Nicotine Lawfare: Sweden and Spain’s Options in Settling the Dispute Over Novel Products

The Internal Market began—and remains—a construct completed through dissension, rather than through an evolution of harmonious cooperation and compromises. Arguably, the Single Market was established through litigation at the European Court of Justice, which established the principles of mutual recognition. This key principle led to the free flow of goods and services and forced the harmonisation of Member State laws.

A conflict that undeniably shaped the Internal Market more than any other is the dichotomy between national legislation for public health and free trade, balancing the traditional protection of citizens’ health against the free movement of goods across Member States. The tension was prominently highlighted in the famous Cassis de Dijon case—arguably the CJEU dispute that spawned the Internal Market and the concept of mutual recognition, asserting that goods legally marketed in one Member State are naturally allowed in others.

Conversely, the compromise in the Lisbon Treaty protected Member States’ autonomy in the organisation of their healthcare systems, but where public health is a shared competence, complemented by EU coordination. To this day, Single Market principles often conflict with national laws, and this tension is particularly evident in the regulation of innovative or controversial products, such as online services, alcohol, or nicotine products, where different national approaches to harm reduction are evident.

Member States Restrictions on Novel Products

The conflict between Spain and Sweden began in late January with the adoption of the Royal Decree amending RD 579/2017, which imposes significant restrictions on novel nicotine products. These include requirements for generic packaging, a ban on flavourings, and a cap on nicotine content at 0.99 mg per pouch.

As an average pouch typically contains the sixfold, several Member States, including Sweden, Romania, Hungary, Czechia, Italy, and Greece, have issued technical opinions against the Decree. Spain’s own competition authority (CNMC) has also issued a critical report, questioning the proportionality and legal basis of several provisions under domestic law.

Sweden and its supporters have also issued critical opinions against France, which has outright banned any sale, importation, manufacturing and even possession of nicotine pouches.

Although inhaling smoke as a form of nicotine consumption is now considered a vice of the past, alternative products such as vaping and pouches are increasing in popularity because they eliminate carcinogenic substances linked to smoking. Furthermore, new products are not only smoke-free but also tobacco-free.

And in other cases, these new products are not particularly new: Smoke-free oral tobacco, such as snus, has been a staple in Sweden and its historical territories since tobacco was introduced in the early 18th century. Swedish snus has been banned in the EU since 1992 under the Tobacco Products Directive, with an exception granted to Sweden upon its accession to the EU, as well as to Norway and other EEA countries. This ban was challenged but upheld by CJEU (Swedish Match, C-210/03).

While tobacco-based snus is banned, non-tobacco pouches are legally sold in 13 Member States. However, the sales of such oral smokeless nicotine products are heavily concentrated in Sweden and Denmark, accounting for over 60% of the total EU market turnover in 2023.

Nevertheless, the Swedish government (as well as its public and science community) widely regard the usage of snus and oral smokeless products as the main reason behind their low rate of smoking-related illnesses, which is the lowest among all EU countries. Outside Sweden and the Nordics, oral smokeless products are “novel” as they were indeed introduced over the last decade. A common concern is that these products are quickly gaining popularity among younger demographics, undermining the effectiveness of traditional tobacco controls.

Moreover, some Member States aim for a level playing field between both new and traditional products, or across EU Member States under the Tax Excise Directive (TED)—especially at a time when governments seek new revenue streams to fund their increases in defence spending.

The ongoing conflicts arise as the European Commission and the Member States prepare to revise the decade-old Tobacco Products Directive (TPD) of 2014, and both sides are pre-empting the legislative negotiations that will take place in the Council next year.

There is a well-known division within the EU regarding nicotine products, and it is not the purpose of this note to advocate for either Spain or Sweden. What is of interest here is how Member States’ view on public health objectives is shaped by local traditions, and have multiple options to address their concerns. Whether it pursues technical deliberations, legislative reforms, or seeks litigation will determine political risks, burden of proof, and second-order impacts. The nature of the product is irrelevant to such an inquiry.

