The State Tobacco Monopoly Bureau Issued Detailed Rules for the Administration of Electronic Cigarette Trading (For Trial Implementation)

Regulations by State Tobacco Monopoly Bureau
Jun.14.2022

Chapter I General Provisions


Article 1 These Rules are formulated in accordance with the Civil Code of the People's Republic of China, the Electronic Commerce Law of the People's Republic of China, the Tobacco Monopoly Law of the People's Republic of China, the Implementation Regulations of the Tobacco Monopoly Law of the People's Republic of China and the Measures for the Administration of Electronic Cigarettes (Announcement No.1, 2022, State Tobacco Monopoly Bureau) and other laws, regulations and normative documents in order to strengthen the management of electronic cigarettes.


Article 2 These rules shall apply to the trading of electronic cigarette products and electronic cigarette raw materials within the territory of the People's Republic of China (hereinafter referred to as electronic cigarette trading).


The raw materials of electronic cigarettes referred to in these Rules refer to aerosol, nicotine for electronic cigarettes, and tobacco monopoly products such as tobacco leaves (including reconstituted tobacco leaves and stems, the same below), redried tobacco leaves, and cut tobacco (including shredded, shredded, granulated, the same below) used in the production of nicotine for electronic cigarettes.

 
Article 3 The department of tobacco monopoly administration under the State Council shall be responsible for supervising and managing the national electronic cigarette trade.


The departments of tobacco monopoly administration at the provincial, municipal and county levels shall be responsible for supervising and managing the electronic cigarette trading activities of the main body of the electronic cigarette market within their respective administrative areas.


Article 4 E-cigarette trading shall follow the principles of equality, fairness, honesty and standardization. Promote the whole process management of e-cigarette traders' flow, logistics, capital flow and information flow, and take the transaction data as an important basis for standardized market management, status evaluation and effective supervision.

 
Chapter II Types of Transactions

 
Article 5 The department of tobacco monopoly administration under the State Council shall establish a national unified electronic cigarette trading management platform (hereinafter referred to as the platform).


Tobacco enterprises (hereinafter referred to as tobacco trading enterprises) with the right to operate tobacco monopoly products such as tobacco leaves, cured tobacco leaves and cut tobacco, e-cigarette import enterprises, nicotine manufacturers, aerosol manufacturers, e-cigarette manufacturers (including product production, processing and brand holding enterprises, the same below), e-cigarette wholesale enterprises, e-cigarette retail business entities and other e-cigarette market entities that have obtained the tobacco monopoly license according to law should conduct e-cigarette transactions through the platform.

 
Imported electronic cigarette products, aerosols and nicotine for electronic cigarettes shall be imported for record by electronic cigarette importing enterprises through the platform before trading, and exported electronic cigarette products, aerosols and nicotine for electronic cigarettes shall be exported for record by electronic cigarette manufacturing enterprises, aerosol manufacturing enterprises and nicotine manufacturing enterprises for electronic cigarettes through the platform.

 
Article 6 Electronic cigarette trading is divided into:


(1) Trading of tobacco monopoly products such as tobacco leaves, re-dried tobacco leaves, cut tobacco, etc. between e-cigarette product manufacturers, e-cigarette brand holders, aerosol manufacturers, e-cigarette nicotine manufacturers and tobacco leaf operators;

 
(2) Trading of nicotine for e-cigarettes among e-cigarette product manufacturers, e-cigarette brand holders, aerosol manufacturers and e-cigarette nicotine manufacturers;

 
(3) E-cigarette products transactions between e-cigarette product manufacturers, e-cigarette brand holders and aerosol manufacturers;

 
(4) Entrusted processing transactions of electronic cigarette products between electronic cigarette product manufacturers, electronic cigarette brand holders and electronic cigarette processing enterprises;


E-cigarette products trading between e-cigarette wholesale enterprises, e-cigarette product manufacturers and e-cigarette brand holders;

 
(6) Trading of nicotine, aerosol and electronic cigarette products for imported electronic cigarettes between electronic cigarette wholesale enterprises, electronic cigarette product manufacturers, electronic cigarette brand holding enterprises and import enterprises;

  
(7) e-cigarette products trading between e-cigarette retail business entities and e-cigarette wholesale enterprises.


Chapter III Commodity Management

 
Article 7 E-cigarette products that have passed the technical review are listed and sold on the platform, and dynamic management is implemented. E-cigarette products sold on the market should be consistent with those that have passed the technical review.

 
Article 8 E-cigarette production enterprises, e-cigarette brand holding enterprises and e-cigarette import enterprises shall supplement and improve the relevant information of e-cigarette products on the platform.


The basic information of aerosol, nicotine for electronic cigarettes, etc. is maintained on the platform by aerosol manufacturers, nicotine manufacturers for electronic cigarettes, and electronic cigarette importers.


The basic information of tobacco monopoly products, such as tobacco leaves, redried tobacco leaves, cut tobacco, etc., which are traded through the platform, is maintained by the tobacco enterprises on the platform.


Article 9 Adhere to the market to determine the price, and establish and improve the price formation mechanism of e-cigarette products mainly regulated by the market.


E-cigarette manufacturers, e-cigarette brand holders and e-cigarette importers independently determine the ex-factory price of e-cigarette products based on factors such as production and operation costs and national tax policies.

 
E-cigarette wholesale enterprises determine the wholesale price of e-cigarette products on the basis of ex-factory price of e-cigarette products, in combination with operating and management costs, national tax policies and other factors.


