Panama’s National Assembly is advancing a comprehensive regulatory framework for electronic cigarettes and vaping products. The Commission on Work, Health, and Social Development approved draft bill No. 227 in late October, aiming to establish specific controls for a market that currently operates without formal oversight. This legislative effort directly addresses growing concerns about youth consumption and the expansion of an unregulated informal market.
The proposed legislation creates strict age verification requirements and imposes significant financial penalties for violations. It represents a decisive shift from previous prohibition-based approaches toward a regulated market model that emphasizes consumer protection and tax collection. The initiative arrives as public health officials document increasing adolescent use of vaping devices despite previous attempts to ban them entirely.
Strict Penalties and Youth Protection Measures
Bill 227 establishes some of the hemisphere’s most stringent penalties for selling vaping products to minors. Businesses caught selling to underage customers face fines ranging from $5,000 to $100,000. The legislation specifically classifies selling to minors, failing to verify age at point of sale, and involving adolescents in marketing activities as serious infractions.
Parents or guardians of minors caught using these devices would also face consequences under the proposed law. They could receive fines between $500 and $5,000 and would be required to attend parental education workshops about addiction and health risks. These measures respond to health ministry data showing steady increases in teen vaping despite previous regulatory efforts.
“This proposal represents a necessary advance to bring order to a currently unregulated market,” [Translated from Spanish] stated the Panama Chamber of Commerce, Industries, and Agriculture in a letter to commission president Edwin Vergara.
The bill further strengthens sanitary and customs oversight to prevent the entry and sale of uncertified products. This specifically targets unknown-origin nicotine liquids circulating in the informal market that have concerned health authorities.
Business Community Backs Regulatory Approach
Major business organizations have thrown their support behind the regulatory framework proposed in Bill 227. The Panama Chamber of Commerce, Industries, and Agriculture (CCIAP) explicitly endorsed the measure, arguing that regulation proves more effective than prohibition. The chamber emphasized that the bill protects minors through strict sales prohibitions and marketing restrictions while creating an orderly fiscal framework that allows the state to collect taxes on products currently sold without contributing to public revenues.
The business group noted the proposal maintains coherence with the technical position of the Ministry of Health, particularly following Resolution No. 146 of 2025. That resolution moved away from prohibitionist approaches toward market regulation and sanitary control. The chamber contends that modern regulatory frameworks actually decrease minor access while strengthening institutional oversight.
In contrast, the business community strongly opposes competing legislation known as Bill 263, which would reestablish an absolute prohibition on electronic cigarettes. They argue this approach already failed when implemented under Law 315 of June 30, 2022. The Supreme Court of Justice declared that law unconstitutional in May 2024 for violating principles of equality before the law, free competition, and equitable treatment.
Prohibiting a product functionally similar to traditional cigarettes, which remain legally available, creates market distortions and opens spaces for smuggling according to business representatives. During the effective period of Law 315, youth consumption did not decrease as intended. Ministry of Health data indicates use of electronic cigarettes among adolescents actually increased from 6.4% in 2017 to 8.5% in 2023.
Broader Coalition Supporting Regulation
The Fundación Libertad organization also endorsed Bill 227, noting the proposal aligns with principles of rational regulation and effective oversight while respecting economic freedom. The foundation stated the text combats illicit trade, protects minors, and creates a progressive tax structure without resorting to arbitrary measures. They believe properly regulated markets better serve public health objectives than outright bans that drive commerce underground.
The Panama Tobacco Harm Reduction Association supports the initiative from a scientific perspective. The organization notes that non-combustion products significantly reduce exposure to toxic substances compared to conventional cigarettes. They point to recognition by the U.S. Food and Drug Administration that these devices represent less harmful alternatives for adult smokers unable to quit entirely.
This coalition of business and scientific organizations creates substantial momentum for the regulatory approach. Their collective support suggests broad recognition that previous prohibitionist policies failed to achieve their public health objectives while creating unintended consequences. The current legislative effort attempts to balance adult access with youth protection through measured controls.
Following the Supreme Court’s declaration that Law 315 was unconstitutional, Panama has operated without specific regulations governing the import, marketing, and use of vaping products. This regulatory vacuum has allowed the informal market to expand rapidly, creating the precise conditions that Bill 227 seeks to address through legal framework rather than prohibition.
Legislative Context and Next Steps
The National Assembly of Panama now faces a clear choice between two competing approaches to vaping products. Bill 227 proposes comprehensive regulation with strict age restrictions, while Bill 263 seeks to reinstate the prohibition model already rejected by the Supreme Court. The business community’s strong preference for the regulatory approach signals likely economic consequences depending on which path legislators choose.
Bill 227’s advancement through the commission stage represents a significant milestone, but the legislation still requires full assembly approval. The proposal must navigate the legislative process amid ongoing debates about public health policy and economic regulation. Its supporters hope the documented failure of previous prohibition efforts will convince lawmakers that regulated markets better protect youth while acknowledging adult consumer choices.
The proposed legislation aligns with broader regional trends toward regulating rather than banning nicotine delivery systems. Several Latin American countries have moved from prohibition to regulatory frameworks in recent years, often citing similar experiences with expanding black markets and persistent youth access despite bans. Panama’s approach appears to incorporate lessons from these international experiences.
Health authorities continue to emphasize that all nicotine products carry health risks, particularly for adolescents whose brains are still developing. The regulatory framework acknowledges these risks while creating mechanisms to manage them through controlled legal markets rather than unregulated informal ones. This represents a pragmatic shift in public health strategy that prioritizes harm reduction over idealistic but unenforceable prohibitions.
As the legislative process continues, the debate over Bill 227 will likely intensify. The proposal’s supporters must demonstrate that regulation can achieve what prohibition could not, reducing youth access while establishing quality controls and tax revenues. The future of desarrollo social and public health policy in Panama may hinge on this critical decision about how best to govern emerging nicotine products in an increasingly complex marketplace.