They are developing a project for alternative regulation of the tobacco and nicotine—containing products market - licensing or a register of wholesalers and retailers. But such rules will be almost equivalent to a ban for many, sellers and representatives of small businesses believe.
Last December, deputies of the Communist Party of the Russian Federation submitted to the State Duma a bill on a complete ban on the sale of vapes and liquids for them. The Government recalled its objections to a similar project six months ago. Deputies from the Communist Party of the Russian Federation, LDPR, New People and Fair Russia — for the Truth factions proposed to ban vapes. Vaping is "presented as a safe alternative to conventional cigarettes," but it causes irreparable harm to the health of both the smoker and others, the explanatory note to the bill said. The number of teenagers using vapes increased 10-fold from 2011 to 2023. The government pointed out at the time that the ban could lead to an increase in illegal trafficking, and was also inconsistent with current Russian laws and regulations of the EAEU.
The Ministry of Health warned in August that vapes and e-cigarettes cause lung disease EVALI. The symptoms are similar to COVID-19: fever, weakness, cough, shortness of breath. In March, the Tomsk Rospotrebnadzor reported a case of EVALI in a teenager and called it "popcorn disease" (when listening to the lungs, a sound resembling popcorn popping is heard). It manifests itself in the form of inflammation, scarring in the lungs, and narrowing of the bronchioles.
"Popcorn disease" and EVALI are two diagnoses that have nothing in common, says a representative of the Union of Enterprises of the Nicotine-containing Products Industry (SPINI). EVALI is a disease that in 2019 in the United States was associated exclusively with the use of vaping liquids containing tetrahydrocannabinol and vitamin E acetate. After banning these components, cases of EVALI have practically disappeared. And the mention of "popcorn disease" (bronchiolitis obliterans) is completely absurd — the diacetyl that causes it disappeared from legal liquids more than 10 years ago.
"The teenager is in intensive care, there is no data on the composition of the liquid, there is no drug test, and a hasty conclusion has been made about the "deadly danger of vaping," insists a representative of SPINI. According to him, the union has already sent a complaint about this to the government, the Ministry of Health, the Investigative Committee and the Prosecutor General's Office, demanding to verify the fact of substitution of diagnoses. He recalls that a similar case in 2021, at the suggestion of officials even before the diagnosis was checked, "replicated by the media as the first in Russia," was used to tighten the regulation of vaping.
How many illegal vapes are there in Russia
Only one electronic cigarette out of 50 in Russia is legal, according to a study by the Union of Nicotine-Containing Enterprises (SPINI). That is, 99% of the market is in the shadow. This leads to a low collection of excise taxes from the sale of these products, the union pointed out.
The ban on the circulation of electronic cigarettes has led to the growth of the shadow market in many countries, Sergei Borisov, Chairman of the Board of Trustees of Opora Russia, said on Monday, March 31.
Requirements for warehouses and stores
The departments are currently developing a licensing plan or creating a register of wholesalers and retailers.
To be allowed to trade, you will need to register the seller in the labeling system, have no tax debts, have warehouses (for wholesale) and retail facilities (for retail) owned or leased for a period of one year. For stores, they can regulate the area of at least 25m2 in rural settlements and at least 50m2 in cities.
There is no final version of the concept yet, two participants in the discussions told Shopper's. "Currently, the issue is being worked out jointly with the relevant departments on behalf of the government," the representative of the Ministry of Finance replied.
Wholesalers can face serious problems with the requirements for the ownership or long—term lease of warehouses (they require registration with Rosreestr), retailers - the requirement for the minimum required area of the outlet, says Elena Dubankova, chairman of the Committee on excisable goods, member of the Presidium of Opora Russia. The vast majority of wholesalers do not have their own storage facilities, as this is economically impractical. 3PL services are common on the market (storage of goods, inventory management, delivery is undertaken by an outside company) when a lease agreement between the product owner and the warehouse owner is not provided.
Wholesalers also have a common practice of storing products in hubs (logistics complexes consisting of many warehouses). Products of different owners can be stored on the same square at a single address — it is impossible to distinguish such storage locations in the Federal Register, Dubankova continues. In addition, due to the additional administrative and financial burden of registering contracts, warehouse owners prefer to sign an 11-month contract and are not ready for a long-term lease, she adds.
