Category: News This Week

Group Calls for Risk-Proportionate Rules

Photo: Balint Radu
The Malaysian Vape Chamber of Commerce (MVCC) has urged to government to introduce risk-proportionate taxes and regulations for e-cigarettes and combustible cigarettes, reports The New Straits Times.
Recently, the government of Malaysia announced a 200 percent tax hike for vape products, to be implemented at MYR1.20 per ml for nicotine e-liquids and non-nicotine e-liquids.
Industry players feel that the taxation rate is too high and will negatively impact the industry. They are likely to pass on the cost to consumers.
“Manufacturers have no choice but to increase the price of their products as the tax rate imposed is equivalent to the current retail price of vape products,” said MVCC Head of Information Ashraf Rozali. “For example, each 30ml bottle of e-liquid will be taxed at MYR36.”
“With this rate, the estimated retail price of vape e-liquids will reach twice the current price per 30ml bottle. Therefore, the new tax rate will not only affect one party but will impact the entire ecosystem, including adding burden on consumers,” Ashraf said.
At the same time, the government has also announced recently that a regulatory framework for tobacco and vape products will be tabled next year.
Any regulations introduced must include elements that can encourage smokers to switch to less harmful products such as e-cigarettes, said Ashraf. He called on the public to sign a petition calling for risk proportionate regulation.
December 20, 2021
Report: Flavored Vapes Remain Widely Available

Photo: kurgu128
Three months after a court-ordered deadline for the U.S. Food and Drug Administration to decide what e-cigarette products can stay on the market, FDA delays have left e-cigarettes in kid-friendly flavors widely available across the country, according to a new report released by the Campaign for Tobacco-Free Kids (CTFK).
Under a federal court order, e-cigarette manufacturers were required to submit marketing applications to the FDA by Sept. 9, 2020, and products that were the subject of timely applications were allowed to stay on the market for up to one year while the FDA reviewed the applications, a period that expired Sept. 9, 2021. The CTFK and other public health groups have urged the FDA to deny marketing applications for all flavored e-cigarettes because of “the clear evidence that flavored products have fueled an epidemic of youth e-cigarette use and nicotine addiction.”
The FDA has denied marketing applications for more than 1 million flavored e-cigarette products. However, the FDA has yet to issue decisions about the e-cigarette brands that have the largest market share or are most popular with kids, such as Juul, most Vuse products, NJOY, Blu, Smok and Suorin.
The FDA is also considering whether to authorize any menthol-flavored e-cigarettes despite the popularity of menthol products with kids, according to the CTFK.
In addition, more than 40 e-cigarette companies have filed lawsuits challenging the FDA’s marketing denial orders, and other companies—including Puff Bar, the flavored disposable e-cigarette that is now the most popular brand among kids—have started using synthetic nicotine because that substance is currently not regulated by the agency.
To assess the impact of the FDA’s actions to date on the availability of flavored e-cigarettes, the CTFK scanned five top online e-cigarette retailers and 43 brick-and-mortar stores in eight cities across the U.S. The group notes that the scan provides a snapshot of the current e-cigarette market and is not intended to be a representative sample of stores nationwide or online.
Key findings include that kid-friendly flavored e-cigarettes and nicotine e-liquids are still widely available; that the bestselling e-cigarette brands remain available for purchase; and that the most popular e-cigarette brands among youth are still available in flavors that appeal to youth, according to the CTFK.
The group has called on the FDA to act quickly on all remaining e-cigarette applications and deny authorization to all flavored e-cigarettes, including menthol-flavored products.
December 20, 2021
UKVIA Director General to Appear on China TV

