Sounding the alarm

Having severely curtailed its tobacco industry, Canada is now going after the vapor business.

By Luc Martial

Fourteen years ago, I sounded the alarm, warning that Canadian governments were about to ban the display of tobacco products at retail. The market in Canada was about to go dark. Such a political initiative made no tobacco-control sense: At the time, 50 percent of each tobacco package was already covered by government-mandated graphical health warnings. (Today, the health warnings in Canada cover at least 75 percent of the pack surface; Quebec mandates 98 percent.)

Prominently positioned within 40,000 points of sale across the country, these warnings had previously been touted as an important public health communication tool, allowing governments to warn potential new consumers against smoking, discourage current smokers from continuing and support those trying to quit.

The industry, unfortunately, did not react swiftly or concertedly. Perhaps it couldn’t imagine that governments would abuse their authority to the point of publicly undermining their own public health agendas. But just walk into any corner store in Canada today and you’ll see just how far governments can go when left unsupervised.

So what does this have to do with the vapor industry? Well, quite simply, as far as Canada is concerned e-cigarettes and associated products are the new tobacco. And governments are about to do to the vapor industry what they did to the tobacco industry.

In Canada, the vapor industry is facing both federal and provincial governments, intent on overregulating their products and activities. It is worth noting at the outset that Canadian governments have a low tolerance for accountability. Public consultations have been marketed to the masses as due diligence and fair play, but to any experienced stakeholder, such consultations are just window dressing. Canadian governments have the authority—and predisposition—to arbitrarily destroy any industry they dislike.

EMERGING MARKET AND LAW

E-cigarettes, as a product category, first saw the light of day in Canada in 2007. They were sparsely sold outside of regular distribution channels and perceived mostly as a gimmick. But things changed quickly. Two years after the introduction of e-cigarettes into Canada, the federal government issued a public advisory, warning that vapor products had not been verified for safety by Health Canada and that the public should be apprehensive about ingredients such as propylene glycol and nicotine.

Nonetheless, between 2009 and 2012, the e-cigarette industry in Canada grew exponentially. Innovations in vaporizers and related accessories, such as batteries, tanks and e-liquids, were well-received. Businesses, including general retail and specialty vape shops, increasingly found commercial value in distributing these new products.

As for consumers, they came in droves. With and without nicotine, e-cigarettes allowed people to quit smoking tobacco where other cessation devices had failed. As a long-standing tobacco control expert, I was quick to recognize the potential of e-cigarettes in providing an alternative to minors who otherwise would experiment with combustible cigarettes. But you don’t have to be a tobacco control expert to figure that out—it’s common sense.

By 2013, the government estimated that 9 percent of Canadians aged 15 and over—2.5 million people—had tried e-cigarettes. Many users were existing tobacco smokers, and only 25 percent of those surveyed reported that their most recently used e-cigarette dispensed nicotine. Consumers were turning to e-cigarettes as a way to never start smoking, reduce their tobacco consumption or quit altogether (2013 Canadian Tobacco, Alcohol and Drugs Survey).

Interestingly enough, e-cigarette products were never marketed as health or smoking-cessation devices. That promotional momentum was purely self-generated among consumers. Adding to the popularity of these products, some physicians started reporting high smoking-cessation success rates among e-cigarette users.

So how did the federal government respond? Underwhelmingly supportive. Instead of recognizing the promise presented by e-cigarettes, the government chose to create fear about using and selling these products. Federal government inspectors began arbitrarily issuing cease-and-desist letters to domestic distributors, general retailers and specialty shops. To their credit, many vape shop owners challenged the government, refusing to either cease or desist.

Although the federal government ensured that no e-cigarettes or accessories containing nicotine were imported into Canada, domestically sourced product remained and prospered.

Despite a March 2015 parliamentary review and regulatory action report, the federal government has yet to introduce a regulatory framework for e-cigarettes. But make no mistake; serious and stringent federal regulations are set to emerge. Fearing the “renormalization” of tobacco—through mimicry—along with a gateway effect, the Canadian government is considering regulating the new category under existing tobacco or pharmaceutical frameworks.

As for provincial governments, their recent regulatory efforts have not only compared e-cigarettes to traditional tobacco products but even paired them with combustible cigarettes. Effectively, seven out of Canada’s 10 provinces now have convoluted laws regulating e-cigarettes/vaporizers and their accessories. Provinces have either defined e-cigarettes as tobacco or developed product-specific legislation.

Current regulations include: prohibiting sales to those under age 19; banning the use of e-cigarettes in public places, restaurants, bars and outdoor patios; banning e-cigarette use in cars if a person under age 16 is present; banning displays and product signage in general stores; restricting displays and  product signage in adult-only stores; banning product sampling and instructional demonstrations; and banning promotions, advertisements and marketing activities overall.

The most outrageous abuse of authority can be found in Quebec, Canada’s second-most populous province. Arguably the most anti-tobacco and anti-business jurisdiction in Canada, Quebec’s politicians in November 2015 introduced amendments to their tobacco law that set a dangerous precedent for all industries. Despite the clear differences between the product categories, Quebec defines e-cigarettes as tobacco. With the exception the tobacco flavoring ban thus far, all tobacco rules now apply to e-cigarettes, as well. One of the law’s provisions effectively excludes retailers from an exemption previously afforded to all industry stakeholders. This exemption? The ability to promote and advertise product within the trade. As outrageous as it may seem, it is now against the law in Quebec for manufacturers or distributors to: (1) show their products to retailers, either at trade shows or during in-store visits; (2) provide promotional samples to retailers; (3) send promotional information or advertising directly to retailers; or (4) allow retailers to access company websites to view and order product. It is also against the law for manufacturers or distributors to advertise and sell e-products through the internet, or to promote the category using social media. If a manufacturer or a distributor is located in Quebec it becomes illegal for them to advertise in a foreign or domestic magazine that is distributed in the province.

If e-cigarettes are such an obvious benefit to smokers who want to quit and an ideal alternative for youth who would otherwise start smoking, then why are governments acting this way? The answer is that what’s currently happening is not about health or safety—it’s about politicians and anti-tobacco groups. Anti-tobacco groups rely on government funding derived from their attacks on all things remotely associated with tobacco, making e-cigarettes a perfect new target. By depicting these products as a potential threat to Canada’s tobacco control agenda, they are generating new wind for their sails. Out comes their playbook of orchestrated fear, statistical pump and dump, government manipulation and a martyred battle against Goliath. Consequently, to protect their reputations and funding, governments and anti-tobacco groups have every interest in publicly describing e-cigarettes as a gateway to tobacco.

Left unsupervised and unchallenged, Canadian governments can be expected to introduce ever-increasing and unwarranted regulations against the vaping industry.

WHAT TO DO?

The vapor industry has an advantage not usually afforded to others. It knows who the enemy is and has seen its playbook. It should act swiftly and concertedly, before things go too far. To help prevent things from getting worse, stakeholders should consider the following actions:

• Be present, everywhere, and insist on keeping everyone honest.
• Sustainably expose malfeasance within governments and anti-vaping groups.
• Work toward securing product-specific legislation for e-cigarettes, removing vaping products from tobacco regulatory frameworks.
• Monitor, question and—if necessary—expose government surveys on the vaping industry to ensure accountability.
• Provide a face to the industry by publicly promoting your consumers and their stories. As for those who quit smoking or avoided starting with the help of e-cigarettes—collect, maintain, distribute and promote their stories to every politician in Canada and the media. Their personal testimonies will likely prove the most effective tool for protecting the vaping industry.

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