Deliberative Track: Delaying Legislations Through TRIS

The EU case law leaves considerable leeway for national legislation that genuinely pursues public health objectives. In some paradoxical ways, Spain and Sweden share the goal of a smoke-free and healthier society, but the two arrive at opposite conclusions due to their cultural differences. Where Sweden views its products as beneficial for harm reduction, they are new sources of harm in Spain and France.

The proposals by Spain and France follow bans in Belgium, Luxembourg, and the Netherlands in 2023, and the opposing countries have submitted comments on these occasions as well.

Germany resorted to a creative course of action when its food safety agency classified nicotine pouches as food products. Since foods are assumed to be already fully harmonised and therefore not subject to a TRIS process, nicotine pouches were banned without any challenge. Even Denmark—a proponent of pouches—has also regulated pouches by imposing a nicotine limit of 9 mg per dose, i.e. ten times the Spanish threshold.

These legal actions signal an urgency to regulate new nicotine products, at least to some degree. The current EU directive of 2014 only covered traditional tobacco products, leaving any later products to the discretion of the Member States in principle. The EU treaties (Art. 168 TFEU) also safeguard the autonomy of national healthcare systems, with the EU complementing a Member State’s authority.

In sum, any new national rules restricting new forms of nicotine consumption are justified on precautionary grounds given the absence of EU harmonisation. However, new rules must meet certain conditions on the free movement of goods that were established in case law. Whether Spain or France fulfils these conditions is far from given, and the question arises in the case of an infringement litigation.

 At the time of writing, eight Member States submitted reasoned or detailed opinions against Spain and France during the TRIS notification procedure (Directive 2015/1535), which requires Member States to notify draft technical regulations that may affect the internal market.

Unlike ordinary comments, so-called “detailed opinions” under Art. 6(2) automatically trigger an extended three-month standstill of the Spanish and French laws from coming into force, preserving the status quo until July 28 for Spain and August 25 for France. These laws are now in procedural limbo as Spain and France prepare responses to the detailed opinions. Notably, no detailed opinions were submitted in the case of the prior bans in Belgium, the Netherlands or Luxembourg. Germany’s circumvention was also unchallenged.

Sweden stands out as the most consistent objector, formally challenging both Spain’s cap and France’s prohibition, leveraging the TRIS procedure to extend standstill periods and prompt substantive justifications from its counterparts. Sweden has argued that these bans constitute measures with an equivalent effect to a quantitative restriction (Dassonville, C-8/74) in violation of the free movement of goods under Article 34 TFEU. It has also challenged the proportionality and scientific basis of the measures.

TRIS procedures were designed to be simple and effective, based on the trade law practice of “explain or allow”. What makes them attractive to the injured party is that they are politically inexpensive and shift the burden of proof onto the defendant rather than the complainant. Unless Spain and France demonstrate that their prohibitions are “necessary,” they are expected to amend or withdraw their laws.

Moreover, the TRIS process also has low political saliency, hidden behind the closed doors of the Council. In return, TRIS procedures do not have binding outcomes, and neither Sweden nor the Commission may prevent adoption through technical commentary alone. Once the standstill expires, there is no effective remedy within TRIS, if Spain and France choose to proceed.

In conclusion, the most natural outcome is a compromise in which the European Commission asks France and Spain to continue delaying the enforcement of their restrictions until an EU-level reform of the relevant directives is completed, and Sweden is urged to refrain from further escalating the dispute.

Legislative Track: Reforming the EU Directives

As the EU institutions prepare to revise both the Tobacco Products Directive (TPD) and the Taxation of Excise Goods Directive (TED), Member States are entrenching their positions ahead of legislative negotiations in the TRIS notification process. By pre-empting EU legislation, the Member States could fortify their positions as fait accompli before the Commission even begins its drafting process.