John Dunne (Photo: UKVIA)
The U.K. Vaping Industry Association’s (UKVIA) director general has been invited to talk on national TV in China to give his thoughts on recent proposed regulation changes in China and their potential impact on the Chinese vaping industry both domestically and globally.
China recently amended its tobacco laws to include e-cigarettes, meaning they will now be regulated like conventional tobacco products.
The regulation of e-cigarettes in China is of critical importance to the international vaping industry because over 95 percent of e-cigarette hardware is manufactured in that country, leaving the sector keen to see whether this latest regulation change will reshape that global industry.
To look at these questions, John Dunne will be interviewed on the China Global Television Network to offer his perspective based on many years immersed in both U.K. and international regulatory environments for the vaping sector.
Speaking ahead of his interview, Dunne described “reasonable regulation” as a “good thing,” adding, “However, while regulation has the ability to raise standards, ensure products are safe for consumers and restrict minors access, in its current form, it could have a massive detrimental influence both domestically and internationally.”
The UKVIA, together with several other organizations, has outlined its concerns and suggestions to make the regulation more effective and less restrictive in a letter that is being submitted to the State Tobacco Monopoly Administration to consider.
During the interview, Dunne will also get the chance to speak to the Chinese media about the latest vaping developments in the U.K., such as it being potentially the first country in the world to prescribe e-cigarettes.
“We know here in the U.K. that what kills people is the combustion and the tar and not nicotine,” he said in a statement. “Our government sees vaping as the solution to a smoking problem and not the problem itself.”
He added, “I hope the Chinese government and STMA [State Tobacco Monopoly Administration] are open to listening to the industry leaders both domestically and internationally to help shape these regulations so that China can, like the U.K., seize the public heath prize that vaping offers without damaging a very large and vital export business.”
December 20, 2021
Belarusian Cigarette Smuggling at New High

Photo: Tricky Shark
The number of Belarusian cigarettes smuggled through Lithuania is growing at a record pace, reports Belsat, citing figures from Lithuania’s Customs Department.
In the first three quarters of 2021, Lithuanian law enforcement officers seized 328 million smuggled cigarettes, compared to 297 million in 2020.
This year, 16.7 million cigarettes were seized on the railroad alone, twice as many as last year. Cigarettes were usually hidden in bulk cargoes, among fertilizers and crushed stone. The problem is exacerbated by the fact that there is no X-ray equipment at some stations.
Illegal cigarettes account for a quarter of the cigarette market in Lithuania. Of all smuggled cigarettes, 84 percent were produced in Belarus.
Belarus’ state-owned Neman factory has been fingered as a major source of illicit cigarettes in the EU. Around 10 percent of the 5.5 billion cigarettes sold illegally in the U.K. annually are believed to have originated in Belarus.
In September, British American Tobacco in suspended the contract manufacturing of its brands at Neman, following international criticism for Belarus’ heavy-handed suppression of protests against the outcome of last year’s disputed presidential elections.
Accounting for 70 percent of domestic cigarette sales, Neman effectively has a monopoly on the Belarusian tobacco market. Washington says it is one of several entities that receive preferential treatment from the regime in return for providing funds to Lukashenko.
December 20, 2021
Iran: Production and Exports Skyrocket

Photo: efesenko
Iran produced 2.44 million kg of tobacco during the first half of fiscal 2021, 265.3 percent more than during same period last year, reports The Financial Tribune, citing data released by the Ministry of Industries, Mining and Trade.
There are presently 43 tobacco producing factories in Iran, compared with 36 last year, the Iranian Student News Agency (ISNA) reported.
The ministry’s data also show 400,200 kg of hookah tobacco were exported during the first six months of this year, up 445.8 percent rise over the corresponding period of 2020.
Cigarette exports nearly quadrupled from first half of the 2020 Iranian calendar year (March 21-Sept. 22) from the comparable 2021 period, according to The Tehran Times.
Iran exported 275 million cigarettes in the first six months of this year compared to the 71 million in the same period last year, ISNA reported.
The country’s cigarette output rose 14 percent in the first half of this year, to 28.7 billion cigarettes
December 20, 2021
Reynolds Prevails in Shareholder Dispute

