CNMC Criticizes Health Ministry's Tobacco Regulation Draft

Key points:

The National Markets and Competition Commission (CNMC) of Spain has criticized the draft proposal by the Ministry of Health, stating that while it aims to address public health issues, it severely impacts competition in the tobacco market, particularly in the production and sale of e-cigarettes and nicotine pouches.

CNMC questions the lack of scientific basis for the proposed ban on e-cigarette and nicotine pouch flavors, as well as the proposal for standardized labeling and nicotine content limits. They also criticize the failure to explore alternative solutions that would have a lesser impact on competition.

The CNMC has warned that the draft legislation is not in line with EU regulations, which could cause trouble for businesses. It is recommended to strengthen public awareness campaigns and prohibit the sale of tobacco to minors, emphasizing that regulatory measures should adhere to good regulatory principles and be implemented through laws rather than royal decrees.

According to a report from the Huffington Post on April 10, the Spanish antitrust agency National Commission on Markets and Competition (CNMC) has strongly criticized the royal decree draft proposed by the Ministry of Health, which aims to regulate tobacco and related products.

The CNMC recognized the necessity of addressing public health issues caused by smoking but questioned the appropriateness of the proposed measures. According to the report, the proposed restrictions significantly impact competition in the tobacco market, particularly by placing restrictions on the production and sale of products such as e-cigarettes and nicotine pouches.

Criticism of CNMC focuses primarily on the ban on flavors other than tobacco in e-cigarettes and nicotine pouches. CNMC argues that this measure lacks empirical support and has not explored less restrictive alternatives that could minimize anti-competitive effects. Additionally, the report points out that the requirement for cigarettes and tobacco to have uniform packaging, as well as the limitation of nicotine pouches to a maximum of 0.99mg per pouch, lack sufficient scientific basis.

The CNMC also questioned the proportionality of the proposed measures, stating that other regulatory options that are equally effective but have less impact on competition were not adequately considered. The report suggests strengthening public awareness campaigns and banning the sale of tobacco to minors as feasible alternative solutions.

Another point of contention is the inconsistency with European regulations. The CNMC has warned that the proposed measures may diverge from future EU regulations that are currently under review by the European Commission, which could potentially add unnecessary trouble and complexity for manufacturers and retailers of tobacco products in Spain.

The report emphasizes that any measures restricting market competition must be in the public interest and adhere to principles of good regulation, such as necessity, proportionality, and non-discrimination. In addition, measures affecting business freedom should be implemented through laws rather than royal decrees.