The draft policy, released by the national tobacco regulator on Thursday, follows a State Council opinion issued earlier this month which placed e-cigarettes and nicotine pouches under stiffer oversight.
As the e-cigarette industry grapples with challenges – including the slow exit of outdated capacity, structural imbalances and poor compliance with export rules – the new regulation specifically names “involution-style” competition as an area of concern.
“No investment in new projects shall be permitted, and relocated or reconstructed facilities shall not result in any increase in production capacity.”
In principle, the measure also forbids the widening of capacity through on-site technical renovations.
Stronger oversight of production capacity was also laid out as a priority in the draft policy. Companies would be mandated to operate strictly within their approved limits, with any proposed adjustments requiring additional approval and updated licensing.
