Category: News This Week

  • Wang: Global Trade Tariffs in Vaping

    Wang: Global Trade Tariffs in Vaping

    The vaping industry has always faced its share of challenges—from shifting regulatory landscapes to evolving consumer preferences. However, a few factors significantly threaten the industry’s future, such as the impact of global trade tariffs. With the United States set to increase tariffs on Chinese imports, companies that fail to adapt could face skyrocketing costs, disrupted supply chains, and a diminished ability to compete in one of the world’s largest markets.

    Trade tensions between the U.S. and China have been escalating for several years. The vaping industry, which relies heavily on hardware manufactured in China, is particularly vulnerable to these developments. Currently, vaping products imported from China face a 25% tariff, but there is a high likelihood that this could double or even increase to 100% under future U.S. administrations.

    For vaping companies, such tariff hikes mean the cost of importing devices could skyrocket. A 100% tariff would effectively double the cost of hardware produced in China, driving up retail prices for all such products in the U.S. market. This scenario threatens the financial viability of vaping companies and the availability of affordable, high-quality products for consumers.

    The Strategic Decision to Move Manufacturing to Malaysia

    Recognizing the potential for increasing tariffs and broader geopolitical challenges, some vaping manufacturers began shifting their operations from China to other countries. Such decisions were never made lightly. China has long been a global leader in manufacturing efficiency with a robust infrastructure and supply-chain network,, and moving away from such an established infrastructure posed significant logistical and operational challenges.

    Malaysia offered several key advantages to manufacturers. Firstly, Malaysia enjoys favorable trade agreements with the United States, the United Kingdom, and the European Union. For instance, starting in December 2024, a new free trade agreement between Malaysia and the U.K. took effect, eliminating tariffs on products moving between the two countries. Similar agreements are in place or in development with other major markets.

    Secondly, Malaysia’s robust manufacturing ecosystem and skilled workforce make it an ideal location for high-quality production. By establishing operations in Malaysia, companies can continue to deliver reliable, innovative hardware without the added burden of excessive tariffs.

    The Broader Impact on the Global Supply Chain

    The shift to Malaysia reflects a broader trend in global manufacturing. As trade barriers between the U.S. and China grow, a widespread redistribution of manufacturing operations is underway. Companies across industries—not just vaping—are reevaluating their supply chains to reduce dependence on any single country.

    This global redistribution of resources presents both challenges and opportunities. For manufacturers, the challenge lies in building new infrastructure, securing reliable suppliers, and maintaining quality control in unfamiliar territories. However, companies that successfully navigate these changes benefit from more resilient supply chains, reduced geopolitical risk, and greater flexibility in responding to market shifts.

    Maintaining Compliance and Quality Standards

    Shifting manufacturing bases also brings new compliance considerations. Regulatory bodies like the U.S. Food and Drug Administration (FDA) require Premarket Tobacco Product Applications (PMTAs) for vaping devices. These applications are tied to specific manufacturing facilities, meaning that changing production locations requires amendments to existing PMTAs or new submissions.

    Manufacturers must ensure that new facilities meet the highest quality and compliance standards. Proactively managing these regulatory requirements ensures that products remain market-ready even as production locations change.

    The Future of the Vaping Industry Amid Trade Challenges

    Looking ahead, it’s clear that trade tariffs and global manufacturing shifts are not short-term challenges. Regardless of who occupies the White House, protectionist trade policies are likely to persist or even intensify. The vaping industry must be prepared for this new reality.

    Companies that fail to diversify their manufacturing operations face mounting costs and increasing vulnerability to trade disruptions. On the other hand, those who invest in flexible, resilient supply chains will be well-positioned to thrive.

    The vaping industry is at a crossroads. Global trade tariffs pose a significant threat, but they also offer an opportunity for companies to rethink their supply chains and build more resilient operations. For manufacturers, shifting production from China to countries like Malaysia is not just a reactive measure—it’s a strategic move to secure long-term growth and competitiveness.

    As the industry moves forward, companies that adapt to these challenges will be the ones that lead the way. The ability to anticipate trade disruptions, embrace innovation and maintain rigorous quality standards will determine who succeeds in this ever-evolving market.

    As co-CEO of Ispire Technology Inc., Michael Wang is a leader in the development and commercialization of vaping technology and precision dosing. Previously, he served in executive roles at The Pharm/Sunday Goods, Onestop Commerce, Zazzle, and Honeywell.

