British American Tobacco (BAT) Plc has confirmed ongoing talks with the Government of Kenya as it lobbies the State to ease regulatory restrictions on the sale and marketing of nicotine pouches, including its LYFT brand.
The products were pulled off the shelves in Kenya in February 2021 after the CS Mutahi Kagwe-led Health Ministry declared them illegal.
The ministry wanted the pouches reclassified to put them in the same category as tobacco products such as cigarettes under tobacco control laws. This would have major implications on marketing and production.
BAT had already identified Kenya to host a shiny new Ksh2.5 billion plant for the production of non-combustible nicotine pouches. Meant for the larger African market, the pouches would be sold across the continent.
Placed under the lip by users, nicotine patches do not contain tobacco. As cigarette use dwindles globally, big tobacco is banking on new products such as nicotine pouches, e-cigarettes and vapes.
“In Kenya, we continue to engage with the relevant authorities on the regulatory and fiscal framework to support a commercially sustainable reentry into the modern oral category.”
“We continue to believe that modern oral represents an exciting opportunity to offer affordable new category alternatives to adult nicotine consumers in emerging markets given the absence of an electronic device and a pre-existing ritual of oral product consumption in a number of markets,” BAT notes in its latest annual report.
Notably, the National Treasury also recently announced a new taxation formula for liquid nicotine products. The new tax regime is expected to result in higher prices of e-cigarettes and vapes in Kenya.
Treasury CS Ukur Yatani proposed the review of the taxation regime for liquid nicotine to Ksh70 per milliliter.