Category: Enforcement

  • Agencies Want Closer Tracking of Imports

    Agencies Want Closer Tracking of Imports

    The U.S. Food and Drug Administration and the Department of the Treasury have announced a proposed rule that would require an importer to submit the FDA-issued Submission Tracking Number (STN) of electronic nicotine delivery system (ENDS) products into the electronic imports system operated by U.S. Customs and Border Protection.

    The new requirement will help streamline the process of reviewing the admissibility of ENDS products into the United States, according to the FDA’s website.

    After an applicant submits a marketing application for a new tobacco product, FDA assigns a unique identifier called an STN. Under the proposed rule, if finalized, any ENDS product, including e-cigarettes, for which the STN is not submitted may be denied entry into the U.S.

    An FDA-issued STN is one data element that is important to FDA’s admissibility review and determination, which also includes review of other information about the product as well as possible sampling and examination of the product, according to the agency.

    “Beginning tomorrow, the docket for the proposed rule, titled ‘Submission of Food and Drug Administration Import Data in the Automated Commercial Environment for Certain Tobacco Products,’ will be open for public comment through October 15, 2024.

    Visit the rulemaking docket at regulations.gov to learn more and comment on the proposed rule.”Beginning tomorrow, the docket for the proposed rule … will be open for public comment through October 15, 2024.

    Visit the rulemaking docket at regulations.gov to learn more and comment on the proposed rule.

  • New U.S. Task Force to Combat Illegal Vapes

    New U.S. Task Force to Combat Illegal Vapes

    Photo: Orhan Çam

    The U.S. Department of Justice (DOJ) and the U.S. Food and Drug Administration have established a federal task force to combat the distribution and sale of illegal vaping products.

    “Enforcement against illegal e-cigarettes is a multipronged issue that necessitates a multipronged response,” said Brian King, director of the FDA’s Center for Tobacco Products.

    In addition to the FDA and the DOJ, partners in the task force will include the Bureau of Alcohol, Tobacco, Firearms and Explosives; the U.S. Marshals Service; the U.S. Postal Inspection Service; and the Federal Trade Commission (FTC).

    “Unauthorized e-cigarettes and vaping products continue to jeopardize the health of Americans—particularly children and adolescents—across the country,” said acting Associate Attorney General Benjamin Mizer. “This interagency task force is dedicated to protecting Americans by combatting the unlawful sale and distribution of these products. And the establishment of this task force makes clear that vigorous enforcement of the tobacco laws is a government-wide priority.”

    The federal task force will focus on several topics, including investigating and prosecuting new criminal, civil, seizure and forfeiture actions under the Prevent All Cigarette Trafficking Act; the Federal Food, Drug and Cosmetic Act, as amended by the Family Smoking Prevention and Tobacco Control Act; and other authorities.

    “The U.S. Marshals Service asset forfeiture division stands ready to work with our task force partners in the seizure of unauthorized e-cigarettes from domestic distributors seeking to sell them unlawfully,” said Ronald Davis, director of the U.S. Marshals Service.

    “The Justice Department is committed to enforcing the laws that prevent the sale and distribution of unlawful e-cigarettes,” said Principal Deputy Assistant Attorney General Brian Boynton, head of the DOJ’s civil division. “We will work closely with our task force partners to address this crisis with all of the enforcement tools available to us.”

    The FTC, which releases reports about cigarette, smokeless tobacco and e-cigarette marketing and enforces various statutory and regulatory prohibitions on false and misleading advertising, will support the task force’s activities, including by sharing its knowledge about the marketplace for vaping products.

    “We look forward to sharing our experience with this rapidly changing, multibillion-dollar market through this important task force,” said Samuel A.A. Levine, director of the FTC’s Bureau of Consumer Protection.

  • Hong Kong Mulls Duty-Paid Labels

    Hong Kong Mulls Duty-Paid Labels

    Image: muh

    Hong Kong officials are considering putting designated labels on tobacco products so they can be easily identified as duty-paid, according to acting Health Minister Libby Lee, reports rthk.hk.

