SYDNEY - Philip Morris International is fighting the Australian government over new rules that would eliminate company or brand logos and promotional text from cigarette packaging, the Associated Press reports. The packaging would instead feature graphic images of sick children; bulging and blinded eyes and cancerous mouths.

The new tobacco advertising rules would be the toughest in the world. Just last week, the U.S. Food and Drug Administration revealed the new grisly images that would appear on every cigarette package in the United States.

Philip Morris has filed for compensation from the Australian government because of the new rules, which Parliament will consider next month. "We would anticipate that the compensation would amount to billions," said Anne Edwards, spokeswoman for Philip Morris International.

The Australian law also reduces brand names to a small, uniform font, easily overshadowed by larger-type health warnings and the full-color graphic images. The law will begin in stages beginning January 2012.

Philip Morris Asia Limited, which has its headquarters in Hong Kong and owns Philip Morris Limited, argued in its filing that the measure breaks the bilateral investment treaty between Hong Kong and Australia. The plan packaging takes away any value from the tobacco company€™s trademark, said Edwards.

"Our brands are really one of the absolute key valuable assets that we have as a company €" it's what helps us compete, it's what enables us to distinguish our products," she said. "This move ... would essentially amount to confiscation of our brand in Australia."

In May, British American Tobacco Australia threatened to lower the cost of cigarettes if the proposal goes into effect. Meanwhile, Australian tobacco retailers have mounted a vigorous campaign against the measure, saying that the plain packaging would irreparably harm their business.