Half of e-cigarettes in Luxembourg sourced from irregular market

An estimated 25,000 people over the age of 15 in Luxembourg vape and one in two e-cigarettes consumed in the Grand Duchy comes from irregular sources, according to a study by the Fraunhofer Institute, the first to analyse the size, structure, and supply chains of Europe’s irregular vape market.

Luxembourg’s new anti-tobacco law, effective from 1 January, places e-cigarettes on the same legal footing as traditional cigarettes. Sales are prohibited to minors, and manufacturers and importers must provide detailed product information to health authorities, including ingredients, maximum nicotine concentration, and refill container quantities.

Before retail sale, products must be reported to the health directorate. This includes all ingredients, emissions, toxicological data, nicotine content, usage instructions, and manufacturer or importer information. Health warnings must appear on packaging, and vapes and e-liquids may only be sold with the correct tax mark.

Luxembourg as a gateway for e-cigarette Imports

The German study however has identified Luxembourg as one of four “gateway countries” for e-cigarette imports from China into the EU, alongside Germany, Belgium, and the Netherlands. In 2024, just under 45,900 tonnes of e-cigarettes and e-liquids entered the EU, with over 90% coming from China.

“Shenzhen is now the global epicentre, where most devices are developed, manufactured, and packaged before reaching European markets via air and sea ports,” said Uwe Veres-Homm, head of risk and location analysis at Fraunhofer IIS. He noted that China has strict domestic e-cigarette regulations, but export rules are much more lenient.

Over 90% of Chinese manufacturers produce exclusively for export, while only 640 companies are licensed to sell domestically. Many European imports are not correctly labelled as vape products, and the flood of parcels from China creates loopholes for the grey and black market.

Fraunhofer defines the grey market as private procurement of products that are illegal or not properly taxed in Luxembourg. Online platforms have removed e-liquids due to stricter EU legislation, but “water-soluble flavours” are now widely sold as non-vape products while reviews suggest they are being used for vaping.

The black market refers to the commercial trade in illegal or untaxed e-cigarettes and e-liquids for profit. Luxembourg’s low taxes on e-cigarettes – just €0.10 per millilitre of e-liquid – make it a strategic transit and distribution point for the EU market, the study explains. By contrast, Slovenia charges €0.70 per millilitre.

Once products undergo customs processing in Luxembourg, they are considered EU goods and can enter the market elsewhere.

The black market for e-liquids is booming

Rico Back, managing partner at SKR, highlighted that “as long as each country has its own rules, gaps will exist for irregular trade.” Illegal products may violate tax laws, contain banned ingredients, exceed nicotine limits, or bypass sales regulations.

The study concludes that banning e-cigarettes would not eliminate the grey and black markets. With nearly 12 million EU vapers, such a ban would likely push consumers toward traditional cigarettes or illicit products, making regulation even harder.

Harmonised EU standards, a unified authorisation procedure, coordinated taxation, and a blacklist of non-compliant companies are recommended, because an e-cigarette that is legal in one country may be illegal in another. “As long as national rules differ, there will always be loopholes. But with harmonised standards, the market can be significantly stabilised,” said Horst Manner-Romberg at the presentation of the study.

Another proposed solution is to involve China more closely in production so that products can be checked for compliance with EU law before they are exported.

What vapers should know

Since the new legislation came into force, the market for e-cigarettes in Luxembourg has changed. Buying in online shops has become more complicated: for example, customers in authorised online shops must be able to prove their identity.

Consumers should ensure that the nicotine content of e-liquids does not exceed the limit of 20 milligrams per millilitre. The warnings must be displayed in either German or French, as packs that are in English only are not authorised in Luxembourg.

E-cigarettes and e-liquids without a CE mark and without a manufacturer’s or importer’s address are not regular products.

(This article has been first published on the Luxemburger Wort. Translated using AI, with editing by Lucrezia Reale.)