Canada Gazette, Part I, Volume 156, Number 24: Regulations Amending the Tobacco Products Regulations (Plain and Standardized Appearance)

June 11, 2022

Statutory authority
Tobacco and Vaping Products Act

Sponsoring department
Department of Health

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations or the Order.)

Executive summary

Issues

Tobacco use continues to be the leading preventable cause of illness and premature death in Canada. While tobacco use has decreased, a significant number of Canadians still use tobacco. Approximately 48,000 Canadians die each year from tobacco use^{footnote 17}. The health and economic costs associated with tobacco use in Canada were estimated at $12.3 billion in 2017^{footnote 2}, with direct health care costs of $6.1 billion.

Health-related messages on tobacco products packaging is recognized as one of the best approaches to inform Canadians of the health hazards associated with tobacco use. Health-related messages for cigarettes and little cigars have been in place since 2011 through the TPLR-CLC, while those for cigarette tobacco, cigars, pipe tobacco, leaf tobacco, tobacco sticks, chewing tobacco and snuff have remained unchanged since their introduction in 2000 through the TPIR. These messages have reached their maximum potential^{footnote 3}. Further, they no longer reflect the most up-to-date information, research and science available.

Young persons experimenting with cigarette smoking often obtain individual cigarettes through social sources, and are not exposed to the health-related messaging on cigarette packaging. This significantly reduces the ability of the health warnings to reach and inform youth of the health hazards and health effects of tobacco use.

Other tobacco products, such as those intended for use with devices (better known as heated tobacco products), the devices themselves and their parts, water pipe tobacco, blunt wraps, as well as any novel tobacco product that may be introduced in the market in the future, are currently not subject to package labelling requirements. Users of these products are not informed of the health hazards of tobacco use via the packaging, and may be misled about the harm these products may pose to their health. Further, Canada is not fully compliant with its tobacco labelling obligations under Article 11 of the FCTC with respect to the following:

• Tobacco products intended for use with devices (better known as heated tobacco products), water pipe tobacco, and blunt wraps do not carry health warnings on their packaging describing the harmful effects of tobacco use, as they are currently not subject to labelling requirements.
• Packages of certain tobacco products, such as cigars and pipe tobacco, do not contain information on their emissions.

Background

Tobacco use is a known or probable cause of more than 40 debilitating and often fatal diseases of the lungs, heart, and other organs^{footnote 4}. Tobacco products contain nicotine, a highly addictive substance responsible for tobacco dependence and consequent repeated long-term use resulting in chronic exposure to harmful chemicals. Young persons are particularly susceptible to the risk of dependence and report symptoms of dependence even at low levels of cigarette use^{footnote 5}.

The health care costs associated with tobacco use represent 47% of health care costs associated with substance use in Canada. Beyond the economic costs of tobacco use, is the burden in terms of human suffering. A 2021 report on Smoking and Tobacco Use by the Centers for Disease Control and Prevention (CDC) in the United States found that for every person who dies of smoking-related causes, at least 30 people live with a smoking-related illness^{footnote 6}.

Decades of coordinated efforts have resulted in smoking prevalence in Canada decreasing from 26% in 2001^{footnote 7} to 13% in 2020^{footnote 8}. Despite these advances, 1 in 10 Canadians report smoking on a regular basis. Adults (aged 25 and older) are almost three and a half times more likely to report being someone who uses tobacco than youth (aged 15–19)^{footnote 9}.

Canada’s Tobacco Strategy (CTS), introduced in 2018, focuses on helping Canadians quit using tobacco, protecting youth and people who do not use tobacco from nicotine addiction, strengthening the foundations in science, surveillance and partnerships, and working with national and regional Indigenous organizations. The CTS aims to achieve the ambitious target of less than 5% tobacco use prevalence by 2035, with targeted approaches focused on specific populations associated with high levels of tobacco use.

Legislative framework and regulatory landscape

Parliament adopted the Tobacco Products Control Act (TPCA) in 1988, which provided the authority to mandate health warnings on tobacco product packages, among other requirements. The Tobacco Act replaced the TPCA in 1997, which also included the authority to mandate health warnings on tobacco product packages. In 2018, the Tobacco Act was amended by Parliament and renamed as the Tobacco and Vaping Products Act (TVPA). The TVPA regulates the manufacture, sale, labelling and promotion of tobacco and vaping products. With respect to tobacco products, the TVPA provides a legislative response to tobacco use, a national public health problem of substantial and pressing concern. Specifically, it aims to

• (1) protect the health of Canadians in light of conclusive evidence implicating tobacco use in the incidence of numerous debilitating and fatal diseases;
• (2) protect young persons and others from inducements to use tobacco products and the consequent dependence on them;
• (3) prevent the public from being deceived or misled with respect to the health hazards of using tobacco products; and
• (4) Enhance public awareness of the health hazards of using tobacco products.

Currently, tobacco products package labelling requirements are found in the TPIR and the TPLR-CLC. These regulations specify that health-related messages must be displayed on tobacco product packaging and leaflets and how they must be displayed. Additionally, the TPR-PSA set out the requirements for manufacturers^{footnote 10} of tobacco products regarding the plain and standardized appearance, shape and content of tobacco product packages. Combined, these regulations directly support the TVPA objectives of enhancing public awareness of the health hazards of using tobacco products, preventing the public from being misled about the health hazards of using tobacco products, and protecting young persons and others from inducements to use tobacco products.

The TPIR and TPLR-CLC apply to packages of tobacco products intended for retail sale within Canada, while the TPR-PSA apply to both tobacco products and their packaging.

As per requirements of the TPIR and the TPLR-CLC, tobacco products packages must display the following labelling elements:

• Health warnings
  • Health Warnings (HW) are messages, usually combining text with illustrations, prominently displayed on the front and back of most tobacco product packages. These messages focus primarily on the health hazards and negative health effects associated with tobacco use.
• Health information messages
  • Health Information Messages (HIM) are messages that combine text with illustrations. They are found either inside tobacco packages, on a leaflet inserted into tobacco packages, or on the exterior of cylindrical packages of cigarette tobacco. In contrast to HW, they focus primarily on the benefits of quitting and provide tips on smoking cessation, and complement HW.
• Toxic emissions and toxic constituents information
  • As per both the TPIR and the TPLR-CLC, toxic emissions and toxic constituents statements displayed on the side of most tobacco product packages are either in the form of short statements about the health impacts of toxic chemicals found in tobacco smoke, or as a list of some of the toxic emissions. Toxic constituent statements display a range of value for selected constituents in chewing tobacco and snuff.

The TPIR were introduced in 2000, and apply to cigars, pipe tobacco, cigarette tobacco, bidis, kreteks,^{footnote 11} leaf tobacco, tobacco sticks,^{footnote 12} chewing tobacco and snuff. These regulations require HW to cover at least 50% of the principal display area of packages of most of these tobacco products. The HW for packages of kreteks, tobacco sticks, cigarette tobacco, leaf tobacco, pipe tobacco and cigars contain both graphics and text, while those for chewing tobacco, snuff and bidis are text only. The TPIR also require text-based HIM to be placed on cigarette packages or on a leaflet inserted in little cigar and cigarette tobacco packages. Additionally, the TPIR set out requirements for toxic emission and toxic constituent statements to be displayed on the package. With the implementation of the TPIR, Canada became the first country in the world to require pictorial HW on tobacco packages, and continues to be the only country where HIM are required to be displayed inside cigarette, little cigars and cigarette tobacco packages.^{footnote 13}

In 2011, the TPLR-CLC replaced the requirements of the TPIR for cigarettes and little cigars. The TPLR-CLC currently require pictorial HW covering 75% of the front and back panels of cigarette and little cigar packages. They also require HIM, enhanced with colours and graphics, be displayed inside packages, and the display of easy-to-understand toxic emissions and toxic constituent information on the exterior packaging. HW include a pan-Canadian toll-free quit line number and web address to inform tobacco users about the availability of cessation services.

Additionally, the TPR-PSA, introduced in 2019, set out requirements that standardize the appearance and shape of packages and certain tobacco products. These regulations were introduced to reduce inducements to use tobacco products by limiting the appeal of tobacco packages and the products they contain, and to prevent the public from being deceived or misled with respect to the health hazards of using tobacco products. Under the TPR-PSA, no distinctive or attractive features can be displayed on tobacco products or their packages. The TPR-PSA mandate the size, shape, and colour of tobacco product packaging, as well as the location, font size and colour of permitted text to be displayed. All tobacco product packages are required to be the same drab brown colour, bearing only the permitted text displayed in a standard location, font style, colour and size.

Effectiveness of health-related messages

Evidence indicates displaying health-related messages on tobacco packaging is one of the most effective approaches to inform users of the health hazards of tobacco use.^{footnote 14}Messages on tobacco product packages and products have the potential of being seen daily by millions of people to help Canadians live healthy, tobacco-free lives.

The effectiveness of health-related messages on tobacco product packages in Canada was measured as part of the Evaluation of the Federal Tobacco Control Strategy 2012-2013 to 2015-2016. The evaluation showed HW are effective in informing those who smoke about the health risks and health hazards associated with tobacco use. However, these messages need to be regularly updated and rotated to maintain impact and effectiveness.^{footnote 15} The current health-related messages have been displayed on tobacco product packages for the past decade for cigarettes and little cigars, and the past two decades for cigarette tobacco, cigars (other than little cigars), pipe tobacco, tobacco sticks, kreteks, bidis, leaf tobacco, chewing tobacco and snuff. These messages have reached their maximum potential and no longer have the same impact as when they were first implemented.

Research has shown that youth and adults strongly support HW on tobacco packaging and view the messages on cigarette packages as good and reliable sources of information.^{footnote 16} HW with large text and pictures on tobacco packages have been shown to increase the motivation to quit,^{footnote 18,footnote 19} and are more effective and generally perceived as more credible for both youth and adults who smoke.^{footnote 22,footnote 20,footnote 21,footnote 1}

Research has also shown that people who use tobacco products are more likely to recall larger warnings, and have been found to equate the size of the warning with the magnitude of the risk.^{footnote 23} The coverage of 75% of the front and back of the package was deemed an appropriate size to include all the necessary information, and retain the overall effectiveness of the message communicating with tobacco users. Research also indicated cessation services information were more visible and legible and have a greater overall impact when integrated into a larger warning.^{footnote 26,footnote 24,footnote 25,footnote 27}

Research indicates combining positive (HIM) and negative (HW) elements is important in motivating behaviour change.^{footnote 29,footnote 28,footnote 32} It suggests pictorial health warnings that elicit strong emotional reactions are significantly more effective.^{footnote 30}

Young persons’ exposure to package warnings

Young persons experimenting with cigarette smoking often obtain single cigarettes from social sources, such as friends, peers or family. In these situations, they are not exposed to HW on cigarettes packages. Recent data shows that 84% of students in grades 7 to 12 in Canada (secondary I through V in Quebec) who smoked in the past 30 days obtained their cigarettes from social sources, including 94% of students in grades 7 to 9.^{footnote 31} For individuals who do not see the package, and are consequently not exposed to the HW displayed on the package, the effectiveness of the HW to raise or enhance awareness of the health hazards and health effects of tobacco use with this segment of the population would either be absent or significantly reduced.

Appeal of cigarettes

Studies from a number of countries have explored the potential of reducing the appeal of cigarettes. These studies show that cigarettes with HW displayed directly on them can further reduce the appeal of the product, in particular among young persons,^{footnote 37,footnote 33,footnote 34,footnote 35,footnote 36,footnote 36,footnote 38} and may have the potential to influence tobacco users in their decision not to smoke.

Health Canada conducted three public opinion research (POR) studies between 2018 and 2020 regarding the appeal and attractiveness of cigarettes with a health warning printed directly on the product.^{footnote 40,footnote 39,footnote 49} Participants, particularly youth who smoke, as well as youth and adults who do not smoke, felt that health warnings on products made cigarettes less appealing than those without warnings, and complemented the health-related messaging on the product packages.

In 2018, Australian researchers published a review of nine studies that evaluated participants aged 11+ perceptions of visual cigarette stick attributes to investigate how people who smoke, people who used to smoke and people who do not smoke identify cigarettes as being attractive or unattractive.^{footnote 41} The review found that the inclusion of HW on cigarettes was particularly effective in changing the perceptions of participants.

HIM placement on cigarette packages

Canada remains the only country to mandate that HIM be displayed inside cigarette, little cigar and cigarette tobacco packages.

While HW focus on the health hazards of smoking, HIM focus on positive cessation messages, including motivational life experiences and testimonials from former tobacco users and tips about quitting. POR studies conducted by Health Canada with people who smoke suggest that more frequent reading of HIM is associated with an increase in self-efficacy to quit, quit attempts and sustaining quitting.^{footnote 42}

However, POR results showed that the current placement of the HIM on the back of cigarette slide-and-shell packages does not maximize its visibility and effectiveness in communicating with tobacco users.^{footnote 43}

Rotation

Health-related messages have the greatest impact shortly after implementation and lose their novelty effect over time. Research indicates the absence of a rotation scheme for health-related messages reduces their effectiveness, and that periodically updating health-related messages can help increase noticeability of these messages.^{footnote 44}

Static incorporation by reference of the Source Document

The health-related messages required to be displayed on tobacco product packages or leaflets under the TPIR and TPLR-CLC are found in Source Documents published by Health Canada. These Source Documents show the different health-related messages that must be used based on package shape and related display surface (e.g. portrait, landscape). The Source Documents indicate the types of health-related messages required for each tobacco product subject to the TPIR and TPLR-CLC, and illustrate the standard expected for the display of messages on packages or leaflets. These Source Documents are incorporated by reference into the TPIR and TPLR-CLC. As such, they are integral parts of each respective set of regulations and serve as a compliance-monitoring tool for Health Canada.

Currently, updates to these Source Documents can only be implemented through amendments to the regulations. This hinders Health Canada’s ability to update health-related messages in a timely manner when new scientific information and research emerge about the link between tobacco use and certain medical conditions, or to maintain the effectiveness of these messages.

International obligations

Article 11 of the FCTC requires Parties to adopt measures including requirements for the display of large, rotating health warnings, and measures to prevent false, misleading or deceptive packaging and labelling. As a Party to the FCTC, Canada has implemented and complies with most of its obligations under Article 11. However, Canada is not fully compliant with respect to the following tobacco labelling obligations:

• Tobacco products intended for use with devices (better known as heated tobacco products), water pipe tobacco, and blunt wraps do not carry on their packaging health warnings describing the harmful effects of tobacco use, as they are currently not subject to labelling requirements; and
• Packages of certain tobacco products, such as cigars and pipe tobacco, do not contain information on their emissions.

The Guidelines for implementation of Article 11 of the FCTC, adopted in 2008, do not create obligations on the Parties, but rather propose measures that can be used to increase the effectiveness of tobacco packaging and labelling measures.^{footnote 45} The Guidelines suggest Parties specify the number of HW and other messages to appear concurrently on tobacco products packages, and establish two or more sets of HW and other messages to alternate after a specified period between 12 to 36 months with a transition period during which two sets are used concurrently. The Guidelines also call for Parties to consider the introduction of innovative measures such as requiring HW to be printed directly on cigarettes.

Objective

The objectives of the proposed Regulations and Order would directly support three of the four tobacco-related objectives of the TVPA to: enhance public awareness about the health hazards of tobacco use; help prevent the public from being deceived or misled about these hazards; and help protect young persons and others from inducements to use tobacco products and the consequent dependence on them.

The proposed Regulations would build on the achievements of the current tobacco product labelling requirements while aiming to improve their overall effectiveness. They would continue efforts to inform Canadians through the balanced use of information about the health hazards and health effects of using tobacco, and the health benefits of quitting and contribute to preventing the public from being deceived or misled with respect to those hazards. The proposed Regulations would continue efforts to reduce the appeal of tobacco products in proposing further measures to protect youth and others from inducements to use tobacco.

The proposed Regulations are an integral part of CTS and, in association with other tobacco control measures under the CTS, would contribute to address the public health problems associated with tobacco use and nicotine addiction among Canadians.

Further, the proposed Regulations would bring Canada into full compliance with its tobacco labelling obligations Article 11 of the FCTC by extending HW and TI statement requirements to all tobacco product packages.

Description

Building on the existing TPIR and TPLR-CLC, the proposed Regulations would strengthen and expand health warning and toxicity information statement labelling requirements to all tobacco product packages. The proposed Regulations would also set out all requirements related to tobacco products packaging (plain and standardized appearance) and labelling in a single set of regulations. Consequently, the TPIR and TPLR-CLC would be repealed when the proposed regulations come into force.

