Governance of the Vaping Industry Is Moving Toward a Law-Based and Standardized Track

Strengthening E-Cigarette Regulation by Law to Guide Enterprises to Operate Legally

The Governance of the E-Cigarette Industry is Moving Toward a Law-Based and Standardized Track

Recently, Zhang Jianmin, Secretary of the Party Leadership Group and Director of the National Tobacco Monopoly Administration, pointed out during a research visit to the e-cigarette industry in Shenzhen that the Shenzhen Municipal Bureau is fully implementing the deployment requirements of the National Bureau, closely combining with the actual situation of the Shenzhen e-cigarette industry, insisting on strengthening e-cigarette regulation by law, actively guiding e-cigarette enterprises to operate legally, focusing on standardizing the order of the e-cigarette market, and promoting the comprehensive governance of the Shenzhen e-cigarette industry to enter a law-based and standardized track.

It is understood that since the release of the "Decision of the State Council on Amending the Implementation Regulations of the Tobacco Monopoly Law of the People's Republic of China" (hereinafter referred to as the State Council's "Decision") in November 2021, the National Tobacco Monopoly Administration has efficiently achieved a fundamental transformation of the e-cigarette market from lack of regulation to law-based governance, from chaos to order, and from barbaric growth to strict management.

Farewell to Barbaric Growth

"Previously, the regulation of e-cigarettes in our country was almost blank; e-cigarettes were neither classified as drugs or medical devices, nor formally included in tobacco. However, with the gradual introduction of relevant regulations on e-cigarettes in our country, it indicates that the e-cigarette industry may completely say goodbye to the situation of 'barbaric growth,'" said Liu Wei, a lawyer at Beijing Yongwen Law Firm, to a reporter from the Legal Daily.

Liu Wei further stated that Article 65 of the State Council's "Decision" in November 2021 stipulates that new tobacco products such as e-cigarettes shall be implemented in accordance with the relevant provisions of this regulation for cigarettes. This means that e-cigarettes are officially included in the tobacco regulatory system.

From the perspective of other national regulations, the State Administration for Market Regulation and the National Tobacco Monopoly Administration issued a notice on August 28, 2018, prohibiting the sale of e-cigarettes to minors, requiring all market entities to refrain from selling e-cigarettes to minors to strengthen social protection for the physical and mental health of minors.

On April 8, 2022, the State Administration for Market Regulation approved the mandatory national standard for e-cigarettes, which will be implemented from October 1, 2022.

From the perspective of local regulations, for example, the "Shenzhen Special Economic Zone Smoking Control Regulations (Revised in 2019)" includes e-cigarettes in the scope of smoking control.

It can be seen that regarding the current regulatory status of the e-cigarette industry (excluding non-heated tobacco products), Liu Wei believes that, first, e-cigarettes are currently implemented in accordance with the relevant provisions for cigarettes and have been included in the tobacco regulatory system; since 2022, the state has formulated mandatory national standards for e-cigarettes; second, in the circulation field, the state has issued regulations prohibiting all market entities from selling e-cigarettes to minors and prohibiting the sale of e-cigarettes via the internet, and has stipulated qualification requirements for the production and sale of e-cigarettes; third, regarding advertising, the state prohibits e-cigarette manufacturers and sellers or individuals from publishing e-cigarette advertisements on the internet.

Standardizing Penalty Standards

It is understood that to standardize the implementation of administrative penalties for tobacco monopoly, ensure and supervise the effective implementation of administrative management by the tobacco monopoly administration, maintain the national tobacco monopoly system, and protect the legitimate rights and interests of citizens, legal persons, or other organizations, the Ministry of Industry and Information Technology recently revised and published the "Regulations on Administrative Penalty Procedures for Tobacco Monopoly" (hereinafter referred to as the "Regulations"), which has been in effect since July 20, 2023, applicable to the implementation of administrative penalties by tobacco monopoly administrations at all levels. The "Regulations on Administrative Penalty Procedures for Tobacco Monopoly" published on January 21, 2010, has been abolished.

