IPCPR Legislative | FDA Compliance Update for Retailers: Pipe Tobacco & Product Sampling

FDA Compliance Update for Retailers: Pipe Tobacco & Product Sampling

21 Nov FDA Compliance Update for Retailers: Pipe Tobacco & Product Sampling

To register or not to register (as a manufacturer)?
We have received many inquiries from our retailers about this issue.  This is an important question because if you are considered to be a “manufacturer” by FDA, then you are required to register and list your products with FDA.  It sounds like an easy question when you think about factories and other manufacturing facilities, but when FDA extended the definition to include certain activities that have long been performed by retailer it created uncertainty for all of us.  We have been asking FDA for clarification for some time about what, exactlya retailer can do and not be considered to be a manufacturer.  We are hoping to have more details soon, but here is what we currently have from FDA:

1)  By regulation at 21 C.F.R. § 1140.3: “Manufacturer means any person, including any repacker and/or relabeler, who manufactures, fabricates, assembles, processes, or labels a finished tobacco product.”
FDA’s definition of a “manufacturer” introduced some additional terms that need to be defined, namely “repacker,” “relabeler,” and “finished tobacco product.”

2)  The Tobacco Control Act does not define any of these terms, but it does talk about how “repackaging” can be considered to be “manufacturing.”  In particular, tobacco product “manufacturing, preparation, compounding, or processing” under the Tobacco Control Act includes “repackaging, or otherwise changing the container, wrapper or labeling of any tobacco product package from the original place of manufacture to the person who makes the final delivery or sale to the ultimate consumer or user.”

3)  Going back to the FDA regulation, note how it applies only to a “finished tobacco product.”  This term is not defined in the law or regulation, but in the deeming rule FDA said that a “finished tobacco product refers to a tobacco product, including all components and parts, sealed in final packaging intended for consumer use (e.g., filters, filter tubes, e-cigarettes, or e-liquids sold separately to consumers or as part of kits).

4)  Finally, FDA explained in the deeming rule that the way the Agency read the law, “retail establishments that blend pipe tobacco, are subject to and must comply with all applicable statutory and regulatory requirements for tobacco product manufacturers.”

So what does this mean?  Pipe tobacco has long been provided in bulk containers and retailers simply weigh out the amount the customer wants (with or without blending by the retailer).  One way to look at it is if the retailer does not “seal” the package of pipe tobacco provided to the consumer, then no “finished tobacco product” is created and therefore there is no requirement for the retailer to register as a manufacturer.  Another way to look at it is if the retailer provides the bulk tobacco but the customer weighs it out (with or without blending by the customer according to a “formula board” posted in the shop), then that is not manufacturing.  In addition, FDA has not said that a retailer is a manufacturer if the retailer simply weighs out a smaller quantity of bulk pipe tobacco for a customer.  Instead the Agency seems focused on a “blending” step, which would involve two or more bulk pipe tobaccos.  We have asked FDA about all of these issues (and many, many more!) but we don’t know how FDA will rule on these situations.  Finally, we are aware that at least some pipe tobacco manufacturers are packaging their products into smaller packages, which may affect whether a retailer needs to “repack” the product at all.

FDA believes that blending pipe tobacco is “manufacturing.”  Therefore, retailers that plan to continue blending pipe tobacco after December 31, 2016, must:

Retailers that do not plan to register as a manufacturer with FDA should discontinue selling blended pipe tobacco by December 31, 2016. FDA has not explained whether any other practices would also constitute “manufacturing” but if they do, we will let you know as soon as possible.

Sampling
In our last update, we explained that effective August 8, 2016, retailers are not permitted to distribute free samples to consumers.  We also noted that IPCPR believes that the following practices do not violate the free sample provision, and have requested written confirmation from FDA:

  • Providing a cigar in exchange for buying other products (e.g. “buy one get one free”).
  • Replacing a plugged, spoiled, or otherwise damaged cigar for free.
  • Having a raffle with cigar(s) as prizes if there is a cost to enter the raffle.

We have not received a formal answer from FDA on these questions.  However, FDA has said:  “Given the public’s interest in the free sample prohibition provision, however, FDA intends to issue guidance in the future to further clarify the provision.”  We know this issue is of great importance to our retailers and we will update you as soon as we learn anything from FDA.

IPCPR’s Recommendation: A transaction must always take place, so keep a paper trail. IPCPR recommends exercising caution until we receive further explanation from FDA regarding the legality of specific practices and scenarios.

International Premium Cigar and Pipe Retailers Disclaimer of Legal Liability:
The materials and information set forth in this email are provided by the International Premium Cigar and Pipe Retailers (“IPCPR”) for informational purposes only and are to be used as a tool to help retailers navigate the recently issued Food and Drug Administration (“FDA”) regulations.  IPCPR has taken reasonable efforts to ensure that all materials and information included herein are accurate and complete. However, as new information becomes available and as the FDA regulations are implemented, the recommendations set forth herein may change.  For this reason, it is recommended that retailers evaluate the applicability of the information set forth herein in light of particular situations and current information. The review of this document is not a substitute for obtaining advice from qualified professionals.  If legal or other professional advice is required, it is recommended that the reader obtain advice from qualified legal or other professionals.
The information presented in this document is provided “as is” without representation or warranty of any kind. In no event shall IPCPR, or its directors, officers, or employees, be held liable for any losses, injury, damages, or any other consequences resulting from, or arising in connection with, the use or reliance on this document, or any information or materials contained therein.



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