E-cigarette manufacturers, e-cigarette brand holders and e-cigarette importers independently determine the suggested retail price of e-cigarette products on the basis of wholesale price.


E-cigarette products of the same specification are subject to the unified national sales price and made public on the platform.

 
The operating profit of each link in the industrial chain should be in a reasonable range, and the overall price level of e-cigarette products will remain basically stable.


Article 10 The prices of vapor substances and nicotine for electronic cigarettes shall be regulated by the market, and the platform shall automatically record, count and analyze the transaction prices.

 
Article 11 If an electronic cigarette production enterprise, an e-cigarette brand-holding enterprise, an e-cigarette import enterprise or an e-cigarette wholesale enterprise need to adjust the price of e-cigarette products, it shall publish the price adjustment information through the platform at least three months in advance.


Chapter IV Contract and Order Management


Article 13 Both parties to the electronic cigarette transaction shall sign a transaction contract on the platform.


The contract contents generally include the name, member code, license number, address, contact information of the parties, name, quantity, quality, price, packing method, inspection standard and method of the subject matter, signing time, performance period, place and method of performance, payment method, transportation mode, contract effectiveness, liability for breach of contract, dispute resolution, etc.


The transaction of e-cigarette products between e-cigarette retail business entity and e-cigarette wholesale enterprise shall be confirmed by order; The retail business entity selects the commodity and submits the order successfully, and the contract is established.


Article 14 Payment settlement of all kinds of transactions shall be conducted on the platform. The retail business entity of e-cigarettes shall settle the payment in real time after placing the order, and the buyers of other transactions shall pay the payment according to the payment time limit agreed in the contract.


Article 15 All kinds of trading entities shall, according to the relevant requirements of e-cigarette logistics management and the contract agreement, carry out warehousing, sorting, transportation and other logistics services, transport e-cigarette products or e-cigarette raw materials to the logistics warehouse or place negotiated by both parties within the agreed time limit, and do a good job in collecting and uploading all kinds of data and information.


Article 16 If there are quality problems in the electronic cigarette products and electronic cigarette raw materials after they are sold, the buyer can apply for a return through the platform according to relevant laws and regulations. If problems are found in the product quality supervision and spot check, relevant regulations shall apply.

  
Article 17 The annual cumulative contract execution of tobacco monopoly products such as tobacco leaves, redried tobacco leaves and cut tobacco shall not exceed the total annual purchase and sale plan issued by the department of tobacco monopoly administration under the State Council.

  
The annual cumulative contract execution of domestic electronic cigarette nicotine shall not exceed the annual production and sale scale of domestic electronic cigarette nicotine determined by the department of tobacco monopoly administration under the State Council according to the market demand.

  
The annual purchase volume of electronic cigarette nicotine and vapor substances imported by the manufacturer of e-cigarette products and the enterprises holding the brand of e-cigarette shall not exceed the annual import demand of nicotine and vapor substances for electronic cigarettes determined by the department of tobacco monopoly administration under the State Council according to the market demand.

  
The annual sales volume of e-cigarette products of e-cigarette wholesale enterprises shall not exceed the target of annual domestic sales volume and import sales volume of wholesale enterprises determined by the department of tobacco monopoly administration under the State Council according to market demand.

  
Article 18 The platform provides consultation and complaint channels for all kinds of e-cigarette market entities that trade, and handles consultation or complaints in a timely manner. The verified complaints will be included in the credit record of the main body of the e-cigarette market.


Chapter V Member Management


Article 19 The platform is subject to membership management. E-cigarette market entities need to register as members before they can trade through the platform.


Article 20 Tobacco leaf enterprises, nicotine manufacturers for electronic cigarettes, aerosol manufacturers, e-cigarette manufacturers, e-cigarette wholesale enterprises, e-cigarette retail business entities, etc., which have obtained the tobacco monopoly license according to law, should register as trading members through the platform.

  
When the electronic cigarette import enterprise is registered as a trading member, it shall upload the authorization letter of overseas e-cigarette enterprise, business license, technical evaluation data of imported e-cigarette products and other relevant materials through the platform.

  
Twenty-first members in case of important information changes, etc., should be timely through the platform to declare the change.


Article 22 The trading activities of members on the platform shall be completed by the designated representative of the member who logs in the transaction account number of the member. Members shall strictly manage their members' representatives and be responsible for all their actions on the platform.

  
Article 23 Members shall enjoy the rights of equal trading, independent trading and fair trading on the platform. The trading activities of members on the platform shall comply with relevant laws and regulations of the State and relevant provisions of the department of tobacco monopoly administration under the State Council, operate in good faith, pay taxes according to law, ensure the authenticity and accuracy of the information published on the platform and bear corresponding legal liabilities.


Article 24 The platform may suspend the relevant membership of market entities that violate relevant regulations.

  
Where a member's tobacco monopoly license is revoked, cancelled or revoked according to law to engage in the production and business qualification of e-cigarette products, vapor substances, nicotine for electronic cigarettes, the corresponding membership shall be cancelled automatically.


The platform should clear the relevant accounts of the cancelled members in time.


Article 25 The department of tobacco monopoly administration relies on the platform to build the credit information management system of the main body of the electronic cigarette market, and strengthen the credit management of the main body of the electronic cigarette market.


Chapter VI Supplementary Provisions

 
Article 26 These Rules shall be interpreted by the department of tobacco monopoly administration under the State Council.


Article 27 These Rules shall come into force as of the date of promulgation.