E-Cig China

[1] To create a good consumption environment and deter criminals, Shenzhen Longgang District Tobacco Monopoly Bureau, in conjunction with public security, market supervision, and other departments, publicly destroyed the illegal e-cigarettes involved for the first time.

[2] On April 9, according to the Department of Health of Kaohsiung City, Taiwan Province, China, since the implementation of the e-cigarette ban on March 22, 15 of the 44 e-cigarette stores in Kaohsiung City have been closed.

[3] On April 12, the official website of the Hong Kong Legislative Council published the "Minutes of the Meeting Process." Among them, Lin Shixiong, director of the Hong Kong Bureau of Transport and Logistics, proposed four significant elements of supervision on the transshipment of e-cigarettes in Hong Kong: pre-registration, security measures, pre-declaration, and real-time monitoring.

International News

#Russia#

[1] On April 6, 2023, 2FIRSTS CEO Zhao Tong and 2FIRSTS Russian Regional Vice President Xu Minghao met with Menshov Valery, a senior researcher of the Russian Academy of Sciences, and Alexey V. Trofimov, deputy director of the Emmanuel Institute of Biochemical Physics, exchanged views on scientific research work in the field of electronic cigarettes.

[2] On April 6, the "China-Russia Electronic Cigarette Trade Compliance and Development Work Exchange Conference" was held in Moscow. Representatives from the China Council for the Promotion of International Trade-China Chamber of International Commerce, the Russian State Duma, the Russian Nicotine Union, the Russian Chinese Entrepreneurs General Chamber of Commerce, and 2FIRSTS participated. The participants conducted in-depth discussions on China-Russia e-cigarette compliance cooperation, trade promotion, and industry collaboration.

[3] With the withdrawal of European and American tobacco companies, the competitive advantage of Chinese e-cigarettes in the Russian market has become prominent. China's exports to Russia will reach 82.5 billion rubles in 2021 and are expected to increase by 35% to 111 billion rubles in 2022. Igeekphone, a consumer electronics information platform, issued a document stating that Chinese e-cigarettes will have broad prospects for entering the Russian market in the next three years.

[4] On April 13, at the live sharing meeting of "Interpretation of Russia's E-cigarette Additive Ban Policy" held by 2FIRSTS, LEV GRIG ORIEV, Chairman of the Professional Union of Russian Market Participants, Member of the Committee of Experts on Competition in the Tobacco and Nicotine-Containing Products Market of the State Duma of the Council of the Russian Federation

said that the ban on e-cigarette additives in Russia may be delayed.

#UK#

[1] On April 6, according to foreign media express, a survey by The UK Vaping Industry Association (UKVIA) showed that if flavored e-cigarettes are banned, nearly 1.5 million ex-smoking users will return to cigarettes.

[2] On April 12, Booker, one of the largest consumer goods wholesalers in the UK, announced that it had recalled six disposable e-cigarette products of the Elux brand due to manufacturing quality problems.

[3] Philip Morris International launched its first disposable e-cigarette VEEBA in the UK last month, priced at £5. However, according to observations from 2FIRSTS, VEEBA is sold at a discount on many e-commerce platforms, which ranges from 30% to 50%. In contrast, the price of the Elfbar600 with the same number of ports remains at around £5 each.

[4] On April 13, according to Better Retailing news, due to the manufacturing quality problems, following the recall of Elux-related disposable electronic cigarette products, another report confirmed that Booker has also issued a recall of SKE Crystal and IVG disposable electronic cigarette series products notify.

#Other#

[1] On April 7, according to the Korean official media 'Joseon Ilbo," the global e-cigarette market is expected to grow from 117.9 trillion won in 2020 to 250 trillion won in 2024.

[2] The Tobacco Department of the Egyptian Chamber of Commerce announced it would increase the prices of 10 types of cigarettes from April 6, including the well-known Egyptian cigarette brand Merit. It is reported that these 10 types are all products under Philip Morris International (PMI).

[3] According to a Korean media report on April 11, the operating profit margin of PMI Korea raised from 5.4% in 2021 to 11.7% in 2022; KT&G's operating profit reached 1.123 trillion won in 2022 with an operating profit margin of 30.3%; BAT Korea's 2022 operating margin dropped from 10.7% in 2021 to 8.3% in 2022.

[4] Vuse's nicotine-free product "Vuse Go" will enter Japan on April 17, with a limited sale of about 10,000 sticks on Amazon, priced at 980 yen.

