[Federal Register Volume 86, Number 201 (Thursday, October 21, 2021)]
[Rules and Regulations]
[Pages 58398-58431]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-22787]
[[Page 58397]]
Vol. 86
Thursday,
No. 201
October 21, 2021
Part II
Postal Service
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39 CFR Parts 111 and 211
Treatment of E-Cigarettes in the Mail; Final Rule
Federal Register / Vol. 86 , No. 201 / Thursday, October 21, 2021 /
Rules and Regulations
[[Page 58398]]
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POSTAL SERVICE
39 CFR Parts 111 and 211
Treatment of E-Cigarettes in the Mail
AGENCY: Postal ServiceTM.
ACTION: Final rule.
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SUMMARY: The Postal Service revises its regulations in Publication 52,
Hazardous, Restricted, and Perishable Mail, to incorporate 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.
DATES: This rule is effective October 21, 2021.
FOR FURTHER INFORMATION CONTACT: Dale E. Kennedy, Director, Product
Classification, at 202-268-6592.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background
II. Summary of Final Rule
III. Response to Comments
A. Lack of Policy Discretion
1. Extra-Statutory Expansion of Mailability
2. Extra-Statutory Restriction of Mailability
3. Effective Date
B. Constitutionality
C. Relation to Other Laws
1. FDA Regulation of Certain ENDS as ``Tobacco Products''
2. Laws Regarding Marijuana, Hemp, and Hemp Derivatives
3. Other Issues
D. Scope of Covered ENDS Products
1. Non-Nicotine-Related ENDS Products Generally
i. Relation to Nicotine and Flavor
ii. Relation to Listed Devices
iii. Legislative History of the POSECCA
2. Products That Aerosolize Non-Solution Solids
3. Heat-Not-Burn Cigarettes
4. Products That Release Aerosols Into Ambient Air, Not for
Direct Inhalation
5. Natural vs. Synthetic Nicotine
6. Precursors
E. Exclusion of Tobacco Cessation and Therapeutic Products
F. Intra-Alaska and Intra-Hawaii Shipments
G. Business/Regulatory Purposes Exception
1. Availability in General
2. Eligible Parties
3. Application Process
4. Documentation of Legally Operating Status
5. Qualifying Postal Service Products
6. Methods of Tender
7. Delivery Requirements
H. Certain Individuals Exception
I. Consumer Testing and Public Health Exceptions
1. Testing by Manufacturers
2. Testing by Federal Agencies
3. Testing by Public-Health Researchers
J. Other Issues
1. International and Overseas Military/Diplomatic Mail
2. Reasonable Cause
3. Terminology
4. Communications
5. Enforcement
6. Availability of Rules' Text
7. Updates
IV. Explanation of Changes From Proposed Rule
I. Background
The Postal Service hereby amends Publication 52, Hazardous,
Restricted, and Perishable Mail, with the provisions set forth herein.
While not codified in Title 39, Code of Federal Regulations (``CFR''),
Publication 52 is a regulation of the Postal Service, and changes to it
may be published in the Federal Register. 39 CFR 211.2(a)(2). Moreover,
Publication 52 is incorporated by reference into Mailing Standards of
the United States Postal Service, Domestic Mail Manual (``DMM'')
section 601.8.1, which is incorporated by reference, in turn, into the
Code of Federal Regulations. 39 CFR 111.1, 111.3. Publication 52 is
publicly available, in a read-only format, via the Postal
Explorer[supreg] website at https://pe.usps.com. In addition, links to
Postal Explorer are provided on the landing page of USPS.com, the
Postal Service's primary customer-facing website; and Postal Pro, an
online informational source available to postal customers.
On February 19, 2021, the Postal Service published a notice of
proposed rulemaking (86 FR 10218) to implement the Preventing Online
Sales of E-Cigarettes to Children Act (``POSECCA''), Public Law 116-
160, div. FF, title VI (2020). Section 602 of the POSECCA adds
``electronic nicotine delivery systems'' (``ENDS'') to the definition
of ``cigarettes'' subject to regulation under the Jenkins Act, codified
at 15 U.S.C. 375 et seq. As a result, ENDS are now subject not only to
rules and restrictions governing remote sales under the Jenkins Act,
but also to separate restrictions and exceptions for postal shipments,
which rely on the same definition. 18 U.S.C. 1716E(a)(1). Section 603
of the POSECCA requires the Postal Service to promulgate implementing
regulations and provides that the prohibition on mailing ENDS will
apply immediately ``on and after'' the date of this final rule.
The statutory framework into which ENDS must now fit was
established by the Prevent All Cigarette Trafficking Act of 2009
(``PACT Act''), Public Law 111-154, sec. 3, 124 Stat. 1087, 1103-1109
(2010), codified at 18 U.S.C. 1716E. Briefly, the PACT Act allows
cigarettes and smokeless tobacco to be mailed only in the following
circumstances:
Intra-Alaska and Intra-Hawaii Mailings: Intrastate shipments within
Alaska or Hawaii;
Business/Regulatory Purposes: Shipments between verified and
authorized tobacco-industry businesses for business purposes, or
between such businesses and federal or state agencies for regulatory
purposes;
Certain Individuals: Lightweight, noncommercial shipments by adult
individuals, limited to 10 shipments per 30-day period;
Consumer Testing: Limited shipments of cigarettes sent by verified
and authorized manufacturers to adult smokers for consumer testing
purposes; and
Public Health: Limited shipments of cigarettes by federal agencies
for public health purposes under similar rules applied to manufacturers
conducting consumer testing.
18 U.S.C. 1716E(b)(2)-(6). Outside of these exceptions, the Postal
Service cannot accept or transmit any package that it knows, or has
reasonable cause to believe, contains nonmailable smokeless tobacco or
cigarettes. Id. at (a)(1).
Nonmailable cigarettes and smokeless tobacco deposited in the mail
are subject to seizure and forfeiture. 18 U.S.C. 1716E(c). Senders of
nonmailable cigarettes or smokeless tobacco are subject to criminal
fines, imprisonment, and civil penalties, in addition to enforcement
under other Federal, State, local, and Tribal laws. Id. at (d), (e),
(h).
In inviting public comment, the notice of proposed rulemaking
highlighted certain topics on which comments would be especially
helpful: The definition of ENDS, appropriate ``catch-all'' terminology,
standards for determining mailability, and the potential applicability
of the PACT Act's exceptions, particularly the Consumer Testing and
Public Health exceptions. 86 FR 10219-10220. We received more than
15,700 comments on these and other topics, most of which appear to be
electronically generated form letters and general expressions of ENDS
users' dissatisfaction with the POSECCA.
In considering the comments, and in view of Congress's abrogation
of the standard 30-day notice period for a final rule under the
Administrative Procedure Act (``APA''), see id. at 10220, the Postal
Service determined that additional guidance might assist the industry
in preparing for the final rule. On April 19, 2021, the Postal Service
published a guidance document (``April 2021 Guidance'') (86 FR 20287)
on two topics. First, the Postal Service informed ENDS industry
participants that it
[[Page 58399]]
would not accept exception applications until the final rule had been
issued, but that industry participants might instead use the
intervening period to compile various types of documentation for
submission with exception applications following the final rule (should
such exceptions be made available). Second, the Postal Service reminded
ENDS industry participants that, regardless of the impending
applicability of PACT Act restrictions or exceptions, certain ENDS
products are currently, and will remain, subject to other mailability
prohibitions and restrictions (e.g., cannabis and other controlled
substances, drug paraphernalia, lithium batteries, liquids, certain
chemicals found in ENDS liquids, and certain advertisements and
promotional materials). Readers of this final rule are encouraged to
review the April 2021 Guidance and Publication 52 overall for
additional information on these prohibitions and restrictions, which
can render even a PACT-Act-exempt item nonmailable.
II. Summary of Final Rule
ENDS products are generally nonmailable, except as authorized by an
exception, and then only if all PACT-Act-related and non-PACT-Act-
related conditions of mailability are met. Congress did not grant the
Postal Service authority to make policy decisions to waive or defer the
operation of the POSECCA, to create new PACT Act exceptions, or to
expand, restrict, or modify the scope of existing exceptions, beyond
the reasonable application of the conditions enumerated in the PACT
Act.
ENDS products comprise (1) any electronic device that, through an
aerosolized solution, delivers nicotine, flavor, or any other substance
to the user inhaling from the device; and (2) any component, liquid,
part, or accessory of an ENDS, regardless of whether sold separately
from the device. This statutory definition resides in the Jenkins Act,
which is administered by the Bureau of Alcohol, Tobacco, Firearms, and
Explosives (``ATF''), and inquiries about whether specific products are
covered should be directed to ATF. Provisionally, however, certain
aspects of the definition are apparent from the plain statutory
language, such as that a user must inhale from the device and that a
covered ENDS product must be, or be capable of use with, a liquid
solution. At the same time, Congress expressly provided that covered
ENDS products extend beyond nicotine-related use, as relevant products
may deliver ``nicotine, flavor, or any other substance.''
The POSECCA excludes from the mailing ban any ENDS product that is
approved by the U.S. Food and Drug Administration (``FDA'') for sale as
tobacco cessation products or for other therapeutic purposes and
marketed and sold solely for such purposes. At this time, the FDA has
not approved any such devices or drugs.
The statutory parameters for the Intra-Alaska/Intra-Hawaii,
Business/Regulatory Purposes, and Certain Individuals exceptions are
compatible with and administrable for ENDS products, and so they will
be made available for such products.
The preexisting centralized application process for the Business/
Regulatory Purposes exception will be extended to ENDS products, albeit
with certain modifications to improve administration. Other,
statutorily-derived requirements relating to acceptance and delivery
will apply to ENDS products in like manner to cigarettes and smokeless
tobacco. For example, approved shippers of Business/Regulatory Purposes
mailings must use specified product combinations that allow for age and
identity verification at delivery (e.g., Priority Mail with Adult
Signature service) and must tender items in a face-to-face transaction
either at a Postal Service retail office or at a Postal Service
business mail acceptance location. For clarity, product combinations
that include Adult Signature service can receive normal carrier
delivery, subject to identity and age verification.
The Certain Individuals exception will apply to ENDS products,
subject to all of the same frequency, weight, age-verification, and
other conditions that apply to other shipments covered by the PACT Act.
By statute, this exception applies to qualifying shipments by
individual adult mailers without regard to the nature of the recipient
entity, expressly including the return of damaged or unacceptable
products to manufacturers. Among other conditions, however, the statute
limits the exception to shipments for noncommercial purposes. Thus, the
compatibility of ENDS manufacturers' recycling programs with this
exception may depend on whether such programs are structured so as not
to involve any exchange of commercial value. The final rule also
clarifies the standard for noncommercial purposes in the context of
returns of damaged or unacceptable products, to the effect that any
value provided in exchange for the returned item cannot exceed that
which would restore the sender to the status quo ante.
As for the Consumer Testing and Public Health exceptions, it is
apparent that Congress intended those exceptions to apply only to
combustible cigarettes, and not to ENDS products or smokeless tobacco.
First, the Consumer Testing exception is statutorily restricted to
cigarette manufacturers with a permit under section 5713 of the
Internal Revenue Code (``IRC''), which does not apply to ENDS
manufacturers. Second, shipments under the Consumer Testing exception
(and, by extension, the Public Health exception) are expressly limited
to specified quantities of ``packs of cigarettes'' containing 20
cigarettes each. This standardized quantification is meaningful in the
context of combustible cigarettes, but not in the context of ENDS
products or smokeless tobacco. Upon consideration of the public
comments, there does not appear to be a workable standard by which to
apply this material condition for the Consumer Testing and Public
Health exceptions to ENDS products, notwithstanding their treatment as
``cigarettes'' for broader purposes of the PACT Act. Given this
context-based plain reading of the statute and the narrow construction
typically due exceptions, the Postal Service concludes that current law
does not support applying these exceptions to ENDS products.
