Analysis of the Current Regulatory Landscape and Trends for E-Cigarettes

On November 1, 2019, the State Tobacco Monopoly Administration and the State Administration for Market Regulation jointly announced the "Notice on Further Protecting Minors from E-Cigarettes"(No. 1 of 2019)(hereinafter referred to as Notice No. 1), comprehensively suspending online sales and advertising of e-cigarettes. ldquo; The release of Notice No. 1 announced the opening of the regulatory curtain for the e-cigarette industry. Various market entities in the e-cigarette industry should pay close attention to the regulatory trends of the e-cigarette industry.

According to Merriam-Webster Dictionary's definition of electronic cigarettes, electronic cigarettes refer to: a battery-powered device, usually designed similar to traditional cigarettes, for users to inhale vapours, which usually contain nicotine. (Note: E-cigarettes contain a liquid solution usually composed of nicotine, various chemicals (such as propylene glycol or glycerol) and often flavored. The solution is heated by a battery to produce an aerosol or vapor that is inhaled by the user). In short, an e-cigarette is an electronic product that imitates cigarettes.

It can be seen from the above definition that the difference between e-cigarettes and traditional cigarettes is that they do not need to be burned, but the aerosol liquid is atomized by the atomizer on the e-cigarettes to achieve a similar effect to the burning of tobacco leaves and shredded tobacco in traditional cigarettes. It should be particularly pointed out that the so-called heated non-combustible e-cigarettes that have been repeatedly investigated in today's China market, although they are sometimes called e-cigarettes, because their cigarettes use shredded tobacco as the main raw material and are wrapped by cigarette paper and other auxiliary materials. After heating, they can generate smoke for smoking or inhaling. They fully possess the basic attributes of traditional cigarettes. They have been recognized as heated non-combustible cigarettes by the State Tobacco Monopoly Administration and should be managed as tobacco products. Therefore, they are not included in the discussion of e-cigarettes in this article.

This article will summarize the current status of e-cigarettes supervision under China's legal system, and make analysis and suggestions on future regulatory trends.

1. Current status of e-cigarette supervision under China's legal system

1. Current laws and administrative regulations in my country

Article 2 of the Tobacco Monopoly Law of the People's Republic of China (Revised in 2015) stipulates that the term "tobacco monopoly goods" as mentioned in this Law refers to cigarettes, cigars, shredded tobacco, recured tobacco leaves, tobacco paper, filter rods, cigarette tow, and tobacco special machinery. Cigarettes, cigars, shredded tobacco, and recured tobacco are collectively referred to as tobacco products.

Article 3 of the "Regulations for the Implementation of the Tobacco Monopoly Law of the People's Republic of China (Revised in 2016)" stipulates that tobacco in tobacco monopoly products refers to silk, powder and granular goods processed from tobacco leaves, recured tobacco leaves, and tobacco flakes.

It can be seen from the above provisions that so far e-cigarettes have not been included in the regulatory scope of tobacco products referred to in the Tobacco Monopoly Law and its Implementation Regulations.

(2) Other national-level regulations

In the field of e-cigarette circulation, the State Administration for Market Regulation and the State Tobacco Monopoly Administration announced the "Notice on Prohibiting the Sale of E-Cigarettes to Minors" on August 28, 2018. In order to strengthen social protection of the physical and mental health of minors, various market entities are required to sell e-cigarettes to minors. The notice believes that the safety and health risks of e-cigarettes mean that the quality of e-cigarette products is uneven, and some products may have quality and safety hazards such as leakage of tobacco oil, inferior batteries, and addition of unsafe ingredients; in addition, the core consumer ingredient of most e-cigarettes is purified Nicotine is nicotine. Nicotine is a highly toxic chemical. The respiratory system of minors has not yet developed. Inhaling such aerosols will have adverse effects on lung function, and improper use may also lead to various safety risks such as nicotine poisoning.

