants, said in a statement that the ruling contained a number of legal and factual errors and did not appear to have been even-handed and objective, and indicated that it would appeal.

An Indonesian trade official said Indonesia would examine its options. Cuban and Dominican trade officials were not immediately available for comment.

Examples of the 'ugly' cigarette packet packaging that tobacco companies were trying to stop. ( Supplied )

Vera Luiza da Costa e Silva, head of the secretariat of the WHO's Framework Convention on Tobacco Control, said it was a huge day for tobacco control.

She saw a "domino effect" in plain packaging, with other countries already moving towards Australian-style rules.

"What this shows in reality is that plain packaging is a reality, it will happen anyway, and parties will progressively adhere more to plain packaging," Ms da Costa e Silva told Reuters.

Some countries were now discussing a tobacco "endgame", with less than 5 per cent of the population smoking, she said, adding: "Plain packaging is part of this path".

ABC/Wires