New health-related messages

The proposed Regulations would introduce renewed health-related messages and extend HW and Toxicity Information (TI) statements to all tobacco product packages. As in the TPIR and the TPLR-CLC, the proposed Regulations would use a combination of HW, HIM, and TI statements to inform users of the health hazards and health effects associated with tobacco use.

A document entitled Labelling Elements for Tobacco Products (the Source Document) would set out two series of HW, of HIM and of TI, to be used in rotation, and applicable for a predetermined period through the proposed Regulations. Each HW^{footnote 46}, HIM and TI set out in an applicable series^{footnote 47} must be displayed equally for each type of package of each brand of tobacco product packaged throughout a one-year period^{footnote 48}.

Health warnings

The proposed Regulations would strengthen and update the current HW for the packages of cigarettes, little cigars, cigarette tobacco, cigars, pipe tobacco, leaf tobacco, tobacco sticks, chewing tobacco and snuff. These renewed HW would feature a number of new themes, including health conditions not included in current messages mandated by the TPIR or TPLR-CLC.

Other tobacco product packages (e.g. those for water pipe tobacco, blunt wraps, tobacco products intended for use with a device, the devices themselves and their parts, and any new tobacco products to enter the Canadian market in the future) that are currently not subject to labelling requirements would be required to display HW under the proposed Regulations. The requirement for HW to be displayed on at least 75% of the front and back of cigarette and little cigar packages would remain and would be extended to all other tobacco product packages. Pictorial HW would be required for chewing tobacco and snuff, replacing the text-only health warnings currently required.

The proposed Regulations would also clarify that HW displayed on tobacco product packages would have a glossy finish.

Toll-free cessation service number and web portal

The proposed Regulations would expand the display requirement to include a pan-Canadian toll-free quit line number and cessation Web portal address on HW to all tobacco product packages and HIM for packages of cigarettes, little cigars, and cigarette tobacco. Currently, this feature is only required on HW and some HIM for packages of cigarettes and little cigars under the TPLR-CLC.

Callers to the pan-Canadian toll-free quit line number would continue to be redirected to existing cessation services offered to tobacco users provided by the provinces and territories. These services provide one-on-one counselling, self-help materials, referrals to community services, and online cessation support. By placing the toll-free phone number and cessation Web portal address prominently on tobacco packages, users would be reminded of cessation services every time they look at the package. The information would also be readily available when they are thinking about quitting.

Health information messages

The proposed Regulations would mandate a new placement for HIM on an extended upper flap of slide-and-shell cigarette packages, improving their noticeability by making it difficult to avoid or discard them. Other changes to the design of the HIM are intended to make them more noticeable, memorable and impactful.

For packages of little cigars, the proposed Regulations would require the inclusion of a leaflet displaying a HIM. For cigarette tobacco, the HIM would be displayed on the package or inside the package, either on the freshness seal, on a leaflet inserted into the package or on a disk on the inside of the lid.

Manufacturers would have the option to print HIM with a glossy or matte finish.

Toxicity information (TI)

TI would provide clear, concise and easy-to-understand information about the toxic substances found in tobacco smoke.

Other tobacco product packages, including those currently not subject to labelling requirements (e.g. those for water pipe tobacco, blunt wraps, tobacco products intended for use with a device, the devices themselves and their parts, and any new tobacco products to enter the Canadian market in the future) would be required to display TI statements. These TI statements would provide information about toxic substances found in either the tobacco smoke or in the product, and would be required to be displayed on the product packaging.

TI statements would use plain language to be accessible to a wider audience. They would be displayed on the side of cigarette, and little cigar packages and on any exterior surface of the package that remains unoccupied by a HW or HIM for other tobacco product packages. Manufacturers would have the option to print TI with a glossy or matte finish.

Warnings on individual cigarettes, little cigars and tubes

The proposed Regulations would also introduce a new requirement to display text HW on individual cigarettes, little cigars that have a filter, and tubes. Messages would be displayed on the tipping paper, with the tipping paper having a length of at least 24 mm. In the case of cigarettes that do not have tipping paper, the HW would be displayed on the cigarette paper at a length of at least 24 mm that starts from one end of the cigarette. The proposed Regulations would not prevent manufacturers of cigarettes that do not currently have tipping paper from adding that feature.

These warnings would feature information about the health hazards of using these products, and would be printed in both English and French on a white background in black ink.

Health warning size and minimum health warning size

The minimum relative size of HW for all tobacco product packages would be standardized to at least 75% of the display area to maximize visibility and legibility of health-related messages on all types and sizes of tobacco packages.

A HW would be required to cover at least:

• For cigarette, little cigar, tubes and cigarette tobacco packages, 75% of the display area of the package;
• For cigars (other than those sold in a tube), pipe tobacco, and chewing tobacco packages, the greater of
  • a) 75% of the display area of the package,
  • b) An area of 6800mm^{footnote 2};
• For cigars sold in a tube, 75% of the display area of the tube;
• For packages of snuff, leaf tobacco, tobacco sticks, water pipe tobacco, blunt wraps, tobacco products that are made in full or part of tobacco, intended for use with a device, the devices and their parts, and any other novel tobacco product, the greater of
  • c) 75% of the display area of the package, or
  • d) An area of 4000mm^{footnote 2};
• For cartons, 75% of the display area.

Rotation scheme

The proposed Regulations would introduce a rotation scheme that aims to enhance the novelty and relevance of the messages on tobacco packages and the HW on individual cigarettes, little cigars that have a filter, and tubes by changing the information on a predetermined schedule. The proposed scheme would include requirements for the periodic rotation of unique sets of HW and TI for all tobacco product packages, and unique sets of HIM for cigarettes, little cigars and cigarette tobacco packages. Unique sets of HW, HIM and TI would rotate every 24 months for cigarettes, little cigars and cigarette tobacco packages. Unique sets of HW and TI would rotate every 24 months for tube packages. Unique sets of HW for individual cigarettes, little cigars that have a filter, and tubes would rotate every 24 months. Unique sets of HW and TI would rotate every 36 months for all other tobacco product packages.

Ambulatory incorporation by reference — Source Document

As with the current TPIR and TPLR-CLC, the proposed Regulations would incorporate by reference a Source Document. This document would show the applicable series of health-related messages by type of package and product that must be used by manufacturers based on the package shape and related display orientation (e.g. portrait, landscape).

As well, it would illustrate the standard expected for the display of messages on packages, leaflets and products. HW would be displayed in a glossy finish, as shown in the printed version of the Source Document.

The Source Document could be amended from time to time without amending the Regulations. This approach would give Health Canada more flexibility to update, edit or replace the images and text in health-related messages to reflect the latest science or new health information. These modifications would be limited to the contents of the health-related messages. The requirements for the packaging, minimum size, rotation scheme and manner of display of the health-related messages could not be amended, as these are prescribed through the proposed Regulations.

Any changes to the Source Document would be implemented to coincide with a scheduled rotation, and would be communicated to interested parties at least eight months ahead of time. The Source Document would be available from Health Canada in electronic and print versions free of charge. Information on how to order the Source Document would be available on Health Canada’s website.

New terminology

The proposed Regulations would introduce new terminology for some tobacco labelling elements, and simplify the display of toxicity information on tobacco products. The proposed Regulations would unify toxic emissions and toxic constituent information under the term “toxicity information,” which encompasses both types of statements. TI statements would apply to all tobacco products; information would be specific to the type of tobacco product and would consist of short statements about the health impacts of specific toxic substances found in tobacco products or their smoke.

Additionally, the proposed Regulations would use the term “avertissement sanitaire” as a replacement for “mise en garde” when referring to HW in French to better align with international practice.

Other amendment to the TPR-PSA

To accommodate current tobacco industry practices, the proposed Regulations would also allow for the display of “RS” or “KS” on cigarette packages, as the case may be, as alternatives to “Regular Size” or “King Size,” respectively, as a declaration of size.

Order amending Schedule 1 to the TVPA

The proposed Order would provide manufacturers with the possibility of using a colouring agent to create a white background for the display of a health warning printed on black ink directly on cigarettes, little cigars with a filter, and tubes.

Schedule 1 to the TVPA prohibits certain additives (column 1) in the manufacture of a tobacco product (column 2). The tobacco products listed in column 2 exclude products that are manufactured or sold for export. Item 4 (for cigarettes and tubes) of Schedule 1 to the TVPA excludes from the prohibition of colouring agents whitening agents used to whiten the paper or filter and colouring agents used to imitate a cork pattern on the tipping paper of cigarettes or tubes. It would be amended to also exclude whitening agents used to whiten tipping paper.

Item 4.3 (for little cigars) of Schedule I to the TVPA excludes from the prohibition of colouring agents those agents used to render tipping paper drab brown or to imitate a cork pattern. It would be amended to also exclude whitening agents used to whiten tipping paper.

The proposed amendments to these two items would enable the display of a health warning in black ink on a white background on the tipping paper of cigarettes, little cigars with a filter, and tubes.

The black colouring agents that would be used to display the health warning and any attribution on a tobacco product are not covered by the proposed Order as they would be considered prescribed additives for the purposes of subsection 5.3(3) of the TVPA.

Future considerations

Health Canada may consider extending the text-based HW labelling requirement to individual little cigars that do not have a filter, and to little cigars that have a plastic mouthpiece or tip. It may also consider mandating text-based HW to be displayed on cigar bands for cigars that do not have packaging through future regulatory amendments.

Regulatory development

Consultation

The Department of Health consulted widely on the proposed Regulations between 2017 and 2021. Consultations were held with the general public; provincial and territorial, Indigenous and municipal governments; stakeholders, including non-governmental organizations (NGOs), health professionals, academics and researchers; and, the tobacco industry. The consultations focused on the format and content of the health-related messages and on specific requirements of the proposed Regulations.

New health-related labelling for tobacco products consultation document

Health Canada published New Health-Related Labelling for Tobacco Products: Document for Consultation on October 26, 2018. This document set out proposals on new health-related labelling for products containing tobacco. It was open for comments from the general public and other interested stakeholders for a 75-day period ending January 8, 2019. The consultation asked participants for input on options for renewed health labelling for tobacco products, including labelling content and design, labelling size and placement, labelling for tobacco products that do not currently require labels, labelling rotation, and on-cigarette labelling. The document was also distributed to NGOs, provincial and territorial governments, Indigenous governments, academics and researchers, health professionals, and members of the tobacco industry.

Health Canada received 141 submissions from the general public, national and regional NGOs, public health authorities, associations of health professionals, provincial and territorial governments, academics and researchers, and the tobacco industry. Overall, there was considerable support for the approaches put forward in the consultation document. The majority of these comments were from the general public, but support also came from NGOs, public health authorities, government, academics and researchers.

Respondents indicated strong support for extending labelling requirements to all tobacco products. There was also support for extending the current 75% HW coverage on cigarette and little cigar packages to other tobacco product packages, for establishing minimum size requirements for HW for those products, and for implementing a rotation scheme. Additional support was expressed for displaying health information messages more prominently on the inside of cigarette and cigarette tobacco packages (either printed directly on or affixed to packaging, to prevent removal), and for printing health warning messages directly on individual cigarettes.

Suggestions were received for the placement and appearance of HIM and TI, as well as for the quit line and website information to maximize their noticeability.

As part of the feedback from the consultation document, a number of respondents offered support for provisions that would allow Health Canada to make changes to the contents of the messages administratively, without the need for regulatory changes.

Responses from the tobacco industry were largely in opposition to the approaches put forward in the consultation document. Concerns were primarily about a perceived lack of evidence to support the approaches as well as anticipated technical and logistical difficulties in implementing the proposed labelling changes.

Submissions from the cigar industry suggested the cigar segment of the market should not be grouped with other tobacco products. They argued there should be a distinction made between different sizes of cigars and that, since the retail market for cigars is small, changing HW is unsuitable and not required.

Respondents representing the tobacco industry indicated some support for refreshing health warning contents and for continuing to require information be displayed on packages. However, there was some opposition to including quit line information on the grounds that there is not adequate space on smaller packages. A submission from the chewing tobacco and snuff industry opposed the inclusion of quit line information until cessation services tailored for chewing tobacco and snuff product users were available.

A summary of the comments received is available on the Health Canada website.

Message development

The proposed health-related messages were developed using the best available information, research and scientific evidence. The process of message development was guided by a set of principles^{footnote 50} based on international practices. Foremost among these principles is that all tobacco products are harmful to health, and that people who use tobacco products deserve to be made aware of the health hazards and health effects associated with such use.

To inform the development of messages on specific health conditions and outcomes associated with tobacco use, Health Canada monitored and assessed scientific evidence from well-respected agencies and organizations, including reports developed on behalf of the United States Surgeon General. The health conditions and outcomes featured on proposed messages were selected based on a process using objective scientific criteria to ensure that the available evidence supports the development of a message. The health conditions and outcomes already featured on messages mandated pursuant to the TPIR and TPLR-CLC were also considered throughout the message development process.

Health Canada reached out to Canadian health organizations, hospitals and universities, as well as international sources, to help source medical images for possible use on tobacco packages.

With assistance from creative design agencies, extensive work was undertaken to create various concepts and content for the renewed messages.

In developing the HW and the HIM, significant emphasis was placed on how to maximize effective communication with tobacco users, while using a variety of approaches to reach different segments of the target audience. To achieve this, the proposed HW and the HIM would include:

• Messages intended to reach people of different ages, genders, and socio-economic and literacy levels;
• A diversity of images, including photos of real people impacted by smoking, photos of organs, and other images intended to grab the attention of the user;
• Diverse approaches to communicating a message, such as short headings to reach individuals with low literacy, impactful phrases, and causal statements; and
• An extended list of health hazards and health effects, including stomach cancer, colon cancer, peripheral vascular disease, and cervical cancer.

Scientific expert panel

A Scientific Expert Panel of 20 researchers, academics, and practitioners reviewed the draft messages (text and images) for scientific and medical accuracy. This expert review was conducted from February to July 2020 and included HW for cigarettes, cigars, pipe tobacco, chewing tobacco and snuff, as well as HIM and TI statements. Feedback from the panel was used to modify the messages, in particular about specific claims regarding diseases caused by tobacco use, and to add detail about how tobacco use affects the body.

Literacy review

A literacy review of the draft messages was conducted to assess their accessibility to a wide audience. The benchmark reading level for messages is set at a grade 5/6 or lower level. In addition, design elements such as font size, colour, capitalization, and contrast with background were evaluated for their effects on readability. The literacy review provided recommendations on the language and design elements of the messages. Specifically, it recommended shortening sentences, minimizing medical and technical language, removing redundant information, and refraining from using contractions. Design suggestions included using selective capitalization of words for emphasis, increasing font size, improving text readability when compared with the background, and occasionally using bold font for emphasis.

Public opinion research

The principal objective of the proposed Regulations is to enhance public awareness of the health hazards of using tobacco so Canadians can make informed choices regarding their health. Therefore, POR with users and non-users of tobacco products was extensively employed in the development of renewed health-related messages.

Between November 2017 and November 2020, eight POR studies were conducted with youth and adult tobacco users and youth who do not smoke to solicit opinions on draft HW, HIM, and TI.^{footnote 41,footnote 51,footnote 52,footnote 40,footnote 53,footnote 54,footnote 55,footnote 56} Focus group sessions were held with more than 4400 English- and French-speaking tobacco users in nine locations across Canada. Five of the studies were conducted in-person, while three of the studies were conducted online with participants from different locations across Canada. One study was an online survey conducted with daily and occasional people who smoke from various age groups across Canada.

Five of the studies surveyed cigarette and little cigar users while one study focused on users of cigars, pipe tobacco, chewing tobacco and snuff. During in-person and online focus group sessions, participants were shown mock-ups of possible HW, HIM, and/or TI. Participants were asked a series of questions about the noticeability and readability of messages, images, and designs, and their effectiveness at conveying health information related to tobacco use. They were also asked to provide feedback in more open-forum discussions. The views expressed by tobacco users and non-users in these studies were highly influential in informing subsequent revisions to the messages, which were modified based on comments received from each round of research.^{footnote 52,footnote 57,footnote 54,footnote 53,footnote 55}

Three studies explored the concept of HW displayed on individual cigarettes with people who smoke and youth who do not smoke. In the most comprehensive of these studies, involving 188 participants across Canada, the appeal and attractiveness of cigarettes with health warnings was explored and showed these cigarettes were seen as less appealing than cigarettes without health warnings. Cigarettes without health warnings were also perceived as less harmful than those with warnings. Overall, participants felt this new labelling element made the health messaging on cigarette packages more complete and impactful, particularly among youth who do not smoke, smoke occasionally, or wish to quit. Youth participants noted they are not usually exposed to the package HW when obtaining single cigarettes in social situations and that a warning directly on the cigarette would be unavoidable.