The State Tobacco Monopoly Administration and the State Administration for Market Regulation issued Notice No. 1 on November 1, 2019“”, which reiterated the requirement to ban the sale of e-cigarettes to minors in 2018, and clearly stated that it is to further increase the protection of minors 'physical and mental health, prevent minors from purchasing and smoking e-cigarettes through the Internet, urge e-cigarette production and sales companies or individuals to promptly close e-cigarette Internet sales websites or clients; Urge e-commerce platforms to promptly close e-cigarette shops and remove e-cigarette products from shelves; Urge e-cigarette production and sales companies or individuals to withdraw e-cigarette advertisements posted through the Internet. Tobacco monopoly administrative departments should increase market supervision of e-cigarette products, strengthen monitoring, dissuade and stop the promotion and sale of e-cigarettes through the Internet, and investigate and punish various illegal activities discovered in accordance with the law or notify relevant departments. ldquo; Notice No. 1 does not clarify the legal consequences of violating this regulation, so the implementation effect of the notice still depends on the enforcement and punishment intensity of the competent authorities.# p#pagination title #e#

(3) Local level regulations

In terms of e-cigarette consumption places, various localities have successively introduced relevant tobacco control regulations in recent years, including restrictions on the use of e-cigarettes. The Regulations on Smoking Control in Shenzhen Special Economic Zone (Revised in 2019) include e-cigarettes in the scope of smoking control. Article 44 of the Regulations stipulates: The meaning of the following terms in these Regulations: (1) Smoking refers to the use of e-cigarettes, possession of other tobacco products that are lit or heated without burning. (2) Tobacco products refer to products produced wholly or partially from tobacco as raw material for smoking, sucking, chewing or inhaling, and e-cigarettes. (3) E-cigarette refers to a device that vaporizes and delivers a mixture of nicotine (or non-nicotine), propylene glycol and other chemicals to the user's lungs. rdquo; It should be noted that in Shenzhen's Tobacco Control Regulations, the definition of e-cigarettes is broader, including devices that deliver vaporized mixtures to the lungs without nicotine.

On November 1, 2018, the "Measures for the Administration of Smoking Control in Xi'an City" was officially implemented. Article 18 stipulates that operators and managers of smoking control places are encouraged to make regulations on the use of e-cigarette products in smoking places.

On January 1, 2019, the "Regulations on Smoking Control in Public Places of Hangzhou City" was officially implemented. Article 34 of the following terms in these Regulations are: Smoking refers to the inhalation and exhalation of tobacco or harmful e-cigarette aerosol, and the behavior of holding lit tobacco products.

In terms of product standards for e-cigarettes and their cigarette liquids, corresponding standards have not yet been issued at the national level. At the local level, on December 9, 2015, the Shenzhen Market Supervision and Administration Bureau issued the local standard of "General Technical Requirements for Electronic Cigarette Aerosol Liquid Products", which was officially implemented on January 1, 2016. The main contents of this requirement include: sanitary requirements and technical requirements for product production, as well as technical requirements for product test methods, inspection rules, labels, labeling, packaging, transportation, storage, etc., which are mainly applicable to the production of e-cigarette aerosol liquid products in Shenzhen., testing, inspection, management, etc. At the industry level, on December 20, 2017, the Electronic Cigarette Industry Committee of China Electronics Chamber of Commerce issued two group standards,"Specifications for Electronic Cigarette Atomization Fluids" and "General Specifications for Electronic Cigarette Atomization Equipment Products", which were officially implemented on January 10, 2018. Although these two standards are not mandatory standards, they provide certain guidance for e-cigarette manufacturers.

In summary, based on the above-mentioned national and local laws, regulations and regulations, the state has a strong policy on e-cigarettes.(excluding unheated tobacco products) The regulatory status of the industry is as follows: 1. In the production field, e-cigarettes currently do not fall within the category of tobacco monopoly products in the Tobacco Monopoly Law and its implementation regulations, so they are not yet regulated by the aforementioned regulations; In addition, in terms of standards for e-cigarettes and their cigarette liquids, corresponding mandatory standards have not yet been issued at the national level, so the production and quality supervision of e-cigarettes are currently basically in a blank area; 2. In the field of circulation, except for the state's regulations prohibiting the sale of e-cigarettes to minors by various market entities and prohibiting the sale of e-cigarettes through the Internet, e-cigarettes have not yet been included in the scope of tobacco monopoly. Therefore, there is currently no special qualification for sales units. requirements; 3. In terms of advertising, the state prohibits e-cigarette production and sales companies or individuals from publishing e-cigarette advertisements through the Internet. However, since e-cigarettes are currently not included in the category of tobacco, their offline advertising is not subject to the restrictions on tobacco advertising under current laws.

