Being Global – regulatory challenges and opportunities when selling your products across multiple markets

Following the explosion of the internet in the 90s and improvements in transport efficiencies, the historical barriers of trade have come tumbling down. Small traders in the furthest stretches of the globe now have access to a truly global market place. Some global barriers to trade however still exist in relation to regulatory constraints, whether chemical shipping; children’s toy safety or food standards; but despite this the opportunity for global trade is vast and has never been greater.

For anyone operating within the electronic cigarette category, the term “regulation” will be synonymous with images of doom and gloom, and of organisations empowered to cast costly requirements on any firm wishing to continue to operate. The world of regulatory affairs is a vast and ever changing landscape and one that a successful firm must comply with in order to keep their products on the market. Radical changes are coming into effect in both the European market place, through the implementation of the Tobacco Products Directive and in the US, with the deeming regulations. Many perceive these regulatory requirements as excessive to the category and costly, both financially and in time, to their firm. On the other hand, regulatory bodies see the looming regulations as essential in capturing market data and to increase consumer protection, in an otherwise out-of-control category.

There is no doubt that regulations pose a challenge to firms and increase the uncertainty of the future of the category. Fortunately many regulatory requirements are harmonised across multiple territories or even globally, to make it easier for smaller firms to compete with the resource heavy larger firms. Recently Europe harmonised chemical and packaging regulations as the Chemical Labelling Packaging Directive (CLP), which has in turn sought to harmonise against the Globally Harmonised System (GHS) for classification. Harmonisation of such requirements means a less costly and more efficient process for all. However, failures to harmonise regulatory requirements can lead to the opposite, with convoluted requirements costing more time and resource to comply with.

Within the European single market place the harmonisation of the Tobacco Products Directive sought to simplify requirements for firms in the category; what has followed is state-by-state variance in requirements and implementation facilitating a disjointed regulation that, it would appear, many people do not fully understand.

There are however a distinct minority of firms who recognise regulation as an opportunity to gain advantage over their competition. Firms who adopt an entrepreneurial spirit typically look to take what is a challenge for their competitor and use it to their advantage, and so regulations do not necessarily have to be perceived as a barrier but potentially as an opportunity to expand market share or product offering.

Though the pending restrictions on advertising proposed in the Tobacco Products Directive in Europe will limit the ability of firms to communicate with potential customers, and so likely lessen new product awareness, it will also level the playing field for those firms who could not possibly compete with the deep pockets of the big players in the industry. This makes for a more appealing playing field for new-entrants into the market and may in turn promote product innovation.

Though large firms are better positioned to comply with regulatory requirements through their diverse skill sets, some having entire departments dedicated to regulatory compliance, this should not be seen as a barrier for smaller firms. Conversely, for larger firms who have for a long time focused their resource on other aspects of compliance, the challenge of a changing landscape and entering a new world of regulation can seem daunting.

We recognise that “regulation” means something different to everyone in the market; some are looking to comply with regulation in order to minimise disruption to their business, while others see the challenge as an opportunity to excel and differentiate their product offering.

We have spent time listening to industry and to those looking to comply with the Tobacco Products Directive. We play an active role in the interest groups, working groups and technical committees working to standardise the requirements of the Directive, so that you don’t have to! Nerudia can support you and your business with your ambitions and make the journey of regulation as seamless as possible.

Our business is to make your business grow.

David Lawson
Chief Regulatory Officer