Reputable research firms using Government of Canada guidelines conducted all research. These firms ensured an unbiased, fair process and results by leading each session, from recruiting candidates to facilitating the presentation of the messages and subsequent discussions. Health Canada representatives viewed all sessions either through one-way glass (in-person sessions) so as not to influence the outcomes, or online through a web-based platform. A report on each study is available on the Library and Archives Canada website.

Engagement with and feedback from stakeholders

In general, tobacco control stakeholders were supportive of efforts to renew health-related messages. They were also in agreement with more stringent requirements, such as extending labelling requirements and increasing the size of HW for all tobacco products. Stakeholders supported the approach of displaying HW directly on individual cigarettes, with suggestions for the messages to be short and concise.

The target audience of adults and youth who smoke, as represented by the participants in various POR studies, has also been largely supportive of increased measures to help them quit tobacco. This includes mandating HW on individual cigarettes. This measure was seen as complementary to the package warnings and effective at making the product less appealing while providing useful health-related information in support of quitting. Warnings on individual cigarettes were considered particularly impactful at possibly discouraging youth from taking up smoking and developing a long-term nicotine addiction. Youth explained they usually acquired individual cigarettes from friends and family members and were not exposed to HW on packages.

Some dissenting opinions from adults who regularly smoke were heard during focus groups testing the concept of HW on individual cigarettes. These individuals tended to feel the measure was excessive, noting that they already feel sufficiently informed of the health hazards of smoking.

Considering the gamut of recommendations, Health Canada has strived to choose options that would best achieve the objectives of the proposed Regulations and result in the greatest health benefit for Canadians, while minimizing burden.

Between 2017 and 2021, the Department of Health also held approximately 20 face-to-face meetings and teleconferences with key stakeholders. Ten of these meetings were held with NGOs, including health organizations, academics and experts. In total, more than 30 organizations and individuals were consulted through these meetings.

The purpose of the meetings varied. Some focused on specific elements of the proposal, while others presented the results of POR undertaken with tobacco users. Many of the meetings resulted in recommendations from stakeholders on the features of the proposed Regulations or on the content of the health-related messages. Tobacco control NGOs recommended strengthening the language of the HW to convey the magnitude of the health hazards of tobacco use. They suggested including additional topics, such as diabetes, cervical cancer, breast cancer, and other women-centric health outcomes related to tobacco use in the proposed messages. NGOs also recommended using a wider variety of images to better appeal to Canada’s diverse population. The entire suite of HW and HIM was modified as a result of this feedback.

Through consultations with the tobacco industry and Health Canada inspectors, Health Canada has determined that over one in three packages of cigarettes surveyed in 2020 indicated either RS or KS rather than “Regular Size” or “King Size” as a declaration of size of the product. The tobacco industry has also expressed, both through exchanges during compliance monitoring activities and through correspondence, that they believe RS or KS are commonly known as declarations of size to the users.

Consultations with government agencies

Under Canada’s Tobacco Strategy, Health Canada collaborates with the Canada Revenue Agency, the Canada Border Services Agency, the Royal Canadian Mounted Police, the Public Health Agency of Canada, Indigenous Services Canada and Public Safety Canada on tobacco control measures. Health Canada consulted with its partners early in the regulatory development process.

Ongoing considerations

A number of respondents to the consultation document requested Health Canada include a HW on the link between smoking and breast cancer. Tobacco control NGOs have also advocated for such a warning. This recommendation was extensively considered and a potential warning was tested in the POR. However, Health Canada is not recommending such a message at this time because the scientific evidence is not sufficient to establish a causal effect between smoking and breast cancer. Health Canada will continue to monitor the medical literature for evidence of a causal link between tobacco use and breast cancer.

In recognition of a well-documented causal link to cigarette smoking,^{footnote 58} Health Canada is proposing mentioning cervical cancer as a health condition that could be prevented by quitting smoking.

Coordination and cooperation

Health Canada has worked with the Canada Revenue Agency to ensure the proposed Regulations align with the Stamping and Marking of Tobacco and Cannabis Products Regulations (SOR/2003-288) to confirm new labelling requirements would comply with current excise stamp requirements.

Modern treaty obligations and Indigenous engagement and consultation

Health Canada distributed New Health-Related Labelling for Tobacco Products: Documents for Consultation to various Indigenous organizations and to groups providing services to Indigenous populations. Responses from regional health authorities working with Indigenous populations supported HW being displayed on the packaging of all tobacco products and covering at least 75% of the display surface. There was also support for displaying health messages directly on cigarettes. It was suggested that tobacco health labelling be culturally appropriate for First Nations populations and not reinforce existing stigmas and stereotypes. Feedback called for the recognition of the traditions of tobacco use in First Nations cultural practices and the high rates of commercial tobacco use among this population.

Instrument choice

Option 1: Baseline scenario (no change in tobacco labelling regulations)

This option would maintain the existing TPIR and TPLR-CLC and the health-related messages currently displayed on all tobacco products subject to these two sets of regulations. Tobacco products that are not subject to any labelling requirements (e.g. tobacco products made in whole or on part of tobacco intended to be used with devices, these devices and their parts, water pipe tobacco, blunts, and any novel tobacco products introduced on the market) could continue to be legally sold to consumers without any health-related messages.

This option was rejected for several reasons. It would keep existing health-related messages on tobacco products, packages or leaflets. These messages, having been on display for a long time, are no longer effective and do not include the latest scientific evidence. Messages on some tobacco product packages would also remain comparatively small, which research has shown results in less effective messages. This option would be unlikely to continue to enhance awareness about the health hazards of using tobacco products, or enable tobacco users to make informed choices regarding tobacco use and their health. Therefore, these messages would not yield incremental health benefits.

This option would not support the objective of protecting young persons and others from inducements to use tobacco products and the consequent dependence on them, as it would not require the display of HW on individual cigarettes, little cigars that have a filter, and tubes. Youth would also continue to be less exposed than adult tobacco users to information on the health hazards of using these products, as they are not usually exposed to HW on tobacco packages. When first experimenting with tobacco use young persons often accessing individual cigarettes from social sources without handling the package itself.

This option would not further contribute to supporting the CTS goal of reducing the prevalence of tobacco use to less than 5% by 2035, nor the objectives of the TVPA of enhancing public awareness of the health hazards of tobacco; preventing the public from being deceived or misled with respect to these hazards; and protecting young persons and others from the inducement to use tobacco products and the subsequent dependence on them.

Finally, by not extending HW and TI labelling requirements to all tobacco product packages, Canada would remain not fully compliant with its tobacco labelling obligations under Article 11 of the FCTC.

Therefore, the status quo is not considered an appropriate option.

Option 2: Update and standardize labelling requirements for all tobacco products

This option would update existing health-related messages on tobacco products packages; expand labelling requirements for HW and TI to all tobacco product packages; and standardize the size of HW to 75% of the display area of the package across all tobacco products.

This option would help to adequately meet the objectives of the proposed Regulations to enhance public awareness about the health hazards of tobacco use by requiring the display of new messages to replace those that have reached their maximum potential and extending labelling requirements to all packages of tobacco products, including tobacco products not currently covered by existing labelling requirements.

In addition, as tobacco products packages without health-related messages could be seen as safe,^{footnote 59} this option would help support the objective of preventing the public from being deceived or misled about the health hazards of tobacco use.

This option would bring Canada into greater compliance with its tobacco labelling obligations under the FCTC by extending HW and TI labelling requirements to all tobacco product packages. In addition, by standardizing the minimum size for HW to 75% of the package across all tobacco products, Canada would exceed another obligation set out in Article 11 of the FCTC.

This option would not fully explore the avenues available to increase the effectiveness of labelling requirements. It would represent a missed opportunity to introduce additional measures to further the objectives of enhancing public awareness in order to better inform Canadians, especially tobacco users and potential users, about the health hazards of using tobacco products; preventing the public from being deceived or misled about these hazards; and protecting young persons and others from inducements to use tobacco products and the consequent dependence on them.

This option would not introduce a rotation scheme for health-related messages on tobacco product packages and would not include HW on individual cigarettes, little cigars that have a filter, and tubes. It would maintain the current placement of HIM on the inside back of cigarette packages, which fails to maximize visibility and effectiveness in conveying information to tobacco users.

Therefore, this option is not considered to be optimal and is not recommended.

Option 3: (Recommended) Update and standardize labelling requirements for all tobacco products, and introduce new measures to enhance and maximize impact

In addition to the elements contained in Option 2, this option would introduce a rotation scheme with multiple sets of messages; allow the incorporation by reference of the Source Document into the proposed Regulations in a version that can be amended from time to time; mandate a new HIM placement for cigarette packages; and, include HW displayed directly on the tipping paper of individual cigarettes, little cigars that have a filter, and tubes. In the case of cigarettes that do not have tipping paper, the HW would be displayed on an area that is at least 24 mm in length that starts from one end of the cigarette.

The introduction of a rotation scheme with multiple sets of labels would aim to enhance novelty and relevance of the health-related information by changing the messages periodically. This would allow for a greater variety of messages to heighten awareness of the health hazards of tobacco use, and help maintain relevance and impact of the messages. The proposed incorporation by reference of the Source Document would give Health Canada more flexibility to amend the document as new scientific evidence emerges on the health effects or health hazards of using tobacco products without amending the regulations. This proposed approach would also assist Health Canada in renewing the messages on a predetermined schedule in a timely manner.

The requirement to display HW on individual cigarettes, little cigars that have a filter, and tubes would help increase awareness among youth of the health hazards associated with using tobacco products, as youth often access individual products from social sources without seeing the HW on the package. It would also help prevent inducements to use tobacco products by making these products less attractive to users and potential users.

The introduction of a new placement for HIM on the inside front of cigarette packages would enhance its visibility and effectiveness in communicating with tobacco users.

This option is recommended. It would more fully support the objectives of the TVPA to enhance public awareness of the health hazards of using tobacco products, prevent the public from being deceived or misled with respect to those hazards and help protect young persons and others from inducements to use tobacco products and the consequent dependence on them.

Collectively, these measures would meet or exceed Canada’s tobacco labelling obligations under Article 11 of the FCTC and include measures that are consistent with the Guidelines for the implementation of Article 11.

Regulatory analysis

Benefits and costs

Summary of cost-benefit analysis

The proposed Regulations and Order would directly support three of the four tobacco-related objectives of the TVPA to: enhance public awareness about the health hazards of tobacco use; help prevent the public from being deceived or misled about these hazards; and, help protect young persons and others from inducements to use tobacco products and the consequent dependence on them.

The proposal would result in total incremental costs estimated at $180 million (2020 CAD) expressed as total present value (TPV) over 10 years or about $25.6 in annualized value. The most significant monetized costs (roughly 60% of the total estimated costs) to the tobacco industry are associated with the introduction and rotation of renewed health-related messages for tobacco product packaging. The estimated cost of complying with a new placement for the HIM requirement for slide-and-shell cigarette packs represents roughly one third of industry compliance costs. Implementation of the proposal would result in incremental costs to Health Canada from performing compliance and enforcement activities.

The proposed Regulations would support the CTS, which aims to reduce the burden of disease and death caused by tobacco use and its consequential impact on the public health care system and on society. Long-term economic benefits of the proposal would be realized in terms of avoided tobacco-related mortality and morbidity, including exposure to second-hand smoke. The break-even analysis indicates that a relatively small effect on cigarette initiation and cessation rates relative to the baseline rates^{footnote 60} — on the order of a 0.18 percent increase in annual cessation rates or a 0.87 percent reduction in annual initiation rates — would be sufficient to produce public health benefits equivalent to or greater than the estimated monetized costs. The relatively small effects on these rates would be equivalent to approximately 9,376 more people who do not start smoking or 2,063 more people who stop smoking by the end of year 10. In 2020, there were just over four million current smokers in Canada.^{footnote 61} Offset of estimated incremental costs of the proposed Regulations equate to roughly 1 in 2,000 current smokers deciding to quit over the next 10 years.

Analytical approach

The Cabinet Directive on Regulation requires departments to analyze the costs and benefits of federal regulations. To measure these impacts, the benefits and costs are estimated by comparing the incremental change from what is anticipated to occur under the current regulatory framework (i.e. the “baseline scenario”) to the new regulatory approach (i.e. the “regulatory scenario”).

Following review of feedback from stakeholders and pending on approval by the Governor in Council, registration and publication of the proposed Regulations in the Canada Gazette, Part II, could take place in 2023, with an implementation period of 6 months for manufacturers and 9 months for retailers. This cost-benefit analysis (CBA) covers the 10-year period from 2024 to 2033 (inclusive). A 7% discount rate is used to estimate the present value of the incremental costs and incremental offsetting benefits. All values reported for the 10-year period are expressed in 2020 constant dollars. Cost estimates are typically based on upper and lower bound for each cost category, based on changes to variables that have a range of estimates. The CBA estimates are based on the midpoint value of each of these cost categories, which is assumed to be the most likely outcome. Cost estimates do not incorporate costs to industry associated with potential changes to the content of the Source Document made during the 10-year period, pursuant to the ambulatory incorporation by reference measure. This issue is described in the qualitative costs section.

The impacts of the proposed Regulations have been estimated using three approaches: quantitative/monetized analysis, where possible; qualitative analysis; and break-even analysis. The cost analysis incorporates information from multiple sources, including tobacco product manufacturers, suppliers, various trade associations, the U.S. Food and Drug Administration (FDA)^{footnote 62} and information submitted to Health Canada pursuant to the Tobacco Reporting Regulations (TRR).^{footnote 63} A summary of the CBA is provided herein. A copy of the CBA report is available upon request from pregs@hc-sc.gc.ca.

Overview of the tobacco products market

The overall tobacco products market in Canada— including federal excise duties imposed under the Excise Act, 2001 — was estimated at $7.5 billion (inflated to 2020 dollars using consumer price index for all products in Canada). This wholesale value is driven primarily by sales of cigarettes, which in 2019 accounted for approximately 94.3% of the total value. The remainder of the wholesale market is made up of cigars at 2.7%, cigarette tobacco at 1.7%, smokeless tobacco at 1.2%, and pipe tobacco at 0.1%. In 2019, 34 manufacturers reported wholesale tobacco product sales in Canada.

Tobacco products are sold at convenience stores, gas stations, supermarkets and tobacconists, including stores on First Nations Reserves. The majority of tobacco product sales occurred at food and beverage stores and gas stations, with cigarette sales accounting for nearly all tobacco product sales by value. It is likely that retail sales of other tobacco products, such as premium cigars or pipe tobacco, occur more often at other types of stores, such as tobacconists. It is estimated smaller retailers include approximately 26,519 gas and convenience stores in addition to 1,900 other small tobacco retailers selling tobacco products in Canada.

Overview of the number of tobacco products in Canada

The CBA uses Health Canada’s Tobacco Products Wholesale Database (“the HC Wholesale Database”), which stores information reported under the (TRR), to determine the number of products on the Canadian market. The data is organized into stock keeping units (SKUs), assumed to be unique combinations of brand, size, and pack type. The wholesale data is based on 2019 sales, prior to the implementation of the TPR-PSA.

Manufacturers are expected to consolidate their product lines in response to the TPR-PSA introduced in 2019, resulting in fewer brands and SKUs on the Canadian market. The CBA therefore uses estimates of the number of brands and SKUs that would remain after applying brand consolidation assumptions in the cost-benefit analysis of the TPR-PSA, as listed below in Table 1.

Data on water pipe tobacco, blunt wraps, and tobacco products intended for use with devices (better known as heated tobacco products), the devices and their parts are not available in the HC Wholesale Database. The number of brands and SKUs for these products was therefore estimated using a combination of third-party data sources and desktop research.

Table 1: Estimated number of product brands and SKUs subject to new labelling requirements

Product	Brands (#)	SKUs (#)	Consolidation factor	Adjusted brands	Adjusted SKUs
Cigarettes	447	1,712	10%	402	1,541
Large Non-Premium Cigars	367	404	10%	330	364
Little Cigars	36	46	10%	32	41
Cigarette Tobacco	47	132	50%	24	66
Pipe Tobacco	381	440	80%	76	88
Smokeless	87	92	50%	44	46
Waterpipe/Shisha Tobacco	5	7	0%	5	7
Blunt Wraps	6	11	0%	6	11
Heated tobacco devices	2	8	0%	2	8
Heated tobacco sticks	2	8	0%	2	8

Sources: (1) Health Canada 2019. HC Wholesale Database; (2) Euromonitor International. Market and Packaging Study of Shisha in Canada. A custom report for Health Canada; (3) IEc Research; (4) Smokers & Tokers. Product categories list. Retrieved from: https://smokersandtokers.ca/product-category/rolling-papers/blunt-wraps/

Assessment of costs and benefits

It is anticipated that the proposed Regulations would result in incremental compliance costs for tobacco manufacturers. The proposal is expected to lead to long-term benefits realized in terms of avoided tobacco-related mortality and morbidity, including from exposure to second-hand smoke. Furthermore, implementation of the proposed Regulations will also require incremental costs to Health Canada for compliance, enforcement and updates to health-related messages. Health Canada commissioned a comprehensive analysis of costs and benefits to support development of a CBA on the impact of the proposed Regulations.

