In depth interpretation of the Electronic Cigarette Management Measures

In depth interpretation of the Electronic Cigarette Management Measures

Abstract: The State Tobacco Monopoly Bureau has released the Measures for the Administration of Electronic Cigarettes. As a lawyer, he must learn at the first time and also has the responsibility to interpret. The following is the interpretation of the author based on the existing laws and regulations and the relevant legal practice.

On March 11, 2022, the State Tobacco Monopoly Bureau announced the Measures for the Administration of Electronic Cigarettes. As a lawyer, he must learn at the first time and also has the responsibility to interpret. The following is a comprehensive interpretation of the existing laws and regulations and in combination with relevant legal practice.

The Regulations for the Implementation of the Tobacco Monopoly Law of the People's Republic of China, revised on November 10, 2021, has added the provisions of Article 65. New tobacco products such as electronic cigarettes shall be implemented with reference to the relevant provisions of these Regulations on cigarettes. Since then, electronic cigarettes have been incorporated into the tobacco monopoly management system. The Measures for the Administration of Electronic Cigarettes released this time further clarifies how to standardize the management of electronic cigarettes.

The author believes that the management of electronic cigarettes should not be limited to the Measures for the Administration of Electronic Cigarettes. Because the Regulations for the Implementation of the Tobacco Monopoly Law of the People's Republic of China has stipulated the principle that "electronic cigarettes should refer to cigarette management", the Measures for the Administration of Electronic Cigarettes, if there are provisions on electronic cigarettes, should be implemented in accordance with the Measures. If there are no provisions in the Measures for the Administration of Electronic Cigarettes, it should be implemented in accordance with a series of laws and regulations regulating cigarettes, For example, the Tobacco Monopoly Law of the People's Republic of China, the Law of the People's Republic of China on the Protection of Minors, and the Regulations for the Implementation of the Tobacco Monopoly Law of the People's Republic of China.

Based on the above principles, the author summarizes ten major contents of electronic cigarette management in combination with the Measures for the Administration of Electronic Cigarettes and relevant laws and regulations governing cigarettes, as follows:

1. Electronic cigarettes are under the supervision and management of the Tobacco Monopoly Bureau

The State Tobacco Monopoly Bureau (hereinafter referred to as the "State Bureau") is in charge of the supervision and administration of electronic cigarettes throughout the country, and is responsible for formulating and organizing the implementation of electronic cigarette industrial policies. The provincial (autonomous region, municipality directly under the Central Government) tobacco monopoly bureaus (hereinafter referred to as "provincial bureaus") are responsible for implementing relevant industrial policies, and are in charge of the supervision and administration of electronic cigarettes within their respective administrative regions. The municipal (county, district) tobacco monopoly bureaus (hereinafter referred to as "district/county bureaus") shall be responsible for the supervision and administration of electronic cigarettes within their respective administrative regions.

2. The electronic cigarette product standard shall comply with the mandatory national standard for electronic cigarettes

Electronic cigarettes include cigarette bombs, cigarette sets, and products sold in combination with cigarette bombs and cigarette sets.

The mandatory national standard for electronic cigarettes has not yet been issued and is seeking comments from the society. The national standard for electronic cigarettes (the second draft for comments) is now being published.

Whether the electronic cigarette complies with the mandatory national standards for electronic cigarette shall be inspected, detected, monitored and evaluated by the electronic cigarette inspection and detection institution. The electronic cigarette inspection and detection institution shall be certified by the National Bureau.

The Tobacco Monopoly Bureau shall establish an electronic cigarette sampling and testing system to regularly or irregularly inspect or test enterprises, individuals and their products that have obtained licenses

3. Implement channel management on electronic cigarette sales and establish electronic cigarette trading management platform

From the purchase and sale of tobacco monopoly products to the production, sale, transportation, export and import of electronic cigarettes, the Tobacco Monopoly Bureau shall exercise supervision and administration. The State establishes a unified traceability system for electronic cigarette products to strengthen the whole process management of electronic cigarettes.

The State Administration has established a national unified electronic cigarette trading management platform. Electronic cigarette related production enterprises, electronic cigarette wholesale enterprises, and electronic cigarette retail business entities that have legally obtained tobacco monopoly licenses shall conduct transactions through the electronic cigarette trading management platform. The transportation of electronic cigarettes shall be subject to the supervision of the Tobacco Monopoly Bureau. The delivery of electronic cigarette products, aerosols,  for electronic cigarettes, etc., and the carrying of electronic cigarettes in other places shall be subject to limited management.

4. Electronic cigarette related manufacturers shall comply with industry supervision

Electronic cigarette related production enterprises include electronic cigarette production enterprises (including product production, co processing, brand holding enterprises, etc.), aerosol production enterprises, and  production enterprises for electronic cigarettes. Before establishment, the National Bureau shall first review and approve the establishment of the project, and then the National Bureau shall approve the acquisition of a tobacco monopoly production enterprise license, and the Market Supervision Administration shall approve the registration.

Electronic cigarette related production enterprises must obtain the approval of the State Bureau for capital construction or technical transformation to expand production capacity.