2. Current status of international supervision of e-cigarettes

1. International Convention

On October 18, 2014, the World Health Organization Framework Convention on Tobacco Control adopted the decision on "Electronic Nicotine Delivery Systems and Electronic Non-Nicotine Delivery Systems", and China is a party to the convention. The decision urges parties to consider banning or regulating electronic nicotine delivery systems/electronic non-nicotine delivery systems as tobacco products, medical products, consumer goods or other products in order to provide a high level of protection for human health, and urges parties to consider banning or restricting advertising, promotion and sponsorship of electronic nicotine delivery systems.

2. Legislation of other countries or regions

According to the decisions of the Electronic Nicotine Delivery System and Electronic Non-Nicotine Delivery System adopted by the World Health Organization Framework Convention on Tobacco Control, various countries 'regulatory policies on e-cigarettes can be divided into prohibiting, classifying them as tobacco product supervision, incorporating them into medical product supervision, and controlling them as electronic products or general consumer goods.

3. Current status of regulation in various countries

Currently, countries that ban the sale of e-cigarettes (containing nicotine) include: Egypt, Australia, Mexico, Honduras, Costa Rica, Panama, Colombia, Brazil, Argentina, Uruguay, Norway, Switzerland, Turkey, Saudi Arabia, Oman, Thailand, Uganda, Brunei, Qatar, United Arab Emirates, Venezuela, Seychelles, Switzerland, and Japan. Countries that ban the sale and use of e-cigarettes (containing nicotine) are: Indonesia, Malaysia, Colombia, and Singapore.# p#pagination title #e#

In addition, the supervision of e-cigarettes in different countries in the world is currently divided into the following three types of supervision models:

Classified as tobacco product supervision: United Kingdom, Germany, Italy, United States, Poland, France, Ireland, Spain, Croatia, Netherlands, Slovenia, Israel, Czech Republic, Bulgaria, Finland, Latvia, Costa Rica, South Korea, Peru, Serbia, Morocco, Romania, Hungary, Slovenia, Portugal, Austria.

Included in the supervision of pharmaceutical products: Denmark, Canada, Sweden, Philippines, Belgium, South Africa, Chile, New Zealand.

Regulated as electronic products or general consumer goods: China, Russia, Pakistan, Ukraine.

It can be seen from the above list that, except for countries and regions that ban the sale of e-cigarettes, most countries in the world choose to regulate e-cigarettes as tobacco products. Taking the United States as an example, the U.S. Food and Drug Administration (FDA) promulgated the Deeming Regulation on May 10, 2016, which includes e-cigarettes in the category of tobacco products for supervision. The regulatory measures are roughly divided into the following aspects: 1. Premarket Tobacco Product Application (PTMA): That is, any tobacco product manufacturer needs to submit an application to the FDA for the e-cigarettes it produces. The e-cigarettes that have been marketed can continue to be sold before submitting PTMA. However, once the PTMA application is not approved, these products need to be removed from the shelves. 2. It is prohibited to sell e-cigarettes, including non-nicotine e-cigarettes, to minors. 3. Advertisements: Nicotine-containing e-cigarettes should include warnings on the advertisements and packaging: Warning: This product contains nicotine. Nicotine is an addictive substance, and nicotine-free e-cigarettes should include a warning on their advertisements and packaging: this product is made of tobacco. Publicity through free samples is prohibited. 4. E-cigarettes imported into the United States must comply with the provisions of the Federal Food, Drug and Cosmetic Act.

