The Impact of New Regulation on E-Cig Merchants
From August 2016, the FDA of US started a new regulation. According to this, all the e-Cigarettes and vaping products will be regulated under the 2008 law. Previously, the 2008 law was used for regulation of sales of cigarettes. The Federal Drug Administration (FDA) will regulate the manufacturing, importing, labeling, packaging, and sale of the e-Cig.
This new rule indicates that every e-Cig and vaping goods must be approved. The manufacturers have to get the approval from FDA before selling goods in the US. It is anticipated that the consequence of this regulation will be severe for vaping and e-Cig producers. This will be difficult for the producers as every component of the product must be approved separately.
Moreover, the cost of obtaining an approval from FDA is approximately US $1,000,000 for each product. It is predicted that the variety of e-Cig and vaping products will be reduced sharply. It is believed this will happen in coming 3 years as the law will completely be in effect.
Effect of FDA E-Cig Law on E-Cig Consumers
Are you wondering what will be the effect on the consumers of FDA regulation? The impact on the e-Cig market of US will be substantial. As a result of the FDA regulation, the product range will be restricted. The total global demand of the e-Cig and vaping market is near $5 billion. The consumers demand by the US consumer is $2.4 billion.
Furthermore, if the prediction about the market will be proved right. There will be a huge decrease in the size of the vaping market. This will lead to a reduction in the availability of a number of a variety of products on US market. It is anticipated the producers will cut back from manufacturing new products. The reason is that the US consumers make up 50% of the global demand. As the products will need to be approved first, it will cost the manufactures plenty of money. So they will be stopping the production of such products.
Therefore, it is sensible to conclude as the regulation will take full effect. The number of products will be lesser in coming 3 years than available on the market today.
In the end, this regulation of e-Cig is being challenged in US courts. This is basically the extension of the FDA regulation related to cigarettes. In case these challenges are successful, there will be adjustments made to the regulations. The changes may reduce the obstacles imposed on the producer. They will be able to sell their products in US market but under certain conditions. This will lead to increase in the availability of the vaping products on the market. On the other hand, if the challenges are not successful, the products will be reduced in the coming 2 to 3 years.
Contact us if you are starting a E-Cigarette business and are in need of an e-cigarette merchant account, to accept payment from clients, such as credit card and ach processing.
High Risk Merchant Account LLC
915 Folly Road, Suite 49
Charleston, SC 29412