BREAKING: Elf Bar’s customs dodging for e-cigarettes sparks urgent investigations

Elf bar
Elf bar

United States: Elf bar, currently the most popular disposable e-cigarette, and other Chinese e-cigarette makers have imported worth hundreds of millions of dollars of products, while repeatedly dodging customs and avoiding taxes and import fees, as per public records and court documents reviewed by the Associated Press.

Moreover, the shipment of disposable vapes are routinely mislabeled as “battery chargers,” “flashlights” and other items, which creates hurdles in the efforts to block such products that are driving teen vaping in the US, says the reports.

US authorities last week issued a public statement saying that, out of the total first confiscation of some of the company’s products, 1.4 million illegal, flavored e-cigarettes from China were also recovered. As per the officials, the estimated cost of the items was around US$18 million, including brands other than Elf Bar.

AP reported that a small, colorful vaping device called Elf bar has become the most sought-after disposable e-cigarette in the world in only two years. Its sales are generating billions of dollars and increasingly emerging as the overwhelming favorite of underage US teens who vape.

More about Elf Bar

Shenzhen iMiracle, a privately held company based in Shenzhen, the sprawling Chinese manufacturing hub has Elf Bar as a leading product. The company produces more than 95 percent of the world’s e-cigarettes.

Vape bars

In the United States, recently iMiracle deserted the Elf Bar name, because of a trademark dispute and attempts by regulators to confiscate its imports. Now its products are sold as EB Create in flavors like watermelon ice and frozen creamsicle.

Jacques Xiang Li, who worked for iMiracle for three months and was still learning about its business said, “All the Elf Bar-branded products you see in the US are counterfeit, I’m pretty sure about this.”

As the company’s US sales and activities are emerging in court documents, it revealed how iMiracle’s parent company, Heaven Gifts, previously described how it could help customers evade import fees and taxes. Heaven Gifts’ website advertised “discreet” shipping methods to buyers, including not mentioning e-cigarettes or its company name “anywhere on the package.” Instead, the company said contents would be labeled as “atomizer, coil, tube, etc.,” AP News reported.

What authorities are doing?

Eric Lindblom, a former Food and Drug Administration official said, “The steps toward regulating disposables have been very weak and that has enabled this problem to get bigger and bigger.”

Shortly before the Chinese regulator banned vaping flavors last week, Fruit-and-candy-flavored disposables started filling into the US. They were acting to protect the children’s health, said the officials there. But health experts and vaping executives observed that the ban happened only after e-cigarettes started threatening sales of traditional cigarettes, which generate $200 billion annually for China’s state-run tobacco monopoly.

Governments from Australia to England have started to work towards banning single-use products, highlighting underage use and environmental impact. Therefore, disposable e-cigarettes might soon become the victim of their own success.

The global backlash could lead vaping entrepreneurs to focus even more on the US, where loopholes and lax enforcement make it easy to disguise e-cigarettes among the thousands of daily shipments arriving by sea and air.

Role of FDA

Food and Drug Administration (FDA) Commissioner Robert Califf said that the agency is “committed to continuing to stem the flow of illegal e-cigarettes into the United States.”

US FDA | Credits: AdobeStock

E-cigarettes which undergo FDA review and don’t come in fruity flavors, can’t compete with cheaper-priced disposables, said the US tobacco companies. Both Reynolds American and Altria filed separate legal actions against iMiracle, Esco Bars, and other disposable makers in recent weeks.

A former FDA investigator now working for Reynolds described vape exhibitors at a recent conference removing hidden e-cigarettes from flashlights, “which is consistent with the fraudulent practice of Chinese manufacturers declaring the product as flashlights.”

The Commission announced last week to open an investigation into the matter.

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