On July 23, 2024, the House Ways and Means Committee of the Philippines approved House Bill No. 10329 (HB No. 10329). This bill aims to combat the illegal tobacco trade by banning online sales of tobacco products, including e-cigarettes.
Background and Legislative Intent
Motivation Behind the Bill
House Bill No. 10329, drafted by Joey Salceda, representative of the second district of Albay, targets the elimination of online sales channels to curb the illicit tobacco trade. Salceda emphasized the financial losses the country faces due to illegal tobacco trade, citing a loss of PHP 221 billion in revenue over the past four years.
Alignment with Existing Laws
The bill aligns with Republic Act No. 9211 (RA No. 9211), which prohibits the advertising of tobacco products in mass media, including the internet. By integrating these regulations, the bill seeks to strengthen the enforcement of existing laws and close loopholes that allow illegal sales.
Key Provisions of House Bill No. 10329
Ban on Online Sales
The bill proposes a complete ban on the online sale of tobacco and nicotine products. Only businesses registered with the Department of Trade and Industry (DTI) and the Bureau of Internal Revenue (BIR) will be allowed to operate in the online market.
Mandatory Use of Track and Trace Systems
To combat illicit trade, the bill mandates the use of secure digital markings with unique identifiers on tobacco products. This track and trace system will help authorities monitor the distribution and sale of tobacco products, ensuring compliance with legal standards.
Mandatory Registration of Tobacco Product Manufacturing Equipment
Manufacturers must register their tobacco product manufacturing equipment within 30 days of acquisition or disposal. This measure aims to prevent unauthorized production and facilitate regulatory oversight.
Responsibilities of Digital Platforms
Digital platforms must ensure that no illicit products are sold on their sites. This provision places the onus on online marketplaces to vet sellers and products, thereby reducing the availability of illegal tobacco products online.
Rationalization of Prohibited Acts
The bill proposes the exclusion of certain crimes from the coverage of the National Internal Revenue Code, the Customs Modernization and Tariff Act, and other special laws. This rationalization aims to streamline the enforcement of anti-illegal trade laws and eliminate redundancies.
BIR Authority to Remove Illicit Products Online
The Bureau of Internal Revenue (BIR), through the National Telecommunications Commission (NTC), will have the authority to delete listings of illegal products from digital platforms. This power will enable swift action against non-compliant sellers and products.
Regulation and Disposal of Seized Products
The bill outlines procedures for the seizure, confiscation, or turnover of covered products to establish a proper regulatory chain. This ensures that seized products are disposed of or managed in a way that prevents their re-entry into the market.
Financial and Regulatory Implications
Addressing Revenue Losses
By targeting the illegal tobacco trade, the bill aims to recover substantial revenue losses. The implementation of strict regulations and enforcement mechanisms is expected to enhance compliance and reduce illicit activities.
Funding Provisions
Salceda expects the House Appropriations Committee to approve the funding provisions of the bill in August. This approval is crucial for the bill to pass the House before the filing of Certificates of Candidacy (COC) in October.
Public Health and Safety
Protecting Youth
By banning online sales and restricting access to tobacco products, the bill aims to protect youth from the risks associated with tobacco use. The stringent regulations are designed to reduce the appeal and availability of e-cigarettes to minors.
Ensuring Product Safety
The track and trace system, along with the mandatory registration of manufacturing equipment, will help ensure that only safe and compliant products are available in the market. This will enhance consumer trust and safety.
Comparative Analysis: Global Efforts Against Illegal Tobacco Trade
International Trends
Many countries are adopting stringent measures to combat the illegal tobacco trade. The Philippines’ approach aligns with global trends aimed at reducing illicit trade and protecting public health.
Lessons from Other Countries
Countries that have successfully implemented similar regulations have seen significant reductions in illegal trade and improved public health outcomes. The Philippines can learn from these experiences to optimize the implementation and enforcement of HB No. 10329.
Public and Industry Reactions
Support from Public Health Advocates
Public health advocates are likely to support the bill, viewing it as a necessary step to combat the illegal tobacco trade and protect public health.
Industry Concerns
The tobacco industry may express concerns about the impact of the ban on online sales and the costs associated with compliance. However, the long-term benefits of reducing illegal trade and enhancing product safety are expected to outweigh these concerns.
Future Outlook and Enforcement
Monitoring and Compliance
The BIR and other relevant authorities will be responsible for monitoring compliance with the new regulations. Ongoing enforcement efforts will be essential to ensure that the objectives of the bill are met.
Potential Policy Adjustments
As the bill is implemented, there may be adjustments based on feedback from stakeholders and the effectiveness of the measures. Continuous evaluation and refinement will help ensure the regulations effectively combat illegal trade and protect public health.
Conclusion
The approval of House Bill No. 10329 by the Philippine House Ways and Means Committee marks a significant step towards combating the illegal tobacco trade. By banning online sales and implementing strict regulations, the bill aims to protect public health and recover lost revenue.
FAQs
What is the main objective of House Bill No. 10329?
The main objective is to combat the illegal trade of tobacco products by banning online sales and enhancing regulatory oversight.
Who is responsible for ensuring compliance with the new regulations?
The Bureau of Internal Revenue (BIR), in collaboration with the National Telecommunications Commission (NTC) and other relevant authorities, will be responsible for ensuring compliance.
How will the bill impact online sales of tobacco products?
The bill bans online sales of tobacco and nicotine products, allowing only registered businesses to operate in the online market and ensuring strict regulation and oversight.
What are the penalties for non-compliance with the new regulations?
The bill outlines procedures for the seizure, confiscation, or turnover of illegal products and grants the BIR authority to delete listings of non-compliant products from digital platforms.
When is the bill expected to take effect?
The bill is expected to be submitted to parliament in September 2024 and take effect on January 1, 2025, following approval and notification to the European Union.
How will the bill protect youth from tobacco products?
The bill aims to reduce youth exposure to tobacco products by banning online sales, restricting access, and ensuring that only safe and compliant products are available in the market.