  • GSTHR Report Finds Vapes Help Smokers Quit

    GSTHR Report Finds Vapes Help Smokers Quit

    The latest Briefing Paper from the Global State of Tobacco Harm Reduction (GSTHR), a project from public health agency Knowledge·Action·Change (KAC), focuses on Aotearoa New Zealand’s remarkable journey towards “smokefree” status.

    “Pro-consumer laws and an endorsement for vaping: why smoking is disappearing in Aotearoa New Zealand” tells the story of the country’s rapid and growing embrace of vaping, which overtook smoking in 2022, and provides another vital case study showcasing the potential of tobacco harm reduction through the adoption of safer nicotine products (SNP), following recent GSTHR Briefing Papers on Japan and the United Kingdom. This country profile also features in The Global State of Tobacco Harm Reduction 2024: A Situation Report published last month.

    While Aotearoa, New Zealand, had been experiencing falling smoking rates for the last 50 years, this decline gathered pace following the widespread adoption and, in 2018, the legalization of nicotine vaping products. Thanks to the Government’s step change in vaping policy, Aotearoa New Zealand now has a considerable chance of reaching its “Smokefree 2025” goal, a designation indicating that smoking prevalence has been reduced to below 5%.

    David MacKintosh, a director for KAC, said the Briefing Paper explores the rapid trajectory of Aotearoa New Zealand’s progress in reducing smoking, the approaches that have underpinned this, and the lessons that can be learned.

    “By embracing vaping as a tool for smoking cessation, policymakers are accelerating the transition away from cigarettes and their associated harms,” he said. “More needs to be done in addressing high smoking rates in some groups, notably among Māori communities, which contributes significantly to health disparities in the country. However, the experiences and success of Aotearoa New Zealand provide food for thought for many other countries seeking to tackle smoking.”

    This would be a remarkable achievement given the smoking rate in 1976 was 40% for men and 32% for women. This has now fallen to the point where only 8.3% of adults smoked in 2023. In the same year 11.9% of adults vaped in the country, up from 1.4% in 2016. But while the overall smoking figures are low, they mask much higher rates within some communities. Daily smoking prevalence for Maori, who make up 16% of the country’s population, was 17.1% in 2022/2023, which is in stark contrast to the 6.1% rate for people of European descent.

    Alongside regulatory oversight of vaping products to ensure quality and safety, a key factor has been the proactive encouragement of vaping as a tool for smoking cessation by the Government. The Ministry of Health has provided official resources for people looking to stop smoking with the help of vaping. Smokefree New Zealand, a smoking cessation resource run by the country’s publicly funded healthcare service Health New Zealand, has stated that “using vaping products is a legitimate option for those people who are trying to quit smoking”.

    Through the Vaping Facts website, the Ministry of Health of New Zealand and Health New Zealand have also emphasized the Cochrane Review’s position that vaping is significantly safer than smoking.

    Aotearoa New Zealand’s attitude to vaping is in direct contrast to its neighbor Australia, which has heavily restricted the availability of SNP by making nicotine available only in pharmacies. Australia has sought to reduce significantly the availability of safer nicotine products, which has led to the proliferation of a thriving black market in the absence of a legal market. Meanwhile, with its broadly supportive public health messaging, Aotearoa New Zealand has enabled consumers to make positive changes in their own volition, enabling them to switch from smoking to safer products.

    These differences in approach have resulted in a marked difference in smoking rates between the two countries, with Australia’s smoking prevalence plateaued in recent years after many years of steady decline. Indeed, the current smoking prevalence for Australians aged 14 and over has only fallen slightly in the last five years, from 12.8% in 2018 to 11.8% in 2023.

    It should be noted that Aotearoa New Zealand’s attitude towards vaping is not mirrored for all SNP. While heated tobacco products are also legal, the sale of both snus and nicotine pouches is banned. Still, as this Briefing Paper shows, Government and public health organizations in Aotearoa, New Zealand, working with consumers, have highlighted the crucial role that vaping can play in reducing smoking.

    The country has demonstrated its ability to enact pro-consumer legislation effectively, and its consistent endorsement of some safer nicotine products has been a key component of its stop-smoking strategy. Central to this has been consumers, who have established a demand for safer products and proven to the Government that these products can and will exist despite initial legislative opposition.

  • Zimbabwe to Phase Out Ethylene Dibromide

    Zimbabwe to Phase Out Ethylene Dibromide

    The Kutsaga Tobacco Research Center in Zimbabwe announced the phaseout of ethylene dibromide (EDB) effective Dec. 31.