International Regulations

#Russia#

[1] According to Russian media reports, the Russian State Duma Committee decided on April 3 to postpone the review of the Tobacco Circulation Bill until April 11.

[2] On April 11, Russia discussed e-cigarette regulatory proposals at the State Duma meeting. The proposals include: prohibiting the addition of flavoring to e-cigarettes; increasing the minimum price of e-cigarette oil; prohibiting "fancy" packaging for e-cigarette products, etc. 2FIRSTS will continue to follow up and report.

[3] On April 11, at the Russian State Duma plenary meeting, more than 99% of the votes supported the "Proposal on Amending Individual Legislative Regulations of the Russian Federation." The proposal aims to tighten the regulation of e-cigarettes in Russia, including the prohibition of e-cigarette flavoring additives. 2FIRSTS Russian market experts conducted an in-depth interpretation of this event.

[4] 2FIRSTS interviewed Russian experts in e-cigarettes. They said the law does not expressly prohibit "e-cigarette flavors"; if Russia bans e-cigarettes, the market will become completely illegal and shrink by about half, but there is still room for maneuver. The industry experts will discuss specific options for a ban with the Russian government.

[5] Volodin, Chairman of the Russian State Duma, stated on the E-cigarette Supervision and Circulation Act: Criminal penalties for illegal sales of e-cigarettes will be increased, and relevant tax laws will be amended to curb the consumption of e-cigarettes.

[6] On April 12, Russia planned to implement a national regulatory policy on circulating tobacco and nicotine-containing products. The State Duma passed the relevant bill in the first reading. HNB products represented by IQOS will be included in the license supervision, and the production license will be implemented before March 1, 2024.

[7] On April 12, according to the Russian media pnp report, the Russian government proposed that the production, storage, and supply of cigarettes, tobacco, and electronic nicotine products require a state license. The bills (No. 310882-8 and No. 310820-8) were adopted by the State Duma in a plenary session on the same day.

[8] On April 13, at the live Q&A session of "Interpretation of Russia's E-cigarette Additive Ban Policy" held by 2FIRSTS, IGOR SAMBORSKIY, CEO of BABYLON, one of Russia's largest compliant distributors, said that he will be cautious before September Wait and see, speaking that the additive ban has little impact on the legal market. The Chinese e-cigarette manufacturers that have been shut down will be even more difficult after September 1.

#US#

[1] Since the start of the year, U.S. Postal Service officials said they have seized and destroyed about 3,000 packages of smuggled cigarettes destined for Connecticut, New York, and other states.

[2] Hawaii's new tax bill, passed by the Hawaii Finance Council, proposes to amend the tobacco tax law to include vaping products and e-liquids and increase license fees for dealers and retailers. A previous bill addressing the growing youth vaping rate failed to pass.

[3] West Virginia has settled a lawsuit with e-cigarette maker Juul Labs Inc. over allegations the company violated the state's consumer credit and protection laws. Juul has agreed to pay the state a $7.9 million settlement.

[4] On April 12, US e-cigarette giant Juul Labs Inc agreed to pay $462 million in settlements to six states, including New York and California, as well as Washington, DC, to bear charges of unauthorized marketing of products to minors.

[5] PMI believes that Reynolds Tobacco has infringed its patent and requested the court to permanently ban Reynolds from selling Vuse e-cigarettes. A federal judge in Virginia rejected the request on April 10, but Reynolds was required to pay the patent fee to PMI.

[6] At 9:30 EST on April 12, the US FDA held a public oral hearing on the "Proposed Requirements for Tobacco Product Manufacturing Regulations (TPMP)," which involves requirements and related regulations for tobacco production (including e-cigarettes).

[7] On April 11, Rep. Suleman Lalani of Texas introduced a bill requiring every institution of higher education to take steps to ban tobacco products and e-cigarette use by August 1, 2024.

[8] On April 12, the US FDA Center for Tobacco Products (CTP) published resources such as forms and videos on its official website to help companies prepare and submit their premarket tobacco product applications (PMTA).

[9] On April 12, the Center for Tobacco Products of the US Food and Drug Administration (FDA) held a public hearing to hear suggestions and comments from all parties on the Proposed Requirements for Tobacco Product Manufacturing Practices (TPMP). A total of 18 participants expressed their views in the hearing, and 2FIRSTS summarized the important points related to the manufacture of e-cigarettes in the hearing.

