A Warning for the Rest of Canada: Imperial Tobacco Canada concedes vapour market in PEI to illegal operators

COMPLEX AND UNENFORCED REGULATION DRIVES CONSUMERS, INCLUDING THE YOUNG, TO SUBSTANDARD PRODUCTS.

MONTREAL, Feb. 27, 2025 /CNW/ - Imperial Tobacco Canada (ITCAN) announces today it will withdraw its vapour products from Prince Edward Island (PEI) due to the province's failure to enforce regulations, allowing the illegal market to thrive. Furthermore, an overly complex tax harmonization process has further disadvantaged legal businesses, contributing to ITCAN's decision.

"Our ambition is to build a smokeless world, and to do so, we believe access to less-harmful alternatives such as vapour products is paramount. However, illegal operators now control PEI's vapour market, while complex tax policies penalize responsible businesses like ours," said Eric Gagnon, Vice President, Corporate and Regulatory Affairs at ITCAN. "As a result, ITCAN has made the difficult decision to exit PEI, and our vapour products will no longer be available as of March 1, 2025."

ITCAN warns that PEI's lack of enforcement has fuelled illegal trade, making unregulated products easily accessible, often to young people, with little to no consequences.

"By imposing regulations without adequate enforcement, the province has handed the market to criminals who have no problem selling to youth," added Gagnon. "These illegal traffickers operate without fear, knowing that inspections are rare, and fines are merely a cost of doing business. They also know demand will persist because people will continue to vape."

Quebec Must Act Before It's Too Late

ITCAN warns that Quebec risks the same fate if it does not act swiftly. In October 2023, Quebec banned the sale of all flavoured vapour products except tobacco and flavourless products, mirroring PEI's 2021 flavour regulations. Since then, the province has been flooded with illegal products.

"I ask Premier Legault: Does he prefer a legal, regulated, and taxed vapour market, where responsible companies like ours, operate transparently and uphold the highest standards, or one that is illegal, unregulated, untaxed and unsafe?" said Gagnon.

A Léger Marketing survey (October 2024), commissioned by ITCAN, found that 61% of respondents had purchased flavoured vapour products, and 33% had bought vapour products online circumventing Quebec's 2015 ban on online vapour sales.

Government inaction is also evident in enforcement data. A report from the Ministère de la Santé et des Services Sociaux (MSSS) shows that only 38% (150) of all vape shops have been inspected, despite widespread non-compliance. Even among those inspected, only 28 retailers received fines despite more than 90% failing to comply with regulations. With fines as low as $2,500 for first-time offenders and $5,000 for repeat violations, illegal operators have little to fear.

"ITCAN urges governments across Canada to crack down on the illegal vapour market before it's too late. Responsible businesses must be allowed to operate under fair and enforced regulations, ensuring consumer safety and keeping unregulated products away from youth," said Gagnon.

About Imperial Tobacco Canada

Imperial Tobacco Canada is Canada's leading tobacco and nicotine products company and is part of the world's most international tobacco group: BAT. At BAT, our purpose is to create A Better Tomorrow™ by Building a Smokeless World.

Our vision is for A Smokeless World built on smokeless products where, ultimately, cigarettes have become a thing of the past. A world where smokers have migrated from cigarettes to smokeless alternatives. A world where smokers make a Switch to Better.

SOURCE Imperial Tobacco Canada

For more information or interview requests, please contact: Dalia Esposito, Torchia Communications, 514-654-2635, [email protected]; Mary Moniz, Torchia Communications, 647-278-0152, [email protected]