Regulate the area of shops (25 sq. m. 50 sq. m) is also impractical, Dubankova stressed. In the regions, about 70% of small retail outlets, including those specializing in tobacco and nicotine-containing products, have an area of at least 5 square meters. up to 8-15 sq. m. In large cities — a little more. At the same time, the product is small—sized, and its layout is prohibited by law — areas above these are not needed. But the effect of such a measure in the fight against the illegal sector has not been determined, Dubankova notes.
Powers of the regions
When discussing the licensing concept, an option arose to transfer to the regions the rights to ban certain categories of products and additional restrictions on places of sale, says Dubankova. But industry experts agree that it is better to maintain centralized regulation at the federal level. Otherwise, the business will not have the opportunity for long- and medium-term planning.
It is pointless to transfer powers to subjects now, says Vladimir Michelovin, a member of the board of SPINI. In the alcohol market, part of the revenue from excise taxes is transferred to the budgets of the regions and there are funds to create infrastructure for market regulation and control of mandatory requirements. In the case of tobacco and nicotine-containing products, all revenues go exclusively to the federal budget.
"As you know, there are various types — cigarettes, heated tobacco, hookah tobacco, chewing tobacco, electronic cigarettes," says the manager of a manufacturer of tobacco and nicotine-containing products. —The different approaches of the regions can create an imbalance in the market, which will eventually hit the consumer." There are also great risks of corruption and an increase in illegal trade, the Shopper's interlocutor adds.
The parade of bans and restrictions will have a negative impact on competition, Michelovin is sure. And consumers who are addicted to such products will still find it either in neighboring regions or illegally on the Internet, he adds.
What are the vaping vendors offering to do?
The idea of licensing companies throughout the logistics chain is borrowed from the alcohol market, says Michelovin. But licensing was introduced there even before the start of the accounting system in the USAIS and was one of the first solutions for the legalization of companies. With the help of the USAIS, the authorities ensured full traceability and legality of the products sold.
Chairman of the Board of Trustees of Opora Russia Sergey Borisov:
The illegal market has taken off in Kazakhstan, where a ban was introduced in 2024. In Thailand, where there are strict sanctions for the sale of vapes, they are sold everywhere, but illegally. In the UK, the ban on single-use vapes is scheduled to come into force only in June, but the market is already rapidly going underground: the number of illegal products seized is growing. In Brazil, a complete ban on vaping products has led to widespread distribution through illegal channels (online and simply the black market). They will promote a bill to legalize vaping and regulate the industry by introducing safety standards and oversight mechanisms. In the UAE, after a period of prohibition and the growth of the illegal market in 2019, the sale of vapes was legalized again.
In the case of tobacco and nicotine-containing products, all legal sellers are already registered in the Honest Sign system, says Michelovin. That is, "everything has already been calculated": up to 170,000 sellers of nicotine-containing products have been registered. There is no need to introduce licensing, Mishelovin believes. As a "soft form of regulation," the registry seems to be the right one, which will automatically include those who are already registered with the Honest Sign. At the same time, it is necessary to free the business from excessive requirements for warehouses owned and long-term leased, necessary retail space, etc.
The simplest and most effective action to legalize the market would be to adjust the excise policy, Michelovin believes. This, in his opinion, "will knock out the economic basis of the existence of unscrupulous entrepreneurs."
The problem of illegal products on the vaping market was aggravated by a sharp increase in excise taxes on liquids in 2024 from 21 rubles to 42 rubles (from 2025 to 44 rubles) per 1 ml, says the manager of the manufacturing company. Now a legal vape costs more than 1,000 rubles. And the one from which the excise tax has not been paid is 300-400 rubles. It is now unprofitable for sellers to enter the legal sector. According to Shopper's interlocutor, by the end of 2024, many importers and distributors of vapes had shut down their activities.
If the concept is adopted in the form it is formulated now, all participants in the turnover and, above all, small businesses will suffer — some will be forced to cease operations, Dubankova fears. There is also a big risk that some of the players will shift to the illegal sector.
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