3. Analysis of regulatory trends of e-cigarettes

(1) Overall direction of supervision

Although the cigarette liquid in the cartridge of nicotine-containing e-cigarettes is not tobacco leaf or shredded tobacco, and the nicotine in it is artificially extracted rather than naturally separated out by burning or heating tobacco leaf or shredded tobacco, e-cigarettes are not included in the current regulatory system of tobacco products. However, according to the "Reply to Recommendation No. 6801 of the First Session of the 13th National People's Congress"(hereinafter referred to as the Reply to Recommendation No. 6801) announced by the State Tobacco Monopoly Administration on August 28, 2018 and the speech of the Director of the Planning Department of the National Health Commission at a press conference on July 22, 2019, regulatory agencies are conducting regulatory research on e-cigarettes and plan to pass legislation to supervise e-cigarettes. According to the reply to Recommendation No. 6801, the State Tobacco Monopoly Administration believes that although e-cigarettes containing nicotine are different in appearance from traditional cigarettes, they also use nicotine as the main consumption ingredient and have addictive and health risks. Therefore, the bureau believes that e-cigarettes containing nicotine should also be included in tobacco products for supervision. Currently, the bureau is actively promoting the regulatory legislation of e-cigarettes containing nicotine and waiting for further instructions from relevant departments.

In addition, the State Tobacco Monopoly Administration announced on September 29, 2019 the "On the Second Session of the 13th National Committee of the Chinese People's Political Consultative Conference No. 2991 (Medical and Sports Category No. 324) Proposal Reply Letter ", in response to the proposal put forward by members of the 13th National Committee of the Chinese People's Political Consultative Conference on legislation to comprehensively ban new smoking products such as e-cigarettes, the key points of the reply include: strengthening policy and legal research on e-cigarettes. Generally speaking, the regulatory policies of various countries can be divided into prohibition, regulation of tobacco products, regulation of medical products, and regulation of electronic products or general consumer products; Regarding the promulgated "Regulations on Smoking Control in Public Places of Hangzhou City" and the revised "Regulations on Smoking Control in Shenzhen Special Economic Zone", e-cigarettes will be included in the regulatory scope of tobacco control in public places. The bureau respects and supports relevant measures in local tobacco control legislation to include e-cigarettes within the scope of tobacco control legislation in public places.

In addition, according to the official website of the National Standardization Administration Commission, the national standard formulation plan for "e-cigarettes" was issued on October 11, 2017. The competent authority is the State Tobacco Monopoly Administration, which is a mandatory national standard. At present, the mandatory national standard for "e-cigarettes" has been reviewed and is in the process of approval. According to the project plan schedule, it may be released within the year.

(2) Nicotine-containing e-cigarettes may be included in the national tobacco product regulatory system

According to the provisions of the Tobacco Monopoly Law and its implementing regulations: cigarettes, cigars, cut tobacco, and recured tobacco leaves are collectively referred to as tobacco products. The above-mentioned reply and reply further characterize cigarettes based on whether all or part of them are made of cut tobacco. According to the reply to Recommendation 6801, the State Tobacco Monopoly Administration believes that e-cigarettes containing nicotine should also be included in tobacco products for supervision, and is promoting relevant legislation.# p#pagination title #e#

The above analysis shows that there is a high probability that nicotine-containing e-cigarettes will be recognized as tobacco products by national regulatory agencies and will be included in my country's tobacco product regulatory system. According to the Tobacco Monopoly Law and its implementing regulations, my country implements tobacco monopoly management. The production, sales (wholesale and retail), import and export of tobacco monopoly products are subject to monopoly management. The planting, purchase, and allocation of tobacco, and the production of cigarettes and cigars are all subject to production planning.

In summary, since e-cigarettes have not yet been included in the regulatory scope of existing tobacco products at the national level, the production and circulation of e-cigarettes are still basically in a regulatory gap. ldquo; Notice No. 1 has made up for the regulatory gap in online sales and advertising of e-cigarettes to a certain extent, but its implementation effect remains to be seen. The risks brought by regulatory gaps are not only reflected in the health risks brought by the use of e-cigarettes itself, but also reflected in the product quality risks brought by the mixed e-cigarette market. As the largest producer and exporter of e-cigarettes, my country should speed up the legislative work of e-cigarettes at the national level, promulgate relevant laws and regulations as soon as possible, and carry out comprehensive and effective supervision of e-cigarettes, or introduce special legislation on e-cigarettes to eliminate the current supervision of e-cigarettes. status that cannot be followed by. It can be expected that the national standard for e-cigarettes will soon be issued, and the strict supervision system for e-cigarettes into tobacco products is also the trend. As various market entities of electronic cigarettes, including manufacturers and sellers, we should pay close attention to the regulatory situation of the electronic cigarette industry and take timely and effective countermeasures to avoid double risks in business and legal compliance.