Tobacco products will become part of the Chinese tobacco monopoly. This was announced by the Chinese government in November. Unconfirmed reports of bans on open systems are now worrying entrepreneurs and users around the world. At the same time, companies now hope for a stable future.
From being somewhat of a grey market in China, e-cigarettes, both hardware and e-liquid, will in the future be regulated to the same standard as the Chinese tobacco monopoly. Chinese authorities are now collecting comments on the upcoming proposal, which will have a significant impact on a market with a global turnover of more than 1,000 tonnes. 20 billion crowns and above 40 million users worldwide.
"A milestone for the vejp industry"
Today, the Chinese e-cigarette market consists of thousands of independent companies of varying sizes. This will reportedly continue to be the case in the future, but the decision raises both hopes and concerns. According to SMOORE, the company behind the Vaporesso brand, the news is positive.
"The legal recognition of e-cigarettes is a milestone for the Chinese vejp industry because it eliminates the uncertainty about the future of the industry," says Frankie Chen, global public relations manager for SMOORE, to Filter magazine. "Considering China's role in the global supply chain, mandatory standardisation requirements will significantly improve product safety and lead to better products" says Frankie Chan.
Rumours of a ban on open systems
Exactly what is included in the proposal is not yet known. What is clear is that in the future, companies on the market will have to register with the authorities, demonstrate financial stability and be part of a system of taxation and control of the products. This is according to information from China Briefing and Reuters.
However, according to information in various media the new legislation also includes restrictions on nicotine strength (20 mg/ml). According to some reports, there will also be a requirement that the nicotine comes from tobacco plants and that containers (tanks) cannot be filled with illegal substances. In practice, this would mean that so-called open systems would become illegal in China. However, this information is as yet unconfirmed. According to British studies, open systems are the most effective and popular variant of e-cigarettes in terms of successful smoking cessation.
Impact on supply in the vejp shops
The Chinese e-cigarette industry accounts for a crucial part of the supply in the world's vejp shops. Everything from high-end devices and tanks to simple disposable pods are manufactured in China. And according to John Dunne, Director General of the British trade association UKVIA legislation in China will have a major impact, both for businesses and consumers. And it's not all positive, he says.
"This will be particularly important in countries like the UK, US and EU states where we already have extensive legislation. While clear laws can have a positive impact on safety and reduce underage drinking, the proposal in its current form could have devastating consequences," Mr Dunne said. CGTN News
Exports 8 billion worth of cigarettes
The Chinese Tobacco Monopoly accounts for half of all tobacco sales. cigarette sales in the world and closer 27 per cent of the adult population smoke. Meanwhile, the Chinese vejp industry has been at the heart of the rapid development of the electronic cigarette market over the past decade. Chinese companies exported nearly 8 billion worth of vejp products in 2020, according to the research firm. E-cigIntelligence.
Unregulated until 2019
Until two years ago, the Chinese market was virtually unregulated, to the credit of the authorities. Economic growth has simply taken precedence over regulation. 2019 Chinese authorities banned domestic online sales of e-cigarettes and e-liquid. However, it did not affect the export of the hardware, the part of the sales that is focused on an international market. It is still unclear how the proposed laws will affect exported goods.
Hoping for a long-term approach
The China Electronics Chamber of Commerce is now collecting input from industry stakeholders for the upcoming legislation. According to Chinese media reports, the new law will come into force in May 2022.
"We hope the legislation preserves the viability of the industry while making the products safer and better in the long run," Wang Shenyi, chairman of Shenzhen Shikai Technology, said in a cautious comment to CGTN News.
Concerns about higher prices
In the UK, where e-cigarettes are an official tool to reduce smoking, hardware prices are a sensitive issue. A starter kit can cost a lot and discourage many smokers from trying the products. Therefore, in the last year, several local authorities have started distributing free e-cigarettes and e-liquid to smokers in economically vulnerable groups, to encourage them to quit smoking.
"E-cigarettes are the solution - not the problem"
According to John Dunne and UKVIA, demanding Chinese legislation could further drive up prices. UKVIA is one of many organisations now trying to influence Chinese authorities to think about future legislation from a health perspective.
"Unnecessarily harsh legislation can be costly. In the UK we know that it is the smoke from cigarettes that kills, not the nicotine. We see e-cigarettes as a solution to the problems created by cigarettes. That's why our authorities are even looking at the possibility of printing e-cigarettes on prescription. I hope that the Chinese legislation will take into account the consequences of overly harsh legislation," says Mr Perez. John Dunne to Tobacco Coreporter