Upon original implementation of the PACT Act, the Postal Service
determined that the PACT Act exceptions cannot feasibly be applied to
inbound or outbound international mail or to mail to or from the Freely
Associated States. The Postal Service cannot fulfill the PACT Act's
verification requirements in locations where it does not interact
directly with shippers and addressees. Nothing has changed in that
regard. As such, all cigarettes and smokeless tobacco in such mail will
continue to be nonmailable, without exception, and the same will be
true of ENDS products.
Moreover, consultation with partner agencies regarding the PACT
Act's requirements and the availability of relevant postal services has
indicated that the statutory prerequisites for the PACT Act's
exceptions cannot reliably be fulfilled at overseas U.S. military
postal addresses. Thus, while shipments from such installations to the
United States were already ineligible for any PACT Act exceptions,
shipments from the United States to such installations must likewise be
ineligible for the exceptions at this time.
III. Response to Comments
The Postal Service received more than 15,700 responses to the
notice of
[[Page 58400]]
proposed rulemaking, several of which included comments on multiple
topics. Commenters included businesses that ship ENDS products;
individual consumers of ENDS products; organizations representing ENDS
shippers and/or consumers; organizations representing taxpayer and/or
business interests generally; a group of state and local attorneys
general; public-health researchers, research institutions, and advocacy
organizations; and a number of individual law students. In addition,
the Postal Service consulted informally with ENDS researchers, industry
participants, State and local attorneys general, and Federal agencies
involved in regulating tobacco and ENDS products. Comments and Postal
Service responses are summarized as follows.
A. Lack of Policy Discretion
1. Extra-Statutory Expansion of Mailability
A large number of ENDS consumers, ENDS shippers, and some law
students (collectively, ``pro-ENDS commenters'') urged the Postal
Service not to subject ENDS products to the PACT Act. As rationales,
these commenters invoked the purported public benefits associated with
ENDS products; the impact of a mailing ban on businesses and the Postal
Service; the possibility of unanticipated and even perverse economic,
distributive, and public-health effects of a mailing ban; doubts about
the role that the mails may play in youth access to ENDS products
(perceived to be the policy motivation for the mailing ban); skepticism
about enforceability; \1\ perceived hypocrisy in the roster of mailable
and nonmailable items; \2\ and concerns about restriction of individual
liberty.
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\1\ These last two sets of arguments, typically expressed by
ENDS consumers, are in tension with one another: One holds that
youth do not tend to get ENDS products through the mails, the other
that youth will continue to access ENDS products through the mails
regardless.
\2\ Some ENDS consumers expressed outrage that ENDS products
should be nonmailable while alcohol, cigarettes, firearms, gun
parts, lettuce, marijuana, and other controlled substances
supposedly remain mailable. In fact, each of these types of items is
nonmailable in at least some--and, in some cases, most or all--
circumstances. See Publication 52 subchapters 42, 43, 47, 53 & part
453.
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A number of ENDS consumers and shippers also proposed that the
Postal Service implement some alternative method of regulating the
mailability of ENDS products, in lieu of the PACT Act's ban and
exceptions. Proposals included the following:
Permit the mailing of ENDS products with age verification
of recipients.
Permit the mailing of ENDS products with warning labels.
Permit the mailing of ENDS products under the same
conditions provided for non-postal delivery channels under the Jenkins
Act (as amended by section 2 of the PACT Act).
Allow the ENDS industry to regulate itself, subject to a
requirement to conduct age verification of consumers.
Limit mailability to ENDS products containing less than a
specified threshold of nicotine.
Limit mailability to non-nicotine-containing ENDS
products.
Limit mailability to single-use ENDS products.
Scale mailability restrictions according to a policy-based
hazard assessment of the product, shipper, and recipient.
In addition, some public-health-oriented commenters and law
students, as well as some Federal agency partners with which the Postal
Service consulted, proposed that the Postal Service ensure that ENDS
products can be shipped in circumstances not covered by any statutory
exception, such as between public-health researchers and individual
test subjects; between governmental actors for enforcement,
investigative, or testing purposes; and from the government to non-
governmental public-health entities. These commenters invoked the
interests of promoting public-health research into and effective
regulation of ENDS products. Many of these stakeholders also urged the
Postal Service to allow use of the Public Health exception for ENDS
products on policy grounds and to allow ENDS-industry businesses to
ship ENDS products to governmental actors for any regulatory purpose,
without regard to the statutory parameters of the existing PACT Act
exceptions.
Finally, a number of commenters of varying orientations--including
some in the ENDS industry--acknowledged that the POSECCA charges the
Postal Service merely with incorporating ENDS products into the
existing PACT Act framework, rather than authorizing it to revisit and
alter that framework.
The latter group of commenters is correct: In this context, the
Postal Service lacks the authority to adopt a regulatory scheme
different from what Congress has prescribed. In general, the Postal
Service, as part of the Executive Branch, is bound to faithfully
execute the laws enacted by Congress and can act only within the scope
of discretion that Congress has delegated to it. U.S. Constitution
article I, section 1; id. at article II, section 3; see, e.g., Gundy v.
United States, __U.S. __, __, 139 S. Ct. 2116, 2123 (2019). The PACT
Act expressly provides that cigarettes and smokeless tobacco are
generally nonmailable, that the Postal Service generally may not accept
them for delivery or transmit them through the mails, and that those
prohibitions give way only in circumstances defined by a number of
statutory parameters and conditions. 18 U.S.C. 1716E(a)-(b). The
POSECCA extends that treatment to ENDS products by including them
within the term ``cigarette.'' POSECCA section 602(a)(1)(C).
Neither the PACT Act nor the POSECCA includes any provision
authorizing the Postal Service to waive the mailing ban for ENDS
products or any other subcategory of ``cigarettes,'' with or without
other regulatory conditions devised by the Postal Service (e.g., age
verification, nicotine limits). In particular, the POSECCA charges the
Postal Service only with ``clarify[ing] the applicability'' of the PACT
Act's mailing ban to ENDS products. POSECCA section 603(a).
Clarification means to make something clear or understandable or to
dispel confusion, presupposing the pre-establishment of the proposition
being clarified: A self-evidently modest task that falls far short of
substantive change to that proposition. See Clarify, Merriam-Webster.com (last visited Oct. 14, 2021). As such, whatever policy
judgments the Postal Service might reach as to public-health effects,
commercial impact, the need to facilitate effective regulation, or
other considerations, those judgments have already been made by
Congress in legislating that ENDS products cannot be mailed except in
statutorily prescribed circumstances.
Congress could have left ENDS products mailable, subjected them to
alternative restrictions (as section 2 of the PACT Act does for non-
postal delivery carriers), or delegated authority to the Postal Service
to grant waivers, create new exceptions, or devise some other
appropriate mailability scheme. Cf. 18 U.S.C. 1716(b)-(e) (authorizing
the Postal Service to permit or limit the mailing of potentially
hazardous materials); 39 U.S.C. 3018(b) (giving the Postal Service
discretion to declare hazardous materials to be nonmailable or to
restrict the time, place, and manner of their mailing). Yet Congress
did none of those things. Instead, it chose to bar the Postal Service
from carrying ENDS products, except pursuant to a limited set of
specifically delineated statutory exceptions. See
[[Page 58401]]
Treatment of Cigarettes and Smokeless Tobacco as Nonmailable Matter, 75
FR 29662, 29664 (2010) (notice of final rule); see also Gordon v.
Holder, 721 F.3d 638, 657 (D.C. Cir. 2013) (declining, on rational
basis review, to ``second-guess the wisdom of [Congress's] choice'' to
enact the PACT Act's mailing ban in lieu of some alternative measure).
In sum, arguments to relax the PACT Act's application to ENDS
products on policy grounds are misdirected to the Postal Service.
Whatever the merits of ENDS products generally or the anticipated
effects of the POSECCA, the forum for that debate is Congress, which
has declined to delegate, and thus has reserved to itself, policy
discretion over the pertinent parameters.
2. Extra-Statutory Restriction of Mailability
Conversely, some public-health-oriented commenters, State and local
attorneys general, law students, and other individual commenters
(collectively, ``anti-ENDS commenters'') urged the Postal Service to
deny or restrict the application of the PACT Act's exceptions to ENDS
products, due to concerns about hazardous materials, controlled
substances, public health, youth access, and the purported risk of
circumventing law enforcement.
For the reasons discussed in the preceding section, neither the
PACT Act nor the POSECCA authorizes the Postal Service to make policy
judgments to narrow or rescind the availability of the statutory
exceptions. Cf. 18 U.S.C. 1716(d)-(e). The parameters of the exceptions
are expressly set forth in the statute. Notwithstanding some limited
interpretive and administrative latitude in implementing the statute,
the Postal Service cannot repeal, disregard, or amend the statute's
explicit parameters on policy grounds. Like policy arguments to relax
the PACT Act for ENDS products, policy arguments to tighten it should
be directed to Congress, not the Postal Service. See United States v.
Rodgers, 466 U.S. 475, 484 (1984) (``Resolution of the pros and cons of
whether a statute should sweep broadly or narrowly is for Congress.'').
Moreover, the public-health and worker-safety concerns raised by
certain public-health-oriented commenters are already addressed by
statutes and regulations independent of the PACT Act. As noted in the
April 2021 Guidance, ENDS products that constitute controlled
substances or drug paraphernalia are nonmailable regardless of whether
the PACT Act would also preclude mailability. 21 U.S.C. 843(b)-(c),
863; Publication 52 part 453; see 86 FR at 20289.
Likewise independently of the PACT Act's application, liquids and
hazardous materials are also nonmailable to the extent that the shipper
has not observed applicable mailing requirements and restrictions. 18
U.S.C. 1716(a), (h); 39 U.S.C. 3018; DMM section 601.3.4; Publication
52 chapter 3 & parts 451, 711-728 & app. A, C; see 86 FR at 20289. The
hazardous-materials rules already embody determinations by the
Department of Transportation, the Postal Service, and other relevant
authorities about how to balance worker safety against commercial
interests, resulting in, for example, differing levels of restriction
and mailing requirements for differing concentrations of nicotine.\3\
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\3\ One public-health-oriented commenter opined that PACT Act
exceptions should be disallowed for ENDS products because they may
contain hazardous materials and yet be transported by air, including
in intrastate shipments pursuant to 18 U.S.C. 1716E(b)(2). But many
hazardous materials are not categorically barred from air
transportation; rather, they can be transported by air
transportation so long as they are properly prepared and labeled
and/or are packaged in limited quantities. See Publication 52 parts
327, 331-337, 343, 346, 349. To the extent that these restrictions
are not observed, then--as was the case prior to this final rule--an
ENDS shipment is nonmailable under the hazardous-materials rules
regardless of the PACT Act.
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That said, the public-health-oriented commenters rightly point out
that the broad array of covered ENDS products is more likely than
cigarettes and smokeless tobacco to implicate mailability rules outside
of the PACT Act. ENDS products include or may contain lithium
batteries, as well as nicotine and other chemicals that are flammable
or toxic. See April 2021 Guidance, 86 FR at 20289; Harmful and
Potentially Harmful Constituents in Tobacco Products; Established List;
Proposed Additions; Request for Comments, 84 FR 38032, 38033-38034
(2019). Once again, all mailers, including businesses, individuals, and
governmental entities that may ship ENDS products pursuant to the PACT
Act's exceptions, are strongly encouraged to review and comply with all
pertinent statutes and Postal Service regulations.\4\ ENDS
manufacturers and distributors are further encouraged to educate ENDS
consumers about the need to ensure that any further mailing of ENDS
products conforms to applicable legal requirements regarding controlled
substances, drug paraphernalia, and potentially hazardous materials, in
addition to the PACT Act.
