Australia's New Vaping Law Leads to the Collapse of the Legal Market and a Surge in Black - market Transactions

Jun.23

Australia’s new vaping law has led to the collapse of the legal market and a surge in black - market transactions. The new regulations, which limit sales to pharmacies, have seen low participation and transaction volumes in the legal market, while black - market dealings have soared. Critics say the policy has fueled organized crime, and experts are calling for legalization and regulation to address the crisis.

Key Points:

·Legal market shrinking: After the implementation of the new law, monthly sales of legal e-cigarettes are less than 6,000, while black market transactions exceed 10 million, mainly dominated by disposable e-cigarettes from China.

·Policy flaws: Regulations restrict flavors, packaging, and sales channels, and failed to consult with pharmacies in advance, leading to the reluctance of most pharmacies (only 700) to participate.

·Black market expansion: The Minister of Health claims that legislation will "eliminate the black market," but the actual effect is the opposite, fueling organized crime and reducing tax revenue.

·Calls for reform: Experts criticize the current policies as failing and suggest comprehensive legalization and consumer-oriented regulation to replace the black market and reduce public health risks.

According to a report by The Telegraph, Australia's strict pharmacy-only e-cigarette laws have caused the legal e-cigarette market to collapse, giving organized crime power. Government data shows that out of 1700 e-cigarette transactions, only 1 was legal.

According to documents obtained by the newspaper, pharmacists report legal sales of e-cigarettes to be fewer than 6,000 per month, while over 10 million e-cigarettes flow into the black market every month - mostly Chinese disposable e-cigarettes sold in convenience stores and tobacco shops.

In 2024, the law allows nicotine e-cigarettes to be sold only in pharmacies without a prescription, but under strict restrictions: limited flavors, simple packaging, and no consumer-friendly branding. However, prior to the law being passed, pharmacies were not consulted so out of 5900 pharmacies, less than 700 have stocked the products.

Minister of Health Mark Butler claims that the legislation will "eliminate the black market," however, Jim McDonald writes:

“Butler's "world-leading" e-cigarette restrictions, combined with Australia's astonishingly high tobacco taxes, have decimated the legal e-cigarette industry, fueled the already massive black market, resulted in a decline in tobacco tax revenues, and encouraged organized crime to become involved in the e-cigarette market.”

Experts and critics are calling for comprehensive legalization and consumer market regulation to replace the black market and reduce harm.

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References:

[1] Australia’s Pharmacy-Only Vape Law Backfires

Also Read:

[1] New Zealand Official Says Vaping Rules Outperform Australia’s, Backs “Licensing Plus Regulation” Approach to Tobacco Control

[2] Queensland, Australia Seizes 76,000 E-cigarettes and Tobacco Products Worth $20.8M

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