Baseline and regulatory scenario

Under the baseline scenario, the existing TPIR, TPLR-CLC and the health-related messages currently displayed on all tobacco products subject to these two sets of regulations would be maintained. Therefore, tobacco products not subject to any labelling requirements (e.g. tobacco products made in whole or on part of tobacco intended for use with devices, those devices and their parts, water pipe tobacco, blunt wraps, any novel tobacco product introduced on the market) would continue to be legally sold to consumers without any health-related messages. Messages on some tobacco product packages would also remain comparatively small. HW would not be required to be displayed on individual cigarettes, little cigars that have a filter, or tubes. Canada would remain not fully compliant with its tobacco labelling obligations under Article 11 of the FCTC by not extending HW requirements to all tobacco product packages; and by not requiring the display of information about tobacco products emissions and constituents on all packages of tobacco products.

Under the regulatory scenario, existing health-related messages would be updated, labelling requirements would be standardized for all tobacco products, and measures to enhance and maximize impact would be introduced. Specifically, HW would be standardized to at least 75% of the display area of the package across all tobacco products.

A rotation scheme with multiple sets of health-related messages would be introduced, along with incorporation by reference of the Source Document allowing the document to be amended from time to time without amendments to the regulations. A new placement for HIM would be required for cigarette packages, and HW would be required to be displayed directly on individual cigarettes, little cigars that have a filter, and tubes. Collectively, these measures would meet or exceed Canada’s labelling obligations under Article 11 of the FCTC and include measures that are consistent with the Guidelines for the implementation of Article 11.

Costs of the Regulations

Quantitative costs

1. Costs associated with implementing and rotating new health-related messages, and requiring a glossy finish on the HW portion of tobacco product packages

A central cost estimate in the CBA is the cost of implementing new health-related messages on the exterior of all tobacco product packages. The proposed Regulations would require sets of messages to be rotated on a predetermined schedule. The rotation frequency affects compliance costs. It is anticipated messages for packages of cigarettes, little cigars, tubes and cigarette tobacco would rotate every 24 months, and messages for all other tobacco products would rotate every 36 months. The proposed Regulations would also require tobacco manufacturers to apply a glossy finish on the HW portion of tobacco product packages. The remainder of the package would continue to have a matte finish, as required under the TPR-PSA, with manufacturers having the option to print HIM and TI with a glossy finish.

The following key assumptions were used in estimating these costs:

• The same degree of SKU/brand consolidation estimated for the 2019 TPR-PSA restrictions over the 10-year period examined is assumed (refer to Table 1).
• The majority of tobacco product packaging is labelled using rotogravure printing methods, for which cost is a function of several factors, including number of SKUs, number of cylinders per SKU, cost per cylinder, rotation schedule and number of message sets.
• Some tobacco product packaging is labelled using offset lithography and flexible lithography systems. Material costs for offset lithography and flexible lithography are derived using estimates from the U.S. FDA.^{footnote 62}
• Material costs associated with rotogravure, offset lithography, and flexible lithography are based on the assumed mix of print technologies for a given product category.
• The glossy finish would constitute what printers refer to as a “spot varnish.” The application of a spot varnish would require an additional image carrier (i.e. cylinder or plate) per SKU in the final step of the print sequence. This additional image carrier would apply spot varnish on the HW portion of the package.
• It is assumed that the addition of gloss would not result in increased set-up costs due to addition of a print station, nor would other cylinders need to be re-engraved. This was a concern raised by manufacturers, but was not included as it was believed to overstate cylinder preparation costs.
• Compliance costs for labour at tobacco manufacturers as well as graphic design and packaging firms under contract to tobacco companies is estimated. These costs are for new sets of messages only. It is assumed that no compliance costs are incurred when a previously developed set returns to circulation because previous sets (i.e. print media) are simply put back into circulation.
• Table 2 summarizes the parameters used to calculate materials and compliance costs associated with labelling.

Table 2: Parameters used to estimate labelling costs

Category	Print Technology	Parameter	Lower	Upper
Materials	Rotogravure	Cylinders per SKU	9 for cigarettes; 5 for other products	11 for cigarettes; 6 for other products
	Rotogravure	Cost per cylinder	$2,000	$4,000
	Offset	Full materials cost per SKU	$862	$862
	Flexography	Full materials cost per SKU	$4,481	$4,481
Compliance	All	Compliance cost	$4,545 per brand	$8,972 per SKU

Sources: IEc Research. FDA text-center for Food Safety and Applied Nutrition, 2014 FDA Labelling Cost Model, prepared by RTI International, August 2015.

Estimated Costs are calculated as follows:

Cost = Rotogravure Cost + Offset and Lithography Cost

Where, for each share of print technology:

• Rotogravure Cost = (Number of SKU * Cylinders per SKU * Cost per Cylinder) + (Number of Brands or SKUs * Compliance Costs per Brand or SKU)
• Offset and Lithography Cost = (Number of SKU * Materials cost per SKU) + (Number of Brands or SKUs * Compliance Costs per Brand or SKU)
• Compliance costs were calculated per brand for the lower range of costs and by SKU for the higher range of costs.

The total present value of the cost of compliance for this measure, including the addition of a gloss finish on HW, is estimated to be $110.6 million TPV over 10 years (or about $15.8 million in annualized value). The costs associated with cigarette packaging account for approximately 80 % of these costs.

2. Costs associated with implementing a new placement for HIM inside of cigarette packages

The proposed Regulations would require HIM to be displayed on an extended interior upper-slide flap of slide-and-shell cigarette packages.

The following key assumptions were used in estimating these costs:

• The analysis calculated the cost of additional rotogravure cylinders needed to print to the interior upper-slide flap of slide-and-shell cigarette packages. Based on industry suggestions, the analysis assumes four cylinders per SKU multiplied by the number of SKUs after the 2019 TPR-PSA consolidation. Each cylinder is assumed to cost between $2,000 and $4,000. It is assumed these costs would be incurred with each new label set but is assumed to be zero in subsequent years because previous sets of messages are simply returned to circulation.
• Manufacturers would also incur recurring costs attributable to the additional paperboard for incorporating and printing to the extended interior flap. The estimate is based on a figure provided by one major tobacco manufacturer scaled up to the industry level.
• The cost of incorporating and printing to the extended interior flap would be incurred on an ongoing basis; this estimate is based on a figure provided by a major manufacturer, scaled up to the industry level based on market share.

Estimated costs are calculated as follows:

• Cost, Year 1 = Number of SKU * (Cylinder per SKU * Cost per Cylinder) + Initial Printing Cost + Ongoing Printing Cost
• Cost, Year 2-10 = Ongoing Printing Cost

Initial Printing Cost and Ongoing Printing Cost in the above calculations are the estimated costs of printing to the extended interior flap, which consists of machinery modification and paperboard costs as estimated by a major manufacturer and scaled up to the total industry cost based on market share. This scaling up results in uncertainty of this portion of the cost component.

The total present value of the cost of compliance for this measure is estimated to be $59.9 million TPV over 10 years (or about $8.5 million in annualized value).

3. Costs associated with implementing a requirement for text HW to be displayed on individual cigarettes, little cigars that have a filter, and tubes

The proposed Regulations would require text HW to be displayed directly on the tipping paper of individual cigarettes, little cigars that have a filter, and tubes, with the tipping paper having a length of at least 24 mm. These HW must be displayed at least 24 mm from one end of the tobacco product for cigarettes that do not have a tipping paper.

Tipping paper is produced and shipped to cigarette manufacturers in large, double-wide rolls (or bobbins). Interviews were conducted with experts at a major tipping paper supplier to estimate the potential costs associated with applying short messages to tipping papers.

Manufacturers would likely apply the messaging using rotogravure methods, so the cost is largely a function of the number of cylinders used and the quantity of ink applied. Both inputs are themselves a function of the features of the messaging, i.e. the amount of text, text size, and colour specifications. The proposed design involves black text on a white background (rather than colour).

The following key assumptions were used in estimating these costs:

• Each rotation would introduce between four and six unique messages. The CBA assumes one message per cylinder.
• The diameter of a cigarette will affect the spacing used when printing tipping paper messages. The TPR-PSA allows a small degree of variation in the diameter of cigarettes (7.65 mm to 8.0 mm) and little cigars (from 7.0 to 8.5 mm). Tipping paper suppliers indicate each manufacturer tends to produce products that are of a standard size. A total of four to eight unique diameters for affected products is assumed, based on data from the HC Wholesale Database indicating a total of eight cigarette manufacturers (domestic and foreign) supply the Canadian market.
• Analysis suggests each cylinder could print 3.8 billion cigarette equivalents before needing replacement (meaning cylinders would need to be replaced several times each year).
• The labelling on tipping paper would require roughly 100 to 300 rotogravure cylinders each year to produce the 24 billion cigarettes, little cigars, and tubes sold on the Canadian market.
• Ink costs per million cigarettes is estimated at approximately $6 to $8.50 per million cigarettes. The analysis uses these figures in combination with data on annual production to estimate annual ink costs.

Estimated costs are calculated as follows:

• Ongoing Cost = Tipping Papers / 3.8 billion * Number of Messages * Unique Diameters * Cost per Cylinder + Ink Costs per Million Papers * Millions of Papers
• Where: Tipping Papers = Number of tipping papers (i.e. printed for cigarettes, little cigars that have a filter, and tubes)

The total present value of the cost of compliance for this measure is estimated to be approximately $5.5 million TPV over 10 years (or about $0.79 million in annualized value).

4. Costs associated with implementing health-related messages for premium cigars

The proposed Regulations would require packages of premium cigars to display a new larger HW and a TI statement.

Most non-premium cigars are sold in paperboard type packs and package labels are printed using the rotogravure printing process. Those compliance costs are covered in Cost #1, above. However, premium cigars are primarily imported, and are in packages that vary in size and in composition, from paperboard to wood, leather or metal. Due to the wide range of packaging, as well as the relatively low numbers of premium cigars sold in Canada, current regulations allow flexible labelling practices.

Under the current TPR-PSA, importers are allowed to apply adhesive stickers that display an HW to comply with labelling requirements. It is anticipated that importers would use this compliance approach rather than having suppliers redesign all premium cigar boxes. Importers would redesign the sticker sets to comply with new requirements for an enlarged HW and addition of a TI.

The following key assumptions were used in estimating these costs:

• As importers apply stickers to premium cigar boxes to comply with TPR-PSA requirements, the incremental cost of materials for stickers is negligible.
• In years when a rotation occurs, managing the number and design of modified stickers would likely require labour on the part of importers. The estimated cost is based on the number of premium cigar box variants, an estimate of the labour per box variant, and labour rates for inventory managers at cigar importing operations.
• The HC Wholesale Database does not distinguish between premium and non-premium cigars, therefore the number of premium cigar boxes was estimated based on assumed unit prices and packaging types.
• It is assumed that there are 10 to 20 SKUs per box type, and then that each importer would handle 50% to 100% of all box types, resulting in a range of estimates of premium cigar box variants (50 to 215). Estimated labour per box variant (1 to 2 hours), and labour rates for inventory managers ($40K to $60K) at cigar importing operations (20 importers) is then used to determine the costs.
• As with other cost estimates, the above ranges are used to determine an upper and a lower range of estimated cost, and the midpoint of the lower and upper bound costs is used.

The estimated cost is calculated as follows:

Ongoing Cost = Full-Time Equivalents (FTEs) * Inventory Manager Salary

Where:

• FTEs = Labour hours / 2,000
• Labour hours = Importers * Box Sizes * Hours per Box Size
• Box Sizes = SKUs / 10 SKUs per Box Type * Share of Boxes Handled

The total present value of the cost of compliance for this measure is estimated to be $0.42M TPV over 10 years (or about $60K in annualized value).

Government costs — Health Canada

5. Implementation, compliance and enforcement costs

The implementation of the proposed Regulations would require a modest investment of public sector resources. Specifically, Health Canada would incur modest incremental costs for performing compliance and enforcement activities. It would also incur costs for managing eventual updates to health-related messages. These costs would be absorbed through existing budget allocations.

Implementation activities in the year following the introduction of the proposed Regulations would include the development of a compliance promotion plan, publication of a notice to inform impacted stakeholders of the new regulations and order, review of compliance and enforcement policies and procedures, development of compliance and enforcement documents (including assessment tools, warning letter templates, external fact sheets and internal guidelines), development of staff training programs and materials, and subsequent training of inspectors.

Compliance monitoring activities include inspections and oversight and coordination of regional enforcement staff. Enforcement activities include seizure of non-compliant products, implementation of enforcement actions and coordination of federal and provincial enforcement activities.

Monitoring compliance with the proposed Regulations would involve activities such as compliance monitoring inspections, seizures of non-compliant products, and implementation of enforcement actions. Health Canada already conducts these activities to monitor compliance with the TPIR and TPLR-CLC. As Health Canada is already conducting compliance and enforcement activities related to tobacco packaging and labelling in a consolidated fashion, the proposed Regulations would result in minimal incremental costs to the Department. Health Canada would continue to utilize existing resources dedicated to tobacco control regulatory activities to facilitate eventual updates to health-related messages and the Source Document. These activities will therefore not result in incremental costs for the Department.

The total government costs are estimated at $3.5 million TPV over 10 years (or about $0.5 million in annualized value).

Qualitative costs

6. Ambulatory incorporation by reference of the Source Document

The proposed Regulations would allow Health Canada to amend the Source Document from time to time.

This is an administrative change in how the source document is incorporated in the regulations. This approach would allow Health Canada to update health-related messages under faster timeframes than previous labelling renewals requiring amendments to the regulations. With the continued aim of supporting the objectives of the TVPA, this mechanism would allow for Health Canada to be more responsive to new scientific research on the health effects or health hazards of using tobacco products by updating, editing or replacing content in the Source Document.

Any changes to the Source Document would be implemented to coincide with a scheduled rotation and would be communicated to interested parties at least eight months ahead of time. The costs associated with full-scale changes to the Source Document may be significant and comparable to the costs of implementing new messages and rotations, as discussed in item #1, above. However, it is difficult to predict whether or how often Health Canada might implement a change in label content. Future compliance costs are therefore difficult to predict, as they are associated with the scope of eventual changes.

While ambulatory incorporation by reference would allow Health Canada to propose future changes to the Source Document over the ten-year period analyzed, it cannot be assumed that changes would be undertaken and to what extent. For this reason, future costs associated with making use of this measure are not incorporated in the estimates.

Health Canada would continue to utilize existing resources dedicated to tobacco control regulatory activities to facilitate eventual updates to health-related messages and the Source Document. These activities will therefore not result in incremental costs for the Department as they do not differ from Health Canada’s activities under the baseline scenario.

Potential economic impacts

7. Profit loss to manufacturers

The introduction of new health-related labelling requirements could have a variety of market impacts that would affect the sales, profitability, and operations of tobacco products manufacturers and their suppliers.

The costs of complying with revised labelling requirements could be passed through to consumers in the form of higher prices, resulting in a reduction in unit sales, and further consolidation of the brands. The impact of a reduction in unit sales on manufacturers’ profits depends on the profit earned on each unit. In general, information on profit margins is closely held by the industry, and the information that is available is largely limited to cigarettes. In addition, if the new messages and presentation of messages, as part of the overall CTS, results in overall lower percentage of Canadians using tobacco products, this would be expected to result in an overall lower profitability to the industry.

8. Profit loss to retailers

An increase in tobacco product prices stemming from the implementation of the labelling requirements would also be expected to affect sales of tobacco products and associated profits in the retail sector.

For tobacco products other than cigarettes, little cigars and cigarette tobacco, the proposed Regulations would allow retailers to keep products featuring a previous series of health-related messages in stock when a second series in rotation is introduced onto the market as a means to minimize the economic impact.

9. Costs to Adults who Smoke

As evidence suggests that addictive products negate the self-control that is essential in the model of rational consumer behaviour, the rational choice framework of economics is inappropriate for assessing consumer surplus impacts of the proposed Regulations.^{footnote 64} Still, manufacturers of tobacco products may pass their compliance costs through to consumers in the form of higher prices and further consolidation in the number of brands; those who continue to purchase these products would realize a loss in consumer surplus either through increased prices and/or loss of access to a preferred product. The potential impact on the price of most tobacco products is expected to be relatively modest.