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\4\ As noted in the April 2021 Guidance, advertisements and
promotional or sales matter regarding controlled substances and
certain hazardous materials are generally also nonmailable. 18
U.S.C. 1716(h); 21 U.S.C. 843(b), (c)(1); DMM section 601.9.4.1; 86
FR at 20289.
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3. Effective Date
Some pro-ENDS commenters proposed that, if the Postal Service does
implement the mailing ban, the Postal Service should defer its
effective date or exercise its enforcement discretion to effectively
allow the continued mailing of ENDS products for some period (e.g., a
period long enough to allow some segment of the ENDS industry to apply
for and receive authorization to use the Business/Regulatory Purposes
exception). One ENDS consumer urged the Postal Service to stay
implementation until after the COVID-19 pandemic, and another suggested
a delay in the general interest of facilitating industry compliance and
reducing diversion to the black market. A law student suggested that
the Postal Service could delay implementation in areas where brick-and-
mortar stores do not meet ENDS demand.
The Postal Service lacks discretion as to the effective date. The
POSECCA expressly provides that the prohibition will apply to mailings
of ENDS ``on and after'' the publication date of the final rule.
POSECCA section 603(b). If anything, it is the effective date of any
applicable PACT Act exceptions, and not the PACT Act's general mailing
ban, about which the POSECCA is silent. Whatever transition-related
challenges that the POSECCA's effective date might pose on the industry
(despite having had an extended period to prepare for the mailing ban),
Congress conferred no authority on the Postal Service to derogate from
the requirement that the final rule have immediate effect.
As for enforcement discretion, the scope of the Postal Service's
enforcement discretion under the PACT Act is the subject of ongoing
litigation. See generally City of New York v. U.S. Postal Serv., No.
1:19-CV-05934 (E.D.N.Y. filed Oct. 22, 2019). To the extent that the
Postal Service can exercise discretion as to enforcement of the PACT
Act, however, the Postal Service declines to exercise it in the manner
proposed by the commenters here. While law-enforcement discretion can
encompass decisions not to enforce a law, such decisions are expressly
and exclusively vested in the relevant Executive Branch entity, which
must balance policy and resource considerations, and are not amenable
to judicial review. E.g., Heckler v. Chaney, 470 U.S. 821, 831-32
(1985). The Postal Service does not regard the commenters' proposal--in
effect, implementing the POSECCA on paper only while broadly
[[Page 58402]]
maintaining the status quo ante in practice--to be a viable or
preferable exercise of its law-enforcement discretion.
B. Constitutionality
A number of pro-ENDS commenters advanced various theories as to the
supposed unconstitutionality of the POSECCA and the proposed
implementing regulations: They would impair the rights of adults to
receive ENDS through the mails; the law is too vague; and the POSECCA
is overbroad in its impact on adult users of ENDS products, not only
minors.
As an initial matter, the constitutionality of the POSECCA has no
bearing on the Postal Service's obligation to execute it. As discussed
in section III.A.1, the Constitution requires the Postal Service, as an
entity within the Executive Branch, to faithfully execute the laws.
U.S. Constitution article II, section 3. By contrast, ``it is,
emphatically, the power and duty of the [Judicial Branch], to say what
the law is.'' Marbury v. Madison, 5 U.S. (1 Cranch) 137, 177 (1803).
For the Postal Service unilaterally to decide not to execute a duly
enacted law on constitutional grounds would abdicate its constitutional
duty and usurp the powers of the Legislative and Judicial Branches. See
Ameron, Inc. v. U.S. Army Corps of Engineers, 787 F.2d 875, 889 & n.11
(3d Cir. 1986) (the President can ``veto, criticize, or even refuse to
defend in court, statutes which he regards as unconstitutional,'' but
may not refuse to execute them on constitutionality grounds) (citing
Marbury and other significant Supreme Court opinions to that effect);
see also Am. Coalition for Competitive Trade v. Clinton, 128 F.3d 761,
766 n.6 (D.C. Cir. 1997) (``administrative agencies . . . cannot
resolve constitutional issues''). As such, barring a contrary judicial
determination, any concerns about the POSECCA's constitutionality are
no bar to its Congressionally mandated implementation by the Postal
Service.
That said, by all indications, the relevant statutes appear to be
constitutional. Congress has plenary powers to enact laws governing the
postal system, as well as to regulate interstate commerce and commerce
with foreign and Tribal nations. U.S. Constitution article I, section
8, clauses 3, 7. In exercising those powers, Congress's authority to
ban a class of products from the mails--even those that are legal in
all States and that are not harmful to Postal Service personnel--is
well-established: Indeed, Congress has historically done so with a
number of other such products. U.S. Postal Serv. v. Council of
Greenburgh Civic Ass'ns, 453 U.S. 114, 126 (1981) (``The validity of
legislation describing what should be carried has never been
questioned. The power possessed by Congress embraces the regulation of
the entire Postal System of the country. The right to designate what
shall be carried necessarily involves the right to determine what shall
be excluded.'') (quoting Ex parte Jackson, 96 U.S. 727, 732 (1878))
(cleaned up); Gordon, 721 F.3d at 656; Musser's Inc. v. United States,
1 F. Supp. 3d 308, 318 (E.D. Pa. 2014). The PACT Act's mailing ban in
particular has been upheld as a rational exercise of Congress's
constitutional powers. Gordon, 721 F.3d at 657; Musser's, 1 F. Supp. at
318.
Given Congress's plenary power over the very existence of the
postal system, it cannot be said that there is a fundamental right to
mail any particular item, let alone ENDS products, and shippers or
users of ENDS products do not constitute a protected class any more
than shippers or users of cigarettes or smokeless tobacco. See Gordon,
721 F.3d at 657 (regarding the PACT Act as a ``law that does not
infringe on a fundamental right or involve a suspect classification'').
As such, Congress's action is presumptively legitimate as long as any
rational basis is conceivable. Id. at 656-57 (plaintiff challenging the
PACT Act must meet a ``high burden to negative every conceivable basis
which might support'' it) (quoting FCC v. Beach Communs., Inc., 508
U.S. 307, 315 (1993)).
It does not require much to conceive of a legislative rationale in
this case. Although the task is ``by no means restricted to the stated
reasons for passing a law,'' the statute here expressly offers multiple
rational bases for a mailing ban on ENDS products. See id. at 657.
By modifying the PACT Act's definition of ``cigarettes'' to extend
to ENDS products, the 116th Congress effectively incorporated ENDS
products into the statement of findings and purposes underlying the
PACT Act. Public Law 111-154, sec. 1(b)-(c), 124 Stat. 1087-1088. For
example, the 116th Congress presumably believed that ``the sale of
illegal cigarettes [now including ENDS products] and smokeless tobacco
over the internet, and through mail, fax, or phone orders, makes it
cheaper and easier for children to obtain tobacco products'' and that a
mailing ban would ``prevent and reduce youth access to inexpensive
cigarettes [including ENDS products] and smokeless tobacco through
illegal internet or contraband sales'': Indeed, the title of the
POSECCA and the relevant House committee report indicate as much. See
id. at section 1(b)(4)-(5), (c)(6); H. Rept. 116-260 at 3-4 (2019).
Contrary to the commenters' overbreadth argument, the PACT Act's
purposes are not limited to youth access. Other stated purposes of the
PACT Act--combating illegal trafficking, circumvention of state and
local laws, and unfair competition with law-abiding retailers--
implicate adult as well as youth consumers and can apply as easily to
ENDS products as to cigarettes and smokeless tobacco. See id. at
section 1(b)(1)-(3), (b)(6)-(7), (c)(1)-(5); Gordon, 721 F.3d at 657.
So, too, can Congress's judgment that an outright ban on the
mailing of ENDS products, notwithstanding the applicability of other,
more targeted requirements and enforcement opportunities, is necessary
to address these harms. Gordon, 721 F.3d at 657.
As discussed in section III.D.1.iii, many pro-ENDS commenters
questioned the evidence of legislative intent to ban the mailing of
ENDS products that do not contain nicotine. For purposes of the
constitutionality discussion here, it is noted that plain language of
the statute makes that intent clear, and the legislative history does,
in fact, attest to the framers' public-health concerns in relation to
non-nicotine-related ENDS products. Even without such expressions of
intent, however, there would certainly be a rational basis for Congress
to have specified the POSECCA's breadth as it did. Given operational
and legal constraints, it is not simple--indeed, it is generally
impossible--for Postal Service personnel prohibited from accepting or
transmitting ENDS products to distinguish liquids that contain nicotine
from those that do not, and it is equally difficult for acceptance
personnel to distinguish devices intended to be used with nicotine-
containing versus non-nicotine-containing liquids. Even barring any
more specific motive for banning non-nicotine-related ENDS products
from the mails, it would be conceivable that Congress intended to
ensure effective enforcement against nicotine-related ENDS products,
rather than letting a safe harbor for non-nicotine-related ENDS
products get in the way of advancing Congress's nicotine-related policy
concerns.
Again, however, such speculation is unnecessary, because the youth-
access and public-health concerns underlying the POSECCA were not
restricted to nicotine. The relevant House committee report cites
information from the Centers for Disease Control and Prevention (CDC)
about lung injuries associated with the use of ENDS
[[Page 58403]]
products, which were ultimately--after the committee report but prior
to floor debate on and passage of the POSECCA--attributed to non-
nicotine constituents of ENDS liquids. H. Rept. 116-260 at 3 & nn.22-23
(citing CDC, Outbreak of Lung Injury Associated with the Use of E-
Cigarette, or Vaping, Products, https://go.usa.gov/xHd78 (last updated
Feb. 25, 2020)). There is no indication in the legislative record that
the POSECCA framers' concern about ENDS-related lung injuries was
conditional upon or limited to any eventual nexus specific to nicotine-
related ENDS products.
Turning to the vagueness contention, it is difficult to see what is
``vague'' about the POSECCA or the PACT Act. The POSECCA makes
nonmailable (with exceptions) ``any electronic device that, through an
aerosolized solution, delivers nicotine, flavor, or any other substance
to the user inhaling from the device,'' as well as ``any component,
liquid, part, or accessory'' of such a device. 15 U.S.C. 375(7)(A),
(7)(B)(vii). While certain terms may benefit from interpretation
pursuant to well-established principles of administrative law, it
cannot be said that the statute fails to give the public or law-
enforcement agencies reasonable notice about what is prohibited. If
anything, the POSECCA definition is more prescriptive than some other
longstanding mailability statutes. Cf. 18 U.S.C. 1716(a) (``hazardous
materials, inflammable materials, infernal machines, and mechanical,
chemical, or other devices or compositions which may ignite or explode,
. . . and all other natural or artificial articles, compositions, or
material which may kill or injure another, or injure the mails or other
property''); id. at (j) (``spirituous, vinous, malted, fermented, or
other intoxicating liquors of any kind''). While the POSECCA definition
may be broad in a manner that some persons find objectionable, that is
not the same as being vague.
For all of these reasons, the Postal Service maintains that it is
not constitutionally barred from executing the POSECCA.