Photo: RAI
The Supreme Court of North Carolina has upheld an April 2020 ruling by the N.C. Business Court that Reynolds American Inc. (RAI) provided “fair value” to shareholders who objected to the return they received from Reynolds’ $54.5 billion sale to British American Tobacco, reports The Winston-Salem Journal.
In January 2017, BAT announced it would acquire the 57.8 percent of RAI that it did not already own. BAT acquired a 42.2 percent ownership stake as part of Reynolds’ $4.4 billion purchase of BAT subsidiary Brown & Williamson Tobacco Corp. in 2004.
BAT’s initial offer for the remaining shares was valued at $59.64 a share. When the deal closed, the share price value had reached $65.87.
Believing the agreed-upon deal price significantly undervalued Reynolds, a group of dissenting shareholders, led by Third Motion Equities Master Fund, refused to tender their shares at closing. RAI then opted to pay them $59.64 per share plus interest..
The N.C. Business Court ruled that Reynolds “properly determined the ‘fair value’ of shares, saying the amount equaled or exceeded the value of Reynolds shares as of the date of the merger.”
The NC Supreme Court agreed with the Business Court judgment that that no further payments to the dissenters are required.
December 20, 2021
Lil Now Available in 20 Countries

Photo: KT&G
KT&G has launched its heat-not-burn product Lil in more than 20 markets within two years after signing a supply agreement with Philip Morris International for overseas sales of Lil in early 2020, the South Korean company announced on its website
Last year, KT&G and PMI launched Lil Solid 1.0 in Russia and Ukraine, and Lil Hybrid 2.0 in Japan. This year, the two companies expanded into other markets including Kazakhstan, Serbia and Armenia, with Lil Solid 2.0 as the flagship product. This August, an announcement was made that Lil was launched in a total 10 markets globally, Albania being the latest market at the time.
KT&G added additional markets in the fourth quarter this year. In November, Lil debuted in Guatemala, the first market in Central America, and the company expanded into the Asian market further, launching Lil in Malaysia after Japan. Additionally in the same month, Lil Solid 2.0 and its dedicated stick Fiit were launched in Italy.
Lil Solid 2.0 is a second-generation model of KT&G’s heat-not-burn products. It boasts improved battery performance and induction heating technology, and it comes in two colors, “stone grey” and “cosmic blue” outside Korea.
The dedicated sticks come in a total of eight variants including Fiit Regular and Fiit Crisp, and a new variant, Fiit Alpine, has been launched in the fourth quarter this year. Two to five variants have been launched in each country‒tailored towards consumer taste preference.
“Lil was able to quickly expand internationally thanks to Lil’s innovative technology in addition to PMI’s commercial resources and infrastructure,” said Wang Seop Lim, chief of KT&G’s next-generation products division. “We will continue to provide high quality products to consumers outside Korea through strategic collaboration with PMI going forward.”
December 20, 2021
Avail Vapor Closes Stores, Sells Assets

James Xu (Photo: Avail Vapor)
Avail Vapor has sold the majority of its retail locations and closed its remaining stores. The company has also sold or closed its ancillary businesses. James Xu, founder of Avail, said the decision was motivated by multiple factors over several years, including what he called unclear and convoluted federal regulatory processes.
At one time, Avail Vapor was the largest family-owned vapor retailer in the U.S. with more than 100 stores in a dozen states. In January 2020, the company split into regulatory compliance and consulting business, and a major wholesale distribution company. Those businesses have also been sold or closed.
Xu said the U.S. Food and Drug Administration’s premarket tobacco product application (PMTA) pathway was a major factor in the decision after the agency arbitrarily changed the requirements to get a PMTA approved. “It’s completely just a mess with FDA policy making and policy strategy. It just did not make any sense from day one,” Xu said. “Everything is really in this gray area. It was totally different from what our mission was and Covid is not helping any retailer.”
Xu said Avail spent more than $10 million in its bid to get regulatory approval since 2016, when the FDA set forth new compliance standards for vaping products. But the FDA rejected Avail’s applications in September and the company sued the government agency in federal appeals court. However, the FDA then stayed enforcement of its marketing denial order on Nov. 1, pending an administrative appeal.
The economic impacts of Covid-19 also created challenges for the company, which began downsizing in August when it sold an estimated 30 of its stores to North Carolina-based competitor AMV Holdings, parent to Kure and Madvapes. It then shuttered or sold its remaining 20 stores, including five in the same city as the company’s headquarters, Richmond, Virginia, Xu said in an interview with Richmond Biz Sense.
Avail was an early entry into the vapor market, opening its first stores in 2013. By 2015, the company was producing its own e-liquids in its 37,000-square-foot office and manufacturing facility. It soon began also producing e-liquids for several other major brands. Xu said that he is not leaving the vapor industry and that a new project would be announced soon.
December 20, 2021
Philippines Senate Passes Vaping Bill

