Until recently, the use of e-cigarettes and tobacco-heating devices in our country was practically unregulated at the legislative level, and they could be sold freely without special restrictions. However, signing the Association Agreement with the European Union obliged the Ukrainian government to implement EU Directive 2014/40, which requires clear regulation and control over the circulation of any tobacco and equivalent products, including electronic cigarette substitutes.
In early 2020, amendments were made to tax legislation under which liquids for e-cigarettes are now included in the category of tobacco products as a separate subgroup. Starting from 2021, an excise tax rate was introduced for such goods — the same as for traditional tobacco products. Thus, not only nicotine mixes for electronic tobacco heaters but also vape liquids became excisable goods requiring labelling and a special licence to sell. That said, this law regulated only the trade in liquids and mixes, while for device users themselves nothing yet changed.
A further development of the anti-tobacco campaign, intended to bring Ukrainian legislation on this issue into line with pan-European norms, was the rather difficult adoption in May and the final entry into force in July 2022 of the Ukrainian law “On amendments to certain laws of Ukraine on protecting public health from the harmful effects of tobacco.” This e-cigarette law, which caused heated public debate and earned a very mixed assessment among our fellow citizens, effectively equated popular gadgets with traditional cigarettes, and the liquids for them with all tobacco products.
How the legislation on e-cigarettes has changed
The new anti-tobacco law was meant to update existing regulations, many of which were enacted too long ago and did not take into account the appearance on the market of fundamentally new high-tech devices — e-cigarettes. Its provisions now prohibit not only smoking in public places but also the use of any nicotine-containing substances — both combustible and heated. Under the current law, smoking and using e-cigarettes or tobacco-heating devices is not allowed on playgrounds, indoors and on the premises of educational institutions, cafes, bars and restaurants, dormitories, hotels, healthcare, cultural, fitness and sports facilities. E-cigarettes are now also banned in administrative buildings such as state and local government bodies, as well as at all enterprises and organisations regardless of their form of ownership.
The updated legislation takes the changed realities into account — it already contains definitions of new terms such as “e-cigarette” or “flavour additive,” which rules out ambiguous interpretation and unjustified application of penalties. And the fines are very significant. For selling e-cigarettes to minors, the law provides for a fine of thirteen thousand six hundred hryvnias. For a repeated violation of the ban, the fine grows to almost twenty-four thousand; even confiscation of property is possible. Owners of catering establishments who allow free use of e-cigarettes in their bar or cafe will pay three thousand hryvnias for the first violation or fifteen thousand on a repeat inspection. For other entrepreneurs the fine is one and ten thousand respectively.
How to sell e-cigarettes without breaking the law
Naturally, the legal norms regulate both the use and the sale of tobacco products, which now include e-cigarettes and even their refill liquids. Regulators may check whether a seller of e-cigarettes or refills holds the appropriate licence to trade in tobacco products, and in its absence draw up an administrative report, which is the basis for applying penalties. The presence of excise stamps on liquid bottles is also subject to inspection, and it does not matter whether they contain nicotine.
According to the definition given in the e-cigarette law, liquids for them are described as mixtures of chemicals that may or may not contain nicotine, intended to create vapour and placed in cartridges, refill containers or other vessels. And there is one very important nuance here — Ukraine’s Tax Code provides an exhaustive list of groups of goods that are excisable, but the assignment of a product to a specific group is made not on the basis of its commercial name, recommended use or the composition written on the label, but solely on the basis of the UKTZED code that the supplier indicated on the invoice. If the invoice shows UKTZED code 3824 90 97 20, such a product is undoubtedly a liquid for refilling e-cigarettes and is subject to all the above legal requirements. But if, according to the accompanying documents, the vape refill is not among the excisable goods, then it can be sold without restrictions and law enforcement can have no claims against the seller.
As a natural reaction to the tightening of anti-tobacco legislation among vapers in the EU, and now in Ukraine, the popularity of component kits intended for self-preparation is rapidly growing. Unlike ready-made liquid, components under the UKTZED codes do not belong to excisable goods and can be sold completely legally without labelling or obtaining a special licence to trade in tobacco products. Octolab is the largest wholesale supplier in Ukraine of Octobar, Black Limit Salt, TWINS, Vape Mix Kit and IONIQ component kits, which according to invoices are not liquids for e-cigarettes and whose sale is not subject to regulation under current law. Of course, refilling a vape with a self-prepared mix does not lift the ban on smoking in public places for vapers, but component kits cost less than ready-made liquid because their price does not include excise duty.