C. Relation to Other Laws
1. FDA Regulation of Certain ENDS as ``Tobacco Products''
Multiple pro-ENDS commenters noted the FDA's definition of ENDS as
noncombustible tobacco products, asserted that the FDA has confined the
scope of its regulations to devices intended to be used with nicotine-
containing ENDS liquids, and urged us to harmonize the POSECCA's ENDS
definition with this purported FDA policy. At least one commenter
pointed to the POSECCA's rule of construction, which provides that the
POSECCA definition shall not ``be construed to affect or otherwise
alter any provision of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 301 et seq.), including its implementing regulations.'' POSECCA
section 602(c). Additionally, some pro-ENDS commenters asserted that
the FDA excludes ``accessories'' from regulation as ``tobacco
products'' and urged the Postal Service to follow suit. See 21 CFR
1100.1-.2.
As an initial matter, the Federal Food, Drug, and Cosmetic Act
(``FD&C Act'') and the PACT Act (as modified by the POSECCA) govern
different subjects. Under the FD&C Act, the FDA regulates the
manufacturing, marketing, and distribution of tobacco products to
protect the public health. FDA regulation of tobacco products is not
necessarily tied to a given distribution method. By contrast, the
relevant portion of the PACT Act governs whether such products--
following or pending authorization for interstate commerce--may be sent
through the federally administered postal system, or whether they may
be transported only through non-postal channels. Indeed, section 2 of
the PACT Act provides that covered items may be carried through non-
postal delivery channels, so long as carriers and sellers comply with
various requirements. Although nonmailability may influence the
practicalities of interstate commerce (e.g., products' costs and
accessibility), it does not constitute an outright legal bar to
interstate commerce.\5\
---------------------------------------------------------------------------
\5\ Of course, it is possible for multiple Federal authorities
to apply concurrently. FDA authorization of a cigarette for
introduction or delivery into interstate commerce does not absolve
an actor from other Federal requirements that govern the manufacture
and distribution of cigarettes and other covered products: Rather,
all overlapping requirements must be complied with in order to offer
the product in interstate commerce.
---------------------------------------------------------------------------
The FDA's regulation of ENDS emanates from a statutory framework
regarding tobacco products that is unrelated to and distinct from the
POSECCA. More specifically, the Family Smoking Prevention and Tobacco
Control Act (``Tobacco Control Act''), Public Law 111-31, granted the
FDA the authority to regulate tobacco products by, among other things,
adding Chapter IX (Tobacco Products) to the FD&C Act, 21 U.S.C. 387a.
Section 901 of the FD&C Act provides that this chapter applies to
cigarettes, cigarette tobacco, roll-your-own tobacco, and smokeless
tobacco, as well as to any other tobacco products that the Secretary of
Health and Human Services by regulation deems subject to it. It is
pursuant to that delegation of ``deeming'' authority that the FDA
decided to subject certain ENDS products--specifically, those that meet
the FD&C Act definition of a ``tobacco product''--to tobacco regulation
under the FD&C Act. 81 FR 28973, 28982 (2016). The FDA's broad
discretion under the FD&C Act encompasses the ability to define the
scope of ENDS products that the FDA considers amenable to regulation,
subject to the FD&C Act's parameters. For example, FDA-regulated
tobacco products (including ENDS products) must be either made or
derived from tobacco and intended for human consumption, or else a
part, component, or accessory of such a product. 21 U.S.C. 321(rr)(1),
387a(c)(1). Pursuant to its discretion, the FDA decided to regulate
``components or parts'' of ENDS products but not ``accessories.'' Id.
at 28,975.
The context here is different, because the statute itself
explicitly defines the scope of nonmailable ENDS in a manner that
departs from the FD&C Act and FDA definitions. Specifically, the
POSECCA makes nonmailable ``any electronic device that, through an
aerosolized solution, delivers nicotine, flavor, or any other substance
to the user inhaling from the device.'' The POSECCA refers to
``nicotine'' without distinguishing on the basis of origin (tobacco or
otherwise). Furthermore, the POSECCA definition of ENDS sweeps beyond
nicotine to include, as standalone triggers, ``flavor[ ] or any other
substance.'' Clearly, Congress could have phrased the POSECCA to tie to
or mirror the FD&C Act terminology, or it could have used other
terminology that aligned with the scope of FDA regulation. Yet Congress
did not do so; instead, it chose to specify a broader universe of
nonmailable items than those that are subject to FDA regulation.
It is apparent that the POSECCA neither alters nor conflicts with
the FD&C Act, and that it impinges in no way on the FDA's implementing
regulations. Rather, the two laws apply concurrently, albeit with only
a partial overlap in scope. This is nothing new. For example, the
universe of products subject to FDA regulation as ``tobacco products''
is itself broader than the scope of ``tobacco products'' subject to
Treasury Department regulation under IRC chapter 52, which expressly
does not include ENDS products. See 26 U.S.C. 5702. Among other laws,
manufacturers of combustible cigarettes must contend with IRC chapter
52 and FDA tobacco regulation as well as the PACT Act; manufacturers of
ENDS
[[Page 58404]]
products within the FD&C Act definition of ``tobacco product'' must
contend with FDA tobacco regulation and now the PACT Act, but not IRC
chapter 52; and manufacturers of other ENDS products must now contend
with the PACT Act, but neither IRC chapter 52 nor FDA tobacco
regulation. There is no conflict of laws here; Congress simply chose to
subject different products to different layers of regulation.
It also bears mention that certain commenters mischaracterized the
FDA's policy on ENDS liquids, suggesting that the FDA has deemed only
liquid nicotine and nicotine-containing liquid to fall within its
regulatory purview. This is not necessarily true. Rather, the FDA
observed that non-nicotine-containing liquids may be FDA-regulated as
components or parts of ENDS liquids, to the extent that they are
``intended or reasonably expected to be used with or for the human
consumption of a tobacco product and do not meet the definition of
accessory.'' 81 FR at 29041. It therefore may be that the POSECCA's
coverage of ENDS products that deliver ``flavor[ ] or any other
substance'' beyond nicotine, as well as non-tobacco-derived nicotine,
represents less of a step beyond FDA regulation than these commenters
asserted.
As for ``accessories'' of ENDS products, it is true that the FDA's
``deeming'' rule exempted them from regulation under the FD&C Act. Yet
Congress chose to render them nonmailable under the POSECCA. We note
that the POSECCA does not define ``accessories,'' and so Congress has
not spoken to whether the term should be interpreted in a manner
consistent with the scope of items that the FDA has defined as outside
of its regulatory framework. As discussed in section III.D, the POSECCA
definition resides in a statute administered by ATF, and so the Postal
Service will look to ATF for interpretive guidance about the scope of
``accessories'' for PACT Act purposes.
2. Laws Regarding Marijuana, Hemp, and Hemp Derivatives
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. 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.'' E.g.,
Public Law 116-260, div. B, sec. 531. 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''). See Agriculture Improvement Act of
2018, Public Law 115-334, sec. 10113, 12619, 132 Stat. 4490, 4908,
5018, Public Law 91-513, sec. 102(16)(B), codified at 7 U.S.C.
1639o(1); 21 U.S.C. 802(16)(B), 812(c)(17).
As discussed further in section III.D.1.i, notwithstanding
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.
That said, 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. 21 U.S.C. 812(c)(17), 843(b);
Publication 52 section 453. Devices, parts, components, and accessories
used with such substances can qualify as drug paraphernalia, which is
likewise nonmailable. 21 U.S.C. 863; Publication 52 part 453. 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. See Publication 52
section 453.37.
Thus, 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. Publication 52 section 453.37. 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.
The POSECCA and the Agriculture Improvement Act overlap, but they
do not conflict. The Agriculture Improvement Act merely excludes
certain products from the CSA. It does not affirmatively declare hemp
and hemp derivatives to be mailable in any and all circumstances,
superseding all other relevant laws (such as the POSECCA). 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. That
Congress has rendered some subset of a class of goods to be nonmailable
while leaving the remainder mailable is not some sort of legal
conflict, but, rather, how mailability regulation typically works.
3. Other Issues
Certain ENDS industry commenters argued that the PACT Act should
not apply to non-nicotine-related ENDS
[[Page 58405]]
products to avoid conflicts with State and local law. Specifically,
commenters asserted that the PACT Act requires manufacturers to
register and certify tax compliance to State and local authorities, yet
some States and localities do not specially tax non-nicotine-related
ENDS products. One cannabis industry coalition also opined that
requirements to report consumer sales could violate State privacy laws.
Another complained that statutory labeling requirements regarding
``nicotine'' and ``tobacco'' are inapt for non-nicotine-related ENDS
products.
Whatever their merit, these comments are misdirected. It is true
that section 2 of the PACT Act amended the Jenkins Act to impose
various registration, labeling, and tax-compliance requirements on
remote sales of cigarettes and smokeless tobacco, and that the
POSECCA's amendment of the ``cigarette'' definition now subjects ENDS
products to those requirements. See generally 15 U.S.C. 375 et seq. But
that portion of the PACT Act is not germane here. Section 3 of the PACT
Act--the portion at issue here--more broadly prohibits consumer sales
from being effected through the mails (except for intrastate shipments
within Alaska and Hawaii). Thus, the Jenkins Act requirements bear
almost entirely on sales through non-postal delivery channels. Whatever
their application to sales of ENDS products shipped through non-postal
channels or to intrastate sales within Alaska and Hawaii effected
through the mails, it should be noted that the Jenkins Act is
administered by ATF, not by the Postal Service. As such, inquiries
about the application of the Jenkins Act's requirements to non-nicotine
ENDS products should be directed to ATF.
Finally, a Federal agency partner inquired whether the final rule
would include an analysis pursuant to the Regulatory Flexibility Act
(RFA). The Postal Service is generally exempt from Federal statutes
that govern administrative matters. 39 U.S.C. 410(a); see Kuzma v. U.S.
Postal Serv., 798 F.2d 29, 31-32 (2d Cir. 1986) (exemption from
Paperwork Reduction Act is consistent with legislative intent to expand
business discretion and modernize day-to-day managerial operations of
the postal system); \6\ accord Shane v. Buck, 658 F. Supp. 908, 913-15
(D. Utah 1985), aff'd, 817 F.2d 87 (10th Cir. 1987).\7\ The RFA is not
among those statutes that Congress has enumerated as specifically
applicable, 39 U.S.C. 410(b), nor does the RFA itself expressly include
the Postal Service as a covered ``agency,'' such as might arguably
supersede the Postal Service's general exemption. See 5 U.S.C. 601(1).
Indeed, the RFA's definition of covered ``agencies'' points back to the
APA, id. (cross-referencing 5 U.S.C. 551(1)), from the ambit of which
Congress removed the Postal Service. 39 U.S.C. 410(a). Although
Congress, as a narrow exception, has provided that proceedings
concerning mailability, such as this one, must be ``conducted in
accordance with chapters 5 and 7 of title 5'' (that is, the APA), 5
U.S.C. chapter 6 (the RFA) is conspicuously absent from this
prescription. 39 U.S.C. 3001(m). Congress's decision to reference two
sets of provisions but not a third is logically dispositive, e.g.,
Longview Fibre Co. v. Rasmussen, 980 F.2d 1307, 1312-13 (9th Cir.
1992); accord Friends of the Earth v. EPA, 333 F.3d 184, 189-90 (D.C.
Cir. 2003), and the contrast is particularly conspicuous here, where
the non-referenced chapter resides between the two referenced chapters.
For all of these reasons, the RFA does not apply.
---------------------------------------------------------------------------
\6\ The Kuzma court noted that the Paperwork Reduction Act was
passed ten years after the enactment of 39 U.S.C. 410(a); that the
Paperwork Reduction Act does not mention the Postal Service or
otherwise expressly indicate Congressional intent that it apply to
the Postal Service; and that repeals by implication are disfavored.
Kuzma, 798 F.2d at 32. The same can be said of the RFA, which was
likewise passed ten years after 39 U.S.C. 410(a), see Public Law 96-
354 (1980), and does not expressly indicate intent to apply to the
Postal Service.