TPD and TED serve as guardrails to harmonise the sale, marketing, and taxation of tobacco and nicotine products in the EU, despite the Member State competences—and Member States remain sharply divided according to the known fault lines: Sweden and its cohort (as well as Denmark) advocate a risk-based, harm reduction approach, pushing for lighter regulations for smokeless products. Conversely, Spain, France, Belgium, Luxembourg, and the Netherlands seek precautionary bans, citing precautionary health concerns and youth protection.

Some attempts at coordination have already taken place. In 2024, the Commission and the Council agreed upon the Revised Recommendations, calling on Member States to extend smoke-free environment policies and urging the expansion of smoke-free policies to new products, such as e-cigarettes and heated tobacco, that target younger users. While the recommendations encourage Member States to strengthen their policies, this guidance fuels regulatory fragmentation as they enact national laws that are inconsistent.

Consequently, this call for action created divergences that complicate enforcement and led to disputes among the Member States. The question is whether the additional pressure that the Recommendations created for revising the EU directive was intentional or not.

At prima facie, the European Commission faces a considerable challenge in harmonising these conflicting interests into coherent directives, navigating these divergent positions. Commission’s enforcement of Member State compliance has already been criticised in some parts of the Council as “selective”. Some Member States—including Sweden, Romania, Italy and Czechia— have challenged the Commission’s interpretation of TPD that, in their view, restricts their ability to pursue their anti-smoking agenda.

If the Commission were to attempt to act as an honest broker, it would face the impossible task of staying within the red lines set by twenty-seven conflicting and incoherent public health strategies, while protecting the integrity of the Single Market. In addition, the Commission has a self-interest in advancing EU executive powers in areas of mixed competences, not least in the broader interest of avoiding uncoordinated restrictions that fragment the Single Market.

Meanwhile, it has also finally leaked that the European Commission is considering introducing tobacco taxation as a potential new source of revenue for the next EU long-term budget. The EU levy would be a historical first instance of EU taxes, which could only be anchored in a political agreement between the Commission and the Member States that enabled President von der Leyen’s second term.

With six influential European countries, including France and Germany, moving to block the sale of nicotine pouches, and the Commission having a natural inclination towards their position, any new EU law will favour prohibitions. For Sweden and its cohorts, any delays through the TRIS process only defer the inevitable, whether the trading restrictions are imposed as national law or updated EU directives.

Proponents of further restrictions hold what the negotiation theory calls “better alternative to a negotiated agreement” (or batna). Spain and France may have put their measures on hold, but they have retained the option to reinstate those measures if EU-level reforms do not deliver their desired outcome. Meanwhile, Sweden et al are negotiating uphill as they are a few million people short of a blocking minority, and must negotiate from a position where any EU-wide compromise is better than the alternative.

Litigating Track: An Infringement Case

Considering that the TRIS process or reforms favour Member States that impose trading restrictions, litigation becomes the most feasible option for the opponents. However, the European Commission is unlikely to initiate infringement proceedings against recent national laws, as its primary interests are better served by renegotiating the TPD. Therefore, the injured party may need to resort to launching a state-to-state infringement case, a rarely used “nuclear option,” under Article 259 TFEU. Alternatively, one of its undertakings might bring litigation under Article 263.

If Spain or France merely postpones or suspends their measures, Sweden et al could argue that the underlying infringement persists, providing grounds for litigation. However, if Spain or France withdraws or postpones its measures, the process comes to an immediate halt, as the CJEU requires a current and active infringement to adjudicate. Hence, if the Spanish and French restrictions are formally withdrawn, an infringement case must be redirected to Belgium, Luxembourg, or the Netherlands. Ironically, giving these countries a free pass in 2023—whether through neglect or design—has kept this avenue open for a potentially precedential case.

The core of all previous CJEU cases to date on the four freedoms and the derogation for precautionary public health concerns (under Art. 36 and 191) are balancing acts that are broken down into a step-by-step methodology testing suitability, necessity and proportionality of the restrictions.

