China's tobacco regulator on Monday issued draft rules to strictly control e-cigarette production, as it tightened oversight of the industry.

The State Tobacco Monopoly Administration said it would "reasonably" control the scale of e-cigarette production capacity to prevent overcapacity.

Foreign investment in the retail of e-cigarette products would be banned, the regulator said, and it would review foreign investment in production, requiring e-cigarette firms that want to list in China or abroad to obtain pre-approval.