E-Cig China

【1】On March 21, the "Health Administration" of Taiwan's health and welfare department stated that it had amended some "Smoke Hazard Prevention Law" provisions. The law was officially implemented on March 22, completely banning electronic cigarettes, controlling heating tobacco and smoking devices, and raising the smoking age to 20 years old.

【2】On March 22, the Hong Kong Special Administrative Region government amended regulations to allow alternative smoking products to be transported through Hong Kong by sea and air, road and air. The relevant draft will be gazetted on March 24 and submitted to the Legislative Assembly on March 29. The Hong Kong Special Administrative Region Government stated it would establish a new regulatory system to strengthen supervision and reduce the risk of alternative smoking products entering the market. Penalties for crimes related to importing alternative smoking products will also be increased.

International News

#Europe #

[1] According to the media website The Grocer, SKE Crystal, the top ten disposable e-cigarette brand in the UK, has been removed from retailers such as One Stop and Booker. Merchants are concerned about the nicotine content of these e-cigarette oils exceeding UK regulatory standards.

[2] In response to BAT's "disposable e-cigarette inspection in the UK," on March 18, 2Firsts received an email reply from Sam Millicheap, director of external affairs of BAT's UK and Ireland company. The email acknowledged BAT UK's testing of major disposable vaping products.

[3] Recently, the British electronic cigarette market has ushered in a variety of new disposable electronic cigarette products. RELX will launch the disposable electronic cigarette product RELX MagicGo. In addition, it will launch the disposable electronic cigarette brand "WAKA soPro" and another brand, "WAKA soFit." Imperial Tobacco (ITG) has launched a new disposable e-cigarette brand, "blu bar," currently on sale in retail stores, priced at 5.99 pounds for a piece, including six flavors. Philip Morris International (PMI) launched the disposable electronic cigarette product "VEEBA" in the UK, which is priced at 4.99 pounds.

[4] According to 2Firsts understanding, several top brands in the Russian e-cigarette market are busy cleaning up their inventory, and some Russian distributors have refused to accept products without honest labels. The Russian government stipulates that starting from March 1, when engaging in the wholesale import of e-cigarettes, it is necessary to upload the retail information of related products to the honest labeling system; starting from April 1, e-cigarette products without labels will not be able to pass through Russia.

[5] British e-cigarette industry expert John Dunne said the UK sold about 459 million e-cigarette products yearly, causing severe environmental pollution. Therefore, measures to reduce tobacco harm should include the management of e-waste.

#North America #

[1] The credit rating agency KBRA released the latest report that about 4.5% of adults in the United States (10.9 million people) use e-cigarettes; in 2021, the US e-cigarette market will be about 7.4 billion US dollars, while the traditional cigarette market will be 215.7 billion US dollars in the same period; 30 states and Washington DC have enacted excise taxes on e-cigarettes. It is estimated that the compound annual growth rate of the US e-cigarette market will be 27.3% by 2028.

[2] According to the research report of Drug Watch, an American organization, about 25% of high school students in the United States use e-cigarettes, and the proportion of adults is about 6%. More than 35% of high school students in West Virginia use e-cigarette products, the highest proportion of a state in the United States; the proportion of adults using tobacco in West Virginia is also the highest in the United States, with a ratio of about 25.2%.

[3] About 250 Minnesota youth, parents, and advocates participated in "Smoke-Free Generation's Day" in Capitol Hill. It urged Minnesota lawmakers to act quickly to end the state's sale of flavored tobacco products.

#Latin America#

[1] On March 24, Cuban media reported that the country's tobacco leaf production in Pinar del Rio de Janeiro, known for its high-quality tobacco, is facing great difficulties. Affected by the hurricane, the province's 2023 harvest is expected to be challenging to meet the planned target (11200 hectares) half.

#Africa#

[1] According to statistics from the Tobacco Industry and Marketing Board (TIMB) of Zimbabwe, the rejection rate of tobacco auctions in Zimbabwe was 60.78% higher than last year. According to the research report of the Ministry of Commerce of China, Zimbabwe is the largest tobacco exporter in Africa and the second largest exporter of flue-cured tobacco in the world after Brazil, with an export rate of 99% of its annual output. It is reported that the country's tobacco is exported to 34 countries, and China is its largest consumer.

International Regulations

#Worldwide#

[1] The Coalition of Advocates for Tobacco Harm Reduction in the Asia-Pacific Region (CAPHRA) stated that country delegations to the Tenth Conference of the Parties (COP10) to the WHO Framework Convention on Tobacco Control (FCTC) should include at least one nicotine product consumer.

