Ontario

Published on April 8th, 2016 | by OCSA

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OCSA Submission on E-Cigarette Regulation

The OCSA is a not-for-profit trade association that represents the interests of over 6,000 convenience store retailers operating throughout Ontario.

The convenience store (c-store) sector is an integral part of the business community of Ontario. Our stores are vital economic and social hubs in the communities they serve, including providing services to some areas that would otherwise be overlooked by bigger retailers.

We interact with 2.7 million Ontarians each and every day. We collect $3.8 billion in tax revenue for the Province every year and in 2014 we accounted for $2.6 billion in lottery revenue for the Ontario Lottery and Gaming Corporation. We are an $18.4 billion industry in Ontario, and support over 65,000 jobs in the province.

We are licensed distributors of tobacco products working in conjunction with the Province to restrict youth access. Our retailers play by the rules and we expect all within the industry to do the same.

The OCSA welcomes the government’s move to regulate the consumption, display and sale of e-cigarettes. Given the absence of federal law, we have seen a patchwork approach to regulation throughout the country. Liquid nicotine is not currently approved by Health Canada and is therefore illegal for sale across Canada. Despite this, our members have noticed a significant movement by vape shops to display and sell this product.

As an Association, we have long advocated against our members selling liquid nicotine until the product is approved and regulated. We have also long advocated that vapour products be sold only to those above the legal age in Ontario. Our members feel it is unfair that these new and unlicensed vape shops could be given preferential treatment over our stores that have dutifully upheld provincial laws according to our tobacco licenses.

We have concerns that, despite our retailers following the law, the proposed regulatory framework around e-cigarettes in Ontario will push us out of the market. We are concerned that vape shops will continue to sell and profit off the sale of liquid nicotine, while the province creates display and sample restrictions that keep c-stores out of the market. C-stores hold tobacco licenses which would prevent us from displaying and sampling in our stores. This in turn creates an uneven playing field in what is currently a highly competitive market.

In addition to the economic impact on our members, we feel that allowing vape shops to continue to operate and expand contravenes the government’s principal interest in regulating this new product category, thereby protecting youth. By not extending the c-store standard to all retailers, there would be nothing to prevent these stores from opening up next to schools and playgrounds and targeting youth with in-store marketing. In addition, without proper enforcement, these shops will be able to continue to openly defy government (as they have been doing by retailing nicotine products), and sell their products without checking for age.

The OCSA is wholeheartedly in support of the government’s intent to ban in-store use or ‘sampling’ of e-juice and e-cigarette products. Use of these products in any public space may have the unintended effect of generating interest amongst youth, and is essentially a form of advertising. OCSA’s members currently do not allow this practice in their stores, and we are hopeful that government will remain committed to implementing the ban across the board.

Our primary request is for the government take an all or nothing approach when it comes to displays and testing. Either allow for the display and sampling of these products for all who intend to sell e-cigarettes, or have it be restricted across the board. We cannot allow for a market that favours one business model over the other; the rules should be the same for both.

On the specific wording of the draft regulation and with respect to in-store display, we are generally in support of government’s proposal. The points reflecting visibility of e-cigarette products from outside of the store (which we understand would not be allowed), and accessibility of the store from other public spaces (ie. the store cannot be a thoroughfare), are acceptable and meet the expectations of our members. However, the section that restricts individuals under the age of 19 from entering a store should e-cigarettes be on display would be very difficult for the c-store industry to accommodate, both from an economic and operational perspective. A good number of c-store patrons are youth, and forcing c-stores to decide between allowing in-store display of a “destination category” product, and banning youth from the store would be received as a very troubling proposition. Additionally, should our members choose to allow in-store displays, it would contradict the differentiating value proposition c-stores provide their communities (i.e. blocking a large segment from entering the store). While it is most important that vape shops be treated in the same way as c-stores, we would also appreciate consideration of allowing youth to enter stores that have e-cigarettes on display.

We request that, following Health Canada approval, liquid nicotine is treated the same in all retailers from displays, communication, promotion and signage. E-cigarettes are not tobacco products and should therefore not be regulated as such when it comes to display and sale.

Ontario’s convenience store sector has a long history of compliance and cooperation with government. This goes back to the original retail display ban for cigarettes, and continues with many of the other initiatives introduced under the Smoke Free Ontario Act and its subsequent amendments and regulations. For our members, it would be confusing and upsetting if this was not considered in government’s decision on e-cigarette regulation.

We look forward to discussing further with officials and staff as the consultation evolves.


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