    In a notice to the industry, Kutsaga said the measure was necessary to ensure that the country’s leaf tobacco meets international standards. More than 90 percent of Zimbabwe’s tobacco crop is exported.

    “No person shall treat any tobacco with a remedy which is not registered nor reap of offer for sale any tobacco treated with nonregistered remedy,” the notice read. “Furthermore, any tobacco so treated will be destroyed without compensation to the grower.”

    Zimbabwean tobacco farmers have used the agrochemical for soil fumigation for many years. According to Kutsaga, there are several alternative nematicides and soil formulations available for nematode control. The research station is also evaluating new active ingredients.

    EDB joins a growing list of banned fungicides, growth regulators, herbicides and insecticides in Zimbabwe. Other prohibited chemicals include benomyl, butralin and alachlor.

    The agrochemical’s discontinuation notice comes as the Zimbabwean tobacco sector anticipates record-breaking tobacco yields for the 2024–2025 growing season, thanks to heightened prospects of good rainfalls due to the La Nina weather phenomenon.

  • Bulgaria to Raise Excise Taxes

    Bulgaria to Raise Excise Taxes

    Photo: Rodworks

    Bulgaria will increase excise taxes on tobacco products in 2025, reports Novinite.

    The finance ministry has proposed to fast-track the increases originally set for 2025 and 2026. Specifically, the excise tax on cigarettes will rise from LEV194 ($104.09) for 1,000 cigarettes to LEV211, which will likely increase the cost of a pack by LEV0.7 to LEV0.8.

    The excise duty on smoking tobacco will also increase, rising from LEV184 per kilogram to LEV0222, while the tax on heated tobacco will jump from LEV331 to LEV400 per kilogram. The excise tax will also rise for other smoking products, including those with or without nicotine, such as herbal mixtures. The ministry expects that these accelerated increases will generate over LEV230 leva in revenue in 2025.

    Despite these planned increases, the Ministry of Finance asserts that the rise in excise duties will not hinder the country’s goal of maintaining 2 percent inflation as part of its preparations for joining the eurozone.

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  • Creditors Approve Canadian Litigation Deal

    Creditors Approve Canadian Litigation Deal

    Creditors have approved a proposed litigation settlement that would require three leading tobacco companies to pay billions to Canada’s provinces and territories, reports CBC.

    The proposed CAD32.5-billion deal between JTI-Macdonald Corp., Rothmans, Benson & Hedges and Imperial Tobacco Canada and their creditors was announced in October after more than five years of negotiations.

    Representatives for the creditors, which include provincial governments seeking to recover smoking-related health-care costs as well as plaintiffs in two Quebec class-action lawsuits, voted on the plan in a virtual meeting Dec. 12.

    The proposed settlement includes $24 billion for provinces and territories, $4 billion for tens of thousands of Quebec smokers and their heirs, and more than $2.5 billion for smokers in other provinces and territories. It also includes more than $1 billion for a foundation to help those affected by tobacco-related diseases.

    If approved in court, the proposed deal would end more than a decade of litigation.

    In 2015, a Quebec court ordered the three companies to pay about $15 billion in two class-action lawsuits involving smokers in the province who took up the habit between 1950 and 1998 and either fell ill or were addicted, or their heirs.

    Four years later, the landmark ruling was upheld by the province’s Appeal Court. The companies then sought creditor protection in Ontario in order to negotiate a global settlement with their creditors.

    All of the legal proceedings against them were put on hold during the talks. That order has now been extended until Jan. 31, 2025.

    The court is scheduled to review the proposed settlement toward the end of January.

  • Illegal Cigarette Factory Dismantled in Latvia

    Illegal Cigarette Factory Dismantled in Latvia

    Photo: Europol

    Latvian authorities dismantled a large illegal cigarette factory last week.

    The massive illegal manufacturing site was fully equipped with production machinery and raw materials. Police detained 32 people and seized nearly 300 million cigarettes, along with approximately 47 tons of leaf tobacco.

    If the cigarettes had entered the market, they would have deprived the Latvian state of more than €75 million in revenues, according to authorities.

    Searches were conducted simultaneously at multiple locations. Police carried out 26 searches in Riga, discovering warehouses containing cigarettes and detaining seven individuals, including six Latvian and one Russian national.

