Regulating the vaping industry

ALT New Zealand Ltd v Attorney-General [2023] NZHC 3855

In 2023, the Government made changes to the Smokefree Environments and Regulated Products Regulations 2021 (the Regulations), reducing the maximum nicotine strength for nicotine salt vaping substances from 50 mg/mL to 28.5 mg/mL.  The amendment was driven by a push to address youth vaping, especially among young people who do not smoke and would not otherwise have been exposed to nicotine products.

 Three companies involved in the manufacturing, importation and sale of vaping products in New Zealand brought judicial review proceedings challenging the Government’s decision.  The applicants advanced a number of grounds including: inadequate consultation; breach of legitimate expectation; failure to take into account relevant considerations; and unreasonableness.

In its decision on 21 December 2023 the High Court held that none of the applicants’ grounds were made out and dismissed the proceedings.  Justice Churchman’s specific findings were that:

1)      There was no statutory or common law duty to consult before amending the Regulations but, in any event, the consultation undertaken by the Minister of Health was adequate in canvassing the views of stakeholders.  Further, the decision as to which stakeholders to consult was within the Minister’s discretion and it could not be said that the Minister’s decision on who to consult was irrational.

2)      There was no legitimate expectation when amending secondary legislation that experts would be consulted, in particular where a regulation aimed to improve the general health of the population.  The Ministry’s use of an external expert advisory group when overhauling the regulatory regime in 2017 was insufficient past practice from which to imply an ongoing commitment to engage independent experts each time a regulation was amended.

3)      The Minister’s advice to Cabinet was not inadequate — the Minister was not obliged to brief Cabinet on the views held by some experts (like those engaged by the applicants) that vaping is harmless and more nicotine in vape products does not make them more addictive.  Cabinet could not be expected to analyse the validity of competing views within the scientific community when reaching its decision.

4)      The amendment to the Regulations was not unreasonable or outside the scope of the power to make regulations under s 84 of the Smokefree Environments and Regulated Products Act 1990 (the Act).  The amendment was made with the objects and intention of the Act in mind — including the aims of regulating smoked tobacco products in a way that reduces harm (such as promoting smoking cessation) and regulating vaping products in a way that seeks to minimise harm, especially harm to young people and children.  In rejecting the applicants’ unreasonableness ground, the Judge held that the balancing of the Act’s purposes, and the manner in which those purposes were to be met, was a judgement call for the Executive to make. 

This decision illustrates that the focus for courts is not the policy reasons behind regulations (secondary legislation), but rather whether that secondary legislation is within the bounds of the empowering statute, having regard to the statute’s purposes.  

It’s worth bearing in mind that the Smokefree Environments and Regulated Products Amendment Act 2024, which came into force recently on 6 March 2024, includes a replacement purpose section for the Act. 

The new purpose section expressly spells out purposes relating to smoking cessation and discouraging non-smokers from taking up vaping.  This section is more explicit than the previous purpose section, under which Cabinet made its decision to reduce the nicotine salt limits and which the Court considered in ALT New Zealand Ltd v Attorney-General.

In particular, it includes (amongst a number of) purposes to:

-          Prevent the normalisation of vaping;

-          Support smokers to switch to regulated products (a category which includes vaping products) that are significantly less harmful than smoking; and

-          Regulate and control the marketing, advertising and promotion of regulated products in order to improve public health by (among other things) discouraging non-smokers (especially children and young people) from taking up vaping.

These amendments to the Act’s purposes may have an impact on any future decision-making as to what limits to set for nicotine concentration in vaping products

Article written by Rachel Bedggood and Sanja Marin

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