KUALA LUMPUR, Malaysia - eTradeWire -- Malaysia's "accidental" nicotine vape ban is no longer just a legal technicality. It is now a fast-moving legal and financial crisis, the Coalition of Asia Pacific Tobacco Harm Reduction Advocates (CAPHRA) warns, and the Ministry of Health has days, not months, to fix it.

Liquid nicotine reverted to the Poisons List after the government withdrew its appeal against a High Court ruling. That makes lawful adult supply of vape products impossible under Act 366, even though the Control of Smoking Products for Public Health Act 2024 (Act 852) was written to regulate them.

Malaysian MPs are now calling on the government to refund an estimated RM354 million in excise already collected from an industry it now classifies as selling a restricted poison. Industry groups say insurers are already signalling they may deny coverage, on the basis vape products could contain an illegal substance, and that banks are growing reluctant to finance new vape factories and retailers. Industry groups also warn continued taxation under Act 852, while sale is banned under Act 366, could expose the government to litigation after the next general election.

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"This is what happens when nicotine policy is made by legal accident instead of evidence," said Nancy Loucas, CAPHRA's Executive Coordinator. "Malaysia now risks a hole in its own budget, a paralysed legitimate industry, and a black market with no reason to fill the gap responsibly."

Samsul Kamal, of the Malaysian Organization of Vape Entity (MOVE), which represents more than 55,000 members, said the ban should alarm anyone concerned with public health, not just industry.

"This 'accidental ban' is a critical threat to public health and consumer safety," Kamal said. "History and international evidence show that prohibition does not eliminate demand; it simply surrenders the market to illicit actors."

Professor Sharifa Ezat Wan Puteh of the Malaysian Society for Harm Reduction (MSHR), and a confirmed speaker at October's Asia Forum on Nicotine (AFN26) in Manila, said the crisis could have been avoided.

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"Our society proposed tighter regulation a decade ago to curb illicit markets and incorporate harm reduction for recalcitrant smokers," Puteh said. "We also proposed using technology to curb underage use, something that can't be done if illicit products are rampant. MOH should allow vape use as a harm reduction method, at minimum prescribed by registered vendors selling legitimate nicotinised vape. Denying options for smokers will just make them revert to tobacco or illicit products, which are already widely available."

CAPHRA is calling on the Malaysian government to align the Poisons Act and Act 852 without delay, permit regulated supply to adults only, and target enforcement at drug-laced illicit products such as Piu Piu, which echo the Kpod-adulterated vape problem already seen in Singapore.