Recently, at a video conference on implementing the "Regulations on Administrative Penalty Procedures for Tobacco Monopoly," Han Zhanwu, a member of the Party Leadership Group and Deputy Director of the National Tobacco Monopoly Administration, pointed out that the newly revised "Regulations" are based on the "Administrative Penalty Law of the People's Republic of China" revised in 2021, combined with the actual enforcement work of tobacco monopoly, and are an effective implementation and supplement to the "Administrative Penalty Law of the People's Republic of China" in the field of tobacco monopoly law enforcement, with a more standardized and clear structure, and more scientific and complete content, providing strong guidance and operability.

It is worth noting that the main content of the revision of the "Regulations" particularly emphasizes the improvement of the execution of administrative penalties, law enforcement supervision, and other regulations. It clarifies the procedures for deferring penalty payments, adds mechanisms for administrative law enforcement evaluation, assessment, and social supervision, and strengthens accountability, listing situations such as conducting law enforcement without qualifications and failing to file cases in a timely manner for cases that meet the filing standards as accountable circumstances. To implement the latest revised content of the "Implementation Regulations of the Tobacco Monopoly Law," it is clarified that administrative penalties for illegal acts related to e-cigarettes and other new types of tobacco shall apply to these regulations.

In Liu Wei's view, the practical significance of the revision of the "Regulations" is that, first, it strengthens the legality and fairness of law enforcement procedures, clarifies the various links and procedural requirements of the administrative penalty procedures for tobacco monopoly, ensuring that law enforcement personnel exercise their powers according to law when performing their duties, increasing the credibility and public trust of law enforcement results. Second, it improves law enforcement efficiency and unifies standards, stipulating the time limits for administrative penalties for tobacco monopoly, applicable scope, and review procedures, simplifying law enforcement procedures, improving law enforcement efficiency, and standardizing penalty standards to avoid subjective judgments and unfair phenomena during the law enforcement process.

Improving and Perfecting the System

Han Zhanwu emphasized at the video conference that it is necessary to raise the level of understanding and deeply understand the basic principles of the "Regulations." Further deepen the concept of law enforcement for the people, adhere to the value orientation of fairness and justice, with the goal of "improving law enforcement quality and increasing public satisfaction with administrative law enforcement," further improve the law enforcement system, enhance law enforcement capabilities, and improve law enforcement methods, ensuring that law enforcement is not only forceful but also warm; further enhance the level of legalization of law enforcement procedures, standardize the operation of administrative power, guarantee the exercise of rights by the parties involved, and improve administrative efficiency; further increase the supervision of law enforcement actions, strictly implement the three systems of administrative law enforcement disclosure, full-process recording of law enforcement, and legal review of major law enforcement decisions, improve the law enforcement supervision mechanism, standardize the content of law enforcement supervision, improve law enforcement supervision procedures, innovate law enforcement supervision methods, strengthen law enforcement supervision guarantees, and effectively prevent major legal risks in the aspect of law-based administration.

During his research work in Shenzhen, Zhang Jianmin proposed three requirements for the next steps: first, to earnestly implement the spirit of the national video conference on the management of e-cigarette enterprises, deeply implement the requirements for the law-based and standardized governance of the e-cigarette industry, continuously consolidate and deepen the results of e-cigarette regulation, and strive to promote the stable and healthy operation of the e-cigarette industry. Second, to fully implement the national legislative purpose, adhere to market orientation, strengthen service guarantees, continuously improve and perfect the institutional mechanisms, continuously optimize regulation and service methods, and severely crack down on various illegal and irregular acts related to e-cigarettes, creating a good environment for the stable and healthy operation of the e-cigarette industry. Third, to further improve the institutional setup, strengthen team building, enhance work levels, effectively guide e-cigarette enterprises to strengthen compliance management concepts, improve management levels, enhance product quality, expand international markets, and legally maintain a good market order and protect consumer health and safety.