    Lawmakers expressed concern regarding efforts to combat illicit cigarettes following an increase in tobacco tax for the second year in a row. Lee noted that officials are looking into the feasibility of placing customs labels on duty-paid products and that progress will be reported in a few months.

    Lawmakers Johnny Ng and Peter Shiu stated that the 12 people prosecuted since 2021 for promoting tobacco products was too low a number, noting that it is common to see flyers promoting illicit tobacco products being handed out at public housing estates.

    Lee’s responded that it is difficult to enforce because officers cannot prosecute someone for holding flyers. She noted, however, that tobacco control officers remove around 50 websites monthly that sell illicit products, but they sometimes run into enforcement problems as well.

    “When it comes to overseas websites, we also have difficulty closing these websites or taking enforcement actions,” said Lee. “However, we’ll set up enforcement efforts … and publicity.”

  • Hong Kong Seizes $26.6 Million in Illegal Cigs

    Hong Kong Seizes $26.6 Million in Illegal Cigs

    Credit: Timothy Donahue

    Customs officers in Hong Kong seized illegal cigarettes worth more than HK$208 million ($26.6 million) in the first 15 days after a tobacco tax increase came into force as part of last month’s budget.

    Superintendent Jeff Lau Leung-chi of the Customs Revenue Crimes Investigation Bureau said on Monday that if the tobacco had been legally imported, the contraband products would have generated about HK$147 million in tax.

    Lau attributed the increase in cigarette seizures to enhanced enforcement action at all levels to combat the trade in illegal tobacco products and the operation’s longer duration in the second phase, according to media reports.

    “We also believe that crime syndicates anticipated the possibility of an increase in tobacco tax, so they stockpiled a larger quantity of illicit cigarettes ahead of time to supply the market after the tax hike,” he said.

    The untaxed cigarettes were discovered over the second phase of a citywide operation code-named “Tempest”, which involved the arrest of 776 people between February 29 and March 14.

    During the first round of the operation, which took place between February 19 and 28, Customs detained 538 people and seized HK$62 million worth of illegal tobacco products in 10 days.

  • Flava Pulled From Philippine Shelves

    Flava Pulled From Philippine Shelves

    Flava brand vaping products have been pulled from store shelves in the Philippines amid allegations of illegal marketing to minors and tax evasion, the Department of Trade and Industry has said.

    The DTI’s Fair Trade Enforcement Bureau (FTEB) on March 15 ordered Flava Corporation, Lilac’s Vape Shop, and social media influencer Lilac Sison Tayaban, CEO of Flava, to refrain from manufacturing, importing, selling, packaging and distributing imported Flava vapes, according to media reports.

    Once the Sampaloc, Manila-based business receives the preliminary order issued by DTI-FTEB, all of Flava’s commercial activities must immediately stop.

    Flava was the respondent to formal charges alleging violations of Republic Act No. 11900, or the Vaporized Nicotine and Non-Nicotine Products Regulation Act, filed before the DTI-FTEB on March 14.

    In turn, the DTI-FTEB gave the preliminary order to confiscate Flava products that violate RA 11900, to prevent the disposition or tampering of evidence and the continuation of the acts being complained of.

    The DTI is the lead implementing and enforcement agency of RA 11900, the landmark law aimed at protecting minors from vaping. The House Ways and Means Committee earlier estimated as much as P728 million ($1.3 million) in foregone tax revenues from the alleged technical smuggling of P1.4 billion worth of illicit Flava devices last year.

    After laboratory testing, The House panel discovered that Flava had not declared the vapes it imported from China. Flava allegedly mislabeled its ingredient as freebase nicotine, which has a lower excise tax than nicotine salt — the nicotine used in Flava products.

