FDA : A victory for the industry, a threat for European aficionados

The decision of the federal judge is a clear and fully deserved victory for the cigar industry in the United States.

A clear victory because the judge completely rejected the proposed FDA regulation of premium cigars. If the FDA wants to try to regulate the handmade cigars market again – which is bound to happen – it will have to start the whole process from scratch.

It is also a legitimate victory insofar as the judge fully recognized the specificity of premium cigars compared to other tobacco products. The FDA’s will was to bring together all tobacco products excluding cigarettes: vape, nicotine pouches, machine-made cigars and handmade cigars. The professionals produced eight criteria to define what a handmade cigar is and managed to convince the judge – a definition that encompasses almost all hand-rolled and unflavored cigars. We dream that European regulators will one day come to similar conclusions, because even if the raw material is identical, handmade cigars, enjoyed in a reasonable way and without addiction, does not ultimately have much to do with cigarettes and all its recent derivatives (vape, etc.) and should therefore not be subject to the same restrictions (taxes, health warnings, track and trace, and other hassles).

European markets still secondary

But however legitimate and invigorating it may be – it removes a sword of Damocles suspended above an entire industry for seven years -, from a European and French point of view, this decision is not necessarily a good news. It confirms the attraction of an already ultra-dominant American market for producers from Nicaragua, the Dominican Republic and Honduras.

In other words, as long as the US market remains the one where cigar producers (with the notable exception of Cuba) sell the largest volumes – more than 460 million units last year – achieve the highest margins thanks to a reasonable (or even zero taxation as in Florida for example), and can work without excessive regulation (little or no health warnings, numerous smoking lounges, authorized mail-order sales and authorized advertising, etc.), it is to be feared that the European markets continue to be considered secondary: fewer cigars, fewer novelties. In short: less involvement.

Laurent Mimouni
Editor-in-chief
laurentmimouni@adc14.com