The separation, merger and cancellation of the electronic cigarette related production enterprises must be approved by the State Administration, and the relevant registration procedures must be handled with the Market Supervision Administration. An enterprise's initial public offering (IPO) and listing shall be reported to the State Administration for examination and approval.

5. Implement license management on production, wholesale and retail entities of electronic cigarettes

No new types of administrative license will be set up for the administration of electronic cigarette license, and only the corresponding items will be added to the scope of license of tobacco monopoly production, wholesale and retail license.

The production enterprises related to electronic cigarettes shall apply for the tobacco monopoly production enterprise license. If the scope of the license is changed, they shall apply for the tobacco monopoly license again. If other registered items are changed, they shall change the tobacco monopoly license in a timely manner.

The electronic cigarette selling enterprise shall change the scope of license in the corresponding tobacco monopoly wholesale enterprise license and tobacco monopoly retail license.

Electronic tobacco monopoly commodities, including tobacco leaf (including reconstituted tobacco leaf and stem), redried tobacco leaf, cut tobacco and other tobacco monopoly commodities shall be purchased from tobacco enterprises that have the right to operate tobacco monopoly commodities, and shall not be purchased illegally. The State Administration shall issue the purchase and sale plan for tobacco monopoly products.

6. Four Prohibitions Related to Electronic Cigarette

Prohibited behavior 1: It is prohibited to sell flavored electronic cigarettes other than tobacco flavor and electronic cigarettes that can add aerosols on their own.

Prohibited behavior 2: It is prohibited to hold exhibitions, forums, expositions, etc. that promote electronic cigarette products in various forms.

Prohibited act 3: It is prohibited to sell electronic cigarette products to minors. The operator of electronic cigarettes shall set up a sign in a prominent position not to sell electronic cigarettes to minors; If it is difficult to judge whether a minor is a minor, he shall be required to show his identity card. Ordinary primary and secondary schools, special education schools, secondary vocational schools, specialized schools and kindergartens shall not set up sales outlets for electronic cigarette products around them.

Prohibited act 4: It is prohibited to use vending machines and other self-service methods to sell or sell electronic cigarette products in disguised form.

7. Legal restrictions should be paid attention to in the promotion of electronic cigarettes

Legal restriction 1: Electronic cigarette products shall use registered trademarks, and the use and management shall be subject to the provisions on the administration of trademark use of tobacco products.

Legal restriction II: The electronic cigarette products shall comply with the relevant provisions on the packaging labels and warnings of electronic cigarette products.

Legal restriction III: The supervision and administration of electronic cigarette advertising shall be subject to the provisions on tobacco advertising in relevant laws, regulations and rules.

8. Strictly control imported electronic cigarette products

An enterprise that holds a license for tobacco monopoly wholesale enterprise may engage in the wholesale business of imported products only after it has been approved by the State Bureau to change the scope of the license.

Imported electronic cigarette products shall use the trademark approved and registered in China, carry out commodity inspection, and mark the words specified by the State Administration on the package.

9. The electronic cigarette for export shall meet the requirements of relevant standards

The packaging of electronic cigarette products exclusively for export shall meet the requirements of the State Administration.

Electronic cigarette products only for export shall meet the requirements of laws, regulations and standards in the destination country or region; If the destination country or region has no relevant laws, regulations and standards, it shall comply with the relevant requirements of China's laws, regulations and standards.

10. Standardize the supervision and inspection of electronic cigarette products

The Tobacco Monopoly Bureau is responsible for investigating and dealing with illegal cases, and together with relevant departments, investigating and dealing with the production and sale of fake and inferior electronic cigarette products, aerosols and  for electronic cigarettes, as well as the infringement of intellectual property rights, illegal operation, smuggling and other acts.

Enterprises that violate the regulations will face suspension of platform trading qualification, order to suspend production and business operations, carry out rectification, and even take measures such as canceling their qualification to engage in the production and business operations of electronic cigarette products, aerosols and  for electronic cigarettes according to law. The dishonest market subjects were listed as the key supervision and inspection objects, and the supervision was strengthened. At the same time, the dishonest information was included in the national credit information sharing platform and the national enterprise credit information publicity system, and was publicized according to law.

It is worth noting that the Measures for the Administration of Electronic Cigarettes also stipulates that, in addition to electronic cigarette products, other new tobacco products shall be implemented in accordance with the relevant provisions of the Measures for the Administration of Electronic Cigarettes. This means that all tobacco products are included in tobacco monopoly management.

epilogue

Electronic cigarettes and other new tobacco products belong to tobacco products and have been incorporated into the national tobacco monopoly management system. The national tobacco monopoly is different from the production and circulation management of other products. Under the laws and regulations on the whole process management of tobacco, the production and sales enterprises related to electronic cigarettes and other new types of tobacco should strictly abide by the national laws and regulations, establish standardized internal management, and legally engage in business activities.

During the legal buffer period (March 11 to April 30, 2022) before the implementation of the Measures for the Administration of Electronic Cigarettes, relevant enterprises should do a good job in the transformation to adapt to the new regulations, so as to avoid being caught unprepared after the formal implementation of the Measures for the Administration of Electronic Cigarettes.