\7\ The Shane court noted that the Postal Service's businesslike
economic operations and financial self-sufficiency framework, in
contradistinction to typical Federal bureaucracies, give it inherent
incentives to minimize paperwork for customers. Shane, 658 F. Supp.
at 915. The same is true with respect to the policy motives for the
RFA. Unlike most Federal agencies, the Postal Service is supported
almost entirely by revenues, not appropriations. See generally 39
U.S.C. 2401. As such, the Postal Service has inherent business
incentives to minimize burdens for small-business customers and to
encourage their patronage, to the extent permitted by law. The
Postal Service is highly mindful of the particular needs of small
businesses and has designed various services and outreach tools
especially with such customers in mind. See, e.g., U.S. Postal
Service, Small Business Solutions, https://www.usps.com/smallbusiness (last visited Oct. 14, 2021).
---------------------------------------------------------------------------
Even if the RFA did apply, however, the substance of this final
rule would address all of the elements of a regulatory flexibility
analysis. Sections I-II state the need for and objectives of the final
rule: Namely, fulfillment of a specific statutory directive. See 5
U.S.C. 604(a)(1). This section III states the significant issues raised
by public comments, the Postal Service's assessment of those issues,
and any changes to the proposed rule made as a result of the comments.
See id. at (a)(2). No response is made to comments by the Chief Counsel
for Advocacy of the Small Business Administration because no such
comments were filed; nonetheless, the Postal Service consulted
informally with staff of that office, and issues raised by such staff
are addressed throughout this section. See id. at (a)(3). Because of
the breadth and heterogeneity of persons and entities who might send or
receive ENDS products, there is no available estimate of the number of
small entities to which the rule will apply. See id. at (a)(4). The
final rule does not impose reporting or recordkeeping requirements; to
the extent that the final rule--or, rather, the governing statute--
imposes various types of compliance requirements, the classes of
entities subject to those requirements should be evident from this
final rule. See id. at (a)(5). Finally, as explained in section III.A
and elsewhere, this rulemaking fulfills statutory directives as to
which the Postal Service was not delegated substantial policy
discretion. As such, the Postal Service has few, if any, means to
minimize the economic impact on small entities. See id. at (a)(6). To
the extent that the Postal Service, in this final rule, does exercise
some limited administrative authority, such as with respect to the
precise method for verifying eligibility for the Business/Regulatory
Purposes exception, the relevant portion of section III will explain
the legal, policy, and/or factual rationale for the chosen measures and
why they are superior to alternatives. Thus, despite their
inapplicability, the substantive requirements of the RFA are fulfilled
in this instance.
D. Scope of Covered ENDS Products
1. Non-Nicotine-Related ENDS Products Generally
The POSECCA defines ENDS products in relation to their delivery of
``nicotine, flavor, or any other substance.'' 15 U.S.C. 375(7)(A).
Through use of this list and the disjunctive ``or,'' this language is
clear on its face: Covered ENDS products may be used to deliver
nicotine, or they may be used to deliver flavor, or they may be used to
deliver any other substance (with or without nicotine or flavor). For
this reason, the Postal Service observed in the notice of proposed
rulemaking that, ``[d]espite the name, an item can qualify as an ENDS
product without regard to whether it contains or is intended to be used
to deliver nicotine; liquids that do not actually contain nicotine can
still qualify as ENDS, as can devices, parts, components, and
accessories capable of or intended for
[[Page 58406]]
use with non-nicotine-containing liquids.'' 86 FR at 10219.
Before addressing comments on non-nicotine substances, it must be
emphasized that ATF is charged with administering the statute in which
the relevant definitions reside. While the Postal Service consulted
with ATF in developing the discussion that follows, questions of
whether a particular product falls within these definitions therefore
should be directed to ATF.
i. Relation to Nicotine and Flavor
Two ENDS industry commenters presented multiple legal arguments for
an alternative construction. First, they invoked the canon of statutory
construction known as ejusdem generis, which ``instructs that, where
general words follow specific words in an enumeration describing a
statute's legal subject, the general words are construed to embrace
only objects similar in nature to those objects enumerated by the
preceding specific words.'' Norman & Shambie Singer, 2A Sutherland
Statutes & Statutory Construction section 47:17 (7th ed. 2020). One of
the commenters argued that, applied here, ``any other substance'' must
be interpreted as ``any other substance that mimics nicotine or
flavor.'' The other argued that ``any other substance'' should be
``limited to substances related to nicotine and flavor, such as liquid
nicotine and liquid nicotine combined with colorings, flavorings, or
other ingredients,'' and posited that Congress may have intended this
to encompass non-nicotine liquids used with e-cigarettes but not with
other ENDS devices.
This argument is unpersuasive. ``Nicotine'' and ``flavor'' do not
admit of any common characteristic, such as might define a class of
substances beyond nicotine and flavor. See id. section 47:18
(application of the canon requires the enumerated things to constitute
a class that is not exhausted by the enumeration); see, e.g., Yates v.
United States, 574 U.S. 528, 543-46 (2015) (``tangible object'' means
``object used to record or preserve information'' when used in
connection with ``record [or] document''). The commenters do not
propose any characteristic common to nicotine and flavor. Nor do they
offer any examples of what things might share characteristics with
nicotine and flavor besides substances that themselves contain nicotine
and flavor. The impression left by these comments is that their
proposals' chief import would be to render the catch-all ``any other
substance'' a nullity, running headlong into the canon against
superfluities. See Singer & Singer, 2A Sutherland Statutes section
46:6; Ali v. Fed. Bureau of Prisons, 552 U.S. 214, 227 (2008).
Moreover, the ejusdem generis canon readily gives way ``when the
whole context dictates a different conclusion.'' Norfolk & Western Ry.
Co. v. Am. Train Dispatchers Ass'n, 499 U.S. 117, 129 (1991); see also
Ali, 552 U.S. at 227 (``we do not woodenly apply limiting principles
every time Congress includes a specific example along with a general
phrase''). Here, Congress's enumeration demonstrates its intent to
include non-nicotine-containing substances within the scope of
nonmailable ENDS: The definition includes solutions containing
``nicotine'' as well as--separately and thus independent of any
nicotine content--those containing ``flavor.'' Thus, despite the focus
on nicotine in the shorthand term ``electronic nicotine delivery
system,'' the explicit listing of ``flavor'' shows that Congress
intended the scope of covered ENDS products to cover some substances
that do not contain nicotine. This enumeration strengthens, rather than
weakens, the ordinary inference that ``any other substance'' extends to
non-nicotine substances. Cf. Norfolk & Western Ry., 499 U.S. at 129
(``all other law'' in exemption means that ``[a] carrier is exempt from
all law,'' with enumeration of antitrust law serving merely to overcome
presumptions against its inclusion).
As in Norfolk & Western, the enumeration here, with its lack of any
reasonably salient shared characteristic among ``nicotine'' and
``flavor,'' implies that Congress intended covered ENDS products to be
those used to deliver any substance, with nicotine and flavor indicated
expressly as examples. The framers may have believed that ``nicotine''
was necessary to justify the use of the shorthand term ``electronic
nicotine delivery systems,'' and/or that listing ``nicotine'' and
``flavor'' would most clearly evince the aim of combating youth access
to nicotine products. As discussed in section III.D.1.iii, youth access
was certainly a major focus of the framers' concern, albeit far from
their exclusive focus: Hence their expressed intent not to limit the
statute to ``nicotine or flavor.''
The statute here is clear on its face: ``any other substance''
means ``any other substance,'' limited not by some dubiously inferred
principle but explicitly by the surrounding text, which confines the
scope to substances delivered from an electronic device to an inhaling
user via an aerosolized solution. Given that the enumerated list
already includes one non-nicotine substance (``flavor,'' as an
alternative to nicotine), it cannot be said that other non-nicotine
substances are ``as dissimilar [from the enumerated items] as documents
and fish.'' See Yates, 574 U.S. at 546; id. at 550 (Alito, J.,
concurring). In effect, the commenters' invocation of the ejusdem
generis principle is an effort to create ambiguity where none exists,
and so there is no occasion to resort to it here. See Ali, 552 U.S. at
227; United States v. Turkette, 452 U.S. 576, 581 (1981).
Finally, the second commenter's alternative hypothesis that
Congress may have intended ``any other substance'' to encompass non-
nicotine and non-flavor substances, but only in connection with e-
cigarette devices, finds no support in the statute. The phrase
``delivers nicotine, flavor, or any other substance'' appears in the
definition's opening paragraph, which establishes the qualifying
parameters for all covered ENDS products, without differentiation as to
any particular species of ENDS device. 15 U.S.C. 375(7)(A). The next
paragraph offers an illustrative list of various devices that are
included within the definition, such as an e-cigarette, e-hookah, e-
cigar, or vape pen. Id. at (B). Nothing in either paragraph ties the
phrase ``any other substance'' exclusively to e-cigarette devices.
Absent such an indication, a plain reading of the statute indicates
that any of the listed devices, along with any part, component, liquid,
or accessory of the device, qualifies as an ENDS if it is used to
deliver any substance through an aerosolized solution, whether or not
the substance is or contains nicotine or flavor.
ii. Relation to Listed Devices
One ENDS industry commenter attempted to enlist a second canon of
construction: Noscitur a sociis, whereby ``doubtful words in an
ambiguous statute [are] given more precise content by the neighboring
words with which [they are] associated.'' Singer & Singer, 2A
Sutherland Statutes section 47:16. The commenter proposed that ``any
other substance'' be construed in light of the list of included devices
in 15 U.S.C. 375(7)(B), which, the commenter claimed, ``can only be
used with nicotine-based products.'' The commenter further asserted
that a nicotine-focused construction would be consistent with the FDA
and CDC's construction of the term ``ENDS.''
This argument, too, founders for multiple reasons. First, the canon
overlaps heavily with ejusdem generis and ``does not apply absent
ambiguity, or to thwart legislative intent, or to make general words
meaningless.'' Id.; see, e.g., Yates v. United States, 574 U.S.
[[Page 58407]]
528, 564 (2015) (Kagan, J., dissenting) (citing Ali, 552 U.S. at 227).
As described in the preceding section, a construction of ``any other
substance'' to mean only substances that contain nicotine, which is
separately enumerated, would indeed make general words meaningless and
thwart legislative intent. And there is no ambiguity in the phrase
``any other substance'': It means what it says, and there is no
apparent reason to infer a (redundant) nicotine-only construction. See,
e.g., Graham County Soil & Water Conservation Dist. v. United States ex
rel. Wilson, 559 U.S. 280, 286-90 (2010) (rejecting noscitur a sociis
as a basis to construe ``administrative'' to refer exclusively to
Federal activities, as opposed to those by State and local
governments).
Even if there were reason to resort to noscitur a sociis here, it
would not produce the limiting construction proposed by the commenter.
Several, and possibly even all, of the statutorily enumerated terms
(not to mention parts, components, and accessories) are used to refer
to devices marketed for use with cannabis, for example, without
concomitant reference to nicotine.\8\ Absent further technical
specificity in the statute, there is no apparent technological or
economic reason why such devices would be capable of use only with
nicotine-containing substances.
---------------------------------------------------------------------------
\8\ E.g., Jen Bernstein, ``The Best Vape Pens: High Times' Vape
Pen Buyers' Guide,'' High Times, https://hightimes.com/products/high-times-2015-vape-pen-buyers-guide (last visited Oct. 14, 2021);
``Marijuana Vaporizers & Vapes,'' Leafly, https://www.leafly.com/products/vaping (last visited Oct. 14, 2021) (vape pens, portable
vaporizers, batteries, power supplies, and accessories); ``Sherlock
Vape Pipe,'' WeedGadgets.com, https://www.weedgadgets.com/sherlock-vape-pipe (last visited Oct. 14, 2021) (e-pipe); see also ``Cannabis
E-Cigarettes: Risks vs. Advantages,'' Way of Leaf (last updated Mar.