10. Loss of tax revenue

The proposed Regulations are expected to result in minor tax revenue losses to governments given that demand for tobacco is expected to decrease. Reduced sales of tobacco products reduce provincial sales tax collections, while manufacturer and retailer profit losses reduce corporate income tax revenue.

Sensitivity analysis

The CBA relies on projections that use various assumptions and parameters to determine these cost estimates. Sensitivity analysis has been conducted by analysis of high and low range values derived from the cost-benefit analysis.

Sensitivity analysis has been implicitly built in to each cost estimate based on upper and lower bound for each cost category based on changes to variables that have a range of estimates. The CBA estimates are based on the midpoint value of each cost category in the proposed Regulations. Aggregate sensitivity using this method results in cost benefits ranging from a low of $120 million TPV ($17.1 million annualized value) to a high of $240 million TPV ($34.2 million annualized value). These high and low values result in a midpoint cost estimate of $180 million TPV, as provided in the detail of monetized costs in Table 6.

Benefits of the proposed Regulations

The proposed Regulations would support the CTS, which aims to reduce the burden of disease and death from tobacco use and its consequential impact on the public health care system and society. The success of the CTS, a federal initiative, will be a result of a multifaceted and coordinated approach and the tobacco control efforts of many partners, such as provinces and territories, municipalities, non-governmental organizations, community agencies and the private sector. Given the variety and number of tobacco control interventions at play, quantifying the benefits of an individual tobacco control measure is very challenging.

The proposed Regulations are expected to enhance public awareness about the health hazards associated with the use of tobacco products, supporting informed decisions about not using them. This, in combination with other interventions under the CTS, would lead to long-term benefits realized in terms of avoided tobacco-related mortality and morbidity, including from exposure to second-hand smoke. Given the significant uncertainties associated with the expected impact of the proposed Regulations on tobacco use, the direct health benefits attributable to the proposed Regulations were not monetized. Instead, a model was developed to examine the implications of changes in cigarette initiation and cessation rates on fatal and non-fatal health effects of tobacco use. Three benefits resulting from changes in the initiation rates and cessation were considered.

• (1) Benefits of reduced tobacco-related mortality,
• (2) Benefits of reduced tobacco-related morbidity, and
• (3) Benefits of reduced exposure to second-hand smoke.

Model description

Given the difficulties in establishing a direct impact of the proposed Regulations on initiation and cessation rates, this analysis does not attempt to quantify the direct public health benefits attributable to the proposed Regulations. Instead, the analysis uses the Tobacco Control Health Benefits Model (HBM) to conduct a break-even analysis that specifies the reductions to cigarette initiation and cessation rates over the next 10 years that would be necessary to produce public health benefits commensurate with the costs of the proposed Regulations.

The model was used to conduct a break-even analysis to determine the percentage change in the annual rate of cigarette initiation from 2024 to 2033 and the percentage change in the annual rate of cigarette cessation that would be needed to generate health benefits commensurate with the estimated costs of the proposed Regulations.

The HBM focuses on cigarettes, which account for approximately 94% of tobacco sales in Canada and cause the vast majority of tobacco-related health impacts. Data on the adverse health effects of cigarette use are more readily available than similar data available on the use of other tobacco products.

Mortality impacts from smoking

To estimate the mortality risk of current and former smokers, data from Taylor et al.^{footnote 65} on mortality risks as a function of sex, age, and time since quitting was relied upon. The estimates were adjusted so that the model’s aggregate age- and sex-specific mortality rates match corresponding rates reported by Statistics Canada (average rates from 2014 to 2018^{footnote 66}). The model estimates annual deaths due to smoking by multiplying the stock of current smokers (and former smokers) by the difference in mortality risk between a current smoker (and former smoker) and a never smoker of the same sex and age.

To value changes in mortality risks, estimates of the value per statistical life (VSL) are used. The VSL is an aggregated estimate of the value of small annual mortality risk changes in a population, based on estimates of individual willingness-to-pay (WTP) to reduce one’s own mortality risk by a small amount. These WTP estimates are derived primarily from wage-risk studies of workers across jobs of varying risk levels. Importantly, the VSL represents the value of one “statistical life,” not the value of saving a specific individual’s life. Consistent with the Treasury Board of Canada Secretariat Policy on Cost Benefit Analysis^{footnote 67}, the model uses a VSL estimate of $7.99 million (2020 dollars).

In addition to estimating the mortality impacts of smoking for current and former smokers, the model also estimates non-smoker deaths attributable to exposure to second-hand smoke (SHS). For this parameter, data on SHS-attributable mortality in 2012 from the Conference Board of Canada^{footnote 68} is used. These mortality estimates were divided by smoking prevalence in 2012 to generate SHS mortality per 1 000 smokers. The model then multiplies these mortality rates by the smoking population in each modelled year to generate estimates of SHS-attributable mortality.

Smoking-related morbidity

To estimate the economic costs associated with tobacco-related morbidity, the model relies on 2017 data on tobacco-attributable direct health care costs and short-term disability from the Canadian Substance Use Costs and Harms Scientific Working Group^{footnote 69}. To estimate these costs, the annual cost of short-term disability and the direct health care costs are divided by the estimated number of people who smoke aged 27 and older. As tobacco-related illnesses generally take several years to manifest, a latency period of 10 years between smoking initiation and the onset of nonfatal health effects is assumed. Available data indicates the average age of cigarette smoking initiation is 17; thus, health costs associated with smoking are assumed to be incurred primarily by adults aged 27 and above who smoke and people who are exposed to SHS. The estimated annual morbidity cost is $2,620 (2020 dollars) for an adult aged 27 and older who smokes.

Results of break-even analysis

Under the proposed Regulations, the estimated incremental regulatory costs yield a present value of $180 million over 10 years (2020 constant dollars, 7% discount rate). To offset these costs, the proposed Regulations would need to result in either a reduction to the annual rate of cigarette initiation by 0.87% relative to the baseline initiation rate, or an increase to annual cigarette cessation rates of 0.18% relative to the baseline cessation rate. While a more likely result would be a combination of reduced initiation and increased cessation rates, in order to solve the model for a break-even result, one or the other needed to be held constant.

It is important to note that these percentage changes (0.87% and 0.18%) are not the absolute changes to initiation and cessation, rather they are percentage changes that would be multiplied by existing initiation and cessation rates.

Table 3: Break-even results for the primary analysis

Cost scenario	Break-even point (present value, 10 years, 7% discount rate)	Reduction in annual cigarette initiation rate required for benefits to equal costs	Increase in annual cigarette cessation rate required for benefits to equal costs
Reduction in consumer demand for cigarettes	$179,985,028	0.87%	N/A
Increase in number of people who have quit cigarettes	$179,985,028	N/A	0.18%

Note: Figures may not add up to totals due to rounding.

To put the analysis of public health benefits for the above break-even scenario into perspective, Table 4 and Table 5 provide additional information. The numbers in these tables are not a prediction of what the proposed Regulations would accomplish. Rather, they illustrate the public health benefits that would be accrued in the event of a 0.87% decrease in the cigarette initiation rate or a 0.18% increase in the annual cigarette cessation rate for the cost scenario. The relatively small effects on these rates would be equivalent to approximately 9,376 more people who do not start smoking or 2,063 more people who stop smoking at the end of year 10. Since the estimated costs for the proposed Regulations have been calculated, the benefits for the break-even scenario must equal or exceed these costs.

Table 4: Public health benefits from the proposed Regulations (Reduced Initiation Rate) — Break-even analysis

Benefits (Avoided Cost)	Current Best Estimate Cost Scenario
	Total Avoided Deaths	PV of Benefits (in Millions of Dollars)	% of Total Benefits
Deaths due to cigarette use	24	$124	69
Deaths attributable to second-hand smoke exposure	10	$50	28
Morbidity costs of cigarette use	N/A	$5	3
Total	34	$180	100

Note: Figures may not add up to totals due to rounding.

Table 5: Public health benefits from the proposed Regulations (Increased Cessation Rate) — Break-even analysis

Benefits (Avoided Cost)	Current Best Estimate Cost Scenario
	Total Avoided Deaths	PV of Benefits (in Millions of Dollars)	% of Total Benefits
Deaths due to cigarette use	30	$152	84
Deaths attributable to second-hand smoke exposure	2	$13	7
Morbidity costs of cigarette use	N/A	$16	9
Total	32	$180	100

Note: Figures may not add up to totals due to rounding.

Sensitivity analysis

Given the uncertainty in regard to the degree to which the regulations would contribute, with other measures, to aid people in making the choice to quit smoking versus aiding people who do not smoke from not starting smoking, a break-even analysis was used to determine estimated reductions to two metrics: smoking initiation rates (fewer people becoming smokers) or increases to cessation rates (more people quitting smoking). Initiation rates are held constant in the HBM while offsetting benefits associated with increases to cessation rates, were estimated. Cessation rates were then held constant in the HBM while offsetting benefits associated with decreases to initiation rates, were estimated. Specifics of the health benefits from each metric are provided in Tables 4 and 5.

Benefits of decreased initiation rates and increased cessation rates at break-even result in different distributions of benefits. Break-even cessation results in relatively higher benefits from deaths due to cigarette uses avoided (84% of benefits, 30 avoided deaths) compared to break-even initiation (69% of TPV, 24 avoided deaths). Break-even initiation yields relatively higher benefits from avoided deaths from second-hand smoke exposure (28% of TPV, 10 deaths avoided) compared to benefits for break-even cessation (7% of TPV2 deaths avoided). Avoided morbidity costs of cigarette use are relatively higher for break-even cessation (9% of TPV) compared to those for break-even initiation (3% of TPV). These differences demonstrate how the estimated distribution of benefits resulting from the proposed Regulations vary at break-even with estimated costs, depending on how cessation or initiation rates change.

Distributional analysis

Monetized incremental costs to tobacco product manufacturers account for 98.1% of the total estimated costs, the remaining costs are borne by government. Based on Canadian Industry Statistics for the tobacco industry, more than half (54%) of tobacco products manufacturers are located in Ontario, followed by almost 1/3 (31%) in the province of Quebec, and the remainder in other provinces.

The small business lens applies, as there are impacts on small businesses associated with the proposed Regulations. As noted in the Small Business Lens section, of the estimated 34 manufacturers, approximately 80% (28) are small businesses.

As described in the GBA+ section, the proposed Regulations are not expected to negatively impact any particular groups of Canadians. However, some groups may disproportionately benefit. This includes youth experimenting with tobacco use who often access individual cigarettes from social sources and are not usually exposed to health warnings on packages. Also, a given overall reduction in initiation or increase in cessation rate may yield different benefits for females compared to males, for example females experience more adverse health effects at lower consumption, greater difficulty quitting, higher susceptibility to chronic obstructive pulmonary disease, and higher risk for heart disease, while males are more likely to develop bladder and oral cancers. Additionally, smoking is more prevalent in lower income groups and is therefore a source of health inequality.^{footnote 70}

Health benefits resulting from the proposed Regulations may disproportionately benefit vulnerable population groups identified in the GBA+ section with higher rates of tobacco use, resulting in positive distributive effects.

Cost-benefit statement

Summary

The proposed Regulations are estimated to result in total incremental costs of $180 million TPV over the 10-year period (or about $25.6 million in annualized value). A break-even analysis indicates that a relatively small effect on cigarette smoking initiation and cessation would be sufficient to produce health benefits to the public equivalent to or greater than the estimated costs of the proposed Regulations.

• Number of years: 10 (from 2024 to 2033)
• Base year for costing: 2020
• Present value base year: 2024
• Discount rate: 7%

Table 6: Monetized costs
Note: Figures may not add up to totals due to rounding.

Impacted Stakeholders	Description of Cost	Base Year 2024	Year 5 2028	Final year 2033	Total Present Value	Annualized Value
Government	Total government costs	$610,941	$442,446	$442,446	$3,493,579	$497,407
Tobacco Industry	Implementing and rotating new health-related messages	$59,394,536	$0	$0	$110,637,616	$15,752,308
	Implementing new placement for HIM inside cigarette packages	$34,244,249	$3,938,662	$3,938,662	$59,905,549	$8,529,203
	Implementing HW on individual cigarettes, little cigars that have a filter, and tubes	$735,518	$735,518	$735,518	$5,527,589	$787,004
	Health-related messages for premium cigars	$139,000	$0	$139,000	$420,694	$59,897
All Stakeholders	Total costs	$95,124,244	$5,116,626	$5,255,626	$179,985,028	$25,625,819

Table 7: Quantified Break-Even Benefits (millions of CAD)

Benefits
Benefits needed to break-even with the estimated costs	Current best estimate cost scenario assuming reduction of 0.87% in the cigarette initiation rate	Current best estimate cost scenario assuming 0.18% increase in the annual cigarette cessation rate
Reduced risk of death due to cigarette use	$124	$152
Reduced risk of death attributable to second-hand cigarette smoke exposure	$50	$13
Reduced risk of morbidity related to cigarette use	$5	$16
Total	$180	$180

Note: Figures may not add up to totals due to rounding.

Table 8: Summary of monetized costs and benefits

Impacts	Base Year 2024	Year 5 2028	Final year 2033	Total Present Value	Annualized Value
Total costs	$95,124,244	$5,116,626	$5,255,626	$179,985,028	$25,625,819

Qualitative positive impacts

• Reduced morbidity and mortality related to tobacco use products other than cigarettes (the HBM only measures benefits from cigarette cessation or initiation).
• Reduced mortality related to exposure to second-hand smoke from sources other than cigarettes (the HBM only measures benefits from cigarette cessation or initiation).
• Improved quality of life and reduced disease-induced pain and suffering for people who use tobacco products.
• Possible reduction in smoking-related fires, and associated risks of property damage, injury and death.
• Reduction in the overall demand on the health care system, freeing resources to address other health issues more effectively and efficiently.

Qualitative negative impact

• Uncertain costs to manufacturers associated with future changes to the Source Document.
• Profit loss to manufacturers.
• Profit loss to retailers.
• Costs to adults who smoke in terms of higher prices.
• Loss of tax revenue for governments.

Small business lens

Based on data on the wholesale tobacco products market, there is an estimated 34 manufacturers and/or importers of tobacco products, concentrated mostly in Ontario and Quebec. Of these, approximately 80% (28) have fewer than 100 employees based on statistics on the tobacco industry, and are therefore small businesses pursuant to the Treasury Board of Canada Secretariat definition.

The small business lens applies, as there are impacts on small businesses associated with the proposed Regulations. Small businesses impacted by the proposed Regulations account for approximately 1% of total industry revenues. The market share of small businesses (%) by tobacco product category was used to estimate the industry cost to small businesses.

The total incremental costs to all impacted small businesses are estimated at $6.40 million TPV over 10 years (or $0.91 million in annualized value). The estimated incremental cost of the proposed Regulations per impacted small business is estimated at $228K TPV and $33K per impacted small business. The costs apportioned to these small businesses are not large relative to small business revenues.

Incremental costs to all small businesses in the tobacco industry

The 28 small businesses in the manufacturer category would bear the same compliance costs related to tobacco products as all 34 manufacturers. In the absence of specific estimates on costs to these small businesses, market share by product category cost is used to allocate cost. These include the following cost categories, as summarized in Table 9.

Labelling costs were allocated to the manufacturers based on the product category and market share. Labelling costs to small businesses were estimated at $6.12 million TPV, or $0.87 million annualized value.

Compliance costs to small businesses for premium cigars were allocated to small businesses based on market share. Total costs to small business for premium cigars were estimated at $143K TPV or $20.3K annualized value. Continued allowance of stickers to be used for health-related messages for premium cigars packages reduces costs for businesses impacted, which are likely to be smaller businesses.

HIM placement costs on the upper slide flap for cigarette packages were allocated to small businesses based on cigarette market share. These costs were estimated at $115K TPV or $16.4K annualized value.

The proposed regulations require text HW to be displayed directly on individual cigarettes, little cigars that have a filter, and tubes. The costs to small businesses were allocated based on market share for impacted products, resulting in an estimated cost of $15K TPV or $2.2K in annualized value.

Additional flexibility considered

The 28 small businesses affected by the proposed Regulations and Order are all manufacturers domiciled in Canada. Modified compliance requirements would limit the health benefits of the proposed Regulations. Therefore, a flexible option was not developed.

The proposed Regulations provide flexibility for retailers of tobacco products. Specifically, the transition period means that inventory obsolescence for tobacco product retailers is expected to be negligible, as it allows sufficient time for inventory to be depleted through sales.

