China Tightens Regulation on E-Cigarette Sector
The e-cigarette sector in China was in a regulatory gray area for a long time. In order to regulate the development of the e-cigarette sector, the State Council of the PRC released the Decision on Amending the Regulations for the Implementation of the Tobacco Monopoly Law of the PRC on 10 November 2021, which clearly stipulates that " regulations on e-cigarettes and other new tobacco products shall be implemented with reference to the relevant provisions of the Regulations".
Later, the State Tobacco Monopoly Administration of the PRC released the Administration Measures for E-cigarettes on 11 March 2022, and the State Administration for Market Regulation of the PRC (State Standardization Administration Committee) issued the National Standards for E-cigarettes on 8 April 2022.
The National Standards for E-cigarettes will be implemented from 1 October 2022. Upon the implementation of the national standards, the e-cigarette products sold in China must meet the national standards. The regulatory authorities have specially set up a transition period from 10 November 2021 to 30 September 2022. During the transition period:
- The existing production and operation entities of e-cigarettes which have been registered with the market supervision department before10 November 2021 can continue to carry out production and operation activities and shall apply for relevant licenses and product technical review in accordance with the Administration Measures for E-cigarettes, National Standards for E-cigarettes and supporting policies. The specific schedule is as follows:
(1)
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From 5 May 2022, the existing production enterprises of e-cigarettes, aerosols and nicotine for e-cigarettes can submit their intention for the application of the license for tobacco monopoly production enterprises to the provincial tobacco monopoly administrative department where they are located, and then submit a formal application according to the time schedule.
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(2)
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From 1 June 2022, the existing retail entities of e-cigarettes can submit an application for the tobacco monopoly retail license to the tobacco monopoly administrative departments of municipal and county-level where they are located.
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- The existing production and operation entities of e-cigarettes are not allowed to build or expand production capacity and shall not set up new e-cigarette retailing outlets.
- All kinds of investors are not allowed to set up new e-cigarette production and operation enterprises.
After the end of the transition period, any production, wholesale and retail of e-cigarette products without a license will be subject to administrative punishment in accordance with the Tobacco Monopoly Law of the PRC and the Regulations for the Implementation of the Tobacco Monopoly Law of the PRC. If the circumstances of the case are serious enough to constitute a crime, criminal responsibility shall be investigated as well.
In addition, China will establish a unified national e-cigarette transaction management platform according to the Administration Measures for E-cigarettes. Starting from 15 June 2022, e-cigarette manufacturers, wholesalers and retailers that have obtained related tobacco monopoly licenses shall gradually conduct transactions through the platform.
At the same time, the Administration Measures for E-cigarettes for the first time clearly prohibit the sale of e-cigarettes in any flavor other than tobacco and e-cigarettes that can add atomization.
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