Shares in Chinese e-cigarette firms slide after state media report
SHANGHAI (REUTERS) – Shares in Chinese vaping firms slid on Thursday (Aug 5) after state media reported that many minors are able to purchase e-cigarettes in the country despite a ban on sales to under-18s and cited an expert as saying a tougher crackdown was needed.
Huabao International Holdings tumbled 8 per cent in morning trade, while China Boton Group fell 4 per cent. Relx Technology closed almost 5 per cent lower in New York after the report by Xinhua news agency was published.
Xinhua news agency said its reporters made unannounced visits to e-cigarette shops in the northern cities of Tianjin and Shenyang and found that while all had signs stating sales to minors were prohibited, enforcement of the law varied in practice.
One unidentified salesman told Xinhua their store did not typically ask for proof of age, unless the customer was obviously very young.
Another vendor contacted by Xinhua on the social media platform WeChat did not ask for the buyer’s age or identification.
“E-cigarettes pose a safety hazard to minors, and further efforts should be made to crack down on the sale of e-cigarettes to minors,” Xinhua quoted director Fu Jia of the Tianjin Lawyers Association’s professional committee for the protection of minors.
The Xinhua report comes as the Chinese authorities have cited the need to improve the protection of minors and other state media have criticised the video gaming sector.
Regulators this year have also upended norms for the technology, education and property sectors, putting investors on edge over what other industries may next be in line for further oversight.
E-cigarettes can be used as a way to quit smoking tobacco but they also contain addictive nicotine. The World Health Organisation (WHO) warned in a report last month they “may act as a ‘gateway’ to tobacco consumption” for young people.
China is the world’s largest consumer of tobacco products, with more than 300 million smokers, according to the WHO report.