Small business lens analysis — Costs to all impacted small businesses in tobacco industry

Small business lens summary

• Number of small businesses impacted: 28
• Number of years: 10 (from 2024 to 2033)
• Base year for costing: 2020
• Present value base year: 2024
• Discount rate: 7%

Table 9: Compliance costs

Activity	Annualized value	Total Present value
Implementing and rotating new health-related messages	$871,971	$6,124,356
Implementing new placement for HIM on cigarette packages	$16,405	$115,223
Implementing HW on individual cigarettes, little cigars that have a filter, and tubes	$2,166	$15,211
Health-related messages for premium cigars	$20,301	$142,586
Total compliance costs	$910,842	$6,397,376
Cost per impacted small business	$32,530	$228,478

Note: Figures may not add up to totals due to rounding.

Table 10: Administrative costs

Activity	Annualized Value	Total Present Value
None	0	0
Total administrative cost	0	0

Table 11: Total compliance and administrative costs

Totals	Annualized Value	Total Present Value
Total cost (all impacted small businesses)	$910,842	$6,397,376
Cost per impacted small business	$32,530	$228,478

One-for-one rule

The one-for-one rule applies. It is an OUT under the Rule for regulatory titles. The proposed Regulations repeal two existing regulatory titles and amend another one: they would merge the TPIR, the TPLR-CLC and the TPR-PSA into a single set of regulations. As a result, a net of two titles out is counted under the rule.

In accordance with Treasury Board of Canada Secretariat Policy guidance, all costs relating to labelling are deemed to be compliance costs. There will be no administrative burden on businesses as a result of the proposed Regulations.

Regulatory cooperation and alignment

Canada is a Party to the FCTC. The proposed Regulations would meet or exceed Canada’s tobacco labelling obligations under Article 11 of the FCTC and would include measures that are consistent with the Guidelines for implementing Article 11.

International stakeholders would be notified through the World Trade Organization notification process and provided with the same access to documents and opportunities to comment as domestic stakeholders. The proposed Regulations and Order would be subject to a 75-day comment period at the Canada Gazette, Part I, stage.

Strategic environmental assessment

In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.

Gender-based analysis plus

A gender-based analysis (GBA+) was conducted on draft HW for cigarettes, cigars, pipe tobacco, chewing tobacco and snuff, draft HIM for cigarettes, and draft TI for cigarettes, chewing tobacco and snuff packages. The GBA+ assessed the labels on sex-specific effects of tobacco use, and how sex may affect tobacco-related diseases or conditions. It also assessed the impact of certain factors such as gender norms or gender roles on tobacco use. Equity factors such as low socioeconomic status, impact on Indigenous populations, and on sexual or gender minorities were assessed. Strategies to avoid gender stereotyping in text or images were also reviewed. Recommendations from the GBA+ report included revisiting HW content to support gender equity and using diverse imagery to portray populations vulnerable to tobacco use. The analysis also pointed out to ways to avoid stigmatization in the depiction of women. These recommendations were taken into consideration in the development of messages and imagery.

The proposed Regulations are not expected to negatively impact any particular groups of Canadians based on gender, race, or ethnicity. However, it is likely that some population groups could be differentially impacted as exposure to the new proposed features will vary with tobacco use. For example, youth experimenting with tobacco use often access single cigarettes from social sources and are not usually exposed to warnings on packages. The display of text health warnings on the tipping paper of individual cigarettes, little cigars that have a filter, and tubes would help to more effectively reach and inform youth—a population particularly vulnerable to nicotine addiction—of the health hazards of tobacco use. The warnings would also reduce the appeal of the product, making it less desirable to consume in social situations, as demonstrated by research studies.

There are gender differences in smoking prevalence among males and females in Canada. In 2020, the prevalence of current cigarette smoking was higher among males (12%) than females (9%)^{footnote 10}. Smoking prevalence is high among LGBTQ+ persons and ranges between 24% to 45% across different groups.^{footnote 71} LGBTQ+ individuals are more likely to start smoking earlier.^{footnote 72}

There are sex differences associated with tobacco use and certain health conditions. For instance, females experience more adverse health effects of tobacco use at lower consumption levels and experience greater difficulty in quitting. In terms of specific health effects, males who smoke are more likely to develop bladder cancer and oral cancers while females are more susceptible to develop chronic obstructive pulmonary disease with less exposure to tobacco as well as a higher risk for heart disease.

Additionally, there are health inequalities in lower income groups where smoking is more prevalent^{footnote 73}.

Vulnerable population groups

Canada’s Tobacco Strategy recognizes certain groups of Canadians face smoking rates that are considerably higher than the general population. These groups require more targeted action to ensure no one is left behind in Canada’s efforts to reach less than 5% tobacco use by 2035. In particular, smoking prevalence among Indigenous peoples is approximately two to five times higher than among non-Indigenous Canadians. Prevalence is higher in certain trades. For example, in 2011, more than one third of construction workers smoked (34%), followed by mining and oil and gas extraction workers (29%) and transportation and warehousing workers (29%).

Health Canada will continue to monitor the health inequalities impacts of tobacco use across the population. Efforts by Health Canada, the Public Health Agency of Canada and Indigenous Services Canada to reach groups with higher rates of smoking will continue through increased resources in tobacco programs.

Implementation, compliance and enforcement, and service standards

Implementation

The proposed Regulations and Order would be made pursuant to the powers of the TVPA. They would come into force on the day they are registered.

Manufacturers would have a transition period of six months (180 days) for implementation, during which they would be allowed to continue to provide retailers with tobacco products, packages or leaflets regulated by the TPIR or TPLR-CLC. Manufacturers would be able to continue to provide retailers with packages of tobacco products that are not regulated by the TPIR or TPLR-CLC.

Retailers would have a transition period of nine months (270 days) for implementation, during which they would be able to sell-through inventoried tobacco products regulated by the TPIR or TPLR-CLC, or continue to provide consumers with packages of other tobacco products not regulated by the TPIR or TPLR-CLC.

Compliance promotion and outreach activities (including notices) aimed at informing manufacturers, distributors and retailers of tobacco products would increase awareness of the measures set out in the proposed Regulations and Order to assist parties in achieving compliance.

Compliance and enforcement

The Government of Canada would actively monitor compliance throughout the supply chain including manufacturers, distributors and retailers. If Health Canada inspectors have reasonable grounds to believe the proposed Regulations have been contravened, appropriate measures would be taken. These could include warning letters, compliance plans, seizures, and recommendations for prosecutions. Compliance and enforcement strategies would be consistent with the overall approach regarding the TVPA and its regulations.

The penalties for not complying with the proposed Regulations when they come into force are set out under Part VI of the TVPA. For example

• Every manufacturer or importer who contravenes section 15 in respect of information that is required to be displayed on tobacco products, packages containing them, and leaflets about tobacco products and their emissions, and about the health hazards and health effects arising from the use of those products and from their emissions, or in respect of the manner of displaying such information on tobacco product packages and on leaflets, is deemed guilty of an offence and is liable on summary conviction to a fine not exceeding $500,000 or to imprisonment for a term not exceeding two years, or to both.
• Every retailer who contravenes section 15 in respect of information that is required to be displayed on tobacco products, packages containing them, and leaflets about tobacco products and their emissions, and the health hazards and health effects arising from the use of those products and from their emissions, is deemed guilty of an offence and is liable on summary conviction to a fine not exceeding $50,000.

Service standards

This regulatory proposal does not relate to the provision of service to the public or to industry. Therefore, there are no service standards associated with this regulatory proposal.

Transparency and international obligations

Canada is a Party to the FCTC. Article 5.3 of the Convention obliges Parties, in setting and implementing their public health policies with respect to tobacco control, to protect these policies from commercial and other vested interests of the tobacco industry in accordance with national law. Therefore, the Government of Canada must actively exclude tobacco industry influence with respect to tobacco control policy. Interested parties must declare any perceived or actual conflicts of interest with the tobacco industry when providing input to this consultation. If an individual is part of the tobacco industry, an affiliated organization or an individual acting on their behalf, they must clearly state so in their submission.

Perceived or actual conflicts of interest with the vaping and/or pharmaceutical industry are also of interest. Members of the vaping and/or pharmaceutical industry, an affiliated organization or an individual acting on their behalf are asked to clearly indicate this in their submission.

Contact

Anne Gabriel
Manager
Tobacco Products Labelling Division
Tobacco Products Regulatory Office
Tobacco Control Directorate
Controlled Substances and Cannabis Branch
Health Canada
Address Locator 0301A
150 Tunney’s Pasture Driveway
Ottawa, Ontario
K1A 0K9
Email: pregs@hc-sc.gc.ca

PROPOSED REGULATORY TEXT

Notice is given that the Governor in Council proposes to make the annexed Regulations Amending the Tobacco Products Regulations (Plain and Standardized Appearance) under sections 7^{footnote a}, 17^{footnote b} and 33^{footnote c} of the Tobacco and Vaping Products Act ^{footnote d}.

Interested persons may make representations concerning the proposed Regulations within 75 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to the Tobacco Products Regulatory Office, Tobacco Control Directorate, Controlled Substances and Cannabis Branch, Health Canada, 150 Tunney’s Pasture Driveway, Ottawa, Ontario K1A 0K9 (email: pregs@hc-sc.gc.ca).

Ottawa, June 2, 2022

Wendy Nixon
Assistant Clerk of the Privy Council

Regulations Amending the Tobacco Products Regulations (Plain and Standardized Appearance)

Amendments

1 The title of the Tobacco Products Regulations (Plain and Standardized Appearance) ^{footnote 74} is replaced by the following:

Tobacco Products Packaging and Labelling Regulations

2 (1) The definitions carton and health warning in subsection 1(1) of the Regulations are replaced by the following:

carton

means a secondary package in which two or more primary packages containing the same type of tobacco product are placed. (cartouche)

health warning,

in respect of a tobacco product, means

• (a) the applicable health warning referred to in subsection 88(1), in the case of a health warning displayed on a tobacco product package; and
• (b) the applicable health warning referred to in subsection 117(1), in the case of a health warning displayed directly on a tobacco product referred to in section 116. (avertissement sanitaire)

(2) Subsection 1(1) of the Regulations is amended by adding the following in alphabetical order:

cigar

means a roll or tubular construction intended for smoking, other than a little cigar, that contains a filler composed of natural or reconstituted tobacco and has a wrapper, or a wrapper and a binder, composed of natural or reconstituted tobacco. (cigare)

cigarette

includes any roll or tubular construction that contains tobacco and is intended for smoking, other than a cigar, little cigar or tobacco stick. (cigarette)

display area

means the portion of the surface area of a tobacco product package, leaflet or tobacco product on which a labelling element is to be displayed. (zone d’affichage)

manufacturer

does not include an individual or entity that only packages or only distributes tobacco products on behalf of a manufacturer. (fabricant)

top edge

means the edge that is in the horizontal plane and forms the upper limit of the package when the package is used in the customary manner to gain access to the tobacco product. (arête supérieure)

3 Section 2 of the Regulations is replaced by the following:

Tobacco product and package — retail sale

2 (1) These Regulations apply to every tobacco product that is intended for retail sale in Canada, as well as to any package that contains such a tobacco product.

Package that does not contain tobacco products

(2) Part 1 also applies, in accordance with section 60, to a package that does not contain a tobacco product, if the package is furnished by a manufacturer of a tobacco product so that a tobacco product, primary package or secondary package may be placed in it after the tobacco product, primary package or secondary package is sold at retail in Canada.

4 Section 5 of the Regulations is replaced by the following:

Plain and standardized packaging

5 For the purposes of sections 15.3 and 23 of the Act, these Regulations set out the requirements that manufacturers of tobacco products must meet in respect of

• (a) the plain and standardized appearance, shape and content of tobacco product packages; and
• (b) the manner of displaying information on tobacco product packages and on leaflets, including the form and placement of the information.

5 The Regulations are amended by adding the following after section 6:

Labelling — required information

6.1 For the purposes of sections 15 and 15.2 of the Act, these Regulations set out the labelling requirements that manufacturers of tobacco products must meet in respect of

• (a) information that is required under the Act to be displayed about tobacco products and their emissions and about the health hazards and health effects arising from the use of those products and from their emissions; and
• (b) the manner of displaying that information on tobacco products, on packages that contains tobacco products and on leaflets.

6 The heading of Part 1 of the Regulations is replaced by the following:

Appearance and Dimensions of Tobacco Product Packages

7 Subsection 10(2) of the Regulations is replaced by the following:

Exception — required or authorized information

(2) Other colours may be used on the interior and exterior surfaces to display a health warning or other information that is required or authorized by or under the Act, any other Act of Parliament or any Act of the legislature of a province in accordance with the requirements imposed by or under that Act, other Act of Parliament or Act of the legislature of a province.

8 (1) Subsection 22(2) of the Regulations is replaced by the following:

Exception — required or authorized information

(2) An exterior surface of a primary package and of a secondary package may include an irremovable sticker that displays information required or authorized by or under the Act, any other Act of Parliament or any Act of the legislature of a province, if the sticker is placed on the package in such a manner that it does not conceal or obscure any such information on the package.

(2) Paragraphs 22(5)(a) of the French version of the Regulations is replaced by the following:

• a) elles ne masquent ni ne voilent les informations exigées sous le régime de la Loi, de toute autre loi fédérale ou de toute loi provinciale;

(3) Subsection 22(7) of the French version of the Regulations is replaced by the following:

Autocollants et languettes transparents et incolores

(7) Les autocollants et les languettes qui recouvrent les informations exigées sous le régime de la Loi, de toute autre loi fédérale ou de toute loi provinciale sont transparents et incolores.

9 Paragraph 24(e) of the French version of the Regulations is replaced by the following:

• (e) aucune information ni aucune caractéristique n’y figurent.

10 Paragraphs 25(d) and (e) of the French version of the Regulations are replaced by the following:

• d) la déclaration de quantité nette du produit du tabac ainsi que son nom commun — inscrits en blanc dans un rectangle noir —, à condition que ces informations soient disposées parallèlement aux informations figurant sur la surface que le suremballage recouvre et dans le même sens que celles-ci;
• e) tout avertissement sanitaire et toute autre information exigée ou autorisée sous le régime de la Loi, de toute autre loi fédérale ou de toute loi provinciale.

11 Paragraph 26(e) of the French version of the Regulations is replaced by the following:

• e) seules y figurent les informations exigées ou autorisées sous le régime de la Loi, de toute autre loi fédérale ou de toute loi provinciale.

12 Subsections 31(1) and (2) of the French version of the Regulations are replaced by the following:

Présentation

31 (1) Le nom de marque qui figure sur une surface extérieure d’un emballage primaire ou d’un emballage secondaire sur laquelle figure également un avertissement sanitaire est disposé parallèlement à l’avertissement et dans le même sens que celui-ci et est centré sur la superficie qui n’est pas occupée par l’avertissement ou par toute autre information exigée ou autorisée sous le régime de la Loi, de toute autre loi fédérale ou de toute loi provinciale.

Autres cas

(2) Le nom de marque qui figure sur une surface extérieure d’un emballage primaire ou d’un emballage secondaire sur laquelle ne figure aucun avertissement sanitaire satisfait aux exigences suivantes :

• a) si d’autres informations figurent sur la surface, il est disposé parallèlement à ces informations et dans le même sens que celles-ci et est centré sur la superficie restante de la surface;
• b) si aucune autre information ne figure sur la surface, il est centré sur celle-ci.

13 Section 33 of the French version of the Regulations is replaced by the following:

Présentation

33 Sur tout emballage, sauf l’emballage cylindrique, l’identité et l’établissement principal du fabricant sont disposés parallèlement aux autres informations qui figurent sur la même surface extérieure et dans le même sens que celles-ci.

14 Section 35 of the French version of the Regulations is replaced by the following:

Présentation

35 (1) La déclaration de quantité nette du produit du tabac et son nom commun qui figurent sur une surface extérieure d’un emballage primaire ou d’un emballage secondaire sur laquelle figure également un avertissement sanitaire sont disposés parallèlement à l’avertissement et dans le même sens que celui-ci.

Autres cas

(2) Si la déclaration de quantité nette et le nom commun figurent sur une surface extérieure d’un emballage primaire ou d’un emballage secondaire sur laquelle ne figure aucun avertissement sanitaire, ils sont disposés parallèlement aux autres informations figurant sur cette surface et dans le même sens que celles-ci.

15 The Regulations are amended by adding the following after section 42:

Dimensions of upper slide-flap

42.1 (1) The upper slide-flap of a slide and shell package that contains regular size cigarettes must have the following dimensions:

• (a) a height of 53 mm; and
• (b) a width of no less than 81 mm and no more than 106 mm.

King size cigarettes

(2) The upper slide-flap of a slide and shell package that contains king size cigarettes must have the following dimensions:

• (a) a height of 64 mm; and
• (b) a width of no less than 81 mm and no more than 106 mm.

