Bipartisan Coalition Of 25 Attorneys General Pressured Shopify After $9 Billion Illegal Vape Market Grew
According to Reuters, Shopify Inc will ban all vapes from its platform as soon as this week following pressure from a bipartisan coalition of 25 US state attorneys general aiming to curb sales of illegal e-cigarettes online.
The Ottawa-based company, which provides the underlying infrastructure for millions of merchants to operate e-commerce channels, has been in talks since last year with the coalition pushing it to crack down on vapes that lack the legally required licence for US sales. Unlicensed vapes, usually manufactured in China, are widely available online and in stores despite being illegal to import or sell.
The ban will apply to all vapes in the US regardless of whether they hold FDA authorisation. The FDA has to date granted marketing authorisation to just 45 e-cigarette products, mostly tobacco-flavoured. The illegal US vape market is currently worth roughly $9 billion, according to British American Tobacco, whose US business has been hit hard by their proliferation.
A relatively small portion of authorised vape sales occur online, meaning the ban should have limited effect on licensed players like BAT or Juul. Separately, Mastercard warned partners in May that unlicensed vape sales violate its network standards.
Shopify is not going after vapes. Regulators went after Shopify first, and Shopify blinked.
Check out our previous coverage of e-commerce regulation and consumer tech here.
