Shopify Inc. will prohibit all vapes from its platform this week due to pressure from a coalition of US state attorneys general who want to stop the sale of illicit e-cigarettes online, Reuters reported. Millions of merchants may operate and expand their e-commerce channels thanks to the underlying infrastructure provided by the Ottawa-based corporation.
A bipartisan coalition of 25 state attorneys general has been in talks with Shopify since last year. They have been pressuring Shopify to take more action to curb the growing market for vapes that don't have the necessary license for sales in the United States or break other laws, the report added.
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Despite being prohibited from being imported or sold, unlicensed vapes — which are typically manufactured in China — are easily accessible in the United States, both online and at vape shops, convenience stores, and gas stations.
The anticipated Shopify ban, which was originally reported by Reuters, would be the biggest victory to date for state law enforcement officials who have been focusing on the industry's infrastructure because of worries that illicit vapes endanger public health.
A Shopify representative said in a statement, "We've always forbidden illegal activity and take action when we become aware of merchants violating our policies." They said that these internal decisions take into account international legal frameworks and are not dependent on input from any particular group.
The representative stated, "When legal changes call for it, we adjust our enforcement approach."
One of the individuals claimed that the anticipated restriction may have a "chilling effect" on vendors and interfere with online sales.
British American Tobacco, whose U.S. business has been severely impacted by the spread of vapes, estimates that the illicit U.S. market for vapes is currently worth about $9 billion.
Only 45 e-cigarette brands, primarily tobacco-flavoured ones, have received marketing authorisation from the U.S. Food and Drug Administration so far. Large tobacco corporations like BAT claim that this strategy has suppressed the legal market and encouraged illicit sales.
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While vapes can only be sold in pharmacies in Australia, they are completely prohibited in other nations, such as India.
According to the two sources, all vapes in the United States will be subject to the Shopify prohibition, regardless of whether they have the necessary FDA authorisation.
According to one of the sources, just a small percentage of authorised vape sales in the United States take place online, which should have a limited impact on licensed players like BAT or e-cigarette manufacturer Juul. Although illicit vapes are primarily sold in physical storefronts, e-commerce is a more significant outlet.
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