    Meanwhile, the state border guard carried conducted eight searches in Ludza, Rēzekne and Daugavpils, detaining 25 Ukrainian nationals at the Ludza factory, where counterfeit cigarettes were being manufactured under well-known brand names.

    The investigation was supported by Europol, which provided analytical support, and the Lithuanian Customs Criminal Service.

  • STMA Appoints New Deputy Director

    STMA Appoints New Deputy Director

    China’s State Tobacco Monopoly Administration (STMA) has appointed Liu Sanjiang as its deputy director, reports 2Firsts.

    Previously, Liu served as the director of the department of quality development at the State Administration for Market Regulation,

    This appointment follows a series of corruption investigations targeting senior STMA officials.

    The STMA is the country’s official regulatory body overseeing the tobacco industry and market, including NGPs such as e-cigarettes.

  • PMI Settles D.C. Flavor Ban Violations Case

    PMI Settles D.C. Flavor Ban Violations Case

    Image: PMI

    Swedish Match North America (SMNA) will pay $1.2 million to settle an investigation into violations of Washington D.C.’s flavored tobacco ban, reports Reuters.

    The District of Columbia attorney general’s office accused SMNA of facilitating online sales of “tens of thousands” of flavored Zyn nicotine pouches to D.C. consumers between Oct. 1, 2022, when the ban was enacted, and June 30, 2024.

    SMNA parent company Philip Morris International must now monitor its distributor’s compliance with D.C.’s ban quarterly and stop sales of flavored Zyn pouches through Zyn.com and related e-commerce platforms.

    Nicotine pouches became the second most commonly used tobacco product in the U.S. after combustible cigarettes, according to the Centers for Disease Control and Prevention.

    PMI suspended sales on Zyn.com after it had been issued a subpoena by the D.C. attorney general earlier this year.

    Swedish Match would continue to focus on its brick-and-mortar stores, PMI said in a statement e-mailed to Reuters.

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  • Bangladesh to Ban E-cigarette Imports

    Bangladesh to Ban E-cigarette Imports

    Bangladesh will ban the import of e-cigarettes and related products, reports bdnews24.

     According to a statement issued by the cabinet division, the health services division proposed to take urgent measures to ban the import of all products tied to the electronic nicotine delivery systems or e-cigarettes “to protect public health and keep future generations safe.”

     After the discussion, it was decided that e-cigarettes will be included in the list of banned products in the import policy order of the ministry of commerce.

  • FDA Submits Proposal to Limit Nicotine

    FDA Submits Proposal to Limit Nicotine

    The U.S. Food and Drug Administration has submitted a proposal to limit the amount of nicotine in tobacco products, reports CNN.

    The FDA has been discussing limiting nicotine levels since 2018, and this week, the FDA submitted the proposal to the Office of Management and Budget (OMB). This move comes as the Biden administration enters into its last weeks and President-elect Donald Trump prepares to take office in January 2025.

    “A proposed product standard to establish a maximum nicotine level to reduce the addictiveness of cigarettes and certain combusted tobacco products, when finalized, would be among the most impactful population-level actions in the history of U.S. tobacco product regulation,” the FDA said in a statement.

    “Once finalized, this rule could be a game-changer in our nation’s efforts to eliminate tobacco use,” said Harold Wimmer, president and CEO of the American Lung Association. “Making tobacco products nonaddictive would dramatically reduce the number of young people who become hooked when they are experimenting. To fully address the toll of tobacco on our nation’s health and across all communities, it is critical to reduce nicotine levels to nonaddictive levels in all commercial tobacco products, including e-cigarettes.”

    “Certainly, there would be individuals who would benefit from substantially lower nicotine levels and find it easier to quit,” said Rose Marie Robertson, a cardiologist and chief science officer at the American Heart Association. “It’s really hard to quit. I’ve seen patients over many years who have gotten the wake-up call with a heart attack or a stroke and really want to improve their health and reduce their risk, but it’s just very, very hard to do.”

    The submitted proposal does not mean that there will be any immediate changes. The OMB’s approval process can take months, and there must be a public comment period. It is likely that the tobacco industry will sue the government as well, as has been seen with other proposed regulations.

    It is unclear what will happen with the proposal following the change in presidency. In Trump’s first term, the Trump administration signaled that it wanted to limit nicotine, but during this year’s election season, the tobacco industry donated heavily to Republicans, and Trump’s pick for chief of staff was previously a tobacco lobbyist.