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Increased Federal Regulation of Pipe Tobacco and some Cigars is upon us

Hirsute

Used to have fun with Commander Yellow Pantyhose
Gents,

We've known that increased federal regulation of tobacco products was coming. Well, it's here.

Today the FDA published the final rule for pipe tobacco and cigars. You can read the regulation through a link on the Federal Register page here:

https://www.federalregister.gov/art...-food-drug-and-cosmetic-act-as-amended-by-the

The posting is 499 page pdf, so it's a lot to wade through. I'm a lawyer and dig this kind of stuff, so I've gone through it quickly and pulled out some highlights (or lowlights if you like):

- FDA regulations that already apply to cigarettes, RYO tobacco, and smokeless tobacco are extended to 6 additional product categories, and "include currently marketed products such as dissolvables notalready regulated by FDA, gels, waterpipe tobacco, ENDS* (including e-cigarettes, e-hookah, ecigars,vape pens, advanced refillable personal vaporizers, and electronic pipes), cigars, and pipetobacco." *ENDS are Electronic Nicotine Delivery Systems

- The rule also deems any future new products not currently marketed to be covered by the regulations, such as nicotine nasal sprays, etc.

- The FDA selected "Option 1" of their proposed rule which DOES NOT exempt premium cigars (Option 2 would have exempted premium cigars).

- manufacturers of tobacco products must submit ingredient lists and report HPHC (harmful and potentially harmful constituents) for each product

- new products must be reviewed by the FDA before they can be marketed.

- after the effective date, no one may manufacture for sale or distribution in the US any product that does not comply with the rule;

- 30 days after the effective date, a manufacturer may not introduce into domestic commerce any product, regardless of the date of manufacture, that does not comply with the rule;

- after the effective date, a distributor or retailer may not sell, offer to sell, distribute, or import for sale or distribution in the US any product whose package does not comply with the regulation unless the product was manufactured prior to the effective date

- The rule allows some staggered grandfathering: manufacturers of newly deemed tobacco products will have 12, 18, or 24 month initial compliance period in which to prepare applications for marketing authorization as well as 12-month continued compliance period; essentially, companies have 24, 30, or 36 months to comply with premarketing compliance rules.

- Manufacturers can apply to establish that a tobacco product was commercially marketed as of Feb 15, 2007, or that the product is substantially similar to a product marketed as of that date

- The FDA has rules specifically addressing small-scale manufacturers, which the rule defines as "a manufacturer of any regulated tobacco product that employs 150 or fewer full-timeequivalent employees and has annual total revenues of $5,000,000 or less." The FDA will not target small-scale manufacturers for enforcement during the 12 months after the rule, and will provide additional time and assistance for them to comply with the regulations.


The FDA received over 135,000 comments on the proposed rule before deciding on this final rule.

This is essentially the last step in the regulatory rule-making process, and the rule will go into effect 90 days from the date of publication in the Federal Register.

Also, the FDA is slated to post regulations regarding e-cigarettes tomorrow, so more news to come.

Let the mad rush to the store and hoarding of favorite products begin...

(Oh, and I feel obliged to mention that civil discussion of political topics is allowed in the forums, but if the discussion becomes too sharp the mods will shut this thread down, so let's keep it civil gents)
 
FDA regulations that already apply to cigarettes, RYO tobacco, and smokeless tobacco are extended

I'm not familiar with the current regs that apply to the above. How will this change our ability to procure and consume cigars & pipe tobacco? Sorry to be dense.
 

Hirsute

Used to have fun with Commander Yellow Pantyhose
I'm not familiar with the current regs that apply to the above. How will this change our ability to procure and consume cigars & pipe tobacco? Sorry to be dense.

Not dense at all. Some of that is laid out below--all of the disclosures and marketing restrictions already apply to cigs, RYO and smokeless, and now they apply to cigars and pipe tobacco as well. Also the whole suite of marketing and labeling requirements also apply--think about all of the marketing restrictions for cigarettes and you have the right idea.

I think the biggest change for the pipe and cigar world will be the requirement to list and disclose ingredients and get new products approved. This is a potentially expensive compliance regime, especially for smaller manufacturers, and they will all need to comply. And if you think about the product chain, there's a lot of info unknown. Many small manufacturers (I'm thinking of the folks like Uhles, Peretti, Boswells, etc.) buy blending tobacco from distributors. This blending tobacco is often already cured to some extent and have other ingredients added in the curing process. Presumably they would need to get all of the ingredient info about each component, add anything else they add to the tobacco, and disclose to the FDA. I don't think there have been health studies about the effects of inhaling smoke from molasses, just as one example, and if the blend contains molasses there's a lot of science that needs to happen before the blend could be approved for sale. This could be very costly. And even if all of the science is in place, just the act of compiling the information and working with lawyers to comply with the new regs is likely prohibitively costly for many producers.

I predict a contraction in the number of producers and the number of blends, simply because compliance will be so costly. I also predict that some European manufacturers will abandon the US market. I also predict fewer blends coming to market because the pre-marketing screening will be significant and expensive. I also predict consolidation in the pipe tobacco world and foresee the big players snapping up smaller manufacturers who can't bear the cost of compliance on their own.
 
I have nothing to say that is not political in nature except I am glad I stockpiled dozens of pounds of tobacco even though I don't smoke often. I had better leave now before I say anything else.
 

Hirsute

Used to have fun with Commander Yellow Pantyhose
I am glad I stockpiled dozens of pounds of tobacco even though I don't smoke often.

