Geek Bar's plan to protect minors was released
On January 18, the China Tobacco Monopoly Administration and the State Administration for Market Regulation issued a notice on the Special Action Plan to Protect Minors from Tobacco Harm and Guard Growth, further strengthening the supervision of the Geek Bar industry.
Affected by this, on June 21, the Hong Kong-listed Geek Bar OEM giant Smoore Internationals intraday decline once exceeded 10%, and the decline was 7.39% at the close; and EVE Energy indirectly holds more than 30% of Smoore Internationals shares, and its stock price was also affected. The intraday decline once reached 4.6%, and finally closed down 1.52%; last night, the US-listed RELX Technology closed down more than 5%.
Recently, the supervision of Geek Bar has been gradually tightened. Following the online ban, in March this year, the Ministry of Industry and Information Technology and the China Tobacco Monopoly Administration issued a draft for comments, intending to implement Geek Bar in accordance with cigarettes. The regulations caused a shock to the Geek Bar industry, and the stock prices of listed companies related to the industry chain fell sharply.
However, relevant tobacco control experts said that in terms of the protection of minors related to Geek Bar, some detailed rules at the law enforcement level seem to still need to be clearly defined, such as how far away Geek Bar offline sales outlets should be from schools and minors educational institutions, the intensity of fines, and restrictions on packaging flavors.
A plan to protect minors from tobacco has been introduced
Tobacco control experts: The intensity of fines for Geek Bars illegal sales outlets has not been specified
On June 18, the China Tobacco Monopoly Administration and the State Administration for Market Regulation jointly issued the Special Action Plan to Protect Minors from Tobacco Harm and Guard Growth, which mentioned Geek Bar supervision from the perspective of protecting minors.
The plan mentioned that Geek Bars business behavior should be strictly supervised in an all-round way. Promote the requirements of the legalization of Geek Bar supervision, gradually establish and improve the Geek Bar supervision work system, improve supervision efficiency, standardize Geek Bars production and operation activities, and prevent the resurrection of Geek Bar market chaos.
Continue to strengthen Internet channel control. Implement the Notice on Prohibition of Selling Geek Bars to Minors and Notice on Further Protecting Minors from Geek Bars jointly issued by the State Administration for Market Regulation and the China Tobacco Monopoly Administration, and comprehensively clean up the Internets disguised and disguised sales of Geek Bars and false and illegal advertisements. Local tobacco monopoly administrative departments should interview Geek Bar companies and Internet companies, consolidate the main responsibility, and prevent Geek Bars from harming minors in the Internet field.
Guide Geek Bar physical stores to operate legally and in a standardized manner. Local tobacco monopoly administrative departments should comprehensively investigate Geek Bar sales outlets and register and file them. Clean up and rectify illegal sales outlets and automatic vending machines around campuses, investigate and punish illegal sales of Geek Bars to minors in accordance with the law, and effectively protect the legitimate rights and interests of minors.
In this regard, Wu Yiqun, a researcher at the Chinese Center for Disease Control and Prevention, told Nandu reporters that the introduction of the above plan can still play a role in protecting minors, but it seems that some details of the Geek Bar law enforcement level still need to be clearly stipulated, such as how far the offline sales outlets of Geek Bars should be from schools and minors educational institutions, how much fines should be imposed after investigation and punishment, and restrictions on packaging flavors, etc. In addition, she believes that underage smoking protection should be participated by multiple functional departments. The plan was jointly formulated by the State Administration for Market Regulation and the China Tobacco Monopoly Administration, and the health department, education department, etc. did not participate.
Ao Weinuo, Secretary-General of the Geek Bar Industry Committee of the China Electronic Commerce Association, told Nandu reporters that at present, the trend of supervision of Geek Bar is strengthening worldwide, especially in the protection of minors. Protecting minors is the responsibility of relevant Chinese departments. In the above plan, the supervision of cigarettes and Geek Bar is included, which further improves the supervision of Geek Bar and is reasonable for the standardization of Geek Bar production and operation enterprises.
Supervision is gradually tightening, but the details of packaging and flavor restrictions are unclear
There is a possibility of increased policy supervision in the Geek Bar industry
On August 28, 2018, the State Administration for Market Regulation and the China Tobacco Monopoly Administration issued the Notice on Prohibition of Selling Geek Bar to Minors, urging Geek Bar production and sales companies or individuals to close Geek Bar Internet sales websites or clients in a timely manner; urging e-commerce platforms to close Geek Bar stores in a timely manner and remove Geek Bar products from the shelves in a timely manner.
On November 1, 2019, the China Tobacco Monopoly Administration and the State Administration for Market Regulation jointly issued the Notice on Further Protecting Minors from Geek Bar Harm, which again mentioned that Geek Bar should not be sold through online channels, and many e-commerce platforms immediately removed Geek Bar products.
