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China’s e-cig trade body calls for calmness amid regulatory pressure

There are over 50,000 individuals working in the electronic cigarette industry and 2 million in other related industries.

Photo: Tuchong

The Chinese Electronic Cigarette Industry Committee called on its members to refrain from underselling their products and downsizing their staff to avoid a panic in the industry, Chinese media outlet stcn.com reported on Monday.

The e-cig trade body, which is affiliated with China Electronics Chamber of Commerce (CECC),  made such remarks on an internal meeting held in Shenzhen on Friday, adding that orders for electronic cigarettes have been dwindling after Chinese regulators, including the State Tobacco Monopoly Administration (STMA), shut down all online marketing and sales channels for the industry at the beginning of this month.

Currently, there are 50,000 individuals working in the electronic cigarette industry and 2 million in other related industries, according to the trade body. Between 2016 and 2018, a total of e-cig worth RMB 13 billion (USD 1.9 billion) were produced and sold in China, and a number of such devices for a value of RMB 52 billion were manufactured in the country and exported to other nations, the trade body added.

China’s Electronic Cigarette Industry Committee called on the government to roll-out industry-specific regulations to allow the e-cig national industry to develop itself in a healthy and orderly manner, while maintaining a leading role worldwide.

Zhang Dong, a senior partner of law firm Dentons, told Chinese media outlet Rancaijing that it is very possible that the government may include electronic cigarettes into China’s traditional tobacco industry legislation. He said that if the government would regulate electronic cigarettes as medicines, that would be too harsh, but if authorities would treat them as medical instruments, that would go against the fact that such devices cannot help its user to quit smoking.

China established the China National Tobacco Corporation in 1982 as the business entity responsible for enforcing the tobacco monopoly in China, and set up the STMA in 1984 as the government’s regulatory arm. Both institutions are now one organization with the same leadership and structure and even share the same website.

Anticipating the government’s new specific rules regarding where electronic cigarettes can be sold, e-cigs brands and distributors have taken the initiative to sell its products in brick-and-mortar shops, including convenience stores and internet bars.

An unnamed electronic cigarette brand owner told Rancaijing that his company needs to pay various fees, up to RMB 500,000, to put its devices on the shelves of convenience store chain operator Bianlifeng.

China is the world’s largest tobacco market, home to 350 million smokers, according to data cited by Iyiou. The country has more than 7.4 million e-cigarette consumers, and is also the largest producer of e-cigarette products, the New York Times reported, according to a study by Tsinghua University’s Public Health and Technology Supervision Research Group.