    Also, the House committee discovered Flava’s aggressive marketing of its flavored vapes to minors, most especially on social media—a violation of RA 11900. Last week, Bureau of Internal Revenue commissioner Romeo Lumagui Jr. disclosed that the taxman seized 1,029 master boxes of Flava vapes from a warehouse in San Pablo City, Laguna, with tax deficiencies totaling P75.7 million.

    The BIR raid conducted together with the Laguna provincial field unit of the Philippine National Police’s Criminal Investigation and Detection Group (PNP-CIDG) also led to the arrest of two individuals manning the warehouse.

    As such, the BIR will file criminal tax evasion charges against Flava.

    “This successful raid of a vape warehouse containing 102,900 bottles of Flava vape products will be one of many. The BIR supports the whole of the government’s approach to eradicating illicit vape products. We have warned you as early as 2022. Our raids are successful. We won the criminal cases. You already have pending warrants of arrest. Register and pay your proper taxes, or suffer the consequences,” Lumagui said.

    Meanwhile, Consumer Protection Group spokesperson, Trade Assistant Secretary Amanda Nograles said they will check the report of the Philippine Drug Enforcement Agency that marijuana-laced electronic cigarettes or vapes are now proliferating in the market.

    “That report alarms us, especially when these will be sold to minors. Since the information was just new, then we will get additional information. But the DTI will continue to confiscate vape products with flavor descriptors and have cartoon characters that are appealing to minors, and products that use influencers,” Nograles said in a radio interview.

    She said if the DTI encountered or confiscated vapes with marijuana oil, then they would refer it to the PDEA.

    On Thursday PDEA operatives seized cannabis oil and ‘kush’, and assorted vaping devices, with an estimated total value of P842,000 in simultaneous raids in Taguig City.

  • Civil Money Penalties for 21 Vape Shops

    Civil Money Penalties for 21 Vape Shops

    The U.S. Food and Drug Administration has issued complaints for civil money penalties (CMPs) against 21 brick-and-mortar retailers for selling unauthorized Esco Bars e-cigarettes.

    In a press release, the agency stated that it had previously issued each retailer a warning letter for their sale of unauthorized tobacco products. However, follow-up inspections revealed that the retailers had failed to correct the violations.

    The agency now seeks the maximum penalty of $20,678 from each retailer.

    The complaints announced today represent the first set of CMPs FDA has filed for the sale of unauthorized Esco Bars e-cigarettes. “These retailers were duly warned of what could happen if they continued selling these unauthorized e-cigarettes,” said Brian King, director of the FDA’s Center for Tobacco Products (CTP). “They should have acted responsibly to correct the violations, but they chose not to do so and now must face the consequences of that decision. FDA won’t sit back and tolerate inaction to comply with the law.”

    Currently, $20,678 is the maximum civil money penalty amount FDA can seek for a single violation from each retailer, consistent with similar CMPs sought against retailers for the sale of unauthorized Elf Bar products in Sept., Nov., and Dec. of 2023.

    The retailers can pay the penalty, enter into a settlement agreement based on mitigation factors, request an extension of time to file an answer to the complaint, or file an answer and request a hearing. Retailers that do not take action within 30 days after receiving a complaint risk a default order imposing the full penalty amount, according to the release.

    “Today’s CMP actions are just the latest in the continued, comprehensive push by FDA to take action across the supply chain to remove unauthorized e-cigarettes, particularly those that are popular among youth, from the marketplace,” the release states. “As of Jan. 30, 2024, FDA has issued more than 440 warning letters and 88 CMPs to retailers, including brick and mortar and online retailers, for selling unauthorized tobacco products.

    “In addition to actions involving retailers, FDA has issued more than 660 warning letters to firms for illegally manufacturing and/or distributing unauthorized new tobacco products, including e-cigarettes.

    “The agency has also filed civil money penalty complaints against 48 e-cigarette firms for manufacturing unauthorized products and sought injunctions in coordination with the U.S. Department of Justice against seven manufacturers of unauthorized e-cigarette products.”