# UK #

[1] Public Health Minister Neil O'Brien proposed a series of measures to crack down on illicit vaping and underage sales. The Independent British Vaping Trade Association (IBVTA) told 2FIRSTS that the association welcomed the announcement.

[2] On April 11, Reuters reported that the British government plans to encourage millions of smokers to switch to e-cigarettes. Under the scheme, nearly one in five smokers will receive free vaping starter kits and cessation support. The government aims to reduce the smoking population from 13% to 5% or less.

#Asia#

[1] On April 4, according to the New Straits Times, the Malaysian government approved an amendment to the Poisons Act 1952 to allow the legalization of nicotine-containing products. Prime Minister Anwar Ibrahim has promised that the Tobacco Products and Smoking Regulation Bill 2022 ("GEG" Bill) will be tabled in the Lower House of Parliament in May to ensure comprehensive regulation of nicotine-containing products.

[2] According to the "New Straits Times" report, the Johor state government in Malaysia will maintain the ban on the sale of e-cigarette products since 2016, including e-cigarette products and e-cigarette oil.

[3] On April 11, Australian Finance Minister Jim Chalmers slammed the "explosive growth" of e-cigarettes among teenagers and hinted to the media that stricter taxes might be imposed on them soon; health experts also disapproved of politicians' calls for the deregulation of e-cigarettes.

[4] According to local media reports, on April 10, the Malaysian Electronic Cigarette Chamber of Commerce expressed concern about the upcoming regulatory laws for the electronic cigarette industry. It said that the association did not understand the forthcoming regulations. The association also urged the Ministry of Health to discuss this with industry players.

[5] The South Australian state government has proposed new laws that would ban e-cigarettes in more outdoor public places and increase fines for selling or supplying tobacco to minors, measures the state officials will curb youth vaping.

China Company

[1] On April 6, Jinjia shares stated on the investor interaction platform that Shenzhen Yunpu Xinghe provides e-cigarette export OEM for customers at home and abroad, e-cigarette packaging, assembly, customs declaration and export, international logistics, and other supply chain services.

[2] On April 10, Changhong Energy announced acquiring a 61.7% stake in Shenzhen Juheyuan Technology Co., Ltd. (Shenzhen Juheyuan) for a total of 98.7169 million yuan. Shenzhen Juheyuan products are mainly used in the field of electronic cigarettes.

[3] On April 10, Zhicube's 2022 annual announcement stated that in 2022, the company's operating income would be 508 million yuan, a year-on-year decrease of 7.35%; the net profit attributable to the parent company will be 117 million yuan, a year-on-year increase of 1.48%; A cash dividend of 10 yuan (including tax) will be distributed for every 10 shares, and 5 shares will be transferred to all shareholders for every 10 shares from the capital reserve.

[4] On April 11, China Bolton announced that it had obtained the right to use a piece of land located in the International Cooperation Industrial Park in Tonghu Ecological Intelligence Zone, Huizhou, at the cost of RMB 40,490,000, covering an area of ​​54,533 square meters for the construction of headquarters and electronic atomizer manufacturing The second phase of the base project.

[5] On April 11, Rhine Biotech announced that the company was allocated 214,285 shares of Ispire's public offering with US$1.5 million of its funds. Previously, CBD manufacturer Ispire was listed on the Nasdaq Stock Exchange in the United States on April 4, with an issue price of US$7.00.

[6] Recently, according to Tianyancha, Goertek Group Co., Ltd. newly invested in Goertek Living Co., Ltd., whose business scope includes catering services; food sales; accommodation services; residential interior decoration; tobacco products Retail; e-cigarette retail, etc.

Overseas company

[1] On April 7, British American Tobacco (BAT) invested $10 million to develop a drug for neurological diseases in cooperation with CBD company Charlotte's Web. It was the tobacco company's first foray into drug development.

[2] On April 11, electronic cigarette hardware supplier Blinc Group and CBD manufacturing company Growpacker jointly issued a memorandum of cooperation to establish a strategic partnership. The move is intended to accelerate their joint development in California.

[3] On April 13, tobacco and e-cigarette manufacturer Imperial Tobacco (Imperial Brands) announced that the company expects its operating profit growth to accelerate in the next three years and will reach a median compound annual growth rate. The revenue of new tobacco products in the first half of the year is expected to exceed that of the same period last year.

Also read:

Global Electronic Cigarette Industry Weekly Report (March 4th Week 3.27-4.02)