16 Section 45 of the Regulations is replaced by the following:

Declaration of size of cigarettes

45 (1) The declaration of the size of cigarettes as regular size or king size may be displayed on the exterior surface of the front and back of a primary package and of a secondary package.

Manner of display

(2) The declaration of the size of cigarettes must be identified by the words “Regular Size” or “King Size”, as the case may be, or by the abbreviations “RS” or “KS”, respectively, and be printed in alphabetic characters of 10 points, oriented parallel to and in the same direction as the health warning and positioned in such a manner that the first letter of the declaration is 5 mm from the bottom and left edges of the package.

17 Paragraph 57(e) of the French version of the Regulations is replaced by the following:

• e) elles sont orientées parallèlement aux autres informations qui figurent sur la même surface extérieure et dans le même sens que celles-ci.

18 Section 63 of the Regulations is replaced by the following:

Alphanumeric code

63 (1) A tobacco product may display an alphanumeric code described in subsection 15(1), printed in black or gray.

Subsection 5.3(3) of the Act

(2) For the purposes of subsection 5.3(3) of the Act, black and gray colouring agents used to display the alphanumeric code on a tobacco product are prescribed additives.

Other requirements

(3) The alphanumeric code must

• (a) be printed only once on the tobacco product, in characters of no more than 8 points;
• (b) have a matte finish and be printed in a regular weight and width Lucida Sans Serif font style, without italics;
• (c) in the case of cigarettes that have tipping paper, little cigars, cigars and tobacco products that are made in whole or in part of tobacco, rolled in paper and intended for use with a device, be oriented parallel to and displayed no more than 38 mm from the end of the product that is not designed to be lit or heated;
• (d) in the case of cigarettes that do not have tipping paper, be oriented parallel to and displayed no more than 38 mm from the end of the cigarette that is closest to the health warning’s display area; and
• (e) be positioned in such a manner that it does not obscure or conceal any health warning or attribution referred to in subsection 83(1) that is displayed on the tobacco product.

Exception — cigars

(4) Despite paragraph (3)(a), instead of being printed on a cigar, the alphanumeric code may be printed on a cigar band that meets the requirements of subsection 71(4) if the code is displayed only once on the band and is printed in characters of no more than 10 points.

Information — characteristics

(5) The alphanumeric code must not convey any information relating to characteristics of the tobacco product or its emissions.

Brand element

(6) The alphanumeric code must not evoke the tobacco product’s brand elements.

19 (1) The portion of subsection 71(1) of the French version of the Regulations before paragraph (a) is replaced by the following:

Informations figurant sur les bagues de cigares

71 (1) Les informations ci-après peuvent figurer sur les cigares si elles figurent sur une bague qui est placée autour de la circonférence du cigare et satisfont aux exigences prévues au présent article :

(2) Subsection 71(2) of the French version of the Regulations is replaced by the following:

Exigences — informations

(2) Ces informations ne figurent qu’une seule fois sur la bague et :

• a) elles ont un fini mat et sont imprimées en police de caractères Lucida Sans Serif d’au plus 10 points, d’épaisseur et de largeur normales, sans italique et en gris;
• b) elles figurent horizontalement sur la longueur de la bague, de manière à ce que le texte se trouve autour de la circonférence du cigare.

20 The heading of Part 3 of the Regulations and Part 3 are replaced by the following:

PART 3
Tobacco Product Labelling — Required Information

Definitions

Definitions

81 The following definitions apply in this Part.

health information message,

in respect of a tobacco product, means the applicable health information message referred to in section 93. (message d’information sur la santé).

labelling element,

in respect of a tobacco product, means

• (a) a health warning referred to in section 87, a health information message referred to in section 92 or the toxicity information referred to in section 98 that is displayed on a package or leaflet; and
• (b) a health warning referred to in section 116 that is displayed directly on a tobacco product referred to in that section. (élément d’étiquetage)

source document

means the document that sets out labelling elements, as well as the attribution of those labelling elements, entitled Labelling Elements for Tobacco Products, as amended from time to time and published by the Government of Canada in print and electronic form. (document source)

toxicity information,

in respect of a tobacco product, means the applicable toxicity information referred to in section 99. (information sur la toxicité).

year

means a period of 12 consecutive months beginning on the day on which section 89 of these Regulations comes into force or any subsequent anniversary of that day. (année)

General Provisions

Electronic files

82 (1) A manufacturer must obtain from the Minister, in the form of electronic files, the labelling elements and the attribution of the labelling elements, as set out in the source document, and display the labelling elements on tobacco products, packages or leaflets.

Source document

(2) Subject to the other provisions of this Part, a manufacturer must display labelling elements on tobacco products, packages and leaflets in the same manner as they are presented in the source document in print form.

Attribution

83 (1) If a manufacturer attributes a labelling element contained in an electronic file, they must do so by displaying the phrase “Health Canada” with the English version of the labelling element and the phrase “Santé Canada” with the French version of the labelling element.

Source document

(2) Subject to the other provisions of this Part, a manufacturer must display the attribution of a labelling element on tobacco products, packages and leaflets in the same manner as it is presented in the source document.

Legibility and official languages

84 The text of a labelling element and of an attribution that is displayed on a tobacco product, package or leaflet must be legible and displayed in both official languages in the same manner.

Permanence

85 A labelling element that is displayed on a tobacco product, package or leaflet must be irremovable.

Printing

86 A labelling element and an attribution that is displayed on a tobacco product, package or leaflet must be printed

• (a) with the greatest clarity possible taking into consideration the printing method used; and
• (b) in colours that are as close as possible to the colours in which the labelling element and attribution are set out in the source document in print form.

Labelling on Packages — Required Information

Health Warnings

Requirement — package

87 Every package that contains a tobacco product, other than papers and filters intended for use with a tobacco product, must display a health warning that consists of three or more of the following components:

• (a) an image;
• (b) a warning header;
• (c) the explanatory text of the warning or related information; and
• (d) a message about tobacco cessation and the pan-Canadian toll-free telephone number and Government of Canada web address relating to tobacco cessation.

Source document

88 (1) The health warnings that are required for a tobacco product and that must be displayed on packages are the health warnings set out for that type of tobacco product in the following Sections of the source document:

• (a) in the case of cigarettes, Section A;
• (b) in the case of little cigars, Section B;
• (c) in the case of cigarette tobacco and tubes, Section C;
• (d) in the case of cigars, Section D;
• (e) in the case of pipe tobacco, Section E;
• (f) in the case of chewing tobacco and snuff, Section F;
• (g) Section G, in the case of
  • (i) tobacco products that are made in whole or in part of tobacco and intended for use with devices that are necessary for the use of those products,
  • (ii) devices referred to in subparagraph (i), and
  • (iii) parts that may be used with those devices;
• (h) in the case of water pipe tobacco, Section H; and
• (i) in the case of other tobacco products that are made in whole or in part of tobacco, Section I.

Health warnings — rotation

(2) The health warnings that are set out in the source document for each type of tobacco product must be used in two series in rotation, beginning on the day on which these Regulations come into force, each series being applicable during the following periods:

• (a) in the case of cigarettes, little cigars, cigarette tobacco and tubes, 24 months; and
• (b) in the case of any other type of tobacco product, 36 months.

Paragraph (2)(a) — 90–day transition period

(3) A series of health warnings may be used during the period of 90 days before the day on which that series applies in accordance with paragraph (2)(a).

Paragraph (2)(b) — retail sale continued

(4) Despite paragraph (2)(b), if a new series of health warnings becomes applicable in respect of a type of tobacco product referred to in that paragraph that is sold, by a retailer, in a package that displays a health warning of the preceding series, the preceding series continues to apply.

Equal use

89 Every manufacturer must use each health warning set out in each applicable series of health warnings in the source document in respect of an equal number of each type of package of each brand name of tobacco products that they package in a year, to the extent possible.

Placement — display area

90 (1) Health warnings must be displayed on the following display areas:

• (a) in the case of a primary package that has a rectangular cuboid shape when it is closed,
  • (i) the exterior surfaces of the front and back of the package, or
  • (ii) the exterior surface of the top of the package, if the total surface area of the exterior surface of the front and back of the package is less than or equal to the surface area of the exterior surface of the top;
• (b) in the case of a cylindrical primary package that contains cigarette tobacco, the portion of the surface area of the package that forms each of the exterior curved surfaces of the front and back of the package, around its circumference, that extend from the top edge to the bottom edge and that form rectangles when projected on a flat plane;
• (c) in the case of a cylindrical primary package that is a cigar tube, the exterior curved surface of the package;
• (d) in the case of any other cylindrical primary package, the exterior surface of the top of the package;
• (e) in the case of any other primary package,
  • (i) the exterior surfaces of the front and back of the package, or
  • (ii) the exterior surface of the top of the package, if the total surface area of the exterior surface of the front and back of the package is less than or equal to the surface area of the exterior surface of the top; and
• (f) in the case of a secondary package that is a carton, the exterior surfaces of the front, back and sides of the package.

Space occupied

(2) The health warnings must occupy at least the following portions of the display area of a package:

• (a) in the case of a primary package that contains cigarettes, little cigars or cigarette tobacco, 75% of the display area;
• (b) in the case of a primary package that contains cigars, other than a cigar tube, or that contains pipe tobacco or chewing tobacco, the greater of
  • (i) 75% of the display area, and
  • (ii) an area of 6 800 mm^{footnote 2};
• (c) in the case of a primary package that is a cigar tube, 75% of the display area;
• (d) in the case of a primary package that contains any other tobacco product, the greater of
  • (i) 75% of the display area, and
  • (ii) an area of 4 000 mm^{footnote 2}; and
• (e) in the case of a secondary package that is a carton, 75% of the display area.

Manner of display — official languages

91 (1) Health warnings must be displayed on packages in both official languages in such a manner that

• (a) in the case of a health warning that must be displayed on two display areas of a primary package, the English version is on one display area and the French version is on the other;
• (b) in the case of a health warning that must be displayed on one display area of a primary package, the English and French versions are side by side; and
• (c) in the case of a secondary package that is a carton, two health warnings are displayed as follows:
  • (i) the English version of one health warning is on the display area on the front or back of the package and the French version is on the display area on the front or back that remains unoccupied by the English version, and
  • (ii) the English version of the other health warning is on the display area on one side of the package and the French version is on the display area on the other side.

Alignment

(2) The health warnings must be positioned parallel to the top edge of the package or to the hinge opening, depending on the type of package, but perpendicular to the top edge, in the case of cigar tube.

Specific requirement — cylindrical primary package

(3) In the case of a cylindrical primary package, the health warning must be positioned as close as possible to the top edge of the package.

Format

(4) The health warnings must be displayed on a package in one of the following formats:

• (a) if the height-to-width ratio of the portion of a display area on which a health warning must be displayed is less than 1, the “Landscape” format;
• (b) if that ratio is greater than 1, the “Portrait” format;
• (c) if that ratio is equal to 1, the “Square” format.

Health Information Messages

Requirement — package

92 (1) Every primary package that contains cigarettes or cigarette tobacco must display a health information message that consists of the following components:

• (a) an image;
• (b) the explanatory text of the message or related information; and
• (c) the pan-Canadian toll-free telephone number and Government of Canada web address relating to tobacco cessation.

Leaflet — cigarette tobacco

(2) However, in the case of a small primary package that contains cigarette tobacco and whose dimensions do not allow the health information message to be displayed on the applicable display area described in paragraph 95(1)(b) or (c), the health information message must be displayed on a leaflet that is inserted in the package.

Leaflet — little cigars

(3) In the case of little cigars, a health information message described in subsection (1) must be displayed on a leaflet that is inserted in the primary package.

Leaflet — dimensions

(4) A leaflet that is inserted in a primary package and displays a health information message must be 80 mm by 53 mm in size.

Source document

93 (1) The health information messages that are required for a tobacco product are the health information messages set out for that type of tobacco product in the following Sections of the source document:

• (a) in the case of cigarettes, Section A;
• (b) in the case of little cigars, Section B; and
• (c) in the case of cigarette tobacco, Section C.

Health information messages — rotation

(2) The health information messages set out in the source document for each type of tobacco product must be used, in respect of packages that contain cigarettes, little cigars or cigarette tobacco, in two series in rotation, beginning on the day on which these Regulations come into force, each series being applicable during a period of 24 months.

Subsection (2) — 90–day transition period

(3) A series of health information messages may be used during the period of 90 days before the day on which the series applies in accordance with subsection (2).

Equal use

94 Every manufacturer must use each health information message set out in each applicable series of health information messages in the source document in respect of an equal number of each type of package of each brand name of cigarettes, little cigars and cigarette tobacco that they package in a year, to the extent possible.

Placement — display area

95 (1) Health information messages must be displayed on the following display areas:

• (a) in the case of a slide and shell package that contains cigarettes, the exterior surface of the upper slide-flap that is visible when the package is used in the customary manner to gain access to the cigarettes;
• (b) in the case of a cylindrical primary package that contains cigarette tobacco,
  • (i) any portion of the exterior curved surface that remains unoccupied by a health warning,
  • (ii) a removable leaflet that is placed on the interior surface of the lid of the package and is in the form of a disc that has a cut-out in its centre, or
  • (iii) the freshness seal of the package;
• (c) in the case of a primary package that has a rectangular cuboid shape when it is closed and that contains cigarette tobacco, any exterior surface that remains unoccupied by a health warning, other than the exterior surface of the bottom; and
• (d) in the case of any other primary package that contains cigarette tobacco, the largest exterior surface of the package that remains unoccupied by a health warning.

Removable leaflet — extension

(2) A portion of the surface of the removable leaflet referred to in subparagraph (1)(b)(ii) may extend beyond the edge of the disc if the extended surface displays the phrases set out in subsection 96(2).

Space occupied

(3) The health information messages must occupy the following portions of the display area:

• (a) in the case of a slide and shell package that contains cigarettes, the entire exterior surface of the upper slide-flap that is visible when the package is used in the customary manner to gain access to the cigarettes;
• (b) in the case of a cylindrical primary package that contains cigarette tobacco,
  • (i) for the exterior curved surface, an area of at least 4 240 mm^{footnote 2},
  • (ii) for a removable leaflet placed on the lid of the package, an area of at least 5 650 mm^{footnote 2}, and
  • (iii) for the freshness seal of the package, an area of at least 7 850 mm^{footnote 2}; and
• (c) in the case of any other primary package that contains cigarette tobacco, an area of at least 4 240 mm^{footnote 2}.

Manner of display — official languages

96 (1) Health information messages must be displayed on primary packages in both official languages in such a manner that

• (a) in the case of a display area other than a removable leaflet referred to in subparagraph 95(1)(b)(ii), the English and French versions are side by side; and
• (b) in the case of a removable leaflet, the English version is displayed on one side and the French version on the other.

Removable leaflet

(2) The extended surface of the removable leaflet referred to in subparagraph 95(1)(b)(ii) may display the phrase “Français au verso” in the English version and the phrase “English on other side” in the French version, printed in a regular weight and width Lucida Sans Serif font style, in characters of 9 points, in black upper case letters, without italics and in bold type.

Alignment

(3) If a health information message is displayed on a display area of a primary package on which a health warning is also displayed, the health information message must be oriented parallel to and in the same direction as the health warning.

Format

(4) The health information message must be displayed on the primary package, including on a removable leaflet referred to in subparagraph 95(1)(b)(ii) or on the freshness seal of a cylindrical package, in “Landscape” format.

Manner of display — leaflet

97 (1) A health information message displayed on a leaflet inserted in a primary package that contains cigarette tobacco or little cigars must be displayed on a display area that occupies the entire surface area of the leaflet.

Official languages

(2) The English version of a health information message must be displayed on one side of the leaflet and the French version on the other.

Format

(3) The health information message must be displayed in “Portrait” format on the leaflet inserted in a primary package.

Toxicity Information

Requirement — package

98 Every package that contains a tobacco product, other than papers and filters intended for use with a tobacco product, must display toxicity information that consists of the following components:

• (a) a toxicity information header; and
• (b) explanatory text related to toxicity.

Source document

99 (1) The toxicity information that is required for a tobacco product is the toxicity information set out for that type of tobacco product in the following Sections of the source document:

• (a) in the case of cigarettes, Section A;
• (b) in the case of little cigars, Section B;
• (c) in the case of cigarette tobacco and tubes, Section C;
• (d) in the case of cigars, Section D;
• (e) in the case of pipe tobacco, Section E;
• (f) in the case of chewing tobacco and snuff, Section F;
• (g) Section G, in the case of
  • (i) tobacco products that are made in whole or in part of tobacco and intended for use with devices that are necessary for the use of those products,
  • (ii) devices referred to in subparagraph (i), and
  • (iii) parts that may be used with those devices;
• (h) in the case of water pipe tobacco, Section H; and
• (i) in the case of other tobacco products made in whole or in part of tobacco, Section I.

