It’s a road the premium cigar business has been down before, but yesterday a proposed House Agriculture Appropriations Bill has cleared a subcommittee with language that contains an exemption for premium cigars and for a change in the grandfather date for premium cigar products to be exempted from regulation.
The central point of interest for cigar enthusiasts is that the proposed bill has language in it that says federal funding cannot be used to finalize, implement, administer, or enforce FDA regulations on premium cigars. The proposed bill also includes language to define what a premium cigar is.
In addition, there is language that calls for the grandfather date of February 15, 2007 to be changed to the effective date of the regulation (which is August 8, 2016). Currently, a grandfathered cigar is one that was marketed on February 15, 2007 or earlier. This will allow for products released up to August 8, 2016 to qualify as grandfathered product.
There are many more steps to make this reality. The Agriculture Appropriations draft must make it into final overall Appropriations Bill and there is a chance the proposals for premium cigars may not make be included. The bill must then be passed by the House. Also, a companion bill must clear the U.S. Senate. And both bill must make it to the floor for a vote. If passed, the President can choose to veto it.
Last year, the language for a premium cigar exemption and grandfather date change did make it into the final overall Appropriations Bill. However, a Continuing Resolution was adopted instead. The Continuing Resolution allowed for the government to continue to operate for the next four months. It extended the current funding for operations for most federal agencies and services, thus overrode the proposals for premium cigars by default.
Putting the grandfather date in the Appropriations Bill adds extra insurance in case the language to exempt premium cigars is dropped from the final Appropriations Bill
The proposed language in the Appropriations only applies for the upcoming fiscal year. It would need to be reintroduced each year unless there an Act of Congress passed into law. Senate Bill S.294 and H.R. 564 have been introduced to Congress to exempt premium cigars. Meanwhile H.R. 1136 is a proposed bill to change the grandfather date.