Just last year, Pennsylvania passed a draconian new tax on electronic cigarettes. Imposed at the rate of 40% of the retailer’s purchase price, the tax applies to all “electronic cigarettes,” which is defined to mean an “electronic oral device, such as one composed of a heating element and battery or electronic circuit, or both, which provides a vapor of nicotine or any other substance and the use or inhalation of which simulates smoking.” This term is defined to include both (1) a device, as described in the definition above, and irrespective how it is marketed, and (2) any liquid or other substance placed or sold for use in such a device. Continue Reading Legislation Proposed to Revamp Pennsylvania Vape Tax
Troutman attorneys Bryan M. Haynes and Robert S. Claiborne, Jr. were featured in the February 2017 issue of SMOKESHOP, a tobacco industry magazine, in an article discussing the Indiana Vapor Act. This article discusses the federal appeals court’s decision that Indiana’s Vapor Pens and E-Liquid Act is unconstitutional to the extent that it regulates out-of-state manufacturers of e-liquid products.
Read the full article here
On March 24, 2017, the Third Court of Appeals of Texas decided Hegar, et al. v. Texas Small Tobacco Coalition, et al., No. 03-13-00753-CV. The court held that a tax on nonparticipating or non-settling manufacturers (“NPMs”) did not violate either the Equal Protection or the Due Process Clause of the Fourteenth Amendment to the U.S. Constitution. The law at issue, Subchapter V to Chapter 161 of the Texas Health & Safety Code (“Subchapter V”), taxed NPMs remaining outside of the Master Settlement Agreement (“MSA”) at approximately $0.55 per cigarette pack and companies subsequently joining the MSA at approximately $0.15 per pack. The case was of particular interest because Texas is not a party to the MSA, yet the MSA’s distinctions were the bases for Subchapter V’s. Continue Reading NPM Tax Valid Under U.S. Constitution, Says Texas Appellate Court
On occasion, a manufacturer of tobacco products may decide to use its permitted facility for another purpose, one that may exceed the permit or be altogether unrelated to the permitted use. For example, a manufacturer of tobacco products may decide to manufacture cigarette papers and tubes, or to process tobacco for third parties, or even to make a product similar to a cigarette that has no tobacco in the product. Some manufacturers have assumed that a tobacco producer permit will automatically cover its activity to also make these products, but it does not. Continue Reading Ramifications of Using the Permitted Area for Another Purpose
On September 2, 2016, California’s Office of Environmental Health Hazard Assessment (OEHHA) finalized its rule amending Article 6 of the regulations implementing Proposition 65 (i.e., California’s Safe Drinking Water and Toxic Environment Act of 1986). As a result of the new regulation, tobacco and electronic cigarette manufacturers may be required to update their Proposition 65 warnings. Continue Reading California Finalizes New Prop. 65 Warning Label Rule
The FDA’s proposed deeming regulations extend the FDA’s regulatory authority to additional tobacco products including e-cigarettes, e-liquids, cigars, hookah tobacco, pipe tobacco and dissolvables, referred to as “covered tobacco products.” The FDA currently regulates cigarette tobacco, roll-your own, cigarettes, and smokeless tobacco. Continue Reading Deeming Regulations: Important Deadlines in 2016
Nicotine: The deeming regulations promulgated by the Food and Drug Administration contain new warning requirements for certain tobacco products, including cigars, pipe tobacco, e-cigarettes, vapor products, hookah tobacco, dissolvables, and nicotine gel. Effective August 8, 2018, a nicotine health warning is required on packaging and advertisements. The language is:
“WARNING: This product contains nicotine. Nicotine is an addictive chemical.”
This will be the first part in our continuing series of posts discussing certain aspects of the FDA’s proposed deeming regulations, which were issued today.
This part focuses on the premarket review process that will be applicable to the newly deemed products — principally e-cigarettes, cigars, and pipe tobacco. The FDA contemplates that the premarket review process applicable to currently regulated tobacco products (cigarettes, smokeless tobacco and cigarette tobacco) will be equally applicable to the newly deemed products. Significantly, the statutory grandfather date of February 15, 2007 applies to the newly deemed products. This means that any product that has been introduced or changed in any way since that date will be subject to the premarket review process. This means that all or almost all e-cigarettes will be subject to premarket review. Continue Reading Deeming Regulations — Initial Impressions — Premarket Review
On January 28, 2016, President Obama signed the Child Nicotine Poisoning Prevention Act of 2015 (the Act) into law which requires liquid nicotine containers to be packaged in child-resistant packaging. The Act takes effect on July 26, 2016. Liquid nicotine containers are defined as packages containing nicotine in a solution or other form, including soluble nicotine in any concentration, and that are accessible by a consumer; but excludes sealed, pre-filled and disposable containers which are inserted into e-cigarettes, ENDS or similar products, and any product where the nicotine is not accessible by a consumer. The Act also provides effectiveness and testing standards as set forth in the federal Poison Prevention Packaging Act. Continue Reading Child-Resistant Packaging Laws for E-Liquids Enacted
An article by the Troutman Sanders Tobacco practice appears in the February issue of Smokeshop Magazine. The article, titled “Pennsylvania’s Legal Battle Over MSA Payments Keeps Twisting” discusses the ongoing battle between Pennsylvania and major tobacco manufacturers regarding disputed 2003 Master Settlement Agreement (“MSA”) escrow payments.