17, 2021) (``An e-cigarette, also known as a vaporizer or a vape
pen, is an electronic device that heats up your marijuana and
enables you to consume it in vapor form.'').
---------------------------------------------------------------------------
Finally, as explained in section III.C.1, the FDA operates under
statutory authority that explicitly requires a nexus to tobacco. The
POSECCA does not; instead, it refers to ``any other substance'' in the
alternative to ``nicotine'' and ``flavor.'' As such, the scope of ENDS
products made nonmailable by the POSECCA is self-evidently and
materially broader than the scope of ENDS products regulated as
``tobacco products'' by the FDA.
iii. Legislative History of the POSECCA
Some ENDS industry commenters purported that certain floor
statements by the POSECCA's sponsors evince an exclusive focus on
nicotine-containing or -delivering ENDS products. From these supposed
floor statements, the commenters concluded that non-nicotine-related
ENDS products are beyond the scope of what Congress intended.
Legislative history ordinarily is useful only for resolving
ambiguity in a statute, not for superseding or ambiguating already-
plain statutory text. See Singer & Singer, 2A Sutherland Statutes &
Statutory Construction section 48:1. Here, the statutory text is clear
in its coverage of ENDS used with ``nicotine, flavor, or any other
substance [i.e., any substance other than nicotine or flavor].'' Even
if the legislative history contained only examples of concern relating
to nicotine substances, that would not be a basis to read out of the
statute the catch-all that Congress expressly included. In that
hypothetical instance, absence of evidence of intent as to non-
nicotine-related ENDS products would not equate to evidence of the
absence of such intent.
Moreover, the commenters are incorrect: The legislative history of
the POSECCA actually attests to concerns about non-nicotine-related and
nicotine-related ENDS products alike. Bill sponsors frequently decried
an epidemic of youth vaping without specifying the chemical composition
of the vapors thus inhaled. One Senate sponsor spoke of teens
``regularly vaping both nicotine and THC products'' and singled out
``closed systems that deliver only nicotine'' as but one subset of a
larger universe of devices, all of which his sponsored bill impliedly
targeted. 165 Cong. Rec. S6,898 (daily ed. Dec. 9, 2019) (statement of
Senator Cornyn).
Most tellingly, perhaps, the POSECCA was introduced in the 116th
Congress during a widely reported health crisis related to vaping
practices, which led to at least 68 deaths and 2,807 hospitalizations
across the country from lung damage related to ENDS use. Hassan Z.
Sheikh, Regulation of Electronic Nicotine Delivery Systems (ENDS):
Background and Select Policy Issues in the 117th Congress 9 (Cong.
Research Serv. Sept. 30, 2021). As discussed in section III.B, the
House committee report on the POSECCA expressly adverted to this crisis
as a motivating factor, as did floor statements regarding the POSECCA.
See H. Rept. 116-260 at 3; 166 Cong. Rec. S7,028 (daily ed., Nov. 17,
2020) (statement of Senator Cornyn); 166 Cong. Rec. S4,174 (daily ed.,
July 2, 2020) (statement of Senator Feinstein); 165 Cong. Rec. H8,491
(daily ed., Dec. 9, 2019) (statement of Representative Mucarsel-
Powell); 165 Cong. Rec. S6,586 (daily ed., Nov. 14, 2019) (statement of
Senator Cornyn); 165 Cong. Rec. S5,431 (daily ed., Sept. 11, 2019)
(statement of Senator Durbin). The CDC ultimately determined--several
months prior to Congress's passage of the POSECCA, and some of the
relevant floor statements--that this crisis was related to a chemical
found in non-nicotine-related (specifically, THC-related) ENDS
products. CDC, Outbreak of Lung Injury Associated with the Use of E-
Cigarette, or Vaping, Products, https://go.usa.gov/xHd78 (last updated
Feb. 25, 2020); see also Sheikh, Regulation of Electronic Nicotine
Delivery Systems at 9 (``Among a subset of hospitalized [e-cigarette or
vaping use-associated lung injury] patients, 82% reported using THC-
containing products.'').
It is evident, then, that, while youth nicotine consumption was a
prominent concern animating this bill, it by no means constituted the
sole motivating concern. The framers' expressed concerns about the
dangers of both nicotine-related and non-nicotine-related ENDS use
underscore the plain import of the POSECCA's inclusion of all such ENDS
products.
2. Products That Aerosolize Non-Solution Solids
Some ENDS industry commenters urged the Postal Service to exclude
personal vaporizers intended for use with waxes or dry herbs, as such
substances do not take the form of an ``aerosolized solution.''
However, one public-health-oriented commenter recommended including
solid substances and devices that aerosolize them, noting that,
according to at least one definition, ``solution'' includes solid as
well as liquid mixtures.
Once again, ATF is charged with administering the statute in which
the relevant definitions reside. Questions of whether a particular
product falls within these definitions therefore should be directed to
ATF.
As a further initial matter, we note that many such products are
already nonmailable regardless of the POSECCA. To the extent that
personal vaporizers are intended for use with waxes or dry herbs
containing THC (other than the limited class of hemp and hemp-based
products under Publication 52 section 453.37), those substances are
controlled substances and the vaporizers are drug paraphernalia under
the CSA. Indeed, online marketing, reviews, and blog posts frequently
tout the suitability of such products for use with controlled
substances. See Publication 52 section 453.131 (listing such
circumstances as
[[Page 58408]]
evidence that an item is drug paraphernalia). For further discussion of
the nonmailability of such products, see section III.C.2.
The Postal Service recognizes that some personal vaporizers may
also be used as aromatherapy devices with herbs that do not contain
controlled substances (e.g., mint or chamomile). Of course, at least
some of the same products may also be used with controlled substances,
and some are capable of use with liquid solutions as well as solid
matter. The remainder of this section will therefore consider
aerosolizing devices (and their related parts, components, and
accessories) intended for use with solids other than controlled
substances (e.g., aromatherapy herbs) and incapable of use with a
liquid solution.
Such devices appear to fall outside of the POSECCA definition of a
generally nonmailable ENDS product (and also would not be nonmailable
as drug paraphernalia). As discussed in the preceding section, the
POSECCA defines ENDS by reference to ``an aerosolized solution''
containing ``nicotine, flavor, or any other substance.'' Regardless of
the constituent substance or substances, they must form part of a
``solution.'' A solution is a mixture of chemical substances that is
both homogenous (i.e., uniformly mixed) and stable (i.e., not prone to
separating upon standing or filtration).\9\
---------------------------------------------------------------------------
\9\ See, e.g., Solution, in Int'l Union of Pure & Applied
Chemistry, Compendium of Chemical Terminology (2d ed. 1997), https://goldbook.iupac.org/terms/view/S05746 (last edited Feb. 24, 2014);
Solution (chemistry), Brittanica, https://www.britannica.com/science/solution-chemistry (last edited Dec. 19, 2019); Solution
(chemistry), Wikipedia, https://en.wikipedia.org/wiki/Solution_(chemistry) (last edited Aug. 26, 2021).
---------------------------------------------------------------------------
Raw or minimally processed organic matter, such as aromatic herb
leaves, does not qualify as a ``solution.'' As such, if a device heats
such matter to produce vapors for the user to inhale, that device does
not operate ``through an aerosolized solution'' and thus falls outside
the scope of the POSECCA definition. By the same token, its parts,
components, and accessories (as well as the herbal matter used in the
device) likewise fall outside of the POSECCA's scope.\10\
---------------------------------------------------------------------------
\10\ As the public-health-oriented commenter noted, solutions
may be typically liquid, but they are not exclusively so. Because
the matter at issue here is not a solution in any event, it is
unnecessary to discuss here whether the reference to ``liquid'' in
the POSECCA's inclusion of ``any component, liquid, part, or
accessory of [an ENDS] device'' excludes the possibility that
covered devices may be used with solid solutions.
---------------------------------------------------------------------------
It is emphasized that this analysis covers only devices used
exclusively with non-solution matter. If a device can be used to
aerosolize a solution as well as non-solution matter for delivery to a
user inhaling from the device, then the POSECCA definition applies
notwithstanding the device's capability of alternative use with non-
solution matter. Finally, it is emphasized again that a device intended
for use with controlled substances (e.g., cannabis herbal matter or
wax) is nonmailable regardless of the POSECCA, irrespective of any dual
capability of alternative licit use.
3. Heat-Not-Burn Cigarettes
One public-health-oriented commenter and two Federal agency
partners inquired whether so-called ``heat-not-burn cigarettes'' are
nonmailable under the PACT Act, either as ENDS products or as other
forms of ``cigarettes.''
Once again, ATF is charged with administering the statutes in which
the relevant definitions reside. Questions of whether a particular
product falls within these definitions therefore should be directed to
ATF.
To the extent that ``heat-not-burn cigarette'' refers to a product
that functions by heating tobacco leaf matter just shy of the point of
combustion, such products vaporize a solid mass of processed tobacco
leaf, not an aerosolized solution. As discussed in the preceding
section, it seems likely that such products fall outside the POSECCA's
definition of ENDS products.
Nevertheless, many, and perhaps all, such products contain or
comprise a roll of tobacco wrapped in paper or another substance not
containing tobacco. As such, these products may already be nonmailable
under the preexisting definition of ``cigarette'' used for PACT Act
purposes. 18 U.S.C. 2341(1)(A), referenced in 15 U.S.C. 375(2)(A)(i),
referenced in 18 U.S.C. 1716E(a)(1). Such products may also be
nonmailable as ``smokeless tobacco,'' insofar as they contain tobacco
and are intended to be consumed without being combusted. 15 U.S.C.
375(13). Parties interested in a definitive opinion are advised to
contact ATF, as instructed in the new rules.
4. Products That Release Aerosols Into Ambient Air, Not for Direct
Inhalation
One ENDS industry commenter expressed concern that the POSECCA
definition of ENDS would prove so expansive as to encompass air
fresheners, essential oil misters, portable aromatherapy diffusers,
electric incense burners, household humidifiers, and other products
that aerosolize matter for release into ambient air, rather than for
direct inhalation. The commenter proposed that the Postal Service
preclude this purportedly untoward construction by appending, to the
statutory definition of ENDS (``any electronic device that, through an
aerosolized solution, delivers nicotine, flavor, or any other substance
to the user inhaling from the device'') an implied limitation: ``into
the lungs.''
We note again that ATF, not the Postal Service, is charged with
administering the definitional statute. Nevertheless, we note that the
commenter's concern may be misplaced. The POSECCA definition restricts
the scope of covered ENDS products based on delivery of a substance
``to the user inhaling from the device.'' 15 U.S.C. 375(7)(A) (emphasis
added). This language could suggest physical contact or proximity
between the user's nose or mouth and the vapor-emitting ENDS device. By
contrast, the products described in the comment release aerosolized
matter into the ambient air, which in turn is breathed by persons in
the room without directly placing their nose or mouth on the product.
While these products may aerosolize solution to be inhaled by a user,
the user arguably does not inhale directly ``from the device.'' As
such, these products (and their components, liquids, parts, and
accessories) might not fall within the scope of the POSECCA's
definition of ENDS.\11\ Again, however, these observations are
necessarily tentative; for a definitive interpretation, parties are
advised to contact ATF as directed in the new rules.