#North America #

[1] US Federal Court Denies Tobacco Industry Petition to Deny California Flavors Ban. The judge said the flavor ban applies only to market sales, and tobacco companies can still produce flavored tobacco in California. Therefore, this is insufficient to conclude that the flavor ban burdened interstate commerce.

[2] US Senate Majority Leader Chuck Schumer called on the FDA to investigate ELFBAR and ban its products from the market. He believes that ELFBAR uses colorful packaging to attract young customers, evading the supervision of US advertising laws by marketing on social platforms.

[3] The proposal to ban all flavored e-cigarette products in Maine is gaining the support of key lawmakers from both parties. The measure would ban the sale of flavored e-cigarettes other than tobacco flavors in Maine. Currently, five cities in Maine have banned flavored tobacco products.

[4] According to a report by the multi-agency Illicit Tobacco Task Force in Massachusetts, the state will lose millions of dollars in tax revenue in 2022 due to the crime of smuggling products such as e-cigarettes. Currently, the cigarette tax in Massachusetts is $3.51 (approximately RMB 24), and there is also a 6.25% sales tax.

[5] In response to the increase in non-tobacco nicotine in currently popular tobacco products, the US Congress passed a law regulating non-tobacco nicotine products by the FDA. The new law will expand the scope of tobacco product requirements in the Federal Food, Drug, and Cosmetic Act to cover manufacturers, importers, retailers, and distributors of non-tobacco nicotine products in the future.

[6] On March 21, Georgia lawmakers passed a bill that would restrict the use of e-cigarettes in public places. The bill would regulate e-cigarettes in the same way as existing tobacco control laws in the state, and those who violate the law can be fined from 100 to 500 US dollars.

[7] On March 23, the US Food and Drug Administration (FDA) released a new official webpage. This page is used to display all citizen petitions related to tobacco products received by the Center for Tobacco Products (CTP) to improve the transparency of FDA review.

#Europe #

[1] Chancellor of the Exchequer Jeremy Hunt raised UK tobacco taxes in the Spring Budget. The cigarette tax has been raised by 12.1%, and the price of 20 packs of cigarettes is expected to exceed £14.

[2] The German Bundesrat has formulated a plan to ban disposable e-cigarettes. The Senate is now urging the federal government to consider a ban. German Federal Environment Minister Steffi Lemke said he would support the resolution.

[3] Belgian courts imposed millions of euros in fines and prison terms on companies and individuals manufacturing millions of cigarettes. Since the cigarettes were not declared to the customs and tax authorities, the company and its responsible person would be fined 36.71 million euros. The responsible person would be sentenced to one year in prison.

[4] The State Construction and Legislative Committee of the Russian State Duma recommends that the House of Representatives passed a bill in the first reading. The Act established administrative and criminal liability for the unlicensed production and distribution of tobacco and tobacco products. Violators will be fined 500,000 to 1 million rubles or imprisoned for up to 3 years.

[5] On March 21, the Russian Duma Youth Policy Committee recommended that the sale of nicotine consumption equipment be equated with the sale of cigarettes. It also suggested that the fines for selling e-cigarettes to minors increased and supported the government's bill regulating tobacco sales.

[6] On March 23, Moscow time, Russian Prime Minister Mishustin (MmwycTnH) stated at the State Duma regular meeting that he would consider the proposal to ban e-cigarettes proposed by the president of the House of Representatives and representatives. In this regard, Liang Jiasen, an expert in the Russian e-cigarette industry, said that Russia had implemented a robust regulatory model on the e-cigarette market by using the "honest label," The regulatory effect will be tested after April 1. If the regulatory measures are effective, then Russia is likely to speed up. If the smoking field is still rampant, the country will likely ban e-cigarettes.

[7] Lincolnshire reported that from April to December 2022, 5062 of the 5417 unsafe products removed from the market by law enforcement officers were illegal e-cigarettes. Among them, e-cigarette puffs are 10,000, 16 times that of British law.

#Oceania #

[1] The Australian medical institution called for a complete ban on the import of all nicotine e-cigarettes without a prescription. The Minister of Health stated that the government would strongly act against illegal e-cigarettes. The Australian National Party believes that the current prescription model should be abandoned and a new system should be established.

