18/12/2013
December 12, 2013
NHA Presents Ho**ah’s Case to the White House
At a recent meeting before the White House’s Office of Management and Budget (“OMB”) and the FDA in Washington, D.C., the NHA and members of Fantasia Distribution, Inc., discussed the yet-to-be-finalized FDA Regulations concerning “other to***co products.”
As you may be aware, the FDA has indicated that the regulations currently applying to ci******es under the Family Smoking Prevention and To***co Control Act (the “Act”) may soon extend to ho**ah to***co. The costs imposed and outright bans of products in that legislation could effectively eliminate our businesses.
The participants in the OMB/FDA meeting sought to educate the government about the ho**ah industry and reasons why ho**ah should not be subjected to the brunt of the new regulations. Key issues that were addressed are summarized below.
Upcoming Regulation That Could Ban Flavored Ho**ah To***co
The Act currently bans the sale of flavored non-menthol ci******es, out of concern that such products appeal to younger consumers and underage smokers. The FDA has indicated that it may extend the ban on flavorings to cigarillos under its authority to apply the Act to “other to***co products.” Ho**ah may also be subject to the ban.
The participants in the OMB/FDA meeting pointed out that the use of flavorings in ho**ah to***co, far from being designed to encourage underage smoking, dates back hundreds of years and is really the essence of ho**ah. The NHA members then elaborated on the cultural origins of flavored ho**ah, among other characteristics of the product that distinguish it from ci******es and other forms of to***co.
The NHA members concluded the discussion by urging the FDA not to impose a regulation that would unwittingly wipe out a mainstay of many ethnic communities. As the NHA members further contended, the contemplated ban would have a devastating effect on not only the many small businesses in the ho**ah industry but the employees depending on those small businesses and everyone else involved in the supply chain.
Retroactive Enforcement That Would Ban Post-2007 Products
The Act generally prohibits the introduction of new to***co products but allows products that were in existence in 2007 to be “grandfathered” in (allowed to continue because they existed before the Act was legislated). To***co companies may also obtain clearance for products that are the “substantial equivalent” of products that were in existence in 2007.
The documentation needed, however, can be difficult to pull together to prove to the FDA’s satisfaction that a product was being marketed in 2007, or was a “substantial equivalent” of a product being marketed in 2007. Small companies in the ho**ah business, particularly those that only got up and running shortly before 2007 or later, are likely to find themselves unable to meet the FDA’s exacting documentation standards. So, even if you had products that, in reality, should be exempt from the ban, you might still be prohibited from continuing to sell them, if the required documentation was lacking.
The NHA members pointed out the unfairness of applying the new regulation retroactively. The members therefore proposed that, if ho**ah is to be subject to the new regulations at all, the laws should apply on a going-forward basis only. The members proposed that the “grandfathering” date for ho**ah product exemptions from the Act should be no earlier than six months after the regulations take effect (sometime in 2014 or 2015).
