Austria Updates Tobacco Monopoly Law to Strengthen Retailers and Regulate New Products

The Austrian government has introduced significant changes to the country's tobacco monopoly through recent amendments to the Tax Amendment Act 2025. The updated regulations aim to modernize the existing framework, with a particular focus on reinforcing the position of tobacco retailers and adapting to new market realities.

One of the central aspects of the revised law is the extension of monopoly rights to encompass nicotine pouches, a product category that has grown in popularity in recent years. This adjustment is intended to ensure that all forms of tobacco and nicotine products fall under consistent regulation, reflecting shifts in consumer habits and the emergence of alternative nicotine delivery systems. Additionally, a new licensing system for e-cigarette liquids will be established, creating clearer guidelines for their distribution and sale within Austria.

In terms of CBD products, the legislation maintains the status quo until the end of 2028, permitting the sale of hemp flowers in specialized CBD shops. However, from 2029 onward, the sale of these products will be restricted exclusively to licensed tobacco retailers. This move is primarily designed to enhance youth protection measures and align the sale of such products with existing regulatory controls for tobacco.

The government emphasizes that these changes serve multiple objectives. Firstly, the strengthened monopoly is seen as a means of supporting tobacco retailers, a significant portion of whom are individuals with disabilities. Access to a stable and regulated marketplace is considered vital for the continued self-employment and economic participation of these retailers. The reforms are also intended to simplify administrative processes for the approval of novel tobacco products, such as heated tobacco, thereby addressing previous competitive disadvantages faced by Austrian retailers compared to counterparts in neighboring European Union countries.

Furthermore, the legislative package addresses broader public health concerns. The government has indicated its commitment to ongoing discussions around tobacco control and non-smoker protection, with further legislative updates expected in related areas. The restructuring of the tobacco monopoly is presented as a balanced approach that seeks to accommodate the interests of retailers, industry stakeholders, and public health objectives.

Officials assert that the reform is the result of extensive consultations and negotiations, aiming to provide a pragmatic solution that delivers economic stability for tobacco retailers while ensuring robust consumer protection standards. By integrating emerging nicotine products under the existing regulatory umbrella and streamlining licensing procedures, the government aims to foster a fair and competitive retail environment while prioritizing health and safety considerations.

These measures are part of a broader effort to adapt Austria's regulatory framework to evolving consumer behavior and industry trends, ensuring the long-term sustainability of the tobacco retail sector and the effective management of new product categories entering the market.