What was seemingly a foregone conclusion following the U.S. Congress’ passage of the Preventing Online Sales of E-Cigarettes to Children Act (the “POSECCA”) in December 2020 has now become official – effective yesterday, October 21, 2021, the U.S. Postal Service (the “USPS”) generally will no longer permit vaping products to be shipped through the U.S. mail.
After a nearly six-month delay, and the receipt of more than 15,700 comments from the public and various industry leaders, the USPS issued its final rule in the Federal Register, banning the shipment through the mail of “electronic nicotine delivery systems,” or “ENDS,” consistent with Congress’ mandate. The ban, which is effective immediately and subject to only a few exceptions, will drastically impact the manner in which cannabis- and vaping-related businesses are able to get their products to consumers.
New Rule Makes ENDS “Generally Nonmailable”
Originally directed to promulgate final regulations consistent with the POSECCA by April 26, 2021, the USPS has now officially issued its final rule, which, according to the rule’s “Summary,” “incorporate[s] new statutory restrictions on the mailing of electronic nicotine delivery systems. Like cigarettes and smokeless tobacco, such items are generally nonmailable, subject to certain exceptions.”
The just-issued final rule provides, in relevant part:
- “The Postal Service will not accept, forward, or deliver any package that it knows, or has reasonable cause to believe, contains nonmailable covered products. If the Postal Service reasonably suspects that a mailer is tendering nonmailable covered products, then the mailer bears the burden of proof in establishing eligibility to mail.”
- “Nonmailable covered products deposited in the mail are subject to seizure and forfeiture. Any nonmailable covered products seized and forfeited shall be destroyed or retained by the federal government for the detection or prosecution of crimes or related investigations and then destroyed.”
- “Persons involved in the shipment or attempted shipment of nonmailable covered products may be subject to seizure and forfeiture of assets, criminal fines, imprisonment, and civil penalties.”
The new rules also permit certain exceptions to these prohibitions that are the same ones applicable to nicotine products: (1) “Intra-Alaska and Intra-Hawaii Mailings;” (2) “Business/Regulatory Purposes,” i.e., business-to-business; (3) “Certain Individuals,” i.e., “noncommercial” individual-to-individual mailings subject to certain restrictions; (4) “Consumer Testing;” and (5) “Public Health.”
New USPS Rule Clearly Intended to Apply to Cannabis Industry
The POSECCA, which was signed into law by then-President Donald Trump, amended the Prevent All Cigarette Trafficking Act (the “PACT Act”), in part, by adding ENDS to the prohibited mailing list.
“ENDS” are statutorily defined as “any electronic device that, through an aerosolized solution, delivers nicotine, flavor, or any other substance to the user inhaling from the device …” (emphasis added). In fact, in its final rule, the USPS emphasized: “Congress expressly provided that covered ENDS products extend beyond nicotine-related use ….” Specifically included within the statutory definition of “ENDS” are all e-cigarettes, vape pens, and “any component, liquid, part, or accessory of a device … without regard to whether the component, liquid, part, or accessory is sold separately from the device.”
Despite arguments to the contrary, the USPS confirmed in the final rule that cannabis-related products can and do fit within this definition. According to the recently published rule, “Numerous pro-ENDS commenters urged that the POSECCA be construed, or the Postal Service’s implementing regulations be written, to exempt ENDS items consisting of, containing, or used with marijuana and marijuana- or hemp-derived products.” The USPS explained further:
Many of these commenters asserted that rendering such items nonmailable would conflict with State and local laws decriminalizing or legalizing cannabis for medical or recreational purposes. Some claimed that the inclusion of such products would conflict with provisions in recent appropriations Acts (including that which includes the POSECCA) that bar the Department of Justice from using appropriated funds to prevent certain States and Territories “from implementing their own laws that authorize the use, distribution, possession, or cultivation of medical marijuana.” Finally, some argued that inclusion of such products would conflict with the removal of hemp and hemp derivatives (with not more than 0.3 percent tetrahydrocannabinol (“THC”) by dry weight) from the definition of marijuana in the Controlled Substances Act (“CSA”) (internal citations omitted)
The USPS, however, expressly rejected these arguments:
[N]otwithstanding Congress’s use of “nicotine” in the term “electronic nicotine delivery systems,” the plain language of the POSECCA definition makes clear that nonmailable ENDS products include those containing or used with not only nicotine, but also “flavor[ ] or any other substance.” It goes without saying that marijuana, hemp, and their derivatives are substances. Hence, to the extent that they may be delivered to an inhaling user through an aerosolized solution, they and the related delivery systems, parts, components, liquids, and accessories clearly fall within the POSECCA’s scope (emphasis added).
