Federal legislation passed and signed into law in late 2020 that prohibits most, if not all, vaping products from being shipped through the U.S. mail has been the cause of much consternation for businesses in the cannabis industry and beyond. Those businesses, though, received at least a temporary reprieve yesterday when the U.S. Postal Service (the “USPS”) announced that “despite [its] best efforts …, [it] is unable to publish a final rule by [yesterday’s] target date.” As a result, the implementation of the new restrictions has been delayed for some indeterminate period of time. Unfortunately, the delay is only temporary; a spokesman for the USPS emphasized that businesses still “should be prepared for implementation [of the new restriction] upon publication anytime.” Accordingly, cannabis- and vaping-related businesses should proactively consider and determine now how they will ship vaping products throughout the United States moving forward.
The PACT Act and its 2020 Amendment
The December 2020 amendments to the federal Prevent All Cigarette Trafficking Act (the “PACT Act”), which were part of the Consolidated Appropriations Act signed into law by the president on December 27, 2020, ban the shipping of “electronic nicotine delivery systems,” or “ENDS,” via the U.S. mail. Although nominally targeted at nicotine, the Act’s definitions are so broad as to also capture vaping products intended for use with cannabis only.
Pursuant to these recent amendments, which were titled the Preventing Online Sales of E-Cigarettes to Children Act, “ENDS” are 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). Specifically included within the 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.”
On February 19, 2021, the USPS published a notice in the Federal Register regarding implementation of the revisions to the PACT Act, inviting public comment. In its February notice, the USPS also stated that ENDS “will … become subject to the mailability restrictions and exceptions” of the PACT Act upon the USPS’ promulgations of final regulations. Pursuant to the PACT Act, those regulations were to have been promulgated by yesterday, April 26, 2021.
On April 19, 2021, one week prior the USPS’ deadline to promulgate final regulations, the USPS, however, published a second notice in the Federal Register, which was intended “to clarify the state of the exception [from the anticipated ban on mailability of ENDS] application process in advance of the final rule and to provide guidance to mailers interested in availing themselves of any exceptions that may ultimately be made available.”
Notably, the April notice provides that “[u]ntil the final rule is issued, ENDS are not subject to the PACT Act, although they may be nonmailable for other reasons.”
Preparing for USPS’ Anticipated Ban on Mailability of ENDS
The PACT Act does provide for limited exceptions to the ban on mailing cigarettes via the USPS. Of those exceptions, which are expected to apply to ENDS, the most relevant one to the cannabis/vaping industry likely is the exception allowing for business-to-business shipping. To qualify for this or other exceptions to the mailing ban, businesses must apply to the USPS. Per its April notice, the USPS has stated that it will not accept early exception applications but suggests that prospective applicants begin preparing for the application process by, among other steps, creating a spreadsheet that includes, but is not limited to, (i) the sender and recipient(s) of vaping devices, (ii) the USPS office(s) where the sender would tender shipments, (iii) the USPS office(s) that would receive the shipment(s), and (iv) the quantity and concentration of the products to be shipped.
The USPS’ suggestion is a good one, especially given that its final regulations will be effective immediately upon issuance. While the grant of an exception will not alleviate all onerous requirements, and all of the potentially devastating effects, of the USPS’ ban on the mailability of ENDS, proactively seeking and obtaining an exception, if and as applicable, can still be valuable.
Additionally, it is imperative that cannabis-related businesses explore shipping options other than the USPS. At present, it appears, however, that the other major players in the commercial shipping industry – FedEx, United Parcel Service (“UPS”), and DHL – have joined in the USPS’ ban on the mailability of ENDS, but it also appears that there at least one niche carrier is actively seeking to fill the void. Other, smaller private carriers may also be willing to ship ENDS.
Leech Tishman’s Cannabis Industry Group is ready and able to assist businesses in the cannabis and other industries to ensure PACT Act compliance, including satisfying registration requirements, and to simultaneously help them explore and craft creative solutions to avoid, or minimize, the operational effects of the recent amendment to the PACT Act. For assistance, or more information, please contact Michael H. Sampson, co-chair of the firm’s Cannabis Industry Group, at 412.261.1600 or firstname.lastname@example.org, or Jeffrey T. Criswell, a partner in the firm’s Litigation Practice Group, at 412.261.1600 or email@example.com.
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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 and Wilmington, DE.