---------------------------------------------------------------------------
\11\ We further note that the commenter's proposed addition of
``into the lungs'' would not have any material effect. By
definition, all inhalation, whether of ambient air or of vapor
directly from the emitting device, is ``into the lungs.''
---------------------------------------------------------------------------
5. Natural vs. Synthetic Nicotine
One ENDS manufacturer, two public-health-oriented commenters, and a
Federal agency partner asked the Postal Service to clarify that ENDS
products include those containing or used with all forms of nicotine,
whether natural or synthetic in origin.
The POSECCA defines ENDS products by reference to the delivery of
``nicotine,'' among other things. There is no statutory basis to read
this term as referring only to natural-origin nicotine, as opposed to
synthetic nicotine. As discussed in section III.C.1, this scope of
regulation is different from that under the FD&C Act, for which
purposes the FDA regulates nicotine-related ENDS products to the extent
that the nicotine is made or derived from tobacco. Beyond this
observation about the POSECCA's plain language, interested
[[Page 58409]]
parties are encouraged to contact ATF for further interpretive
guidance.
6. Scope of Components and Parts
In addition to fully assembled vaping devices, the POSECCA includes
in its definition of ENDS ``any component, liquid, part, or accessory
of [an ENDS], without regard to whether the component, liquid, part, or
accessory is sold separately from the device.'' 15 U.S.C.
375(7)(B)(vii). Some pro-ENDS commenters found this definition to
create a line-drawing conundrum, noting that certain materials used in
ENDS devices and liquids are used in a wide array of non-ENDS consumer
products. A partner agency also suggested that the terms could be
interpreted in a manner similar to the definitions of ``accessory'' and
``component or part'' for purposes of the FDA's regulation of certain
ENDS products. See 21 CFR 1100.3.
The Postal Service recognizes the point and notes that it resonates
with other contexts in which parts, components, or accessories of a
given type of item may be regulated. E.g., 18 U.S.C. 921(4)(C), (24),
(29)(B); 22 U.S.C. 2778(b)(1)(B); 26 U.S.C. 5845(b), (f)(3); 15 CFR pt.
774, supp. no. 1; 22 CFR 121.1. It is necessarily a fact-specific
question whether an item has a sufficient nexus to the regulated end
product to itself warrant control; as such, such questions may require
case-by-case determination.
Here, too, interpretative questions about whether the POSECCA
definition codified in the Jenkins Act applies to specific precursor
parts, components, or accessories should be directed to ATF.
E. Exclusion of Tobacco Cessation and Therapeutic Products
The POSECCA excludes from the definition of ENDS products any such
products that are approved by the FDA for sale as a tobacco cessation
product or for any therapeutic purpose, and that are marketed and sold
solely for such purposes. 15 U.S.C. 375(7)(C).
Multiple public-health-oriented commenters and law students
recommended that the Postal Service disallow the exclusion at this
juncture, or at least establish a presumption that mailed ENDS products
are not covered by the exclusion. These commenters pointed out that no
such products have been approved by the FDA. Hence, given the
prevalence of non-validated tobacco-cessation and other health claims
by the industry in association with ENDS products, allowing mailers to
purport to use the exclusion would arguably invite deceptive practices
and complicate enforcement.
Two public-health-oriented commenters and one law student went
farther and offered specific proposals for how the Postal Service could
administer the exclusion if and when the FDA issues a pertinent
approval. As envisioned by one public-health-oriented commenter, the
FDA would formally inform the Postal Service of its approval, whereupon
the Postal Service would collaborate with the FDA and manufacturers to
establish a list of eligible shippers (e.g., medical-product
distributors, health departments, or healthcare facilities) who might
apply for permission to mail under the exclusion. The second such
commenter proposed that mailers should have to provide an FDA approval
letter at the time of mailing, not merely mark the package as an
excluded tobacco-cessation or therapeutic product. The law student
recommended that mailers be required to clearly mark the manufacturer
and brand on the exterior of mailpieces, to ease verification against a
Postal Service list of approved products, and that age verification be
required at delivery.
One ENDS industry commenter opined that the exclusion pertains to
drug protocols and would paradoxically exclude the ENDS industry. The
commenter went on to quote from a court opinion to the effect that the
FDA is authorized to regulate ``customarily marketed tobacco products--
including e-cigarettes--under the Tobacco Control Act'' and
``therapeutically marketed tobacco products under the [FD&C Act's]
drug/device provisions.'' Sottera, Inc. v. FDA, 627 F.3d 891, 898-99
(D.C. Cir. 2010).
A manufacturer of herbal vaporizers proposed that mailers be
allowed to self-certify the eligibility of a product for the exclusion
via distinctive labeling on the package, backed by recordkeeping
requirements similar to those for hemp-based cannabidiol (``CBD'')
products. See Publication 52 section 453.37.b. The commenter considered
the analogy to be apt because of the difficulty in distinguishing CBD
products that do and do not qualify for the CSA exception, similar to
the likely difficulty in distinguishing ENDS products that do and do
not qualify for the POSECCA exclusion. The commenter opined that this
approach would provide a credible means of verifying eligibility, while
minimizing burdens on the Postal Service's operational and enforcement
personnel.
Finally, a large number of individual ENDS consumers commented
about the perceived tobacco-cessation benefits of ENDS products, both
in their own experience and in relation to U.K. studies and purported
official European health recommendations.\12\ Other individual ENDS
consumers wrote of the perceived therapeutic benefits of cannabis or,
in rare instances, aromatherapy delivered using ENDS products.
---------------------------------------------------------------------------
\12\ See M[aacute]irtin S. McDermott et al., ``The Effectiveness
of Using E-Cigarettes for Quitting Smoking Compared to Other
Cessation Methods Among Adults in the United Kingdom,'' __Addiction
__(2021), https://onlinelibrary.wiley.com/doi/10.1111/add.15474;
Peter Hajek et al., ``A Randomized Trial of E-Cigarettes Versus
Nicotine-Replacement Therapy,'' 380 New Eng. J. Med. 629 (2019),
https://www.nejm.org/doi/full/10.1056/NEJMoa1808779; Jamie Brown et
al., ``Real-World Effectiveness of E-Cigarettes When Used to Aid
Smoking Cessation: A Cross[hyphen]Sectional Population Study,'' 109
Addiction 1531 (2014), https://onlinelibrary.wiley.com/doi/full/10.1111/add.12623. It should be noted that the Hajek article website
includes a number of letters by other researchers pointing out
limitations in the study design and questioning the reliability of
its findings.
---------------------------------------------------------------------------
The first set of commenters is correct: The FDA has not approved
any ENDS product for smoking-cessation or other therapeutic use.\13\
Unless and until the FDA approves any ENDS product for smoking-
cessation or another therapeutic use, then, the statutory exclusion
lies dormant and has no real-world import.
---------------------------------------------------------------------------
\13\ FDA, Drugs@FDA: FDA-Approved Drugs, https://go.usa.gov/xHHxa (search for ``nicotine'' conducted Oct. 14, 2021 yielded no
ENDS-related results); Hassan Z. Sheikh, Regulation of Electronic
Nicotine Delivery Systems (ENDS): Background and Select Policy
Issues in the 117th Congress 5 (Cong. Research Serv. Sept. 30,
2021); Richard J. Wang et al., ``E-Cigarette Use and Adult Cigarette
Smoking Cessation: A Meta-Analysis,'' 111 Am. J. Pub. Health 230
(2020), https://ajph.aphapublications.org/doi/full/10.2105/AJPH.2020.305999 (``E-cigarettes have been promoted for smoking
cessation even though, as of November 2020, no e-cigarette has been
approved as a smoking cessation medication by the FDA Center for
Drug Evaluation and Research (CDER).'' (citations omitted)).
---------------------------------------------------------------------------
While the distinction between excluded and nonmailable ENDS
products may be difficult to get right in practice, it is essential to
get it right, given the PACT Act's directive that the Postal Service
not ``accept for delivery or transmit through the mails'' any package
as to which ``reasonable cause'' exists to believe that it contains
nonmailable ENDS products. See 18 U.S.C. 1716E(a)(1). Whatever merit
the ideas raised by commenters on this topic may have, the Postal
Service finds it inadvisable to attempt (in consultation with ATF) to
set forth appropriate standards in the abstract. Rather, if and when
any product is approved by the FDA, concrete circumstances will guide
the development of a practical approach.
Therefore, the final rule contains language clarifying that the
exclusion does not apply at this time, but inviting
[[Page 58410]]
any ENDS manufacturer of an FDA-approved product to notify ATF and the
Postal Service in the event of such approval. At that time, ATF and the
Postal Service may develop appropriate rules governing the exclusion.
The FDA likewise has not approved any ENDS product for therapeutic
delivery of any non-nicotine substance, including, in particular, CBD
or other substances derived from marijuana.\14\ Once again, except for
hemp-derived CBD containing no more than 0.3 percent THC by dry weight,
cannabis and cannabis derivatives remain nonmailable under the
Controlled Substances Act regardless of the POSECCA and notwithstanding
any State or local laws on ``medical'' marijuana. See supra section
III.C.2; 84 FR at 12970. Far from taking marketing claims of
therapeutic benefit at face value, the FDA has undertaken enforcement
action against companies making such claims about CBD and other
cannabis-related products absent new drug approvals from the FDA. See
84 FR at 12970.
---------------------------------------------------------------------------
\14\ The FDA has approved a small number of drugs that contain
CBD, a synthetic THC (dronabinol), and a synthetic chemical similar
to THC (nabilone), but only for oral delivery in capsule or solution
form, not via an ENDS. FDA, Drugs@FDA: FDA-Approved Drugs (searches
conducted Oct. 14, 2021); see Scientific Data and Information About
Products Containing Cannabis or Cannabis-Derived Compounds, 84 FR
12969, 12972-12973 (2019).
---------------------------------------------------------------------------
The concern that the statutory exclusion pertaining to FDA drug or
device protocols would paradoxically exclude the ENDS industry appears
to be off-base. The very court opinion quoted by the commenter notes
that the FDA's regulatory authority extends to ``therapeutically
marketed tobacco products under the [FD&C Act's] drug/device
provisions.'' Sottera, 627 F.3d at 898-99. Moreover, with respect to
ENDS comprising, containing, or used with CBD, the FDA's authority to
approve drugs and medical devices extends to cannabis and cannabis-
derived products that could form part of an ENDS. See 84 FR at 12972-
12974.
Finally, a Federal agency partner suggested that the Postal Service
clarify the scope of ``other therapeutic purposes,'' perhaps in line
with the Sottera court's borrowing of ``diagnosis, cure, mitigation,
treatment, or prevention of disease'' phraseology from the FD&C Act's
``drug'' and ``device'' definitions. Sottera, 627 F.3d at 894 (quoting
21 U.S.C. 321(g)(1)(B)); accord 21 U.S.C. 321(h)(1)(B). Such an
interpretation may be reasonable, and even tautological, given that the
POSECCA exclusion requires FDA approval of an ENDS product, which
itself would require an FDA determination that the product meets the
purposive criteria for a ``drug'' or ``device.'' However, it may also
be that ``therapeutic purposes'' means something narrower in this
context, given the term's juxtaposition with ``tobacco cessation.'' The
Postal Service declines to announce any particular interpretation of
``therapeutic purposes'' at this time, both out of deference to ATF's
authority to interpret the relevant statute and because no ENDS
products have been FDA-approved for any arguably relevant purpose at
any rate. In the event that any such product garners FDA approval for a
use other than tobacco cessation, then ATF may find it appropriate to
opine on whether that product fulfills a ``therapeutic purpose'' for
purposes of the POSECCA exclusion.