Toxicity information — rotation

(2) The labelling elements related to toxicity information that are set out in the source document for each type of tobacco product must be used, in respect of packages containing tobacco products, in two series in rotation, beginning on the day on which these Regulations come into force, each series being applicable during the following periods:

• (a) in the case of cigarettes, little cigars, cigarette tobacco and tubes, 24 months; and
• (b) in the case of any other tobacco product, 36 months.

Paragraph (2)(a) — 90–day transition period

(3) A series of labelling elements related to toxicity information may be used during the period of 90 days before the day on which that series applies in accordance with paragraph (2)(a).

Paragraph (2)(b) — retail sale continued

(4) Despite paragraph (2)(b), if a new series of labelling elements related to toxicity information becomes applicable in respect of a type of tobacco product referred to in that paragraph that is sold, by a retailer, in a package that displays a labelling element related to toxicity information of the preceding series, the preceding series continues to apply.

Equal use

100 Every manufacturer must use each labelling element related to toxicity information that is set out in each applicable series in the source document in respect of an equal number of each type of package of each brand name of tobacco products that they package in a year, to the extent possible.

Placement — display area

101 (1) Toxicity information must be displayed on the following display areas:

• (a) in the case of a primary package that has a rectangular cuboid shape when it is closed,
  • (i) for a slide and shell package that contains cigarettes, the exterior surface of one of the sides of the package, and
  • (ii) for any other package, one of the largest exterior surfaces of the package that remains unoccupied by a health warning or health information message, other than the exterior surface of the bottom;
• (b) in the case of a cylindrical primary package, any portion of the exterior surface that remains unoccupied by a health warning or health information message, other than the exterior surface of the bottom;
• (c) in the case of any other primary package, any exterior surface of the package that remains unoccupied by a health warning or health information message; and
• (d) in the case of a secondary package that is a carton, any exterior surface of the package that remains unoccupied by a health warning.

Space occupied

(2) The toxicity information must occupy the following portions of the display area of a package:

• (a) in the case of a slide and shell package that contains cigarettes, the entire exterior surface of one of the sides of the package;
• (b) in the case of any other primary package that contains a tobacco product,
  • (i) if the display area is less than 1 000 mm^{footnote 2}, the entire display area, and
  • (ii) if the display area is equal to or greater than 1 000 mm^{footnote 2}, at least the greater of 60% of the display area and 1 000 mm^{footnote 2}; and
• (c) in the case of a secondary package that is a carton, at least 50% of the display area.

Exception — large display area

(3) The portion of the display area that the toxicity information occupies need not exceed 3 000 mm^{footnote 2}, except in the case of a secondary package that is a carton.

Manner of display — official languages

102 (1) Toxicity information must be displayed on packages in both official languages in such a manner that the English and French versions are side by side.

Format

(2) The toxicity information must be displayed on the package in “Landscape” format.

Kits

Definition of kit

103 In sections 104 to 108, kit means a package in which two or more of the following types of tobacco products are placed, if at least two of those types of tobacco products are intended to be assembled together by a consumer for their use:

• (a) cigarettes;
• (b) little cigars;
• (c) cigarette tobacco;
• (d) leaf tobacco;
• (e) cigars;
• (f) pipe tobacco;
• (g) tobacco sticks;
• (h) chewing tobacco;
• (i) snuff;
• (j) blunt wraps;
• (k) tobacco products that are made in whole or in part of tobacco and intended for use with devices that are necessary for the use of those products;
• (l) devices referred to in paragraph (k);
• (m) parts that may be used with those devices;
• (n) tubes;
• (o) any papers or filters intended for use with another tobacco product referred to in paragraph (a) to (m) or (p), if that tobacco product is also placed in the package; and
• (p) any other tobacco product.

Requirement

104 (1) Every kit must display a health warning described in section 87 and the toxicity information described in section 98.

One type of tobacco product

(2) A kit that contains papers or filters and in which only one type of tobacco product referred to in any one of paragraphs 103(a) to (m) or (p) is placed, must display the health warning and the toxicity information required for that type of tobacco product under sections 88 and 99, as applicable.

Two or more types

(3) A kit that contains two or more types of tobacco products referred to in any of paragraphs 103(a) to (n) or (p) must display the health warning and the toxicity information required under sections 88 and 99, as applicable, for the tobacco product whose health warning must occupy the largest area on its primary package, as determined in accordance with subsection 90(2)

• (a) for any cigarettes, little cigars, cigarette tobacco or tubes placed in the kit;
• (b) if the kit does not contain any of the tobacco products referred to in paragraph (a), for any cigars, pipe tobacco or chewing tobacco placed in it; and
• (c) if the kit does not contain any of the tobacco products referred to in paragraph (a) or (b), for any other products placed in the kit, with the exception of papers and filters.

Area of same size

(4) If the area determined under subsection (3) is the same size for at least two tobacco products placed in the kit, the kit must display the health warning and toxicity information required under sections 88 and 99, as applicable, for the tobacco product whose health warnings are set out in the Section of the source document that appears first in the source document.

Health Warning

Display area

105 (1) Health warnings must be displayed on the following display areas on a kit:

• (a) the exterior surfaces of the front and back of the kit; or
• (b) the exterior surface of the top of the kit, if the total exterior surface area of the front and back of the kit is less than or equal to the exterior surface area of the top.

Space occupied

(2) The health warnings must occupy at least 75% of the display areas.

Manner of display — official languages

106 (1) Health warnings must be displayed on kits in both official languages in such a manner that the English version is displayed on one display area and the French version on the other.

Only one display area

(2) However, in the case of a display area referred to in paragraph 105(1)(b), the English and French versions of the health warning must be side by side.

Format

(3) Health warnings must be displayed on the kit in “Landscape” format.

Toxicity Information

Display area

107 (1) The toxicity information must be displayed on a display area that is one of the exterior surfaces of the kit that remains unoccupied by a health warning.

Space occupied

(2) The toxicity information must occupy at least 50% of the display area.

Manner of display — official languages

108 (1) Toxicity information must be displayed on kits in both official languages in such a manner that the English and French texts are side by side.

Format

(2) Toxicity information must be displayed on kits in “Landscape” format.

Technical Specifications — Manner of Display

Labelling on package — integrity

109 (1) The customary method of opening a package containing a tobacco product must not sever or otherwise damage a labelling element or render it illegible.

Severed package

(2) However, a labelling element may be severed and two lines of text within the labelling element may be separated when the package is opened by the customary method if

• (a) the integrity of the labelling element is restored when the package is closed; and
• (b) no letter, numeral or other character that is part of the labelling element is severed.

Non-application

(3) This section does not apply to a package that is ordinarily torn during or discarded after opening.

Visibility

110 (1) A labelling element, component of a labelling element or attribution of a labelling element must not be obscured, except partially by a tear tape required under provincial legislation.

Coverage

(2) A labelling element, component of a labelling element or attribution must not be concealed, except partially by a tobacco excise stamp and on the following conditions:

• (a) the labelling element is concealed to the least extent possible and to a maximum surface area of 180 mm²; and
• (b) the labelling element or attribution is adapted in accordance with section 114 in such a manner that none of the components of the labelling element nor the attribution is entirely concealed by the tobacco excise stamp.

Tax stamp

111 A labelling element or attribution of a labelling element must not conceal or obscure a tobacco excise stamp that is affixed to the package in the manner prescribed by the Stamping and Marking of Tobacco and Cannabis Products Regulations.

Orientation of text

112 The text of a health warning or health information message must be oriented in such a manner that it is readable from left to right when a package is used in the customary manner to gain access to the tobacco product.

Leaflet — visibility and readability

113 A leaflet on which a labelling element is displayed must be

• (a) readily visible when the package is used in the customary manner to gain access to the tobacco product;
• (b) easily removable from the package; and
• (c) placed in the package in a manner that would make the text of the labelling element, or some portion of the text, readable without further manipulation.

Adaptation

114 Despite sections 82 and 83, if a labelling element or attribution of a labelling element does not fit the portion of the display area on a package, or the surface area on a leaflet, that it must occupy, the labelling element or attribution must be adapted as follows:

• (a) the components referred to in section 87, subsection 92(1) and section 98 must, to the extent possible, maintain the scale of the components in the source document
• (b) the attribution must, to the extent possible, maintain the scale of the attribution in the source document;
• (c) the positions of the components and attribution must, to the extent possible, be maintained relative to each other;
• (d) the integrity of the labelling element must be maintained;
• (e) the explanatory text and related information of a component may be displaced solely to meet the requirements of subsections 109(1) and 110(1); and
• (f) the number of lines of text may be adapted solely to avoid distortion of a component or attribution.

Finish — health warning

115 (1) For greater certainty, the text of a health warning or attribution of a health warning that is displayed on a package must have a glossy finish.

Health information message and toxicity information

(2) The text of a health information message, the toxicity information or an attribution of those labelling elements that is displayed on a package or leaflet may have a matte or glossy finish.

Labelling on Tobacco Products — Required Information

Requirement — tobacco products

116 A health warning that consists only of the explanatory text of the warning must be displayed directly on the following tobacco products:

• (a) cigarettes;
• (b) little cigars that have a filter; and
• (c) tubes.

Source document

117 (1) The health warnings that are required for a tobacco product and must be displayed directly on the product are the health warnings set out for that type of tobacco product in the following sections of the source document:

• (a) in the case of cigarettes, Section A;
• (b) in the case of little cigars, Section B; and
• (c) in the case of tubes, Section C.

Health warnings — rotation

(2) The health warnings that are set out in the source document for each type of tobacco product must be used in two series, in rotation, beginning on the day on which these Regulations come into force, each series being applicable during a period of 24 months.

90–day transition period

(3) A series of health warnings may be used during the period of 90 days before the day on which that series applies in accordance with subsection (2).

Equal use

118 Every manufacturer must use each health warning set out in each applicable series of health warnings in the source document in respect of each size of each brand name of cigarettes, little cigars and tubes that they package in a year, to the extent possible.

Placement — display area

119 (1) In the case of tobacco products that have tipping paper, the health warning must be displayed on a display area that consists of the portion of the surface of the tobacco product’s tipping paper that extends from the end of the tobacco product that is not designed to be lit.

Other display area

(2) In the case of cigarettes that do not have tipping paper, the health warning must be displayed on a display area that consists of the portion of the surface of the paper that covers the rolled tobacco and extends from one end of the cigarette.

Display area — dimensions

(3) The display area must measure at least 24 mm in length.

Space occupied

(4) The health warning must occupy at most 80% of the display area of the tobacco product.

Manner of display — official languages

120 (1) Health warnings must be displayed on tobacco products in both official languages in such a manner that

• (a) the English and French versions each occupy at most 40% of the display area; and
• (b) one version is below the other.

Alignment

(2) The health warnings must be

• (a) left justified, 1 mm from the edge of the display area; and
• (b) positioned horizontally along the length of the product.

Text

(3) The text of the health warnings must be printed

• (a) on two white backgrounds, with the English version on one and the French version on the other;
• (b) in black upper case letters, without italics and in bold type;
• (c) in a regular weight and width Lucida Sans Demibold Roman font style, in characters of at least 8 points; and
• (d) in lines that are separated by 8 points.

Format

(4) The health warning must be displayed on the tobacco product in “Landscape” format.

Rectangular border — tipping paper

121 In the case of a tobacco product that has tipping paper that imitates a cork pattern or is drab brown, each of the white backgrounds on which the health warning is displayed must

• (a) be enclosed within a rectangular border that has a colour that imitates a cork pattern or is drab brown, as the case may be; and
• (b) be positioned in such a manner that it starts 0.5 mm from the end of the tobacco product that is not designed to be lit and ends 0.5 mm from the portion of the tobacco product that is designed to contain tobacco.

Attribution

122 (1) The text of an attribution of the health warning must be printed

• (a) on the white background referred to in paragraph 120(3)(a);
• (b) in black letters, without italics or bold type; and
• (c) in a regular weight and width Lucida Sans Serif font style, in characters of 6 points.

Capital letter

(2) Only the first letter of each word in the attribution may be a capital letter.

Subsection 5.3(3) of the Act

123 For the purposes of subsection 5.3(3) of the Act, black colouring agents used to display a health warning or an attribution on a tobacco product are prescribed additives.

Visibility

124 (1) The entire text of one version of a health warning referred to in paragraph 120(1)(a) must be visible under normal conditions of use of a tobacco product without turning the product.

Alphanumeric code

(2) A health warning and any attribution of the health warning must be positioned in such a manner that they do not obscure or conceal the alphanumeric code referred to in subsection 63(1).

21 The French version of the Regulations is amended by replacing “renseignement” and “renseignements” with “information” and “informations”, respectively, with any necessary modifications, in the following provisions:

• (a) section 9;
• (b) subsection 15(3);
• (c) subsection 17(2);
• (d) paragraph 22(5)(b);
• (e) paragraph 23(c);
• (f) the portion of section 25 before paragraph (a);
• (g) the heading before section 27;
• (h) the heading before section 32 and subsection 32(2);
• (i) subsection 34(2);
• (j) section 36;
• (k) subsection 50(2);
• (l) subsection 55(2); and
• (m) subsection 64(2).

Transitional Provisions

22 The following definitions apply in this section and sections 23 to 26.

cigar

means a roll or tubular construction intended for smoking, other than a little cigar, that contains a filler composed of natural or reconstituted tobacco, and that has a wrapper, or a wrapper and a binder, composed of natural or reconstituted tobacco. (cigare)

cigarette

includes any roll or tubular construction that contains tobacco and is intended for smoking, other than a cigar, little cigar or tobacco stick. (cigarette)

commencement day

means the day on which these Regulations come into force. (date de référence)

former Regulations

means the following regulations:

• (a) the Tobacco Products Labelling Regulations (Cigarettes and Little Cigars) as they read immediately before the day on which these Regulations come into force, in respect of the following tobacco products:
  • (i) cigarettes, and
  • (ii) little cigars; and
• (b) the Tobacco Products Information Regulations as they read immediately before the day on which these Regulations come into force, in respect of the following tobacco products:
  • (i) cigarette tobacco,
  • (ii) leaf tobacco,
  • (iii) cigars,
  • (iv) pipe tobacco,
  • (v) tobacco sticks,
  • (vi) chewing tobacco,
  • (vii) snuff,
  • (viii) kreteks, and
  • (ix) bidis. (règlement antérieur)

manufacturer

does not include an individual or entity that only packages or only distributes tobacco products on behalf of a manufacturer. (fabricant)

new Regulations

means the Tobacco Products Regulations (Plain and Standardized Appearance) as they read on the day on which these Regulations come into force. (nouveau règlement)

23 (1) Despite these Regulations, if a package of a tobacco product or any leaflet provided with the product displays information in accordance with the former Regulations and that product is sold or distributed by a manufacturer, the former Regulations continue to apply to the package or the leaflet during the period of 180 days after the commencement day.

(2) Despite these Regulations, if a package of a tobacco product or any leaflet provided with the product displays information in accordance with the former Regulations and that product is sold by a retailer, the former Regulations continue to apply to the package or the leaflet during the period of 270 days after the commencement day.

24 (1) Despite these Regulations, a manufacturer may sell or distribute, during the period of 180 days after the commencement day, a tobacco product in respect of which the former Regulations do not apply and whose package, or any leaflet provided with the product, does not display information in accordance with Part 3 of the new Regulations.

(2) Despite these Regulations, a retailer may sell, during the period of 270 days after the commencement day, a tobacco product in respect of which the former Regulations do not apply and whose package, or any leaflet provided with the product, does not display information in accordance with Part 3 of the new Regulations.

25 Despite these Regulations, if a package of cigarettes displays information in accordance with the former Regulations, section 42.1 of the new Regulations does not apply to the package during the following periods:

• (a) in the case of cigarettes that are sold or distributed by a manufacturer, 180 days after the commencement day; and
• (b) in the case of cigarettes that are sold by a retailer, 270 days after the commencement day.
  

26 (1) Despite these Regulations, a manufacturer may sell or distribute, during the period of 180 days after the commencement day, a tobacco product referred to in section 116 of the new Regulations that does not meet the requirements of Part 3 of the new Regulations.

(2) Despite these Regulations, a retailer may sell, during the period of 270 days after the commencement day, a tobacco product referred to in section 116 of the new Regulations that does not meet the requirements of Part 3 of the new Regulations.

Repeals

27 The following regulations are repealed:

• (a) the Tobacco Products Information Regulations ^{footnote 75}; and
• (b) the Tobacco Products Labelling Regulations (Cigarettes and Little Cigars) ^{footnote 76}.

Coming into Force

28 These Regulations come into force on the day on which they are registered.