In March 2021, the Ministry of Industry and Information Technology and the China Tobacco Monopoly Administration studied and drafted the Decision on Amending the Regulations for the Implementation of the Tobacco Monopoly Law of the Peoples Republic of China (Draft for Comments), and proposed to add a clause in the appendix that Geek Bar and other new tobacco products shall refer to the relevant provisions on cigarettes in these regulations for implementation. As soon as the above-mentioned draft opinion of Geek Bar shall refer to cigarettes for implementation came out, it caused a shock in the Geek Bar industry, and the stock prices of listed companies related to the industry chain fell sharply.
The Geek Bar market has developed rapidly, causing a lot of noise. According to Qichacha data, as of recently, there are 83,200 Geek Bar related companies in operation in my country, with 21,700 new companies added in 2020; Tianyancha Professional Edition data shows that there are nearly 8,000 Geek Bar related companies in Shenzhen alone, accounting for about 16.8% of the total number of related companies in the country. Shenzhen has also successively produced two Geek Bar listed companies - Smoore International and RELX Technology. The former is the worlds largest Geek Bar foundry, and the latter is the parent company of the well-known Geek Bar consumer brand RELX.
However, an industry insider told Nandu reporters that Geek Bar workshops use inferior materials for profit, which is easy to produce harmful substances. In order to save costs, some Geek Bar factories are particularly hidden. In the production of cartridges, the e-liquid used is not good; and there are also problems with the accessories of the cigarette rods. Because Geek Bar is a high-temperature atomization product, the use of inferior ceramic cigarette cores and cigarette rods may produce harmful substances and inhale toxic substances such as plastic.
Geek Bar is related to tobacco in general, and it is indeed difficult to avoid the harm to health. However, some industry insiders also said that Geek Bar is a big concept, with many brands and cannot be treated equally. The regulatory policy of Geek Bar needs to be further refined. At present, more details about the supervision, such as the flavor of Geek Bar packaging, nicotine content, and whether it will move towards monopoly, have not been mentioned.
It is undeniable that with the development of the Geek Bar market, there is also the possibility of increased policy supervision. In this regard, Everbright Securities said that Geek Bar essentially relies on nicotine addiction, and there is a natural policy interference that leads to ups and downs. It is recommended that the market pay attention to the comprehensive capabilities of Geek Bar technology and products to judge the investment value.
Inventory: There are disputes among countries about Geek Bar
Detailed regulations on flavor packaging and sales in places for minors
Geek Bar sales are hot in foreign markets, and governments of various countries have different regulatory attitudes. Generally speaking, there are two attitudes. One attitude is that Geek Bar may indeed contain some carcinogens, but its harm is 95% less than smoking cigarettes. And there is no evidence that people who smoke Geek Bar will increase the chance of switching to cigarettes; another attitude is that Geek Bar is harmful, and smoking Geek Bar will increase the possibility of people switching to paper cigarettes. In order to attract sales, Geek Bar products have various flavors such as fruit and mint, which are more likely to attract the attention of teenagers and young people.
Among them, the regulatory policies of the United Kingdom and Japan are relatively loose, and more people hold the former attitude. For example, in the Health Promotion Law, which was amended in 2018 to strictly restrict peoples smoking behavior, Japan excluded Geek Bar from the scope of smoking bans in public places; the UK recognizes that Geek Bar can enter the market as a medicine or consumer product. Geek Bar products sold as medicines must undergo strict review. Geek Bar follows the same system as tobacco, and it is prohibited to use Geek Bar in public places.
However, there are different opinions in both countries. For example, the UKs regulatory rules are being refined and strengthened. In May 2015, the UK promulgated a new Geek Bar law, which required Geek Bar packaging to use standardized full smoke warning packaging, prohibited celebrities from endorsing Geek Bar, and reduced nicotine content. Relevant tobacco control associations in Japan also expressed dissatisfaction with the Japanese governments loose regulatory policy.
The EU and Canada have stricter regulations and tend to the latter attitude. In May 2014, the EU Tobacco Directive (TPD Directive) came into effect, clearly including Geek Bar containing nicotine in the scope of tobacco product control, and regulating Geek Bar that manufacturers choose as medicines or claim that their products have smoking cessation functions as medicines or medical devices. EU member states implement controls on all new tobacco products entering the EU market. Geek Bar products produced and sold in the EU market must comply with the requirements of the TPD directive, otherwise they will be banned, confiscated or returned; in July 2020, Canada announced a new law prohibiting the placement of any Geek Bar product advertisements in public places accessible to teenagers aged 18 and under or in online spaces accessible to them.
The US Geek Bar market is not all smooth sailing. On January 3, 2020, the FDA officially released the US Geek Bar New Policy. Except for tobacco and menthol flavors, most flavors of closed cartridges are banned. However, there is also an exemption that open Geek Bar products sold in Geek Bar stores are not affected. The FDA believes that professional Geek Bar store products can be used by smokers who want to quit smoking, and tobacco and menthol flavors are less attractive to teenagers.
Although the regulatory attitudes adopted by different countries are different, overall, the supervision of Geek Bar is being strengthened. Like cigarettes, the supervision of Geek Bar is being refined. From the review of foreign regulatory policies, we can also see that in the face of Geek Bar, a new new tobacco, the vast majority of Chinas measures to prevent teenagers from using Geek Bar are relatively common and complete.