# Asia #

[1] Cambodia will promote the principles of smoke-free sports at the 32nd Southeast Asian Games and the 12th ASEAN Para Games. Authorities have announced that the use, sponsorship, distribution and promotion of cigarettes and e-cigarettes will be banned at the SEA Games.

#Africa #

[1] Egypt confirms that e-liquids for e-cigarettes are subject to taxation. Therefore, each milliliter of e-liquids is levied at 2 Egyptian pounds.

Company News

Philip Morris International (PMI)

[1] On March 16, the FDA authorized the smokeless tobacco company's Copenhagen classic snuff as a modified risk tobacco product ( MRTP ) for sale. It is introduced that Copenhagen classic snuff is a smokeless tobacco product of moist bulk snuff.

Altria

[1] On March 23, Altria held an investor day meeting at the New York Stock Exchange. At the meeting, Altria stated that its sales volume of smoke-free products in 2022 will be 800 million units, and it is expected to increase by at least 35% by 2028, and its revenue will reach US$5 billion, of which US$2 billion will come from smoke-free products.

ELFBAR

[1] On March 21, ELFBAR revealed to 2Firsts that British American Tobacco had proposed its acquisition in August 2022. After four months of negotiations, Ai Miracle rejected the acquisition proposal. In February this year, ELFBAR, a product of Ai Miracle, broke the "excessive smoke oil" in the British market. Experts said this is a typical "acquisition + morality" strategy of international tobacco.

R.J. Reynolds

[1] The FDA issued a marketing refusal order for two menthol e-cigarette products under the Vuse Solo brand of Reynolds. The FDA requires applicants to provide strong evidence that menthol-flavored e-cigarette products can significantly reduce adult smokers' use of cigarettes and are more beneficial than tobacco-flavored e-cigarettes.

[2] Reynolds's parent company British American Tobacco (BAT), seeks to suspend the enforcement of the FDA's marketing ban on two e-cigarette products under the Reynolds brand Vuse.

[3] The US Court of Appeals allowed Reynolds Tobacco to continue selling two Vuse mint-flavored products. The two Vuse products have previously been subject to marketing denial orders (MODs) by the FDA. Reynolds said it plans to immediately seek an enforceable stay, allowing the products to continue to be sold.

[4] Reynolds American Corporation released its first white paper, the first in a series of white papers. The white paper seeks to raise awareness of tobacco harm reduction (THR), which Reynolds presents as a public health strategy to encourage adult smokers who do not want to quit completely to switch to non-combustible product alternatives.

[5] The 2022 annual report of British American Tobacco, the parent company of Reynolds, shows that the number of employees of Reynolds American and its subsidiaries will decrease by 10.7% to 4,274 during 2022.

JUUL

[1] Members of the Hillsborough County School Board in Florida, USA, will approve JUUL's settlement to the school on Tuesday, which will be paid out over the next few years and is expected to reach millions of dollars. According to the 2Firsts arrangements, the settlement funds paid by JUUL have accumulated to 2.6376 billion US dollars, and it is still facing nine independent lawsuits from other states.

[2] On March 22, Harris County, Texas, USA, announced that it had settled its lawsuit with the e-cigarette company JUUL and would receive $20 million in damages. A spokeswoman for the program said the proceeds from the settlement would be used to mitigate the effects of teenage nicotine addiction.

Smoore

[1] On the evening of March 20, Smoore International released its 2022 performance report. According to the financial report, Smoore's operating income in 2022 will be 12.145 billion yuan, a year-on-year decrease of 11.7%; after adjustment, the annual net profit for 2022 will be 2.575 billion yuan, a year-on-year decrease of 52.7%. Smoore has launched a new disposable electronic cigarette product in the European market, with sales revenue of 1.93 billion yuan in 2022, an increase of 19.19% from 95 million yuan in 2021. Among them, the sales revenue in the year's second half was 1.611 billion yuan, a year-on-year increase of 1761%.

Other

[1] On March 17, CBD vaping equipment provider Ispire halved the size of its initial public offering, from 6 million shares planned earlier to 3 million shares. In the first half of 2022, the company had a net loss of US$2.95 million and revenue of US$58.8 million.

[2] On March 23, China Boton Group released its 2022 annual report. The annual report disclosed that its operating income in 222 was 23.257 yuan, a year-on-year increase of 1.7%. The profit was 84.5 million, a year-on-year decrease of 62.5%. Among them, the e-cigarette product segment and the flavor enhancer segment together contributed approximately 84.3% of the total revenue.