State Tobacco Monopoly Bureau solicits public opinions on the "Regulations on the Management of Tobacco Products in Duty-free Markets".

On July 25th, the State Tobacco Monopoly Administration publicly solicited opinions on the "Regulations on the Management of Tobacco Products in the Domestic Duty-Free Market (Draft for Comment)". The draft mentions that retail enterprises are not allowed to sell duty-free tobacco products to consumers in quantities exceeding the limits specified by the relevant competent department of the State Council; duty-free tobacco products sold to international cruise ship staff and passengers for personal use and in reasonable quantities shall be executed in accordance with the regulations on the provision of supplies to international cruise ships docking in ports of the People's Republic of China (State Council Decree No. 780). The original text of the draft is as follows: Management Measures for Duty-Free Tobacco Products in the Domestic Duty-Free Market (Draft for Comment) Chapter I General Provisions Article 1 In order to implement the requirements of the State Council on strengthening the supervision of duty-free market tobacco products in the domestic duty-free market, further regulate the operation order of duty-free tobacco products in the domestic duty-free market, ensure national fiscal revenue, and safeguard consumer rights, these measures are formulated in accordance with the "Tobacco Monopoly Law of the People's Republic of China" and its implementing regulations, as well as relevant laws and regulations on foreign trade, duty-free goods management, etc. Article 2 These measures apply to: (1) Supplying duty-free tobacco products to the duty-free market in China; (2) Engaging in wholesale and retail business of duty-free tobacco products in the duty-free market in China; (3) Supervision and management of the above behaviors. Article 3 Duty-free tobacco products referred to in these measures refer to cigarettes (excluding heated cigarettes), cigars, tobacco leaves, and other tobacco products supplied in a duty-free manner to designated retail locations and sold to specific objects such as cross-border travelers. Duty-free tobacco products are divided into domestically produced national brand duty-free tobacco products and imported brand duty-free tobacco products produced abroad. Article 4 Duty-free tobacco products can only be retailed in the following places: (1) Duty-free shops authorized to operate tobacco products; (2) International cruise ships purchasing tobacco products from within China. Article 5 The State Administration of Tobacco Monopoly shall manage duty-free tobacco products in accordance with the following principles. (1) Strengthen tobacco monopoly administrative supervision, coordinate taxed and duty-free markets, safeguard national tax interests; (2) Strengthen control over the source of duty-free tobacco products to ensure their quality and reliability and protect consumer rights; (3) Regulate enterprise production and operation order, continuously improve regulatory effectiveness, and create a good market environment. Chapter II Business Management Article 6 The State Administration of Tobacco Monopoly shall implement unified management of the import and export of duty-free tobacco products in accordance with the state-operated trade method. Enterprises engaged in the retail business of duty-free tobacco products (referred to as retail enterprises) shall, in accordance with these measures, submit procurement requirements to enterprises engaged in the wholesale business of duty-free tobacco products (referred to as wholesale enterprises). After the wholesale enterprises purchase from enterprises engaged in the supply of duty-free tobacco products (referred to as supply enterprises), they shall import and export duty-free tobacco products to the domestic duty-free market in accordance with the regulations on state-operated trade of tobacco goods. Article 7 The State Administration of Tobacco Monopoly shall implement planned management of the import and export of duty-free tobacco products in accordance with the law. Article 8 The State Administration of Tobacco Monopoly shall issue annual sales plans for duty-free tobacco products to wholesale enterprises and annual procurement plans for duty-free tobacco products to retail enterprises. After the retail enterprises' annual procurement demands for duty-free tobacco products are aggregated by wholesale enterprises, the annual procurement plans for retail enterprises shall be approved and issued by the State Administration of Tobacco Monopoly. Article 9 Retail enterprises' combined procurement demands for duty-free tobacco products submitted in accordance with Article 6 of these measures shall not exceed the total amount of the annual procurement plan. Wholesale enterprises shall promptly submit purchase orders to supply enterprises based on the procurement demands not exceeding the total amount of the annual procurement plan submitted by retail enterprises. -Translation continues in next message due to character limit-