On August 9th, 2022, according to a draft resolution released by the Russian Federal Ministry of Industry and Trade, Russia will implement a "mandatory digital label management" system for electronic cigarettes and e-liquid starting on November 1st, 2022. This aligns with information disclosed at the July 26th meeting of the Russian Tobacco Industry Expert Council.
Russia previously conducted a "marking experiment" on e-cigarettes. According to official information on the Russian government's website, the experiment began on February 15, 2022, and was originally scheduled to continue until February 28, 2023. The announcement of the draft resolution for this experiment was made nearly four months earlier than the originally planned timeline.
According to research firm Euromonitor International, last year Russia sold over 67 million electronic cigarettes and around 10,000 liters of e-liquid, totaling a value of 35.5 billion rubles. The majority of these products were illegal, with analysts estimating that the government lost out on 28.5 billion USD in consumption tax revenue. Russia has now decided to introduce mandatory labeling to crackdown on counterfeit and illegal e-cigarette products, protecting government revenue and ensuring fair market competition.
Although the mandatory labeling system is still in the proposal stage and specific details have not been disclosed, the "labeling and tracking system" has already been implemented in Russia for traditional products such as tobacco, pharmaceuticals, milk, tires, and fur coats. Their operational experience can be a reference for the upcoming electronic cigarette labeling system. In addition, 2FIRSTS contacted Peter Davydov, the chief spokesperson for the Russian Tobacco Expert Council, who provided information guidance on the "electronic cigarette labeling experiment.
Russia, the world's fourth largest market for electronic cigarettes, is a crucial region for many e-cigarette companies. However, many of these companies are unfamiliar with the "marking system." In response, 2FIRSTS has gathered information on the meaning of the marking system, its processes, and how to apply for it. This information has been compiled for industry professionals to exchange, learn, and explore.
What are labeling and tracking systems exactly?
The system for labeling and tracking goods as a sign of honesty is based on the Federal Law No. 387 "Fundamentals of State Regulation of Trade Activities in the Russian Federation" that came into effect in Russia in February 2010. It was legally formalized in May 2019 through Government Decree No. 515.
The main forms of electronic tagging consist of two-dimensional codes and encrypted verifications. The information included in the tag includes the manufacturer, country of origin, material information, brand, expiration date, and circulation status. The tag uses encryption technology that cannot be replicated or reused, and its mission ends once the product is deregistered or sold to the consumer.
How does the tagging system track product distribution?
According to the official website of the Russian government, the "tagging system" will go through five stages in total.
In the first phase, the government will assign a unique code for each product, which manufacturers or importers can use on their product packaging.
In the second phase, the product code will track the entire path of the goods from the factory to the consumer.
In the third stage, the code will track the entire logistics chain and distributors will be required to check the product code before placing it on shelves.
During the fourth stage, when consumers check out, this code will appear on the billing page. After that, the code will no longer be in circulation.
In the fifth phase, if you wish to check the code after shopping, you can do so by using the Honest SIGN application.
These five stages almost cover all aspects of the production to sales process of goods, not only safeguarding the legitimate rights and interests of consumers to the greatest extent possible, but also facilitating the government to monitor product information and market conditions for problem tracing, tax collection and policy-making data support.
How to apply for a labeling and tracking system?
Russia's mandatory labeling system for e-cigarettes will officially take effect in four months, but the management of e-cigarette labeling is still in the experimental stage. According to Peter Davydov, those interested in participating in the "e-cigarette label experiment" can sign up on the official Russian government website, fill out a questionnaire, and wait for the approval process.
The survey requires respondents to provide their tax identification number, product name, contact person, and contact information. Channel and wholesale sellers must specify their exact role. Manufacturers or importers are also required to provide the HS code or TN VED code, type of production, country of production, and whether there are labeling devices for the product.
For those interested in applying for official certification marks, or seeking guidance from other categories of products, it is important to note that for Russian certification marks, businesses must apply within the Federal State Unified Register of Legal Entities and the Individual Entrepreneur Register. Applicants will need to provide specific information, including product name, manufacturer, trademark, ingredients, model, and instructions. Additionally, businesses will need to provide supplementary information, such as product usage and consumer demographics, as well as safety requirements. The cost of applying for, obtaining, and attaching the certification mark to the product packaging will be borne by the business, which may choose to photocopy the mark onto the packaging or adopt other methods as it deems appropriate.
2FIRSTS will continue to monitor the latest developments regarding Russia's electronic cigarette regulatory policies. To learn more, click here to visit our dedicated coverage.
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This article was compiled and organized by 2FIRSTS based on information obtained from official Russian websites and news outlets. It is intended for industry professionals only.
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