Photo: Oleksii
The Philippine Senate on Dec. 16 approved the proposed Vaporized Nicotine Products Regulation Act, reports The Philippine Inquirer.
Senate Bill 2239 transfers regulatory authority over vapor products from the Philippines Food and Drug Administration’s authority to the Department of Trade and Industry.
According to Vaping360, the move was prompted partly by outrage over news that groups supported by Bloomberg Philanthropies had funded the FDA in an effort to influence the agency to impose harsh vaping restrictions.
The legislation prohibits the sale of vapor products to people below the age of 18 and bans e-cigarette sales within 100 meters from “any point of the perimeter of” a school, playground, or other facilities frequented by minors.
The bill also prohibits celebrities or social media influencers from endorsing vapor products.
Physical and online retailers or distributors must register with the Department of Trade and Industry and the Securities and Exchange Commission.
Senate President Pro Tempore Ralph Recto, the sponsor of the bill, said shifting to vaporized nicotine products “is a good public policy.”
“There will be less death and less expense on the part of society in treating patients. And that is the direction where many countries, more developed economies are moving toward,” Recto added.
The Philippines House of Representatives overwhelmingly passed a similar bill in May. The two bills will now go to a conference committee where they will be reconciled, and both houses will vote on the final version. Then the unified bill will go to President Rodrigo Duterte to sign into law or veto.
Tobacco control groups are lobbying the president to veto the bill when it reaches his desk. A veto can be overridden with a two-thirds vote of both houses.
December 17, 2021
Glover: Kiwi Tobacco Rules Hurt Minorities
Marewa Glover
New Zealand’s new tobacco rules will likely have harsh consequences for indigenous Māori and other minority groups, according to Marewa Glover, founder and director of the Centre of Research Excellence: Indigenous Sovereignty & Smoking.
On Dec. 9, New Zealand announced a raft of new measures to help achieve its Smokefree 2025 goal. The legislation includes a plan to gradually raise the age at which people can purchase tobacco until it covers all age groups. Children now aged 13 and below face a lifetime ban on legally buying tobacco.
The new law will introduce a licensing system for tobacco retailers, reducing the number approved to 5-10 percent of the current estimated outlets. It bans filters and flavors, and seeks to cap cigarette nicotine to levels that are unsatisfying for smokers dependent on the substance.
Writing in Filter, Glover says Māori will be disproportionally affected because they have significantly higher rates of daily smoking (22.3 percent) than New Zealanders of European ancestry (8 percent).
“Illicit markets will scale up to fill the void where there should be a regulated market,” says Glover. “Competition over such markets can bring violence, and Māori, heavily overrepresented among lower-income groups with the highest smoking rates, will bear the brunt. The government response to illicit sales will mean criminalization and arrests, further swelling the grossly disproportionate numbers of Māori who are incarcerated.”
Meanwhile, New Zealand’s sizable Indian and Asian communities will be hurt economically by the new rules, as they own the majority of the small retail businesses that sell tobacco, according to Glover. “When raised tobacco taxes made cigarettes unaffordable for a large proportion of people who smoked, we saw a surge in aggravated robberies of such stores, in an illustration of ignored unintended consequences.”
Glover argues that, in pursuing smoke-free objectives, a legal reduced-risk product market is more effective than prohibition and punishment.
December 17, 2021