The USPS also emphasized that “THC is generally nonmailable for reasons independent of the POSECCA and the PACT Act. THC-containing substances remain generally prohibited under the CSA, regardless of whether they are intended for purportedly medical or recreational purposes or whether the shipper or recipient resides in a State or locality that has decriminalized either or both such uses. Devices, parts, components, and accessories used with such substances can qualify as drug paraphernalia, which is likewise nonmailable” (citations omitted). It did note, though: “The only exceptions to this mailing ban are for hemp and hemp derivatives that contain no more than 0.3 percent THC by dry weight.”
“Thus,” the USPS continued:
ENDS products containing or used with THC (e.g., THC-containing liquids, cannabis waxes, dry cannabis herbal matter) are already nonmailable under the CSA. Congress’s decision to keep such items out of the Federal postal network does not bear on whether their use or exchange violates State or local law. Nor does it alter whether the Department of Justice – a Federal entity independent of the Postal Service – may use its appropriated funds to interfere with the operation of State or local laws.
For clarity, even if a shipper could avail itself of a PACT Act exemption with respect to ENDS products generally, the shipper is still prohibited from mailing ENDS products that contain THC (other than hemp derivatives with no more than 0.3 percent THC by dry weight). Nor does the lack of civil or criminal sanction under State or local law entitle any person to ship THC through the Federal postal network or absolve them of penalties under Federal law, so long as the Federal CSA remains applicable.
Conversely, THC-containing substances that are excluded from the CSA – that is, hemp and hemp derivatives with no more than 0.3 percent THC by dry weight — are not subject to CSA-based mailability restrictions, and items used with such substances (and not with controlled substances) may fall outside the definition of drug paraphernalia. As such, those substances continue to be mailable generally, to the extent that they are not incorporated into an ENDS product or function as a component of one. To the extent that they do comprise or relate to an ENDS product, however, then that product is now nonmailable under the PACT Act and POSECCA, except pursuant to a PACT Act exception.
For its part, the POSECCA restricts the mailability of only certain hemp-based and related products; hemp-based non-ENDS products are unaffected, as are ENDS products falling within one of the PACT Act’s exceptions (emphasis added) (citation omitted).
Leech Tishman’s Cannabis Practice Group is ready and able to assist businesses in the cannabis industry and related to ensure POSECCA/PACT Act compliance, including satisfying registration requirements, and simultaneously helping them explore and craft creative solutions to avoid, or minimize, the operational effects of the USPS’ mailing restrictions.
For assistance, or more information, please contact Michael H. Sampson, co-leader of the firm’s Cannabis practice group and a partner in the firm’s Litigation practice group, at 412.261.1600 or email@example.com, or Jeffrey T. Criswell, a partner in the firm’s Litigation practice group, at 412.261.1600 or firstname.lastname@example.org.
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Leech Tishman Fuscaldo & Lampl is a full-service law firm dedicated to assisting individuals, businesses, and institutions. Leech Tishman offers legal services in business restructuring & insolvency, corporate matters, employment & labor, estates & trusts, intellectual property, litigation & alternative dispute resolution, and real estate. In addition, the firm offers a wide range of legal services to clients in the aviation & aerospace, cannabis, construction, energy & natural resources, healthcare, and hospitality industries. Headquartered in Pittsburgh, PA, Leech Tishman also has offices in Chicago, Los Angeles, New York, Philadelphia, Sarasota, Washington, D.C. and Wilmington, DE.