For one, Spain and France will certainly contend that all their measures—generic packaging, flavour bans, nicotine content caps, and outright prohibitions—are suitable for protecting public health, particularly in preventing youth uptake of novel nicotine products. They will rely on the precautionary principle, arguing that the uncertainty surrounding the long-term health effects (of nicotine) on youth makes their measures suitable, especially as pouches are not traditionally consumed in their countries. This is also the reasoning of the CJEU in its ruling on snus in Swedish Match.

Conversely, Sweden will challenge the arguments by asserting it lacks a scientific basis and undermining established harm reduction strategies (for tobacco), citing its own experience with oral smokeless products. It will further contend that some or all of the measures fail the necessity test, arguing that less trade-restrictive measures can achieve the stated public health goals.

For this, Sweden must present actual evidence that stricter age limits, sales and marketing restrictions, and higher content thresholds are equally effective. In particular, Sweden’s line of argument is almost sure to argue that the existence of higher thresholds in Denmark indicates that Spain’s de facto bans are either unnecessary or disproportionate. Sweden would argue that the mere existence of thresholds proves that there are less restrictive measures than bans, and their measures are inconsistent if they permit other products (e.g. cigarettes) with similar or greater nicotine absorption rates or otherwise discriminatory or inconsistent with national policies overall (Beer Purity, C-178/84).

In contrast, France and Spain have legal precedents supporting strong precautionary measures in contexts where less restrictive alternatives may not be sufficient (Motorcycle trailers et al., C-110/05), thereby asserting that their chosen level of restriction is necessary to achieve the policy objectives sought.

In other words, Member States should have reasonable discretion to define what they deem as the appropriate level of protection (e.g., nicotine content) in their jurisdiction. However, they must choose a measure that is proportionate and least restrictive for that objective, and past CJEU rulings more often found national regulations to be disproportionate than not.

Conclusions: Legal Strategy Matters

Ultimately, the choice of legal strategy of the respective Member State and the Commission holds considerable significance for the outcomes as well as risks in the case of “failure” in their pursuit of their interests at the EU level.

Given the limitations inherent in deliberative processes such as TRIS and the realpolitik involved in negotiating TPD and TED reforms, the pursuit of market access likely necessitates resorting to litigation at the CJEU. There is also a strong causal relationship between litigation and legislative action. CJEU rulings often precede legislative developments by influencing changes in EU regulations and directives, where the Commission and Member States leverage on unsustainable CJEU outcomes to press for new legislation.

Despite the substantial political and economic risks involved, litigation uniquely promises some chance of remedy for Sweden et al., while a standstill is a pyrrhic victory that undermines their long-term chances. In addition, a CJEU case is not merely about overturning isolated cases of unfavourable Member State laws. For Sweden et al., it is a tactical manoeuvre to dig better-positioned trenches and let an ongoing court case delay the negotiations on TPD and TED, as they currently lack both a blocking minority and moral authority.

Ironically, France and Spain could block such an attempt by withdrawing their laws. Whereas the Council cannot “overwrite” an interpretation of the treaties by the CJEU, an unfavourable ruling to them in the CJEU could be superseded by technical standards with relative ease, with a qualified majority. For Spain and France, the choice is binary: whether to negotiate the tobacco directives before or after a CJEU ruling deeming some (but hardly all) of their laws disproportionate.

Finally, as often happens, the Commission finds itself in the most advantageous position. It can leverage these divergences to push for a unified approach and to emerge from TPD and TED negotiations with expanded regulatory powers that align with its broader post-pandemic strategy to strengthen the EU’s role in health-related regulation. More importantly, what is at stake for the current Commission (and a key Member State that orchestrated it) is fiscal powers that could bring about a historic change in the Commission’s executive role and the balance of inter-institutional powers.

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Disclaimer: The authors of this article are former public servants from Spain and Sweden. This piece does not aim to argue in favour of either country or seek to elevate the legal or scientific merits of one side of the argument over the other.