The new and very strict vape shipping regulations introduced in America known as the PACT act is causing big issues for American e-liquid brands in the UK.
Your have probably noticed that the stock level of brands such as Kai’s Virgin Vapor, Kind Juice and our very own Vape Green e-liquid line (which is made in America) is currently extremely low. This is due to the new shipping regulations introduced in America where all of these e-liquids are being manufactured.
In December of 2020 a new ban on shipping of vape products was introduced in America, this new law is enforced by the ATF which is an actual police agency that takes its enforcement mandate very serious. This has caused most mainstream couriers to completely ban shipping of vape products, even if it is from America in to the UK.
How does the US PACT shipping ban affect the UK market?
Whilst some of the bigger American e-liquids brands have managed to moved some of the production of e-liquids intended for the UK market in to the UK by partnering up with other already established UK e-liquid manufacturers. Many American brands are still producing all their e-liquids in the US, for these companies it will be extremely hard as they are now facing serious shipping challenges.
Companies such as Fedex, UPS and DHL will no longer carry their packages from the US in to the UK.
Whilst USPS (United States Postal Service) have exemptions for B2B, these are complicated, expensive and brutally cumbersome to say the least.
Any manufacturer wishing to ship their products via USPS to a retailer must submit an application where they provide the name and addresses of all the businesses they will be shipping to. They also need to provide a list of all their customers licenses.
If they want to add new customers, or change the address of an existing customer they must update this and get it approved by USPS before they can ship any products to the new address.
Perhaps the most bizarre rule is that they must apply to each individual post office they will ship from, if approved they can then only ship from these approved branches.
Once approved, all packages will have to be physically carried into the post office, and processed in a face-to-face transaction. Shippers are restricted to three Priority Mail options. Each package must have attached a request for PS Form 3811 return receipt, which must bear the sender‘s PACT eligibility number and other specific information, some of which must be identical to that listed on the shipper’s B2B tobacco application. The receiving business has another set of steps to follow.
American E-Liquid manufacturers must come up with entirely new shipping eco systems by themselves.
Understandably these new requirements are not practical for any manufacturer that ships a lot of parcels as it would be impossible to send dozens or hundreds of large packages a day this way. This would require manufacturer to hire staff that does nothing else but visit the post office daily, que up, fill out the forms and send these parcels.
“Unless you’re shipping just two or three packages a day, USPS isn’t going to work. I’d have to physically go into the post office and fill out one of those little green cards for each package,” says Mi-One’s Geoff Habicht. “Nobody will do that.”
That leaves manufacturers and wholesalers in the same boat as online retailers: they will have to create a private network of shipping companies to carry products. And while the PACT Act requirements are somewhat less strict for businesses, vape shippers are still stuck with nearly the same tax compliance and reporting issues.
The wholesale segment of the vaping industry is fairly accustomed to the world of shipping freight. But with the big carriers out of the picture.
The freight industry is a huge collection of national, regional and local carriers that deliver full truckloads, LTL (less-than-truckload), and smaller parcels. Vaping businesses will have to assemble ad hoc networks from the existing companies—after assessing shippers’ willingness to carry nicotine and vaping products—and create logistics systems that can manage deliveries between the various manufacturers, distribution warehouses, and vape shops.
Many American e-liquid manufacturers and online retailers will probably not survive.
Needles to say, manufacturers that do not have extremely large pockets will not survive this transition. This will require time, and time spent trying to solve a problem whilst not taking any money is hard unless you have a lot of money saved up for a rainy day.
This will also see alot of US based online retailers close down wich will result in a lot of adults going back to smoking. Finding the right e-liquid that tastes good to you can be difficult as it will requires a lot of experimentation. Needless to say a lot of smokers will go back to smoking after having to try chemical tasting e-liquids and vapes found at their nearest petrol station.
As of the 20th of September 2021 Kai’s Virgin Vapor has put a notice on their website saying that they will have to close their business after 11 years in the industry due to the new FDA rules and regulations in America.
You can read their article here.
Image from Kai’s Virgin Vapor website.