Chinese Conference English Version June 2020

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About The UKVIA

The UK Vaping Industry Association is Britain’s leading trade association representing the dynamic vaping sector.

Our vision: to create a world where the evidence-based, life-changing public health benefits of vaping are fully understood, and their positive impact is maximised.

We use our collective voice to campaign for common sense regulation, which puts the safety of the consumer first.
We raise awareness of vaping and educate the public, media and parliamentary stakeholders on the evidence of vaping’s huge public health potential.
We set the highest levels of quality standards – from the manufacturing of products, to their ingredients, through to their electronic function.

Overview

The UK is Europe’s largest vaping market; light-touch regulation developed by the UK government following the implementation of the Tobacco Products Directive (TPD) has encouraged growth, and the public health system is generally supportive of the category.
No tax is applied to vaping, despite a new tax being applied to heated tobacco products in the country. Cross Border distance sales are allowed and there is currently no legal restriction on public use of e-cigs.
After Brexit the TPD will no longer apply, but the Tobacco and Related Products Regulations 2016 (TRPR) will remain in force with possible amendments.
The vape store channel is still the most popular for purchasing e-cigs. This channel is very consolidated with 70% of stores belonging to a chain. Mainstream retail is growing with more brands entering this channel and closed system products are growing in popularity.
Fruit is the most popular flavour among e-cig users. Nicotine salt e-liquids are becoming more popular – 10% of the e-liquid products that top brands offer are nicotine salts.

IN THE UK, TOBACCO IS IN TERMINAL DECLINE

Since 2011, there has been a significant reduction in adult smokers driven by:

Cost savings
Desire to switch to safer alternatives
Public education programs
Vape friendly public health

VAPING TECHNOLOGY IS A KEY DRIVER OF CIGARETTE DECLINE

There are 3.1 Million smokers that want to stop now

10.6M

UK Nicotine Inhalation Consumers

The UK vape category is worth 1 Billion

Retail Market by Volume

Volume grew slightly ahead of value at +29% as category average price dropped -0.3%.

‘Capsules & Pods’ contributed over 50% of the growth

UK Market Snapshot

Despite a concerted effort by UKVIA to work with regulators, vape shops were not granted essential status and all vape shops closed from March 24th.
All non-essential workers were put on home lockdown
New switchers left with little educational support
Government put grants and wage subsidies in place
Open system sales down 60%*
Vape shops quickly adapted to online & home delivery
Big increase in online sales with some members reporting +1500%
Vape shops adapted to online & home delivery but still saw 30% – 60% decline
Vaping supply chain has suffered the effects of reduced availability of supplies coming in from China

But there is good news

We have a robust industry – the vaping sector now has an estimated 3,000 stores, up roughly 10% since last year.
All vape stores in Britain reopened yesterday with Scotland and Wales reopening next week.
Thanks to the government’s financial intervention many vape shops were able to keep their staff paid and for some, although turnover was down, profits were up.
The menthol ban for cigarettes may encourage smokers to make the switch to vaping.

Future Outlook & Challenges

Vaping is well placed to bounce back, with many of our members reporting a positive long-term view. However, there will be short term challenges.
Adapting to social distancing rules and uncertainty about how quickly the foot fall will return.
Ensuring a secure and stable supply chain with China.

Who do we engage with?

We engage directly with the Department of Health (DH), Department for Business, Energy, and Industrial Strategy (BEIS), Department for Exiting the European Union (DexEU), as well as executive agencies including Public Health England (PHE) and Trading Standards.

Continue to create a constructive and valuable working relationship with the Medicines and Healthcare Products Regulatory Agency (MHRA), acting as a strong voice for the responsible vaping industry by conveying key compliance and regulatory messages on behalf of the MHRA. This has included working with them on their Brexit preparations.

Actively pursues legislative opportunities in Parliament for driving forward reforms to the Tobacco and Related Products Regulations.