The rule goes into effect 90 days from today, do depending on your reading of the tea leaves (or tobacco leaves as it were), folks may want to start acquiring blends they love that might go away or simply engage in an all-out orgy of hoarding before the price increase.

Also, the exemption for blends marketed or sold on February 15, 2007 (and the rule is clear that the blend had to have been marketed in the US on that date; it's not enough for it to have at one time before marketed here before that date) means that some old favorites may be exempted from the ingredient reporting requirements (I'm thinking about classic Dunhill and MacBaren blends for example), but the manufacturers still have the burden to prove those blends were marketed and sold here on that date. So if you're reading tea leaves, I expect a lot of those blends will be available after the change unless the manufacturer decides to pull them, but the prices will go up due to compliance costs and the cost of compliance for their other products.

I also predict increased "out of stock" notices at our favorite retailers during the next 90 days as TAD grips the pipe and cigar world.
 

TexLaw

Fussy Evil Genius
Time to buy another humidor and a whole bunch of mason jars.

I'm not as well stocked against the zombie apocalypse as some are, but we'll make it work.

Thanks, Hirsute, for all the summary and analysis. That was a lot of work!
 
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Hirsute

Used to have fun with Commander Yellow Pantyhose
Hey gang, let's keep the comments clean so we can keep this thread open. I don't think anyone's crossed the line yet but I know that mods are watching as we're getting closer to that line.

I know many of us are disappointed in the new regulations and have strong feelings about them, but the fact of the matter is they're all but a done deal at this point. The point of my thread was to inform and have a discussion about what this means for our hobby, so we can all make decisions about how best to prepare for the new regulations.

If this turns into a political debate about the merits of the regulations or about the overreach of government I'm sure the thread will be shut down.
 

simon1

Self Ignored by Vista
The posting is 499 page pdf, so it's a lot to wade through. I'm a lawyer and dig this kind of stuff, so I've gone through it quickly and pulled out some highlights (or lowlights if you like):

I get a headache just going through State Statutes and then case law to see how they've been interpreted.

I have lost all desire to go to law school. :biggrin1:

The FDA needs to file a Nunc Pro Tunc (if that's even the correct document in this situation) and after the style/heading there is just a blank piece of paper. :thumbup:

I wonder if other tobacco places are going to do a petition like Cigars International.

http://www.cigarsinternational.com/page/fda-regulation-comments
 
Thanks for getting this up on the board today. I received a notice earlier in the day and still can't figure out why option 1 was taken, other than regulating the possible future importation of Cuban cigars. I have more questions than answers. I'm digesting how this is going to affect us, the industry and those that are employed by it. Not wanting to cross that political line, but my thought about this whole piece of regulation, is, why?
 

Hirsute

Used to have fun with Commander Yellow Pantyhose
Thanks for getting this up on the board today. I received a notice earlier in the day and still can't figure out why option 1 was taken, other than regulating the possible future importation of Cuban cigars. I have more questions than answers. I'm digesting how this is going to affect us, the industry and those that are employed by it. Not wanting to cross that political line, but my thought about this whole piece of regulation, is, why?

The final rule has a little discussion about selection Option 1 over Option 2, and basically they chose Option 1 because it catches more tobacco products and has more comprehensive regulation of the health effects of tobacco. At least that's their reasoning.

There are some bills working their way through Congress that attempt to exempt premium cigars from these rules, but until they pass both chambers and are signed, I won't hold my breath. And none of the bills help pipe tobacco.
 
The rule goes into effect 90 days from today, do depending on your reading of the tea leaves (or tobacco leaves as it were), folks may want to start acquiring blends they love that might go away or simply engage in an all-out orgy of hoarding before the price increase.

Also, the exemption for blends marketed or sold on February 15, 2007 (and the rule is clear that the blend had to have been marketed in the US on that date; it's not enough for it to have at one time before marketed here before that date) means that some old favorites may be exempted from the ingredient reporting requirements (I'm thinking about classic Dunhill and MacBaren blends for example), but the manufacturers still have the burden to prove those blends were marketed and sold here on that date. So if you're reading tea leaves, I expect a lot of those blends will be available after the change unless the manufacturer decides to pull them, but the prices will go up due to compliance costs and the cost of compliance for their other products.

I also predict increased "out of stock" notices at our favorite retailers during the next 90 days as TAD grips the pipe and cigar world.

The final rule has a little discussion about selection Option 1 over Option 2, and basically they chose Option 1 because it catches more tobacco products and has more comprehensive regulation of the health effects of tobacco. At least that's their reasoning.

There are some bills working their way through Congress that attempt to exempt premium cigars from these rules, but until they pass both chambers and are signed, I won't hold my breath. And none of the bills help pipe tobacco.
First, Hirsute, thanks for being on top of this. I know I am grateful to have a lawyer sift through and distill the implications of this new regulation.

Of course option 1 would be their first choice. It's like asking a kid to choose between broccoli and skittles for an afternoon snack.

Today, I read an article that Scandanavian Tobacco Group employs 8100 people worldwide. Many are obviously in more impoverished countries of Central America. They said these new regs will not impact 2016 earnings. A lot of people here and abroad may be affected post 2016.
 
I like two kinds of pipe tobacco: English and Aromatic.

The aros that I like are classic OTCs, mostly from Middleton. It's feasible for them to continue, but I wonder if each of them is a big enough seller to support itself.

My favorite English is a new Balkan from small blender Milan Tobacconists. I better stock up.

This really isn't the right year for me to blow money on tobacco. I expect next year to be better...I wish they could have held off. Well, even once the new regulations go live I guess there's that grace period that could last up to 36 months.
 
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