Tobacco Asia

26 tobaccoasia PRODUCT NEWS 产品新闻 India Rejects HTP Push India has ruled out easing its ban on e-cigarettes that would have allowed heated tobacco products (HTP), dealing a setback to a years-long lobbying effort by Philip Morris International (PMI) to introduce such devices in the country, according to Reuters. India prohibited e-cigarettes, including HTP, in 2019, essentially blocking products from companies including Juul Labs and PMI. The country ranks as the world's seventh-larg- est cigarette market by volume, with more than 100 billion cigarettes sold annually. In an interview with Reuters, PMI c.e.o. Jacek Olczak said he had spoken with various people in India. He called it "illogical" that the country allows cigarettes but bans smoking alternatives such as heated tobacco and vaping products. Olczak added that India's prohibition on smoking alternatives ignores scientific evidence showing that smoking rates decline when alternatives become available. It remains unclear whether other companies have lobbied the government to oppose the ban. PMI says it holds a 76% share of the global heated tobac- co market. The company increased its share of India's cigarette market to 7.6% in 2024 from 1.75% in 2019, according to estimates from Euromonitor International. Rival British American Tobacco (BAT) holds a stake in ITC Limited, which dominates the Indian cigarette market. Last year, PMI sold about 151 billion IQOS units across 79 markets. US Vape Ban Could Reshape Market A potential US move to block imports of some disposable vapes could shrink the country's booming market for unregu- lated e-cigarettes by as much as one-third, according to Tadeu Marroco, chief executive of British American Tobacco (BAT). Speaking to Reuters, Marroco said any significant market impact would likely not appear before 2027. Major tobacco companies, including BAT and Altria Group, have spent years pushing back against a surge of mostly Chinese-made disposable vapes. These products lack authorization from the US Food and Drug Administration (FDA) but still dominate the world's largest market for smoke-free alternatives. BAT estimates that unregulated devices account for about 70% of all e-cigarette sales in the US, a situation the company says has hurt both its vape and traditional tobacco businesses. The company has filed 2 active cases with the US International Trade Commission (ITC) seeking to block imports of those products. Last year, an ITC judge ruled in BAT's favor in a patent dispute and recommended a general exclusion order that would block disposable vapes that infringe the company's patents. BAT said that it expects a full ITC determination in March, followed by a 60-day presidential review period. Marroco told Reuters that such a block could significant- ly reshape the market. He defined that shift as a drop in unregulated products to below 50% of total industry sales— roughly a one-third reduction. However, he added that the exact scale of the impact remains difficult to predict. He also warned that the long US supply chain for these devices and large existing inventories could delay the effect of any restrictions. "So even if you get the support from the ITC ... it will not be until early next year that you have a material impact on that," he said. Marroco also said he would not be surprised if FDA tested a new regulatory approach to vaping products, poten- tially including flavored vapes. After years of rejecting most applications for new nicotine products, the agency has recently explored ways to speed up or streamline its review processes. China Moves to Control Vape Output China's State Tobacco Monopoly Administration (STMA) on February 13 ordered e-cigarette manufacturers to suspend investment projects and halt construction of new production facilities in an effort to curb price wars in the sector. The directive, sent to provincial tobacco monopoly bureaus, aims to implement e-cigarette industrial policy and maintain what regulators describe as a "dynamic balance" between supply and demand. Authorities said the measure seeks to standardize industrial order, curb "involution-style" competition, prevent overcapacity risks, and strengthen compliance among producers of e-cigarettes, e-liquids, and nicotine used in e-cigarettes. Regulators said the industry already operates at a high level of capacity utilization and warned companies not to circumvent the directive by building facilities that claim to produce other goods but actually manufacture e-cigarettes. Under the guidance, manufacturers may invest in new projects or expand capacity only when necessary or when they can demonstrate that additional output will serve export markets. The directive also prohibits e-cigarette producers from transferring supply quotas to unlicensed companies and bars firms from expanding capacity through new investment in other products as a way to conceal e-cigarette production. Authorities will introduce a verified-capacity manage- ment system based on principles described as "fair, open, differentiated, steady, and orderly." Companies may not operate beyond approved capacity, and any adjustments will require re-verification and new licensing procedures. Regula- tors will set each company's annual production scale within approved limits as its yearly production and sales target, while authorities will review any changes under stricter standards emphasizing total volume control. For contract manufacturing, both the commissioning company and the contractor must operate within verified capacity limits. Companies that maintain low utilization while outsourcing production may face reductions in approved capacity. Regulators will allow companies to reorganize capacity through mergers, including consolidation among entities under the same controlling shareholder or integration of production sites within a single enterprise. Authorities also encourage consolidated operations in regions with stronger industrial bases and higher concentrations of manufacturers. STMA warned that companies that fail to meet industrial policy requirements or mandatory standards related to quality, hygiene, safety, fire protection, environmental protection, or

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