Policy and Regulation – Current Landscape

Tobacco Products Directive Review – We will be working with our European partners on the TPD review over the course of the next year to ensure the voice of the vaping industry is heard loudly and clearly. Whilst the UK has left the EU, we understand that the UK is not safe from bad legislation made elsewhere and it is in all our interests to protect from bad decisions which lead to unintended consequences for our industry and for public health.

All Party Parliamentary Group – the APPG on Vaping has been a useful tool in engaging UK parliamentarians and regulators to improve education and awareness and encourage an appropriate response to the increase in vaping.

Re-engaging with Government – UKVIA has identified objectives to engage the UK Government such as demonstrating the industry as professional and responsible, ensuring fair and proportionate regulation, challenging misinformation with HMRC, and positioning vaping as an effective way to stop smoking.

Response to COVID-19 – In support of the retail sector during the COVID-19 crisis, the UKVIA has lobbied No.10, Cabinet Office, a wide range of government departments and supportive parliamentarians to ensure a positive outcome for the vaping industry at an incredibly challenging time.

Improving Relationship with Regulators – Working harder to ensure a better relationship with UK regulators and health public policy makers.

The UKVIA Committee Structure – Our committee structure ensures our members are engaged in the decision making process and are kept informed of developments through the work of committees such as Youth Access Prevention, Policy and Regulatory and Standards.

Policy and Regulation – Future Landscape

A New Public Affairs Strategy:

Agreeing our objectives – through the work of our committees, we are developing the priorities and positions which we can use to engage with policy makers and decision takers.

Beginning engagement – Identifying and strengthening relations with parliamentarians, government departments including the Department for Health and Social Care, UK regulators and public health bodies such as Public Health England and the NHS.

Building Relations with the Devolved Administrations – the devolved administrations of Scotland, Wales and Northern Ireland have the ability to take, and at times are likely to take, a different approach to that of the UK government. The UKVIA is focusing on establishing better relationships with key politicians and decision makers in the devolved administrations, turning the attention away from just engagement with the Westminster government.

Continuing a strong relationship with the EU – despite the UK leaving the EU, it is important we remain closely linked with colleagues in EU institutions to ensure that we continue to get our voice heard. It is still the case that any legislation originating from the EU is likely to have an affect on the UK. Whilst the UK will have the power to diverge from EU law, it remains to be seen how often it will. It is in all of our interests to have a successful global market for the vaping industry to operate in

WHO Framework Convention on Tobacco Control, Conference of the Parties – Although postponed, the UKVIA will play an active part in preparing for and being represented at COP9 which is now due to take place in the Hague in November 2021.

The British Standards Institution (BSI) is a service organization that produces standards across a wide variety of industry sectors. Its codes of practice and specifications cover management and technical subjects ranging from business continuity management to quality requirements. UKVIA provide two member experts to the institute.

The BSI committee feeds into standards for both CEN, EN and ISO standards through various working groups.

There are a number of work streams for BSI vaping products including testing devices, liquids, ingredients and definitions

UKVIA subject matter experts hold two seats on this committee. This access gives the UKVIA a chance to influence future standards development and also gives members an insight into new standards being developed.

Negative perception still a threat

Vaping still has an ongoing perception problem – aggravated most recently by the US President’s intervention over a flavour ban in the American market in the wake of a number of deaths linked to illegal THC/Vit E acetate usage & the outbreak of Covid19.

Today, just over half of smokers (53%) understand that vaping is less harmful than smoking .

From 2013-2018, the proportion of UK adults who believe that vaping products are “as harmful” or “more harmful” than smoking has almost quadrupled from 7% to 25%.

The number of UK vapers increased just 0.4% from 2017-2018, compared to 86% in 2013, 62% in 2014, and 24% in 2015.

There is continuing alarm in the media and public mind that young people may take up vaping.

US anti-vaping funding is reaching far outside of the US market.

Media driven by “click-bait” headlines rather than fact-based science.

Pressure on UK politicians is growing to ban flavours, domestic advertising and vaping in enclosed spaces. There is also a push to require medicinal licensing (not possible while the UK is aligned to the EU) and plain packaging.

Vaping News Provided by John at UKVIA to Vapebargains UK