F. Intra-Alaska/Intra-Hawaii Shipments
One public-health-oriented commenter proposed that the Postal
Service clarify that, while the PACT Act's exception for intrastate
shipments within Alaska and Hawaii may apply to ENDS products, it does
not apply to interstate ENDS shipments into or out of either state.
The Postal Service does not believe that such clarification is
necessary. The PACT Act is already abundantly clear that the exception
applies only to ``mailings within the State of Alaska or within the
State of Hawaii.'' 18 U.S.C. 1716E(b)(2) (emphasis added). Longstanding
Postal Service rules, which will now encompass ENDS products, make this
even more explicit, by requiring such a mailing to be tendered to a
Postal Service employee in a face-to-face transaction within the
relevant State, to destinate in the same state as the state of origin,
and to bear a valid, complete return address within the state of
origin. Publication 52 section 472.21.a-.c.\15\ These requirements
allow Postal Service personnel at the point of acceptance to verify
that the shipment will destinate in the noncontiguous state of origin.
Treatment of Cigarettes and Smokeless Tobacco as Nonmailable Matter, 75
FR 24534, 24535 (2010) (notice of proposed rulemaking). It is difficult
to imagine how the geographic limitation on this exception could be
made any clearer.
---------------------------------------------------------------------------
\15\ All citations to Publication 52 chapter 47 throughout this
section III refer to the version in effect prior to this final rule.
---------------------------------------------------------------------------
G. Business/Regulatory Purposes Exception
The Business/Regulatory Purposes exception was a major area of
commenter discussion, and so it is discussed extensively here. In
short, the exception permits shipments between legally operating
businesses in certain industry sectors and between such businesses and
Federal or State government agencies, subject to multiple conditions.
18 U.S.C. 1716E(b)(3)(A). Those conditions include Postal Service
verification of the sender and recipient's respective eligibility, as
well as the recipient's age and employee status; restriction of
available products to those that allow tracking and confirmation of
delivery; capture and retention of package-specific identifying
information by the Postal Service; and certain package markings. Id. at
(b)(3)(B).
In implementing these requirements, the Postal Service adopted a
process whereby potential senders must first submit an advance
application to the Postal Service's Pricing and Classification Service
Center (PCSC) for an eligibility verification as to the applicant and
any anticipated recipients of that applicant's shipments. Publication
52 section 472.221. Upon a PCSC determination of eligibility, the
authorized sender must show the resulting authorization letter when
tendering any covered mailing via a face-to-face transaction with a
Postal Service employee at an approved acceptance location. Id. section
472.222. The mailer may use only certain combinations of postal
services that allow for age verification, tracking, and confirmation of
delivery, as well as a return receipt returnable to the PCSC for
recordkeeping purposes. Id. section 472.222.a-.b. Finally, the Postal
Service conducts the requisite verification of age, identity, and
employment status upon face-to-face delivery. Id. section 472.223.
In the notice of proposed rulemaking, the Postal Service proposed a
simple amendment to the terminology used in the Business/Regulatory
Exception rules, such that the same rules would automatically apply to
ENDS products as to other PACT Act-covered products. 86 FR at 10220.
1. Availability in General
As an initial matter, a few comments dealt with existential aspects
of the exception. Two ENDS industry commenters sought confirmation that
the exception would extend to ENDS products, in order to sustain
industry supply chains, regulatory activities, and the channeling of
ENDS to retail outlets subject to State and local law (in lieu of
direct-to-consumer shipments). Conversely, one law student urged the
abolition of the exception for ENDS
[[Page 58411]]
products except as necessary for regulatory activities.
As discussed in section III.A.2, the Business/Regulatory Purposes
exception is established by statute, and the Postal Service lacks the
delegated authority to modify or restrict the exception's applicability
on policy grounds. Unlike the Consumer Testing and Public Health
exceptions discussed in section III.I, nothing in the statutory
language concerning the Business/Regulatory Purposes exception
indicates Congressional intent to exclude ENDS products from the
exception, and there is no other basis to find such products to be
incompatible with the exception's terms. As such, the exception is
available in connection with ENDS products as a legal matter,
regardless of whatever policy arguments might militate for or against
it.
Another pro-ENDS commenter feared that the conditions for the
exception could be expanded into termination of the exception
altogether. This comment appears to misconstrue the exception as a
freestanding entitlement, upon which the Postal Service somehow
discretionarily grafted conditions as a means to subvert the intended
scope of the exception. In fact, however, Congress itself specified the
criteria as conditions precedent that must be met in order to qualify
for the limited exception: The conditions are therefore integral to the
statutory framework for the exception. The longstanding conditions in
Publication 52 merely bear out that framework, either by literally
transmuting the statutory requirements or by means designed to fulfill
those requirements. The regulatory framework has applied to cigarettes
and smokeless tobacco since 2010. The POSECCA charges the Postal
Service with clarifying the applicability of the limited exception,
with its eligibility conditions, to ENDS products, and the final rules
here do that.
One public-health-oriented commenter viewed the Business/Regulatory
Purposes exception as being cabined by 18 U.S.C. 1716, such that 18
U.S.C. 1716(a) and (e) would preclude use of the Business/Regulatory
Purposes exception as a ``bulk distribution method'' for manufacturers
and wholesalers to transport ENDS products to retailers. It is true
that eligibility to use the Business/Regulatory Purposes exception to
the PACT Act does not excuse a mailer from compliance with other
applicable mailability statutes, including 18 U.S.C. 1716. But the
Postal Service cannot join the commenter's sweeping conclusion that all
``bulk distribution'' shipments of ENDS products that could be sent
under the Business/Regulatory Purposes exception would necessarily be
prohibited or restricted under 18 U.S.C. 1716. Many ENDS products do
not qualify as injurious articles subject to 18 U.S.C. 1716, and as
discussed in section III.A.2, Postal Service regulations permit many
hazardous materials to be mailed pursuant to specified precautions. The
precautions in existing regulations have historically been deemed
sufficient to fulfill 18 U.S.C. 1716 for otherwise mailable shipments
of ENDS products; it has never been the case that otherwise mailable
ENDS products were deemed so extraordinarily dangerous as to warrant
outright prohibition in the face of lesser applicable hazardous-
materials safeguards. While the scope of generally mailable ENDS
products will now be limited by the PACT Act's exceptions, the Postal
Service perceives no rational basis to upset the highly reticulated
harm-based framework for hazardous-materials regulation.
In the course of its 18 U.S.C. 1716 argument, the same commenter
raised policy concerns about use of the Business/Regulatory Purposes
exception to evade state and local taxes. But 18 U.S.C. 1716 has
nothing to do with tax collection or evasion. Nor has Congress
specifically conditioned eligibility for the Business/Regulatory
Purposes exception on any particular standard of tax compliance, as it
expressly did for the Consumer Testing exception. 18 U.S.C.
1716E(b)(5)(A)(iv), (b)(5)(C)(ii)(III) (Consumer Testing exception). Of
course, noncompliance with applicable tax laws may subject a business
to penalties under other Federal, State, local, or Tribal laws. It may
also affect the business's ability to obtain relevant licenses or
permits, which is a prerequisite for eligibility to use the Business/
Regulatory Purposes exception. Id. at (b)(3)(A)(i). Where information
may indicate that an entity that may be authorized to use the Business/
Regulatory Purposes exception is not, in fact, operating lawfully, all
parties are encouraged to bring such information to the attention of
the Postal Inspection Service.
Finally, a Federal agency partner sought clarification of whether
the Business/Regulatory Purposes exception encompasses shipments from
businesses to Federal regulatory agencies and vice versa for
enforcement or investigational purposes. The PACT Act permits use of
the exception ``for regulatory purposes between any [covered] business
. . . and an agency of the Federal Government or a State government.''
Id. at (b)(3)(A)(ii) (emphasis added). The word ``between'' plainly
denotes movement in either direction. See, e.g., Atlas Aerospace LLC v.
Advanced Transp., Inc., No. 12-1200-JWL, 2012 WL 5398027, at *1 (D.
Kan. Nov. 2, 2012); Union Pacific Corp. et al., 2 S.T.B. 276, 280
(1997) (``Citation is hardly necessary on this point.''). It is further
apparent that ``regulatory purposes'' encompasses enforcement against
and investigation of regulated entities, among other governmental
activities. Therefore, shipments from a business to a Federal or State
governmental body and vice versa are within the ambit of the Business/
Regulatory Purposes exception, provided that all of the other
conditions for use of the exception are met.
2. Eligible Parties
The Business/Regulatory Purposes exception permits shipments of
PACT Act-covered products between ``legally operating businesses that
have all applicable State and Federal Government licenses or permits
and are engaged in tobacco product manufacturing, distribution,
wholesale, export, import, testing, investigation, or research'' and
between such businesses and Federal or State government agencies. 18
U.S.C. 1716E(b)(3)(A)(i)-(ii).
A number of ENDS industry commenters opined that ``businesses . . .
engaged in . . . distribution'' should be understood to include
retailers, common carriers, and contract delivery services. This
interpretation accords with the Postal Service's longstanding practice
in applying the statutory term, as well as with dictionary and related
statutory definitions. See, e.g., Distribute, Black's Law Dictionary
(11th ed. 2015) (``3. To deliver.''); Distribute, Merriam-Webster.com
(last visited Oct. 14, 2021) (``2b: To give out or deliver especially
to members of a group''); cf. 21 U.S.C. 802(8), (11) (distribution of a
controlled substance or listed chemical generally means transfer
between parties). Because the Postal Service considers this meaning to
be plain from the statutory term, there does not appear to be a basis
to deviate from or elaborate upon the statutory language. It is
emphasized that the statutory Business/Regulatory Purposes exception
permits shipments between a retail or other distributor and another
industry business or regulator, but not a distributor's (or any other
entity's) direct shipments to consumers. The measures discussed in
sections III.G.3-.7 are designed to ensure that the Business/Regulatory
Purposes exception is used only for eligible business-to-business or
business-to-government shipments and not for shipments to or
[[Page 58412]]
from ineligible parties, including retail consumers.
An ENDS industry association proposed to clarify that ``testing,
investigation, or research'' includes contracted research organizations
and laboratories. It seems self-evident that such entities would be
covered, to the extent that they are ``engaged in . . . testing,
investigation, or research'' as to PACT Act-covered products; the
statute provides no basis for distinction according to such entities'
contractual relationships. Here, too, the Postal Service regards the
statutory language as sufficiently clear in encompassing the relevant
entities, without further elaboration. While the statute does not
appear to preclude eligibility for such parties generally, verification
of any particular research organization or laboratory's eligibility
will involve a case-specific determination based on the documentation
submitted with the relevant application.
The same ENDS industry association asked that marketing firms be
treated as eligible. The PACT Act does not appear to permit such
treatment. None of the categories of business activity enumerated in
the statute encompasses marketing or related activities, such as
advertising or promotion. Nor does the statute extend eligibility to
agents of enumerated businesses, in contrast to the Consumer Testing
exception. Cf. 18 U.S.C. 1716E(b)(5)(A). As an exception to a general
policy of nonmailability, the Business/Regulatory Purposes exception
merits narrow construction. See, e.g., Maracich v. Spears, 570 U.S. 48,
60 (2013) (quoting Comm'r v. Clark, 489 U.S. 726, 739 (1989)). The PACT
Act delegates to the Postal Service only the authority to ``establish
the standards and requirements that apply to all mailings'' defined by
the statutory criteria for the Business/Regulatory Purposes exception,
18 U.S.C. 1716(b)(3)(B)(i), and the POSECCA permits the Postal Service
only to ``clarify the applicability'' of the PACT Act's prohibition
(and, by implication, its exceptions). POSECCA section 603(a). As
discussed in section III.A.1, neither statute permits the Postal
Service to modify those criteria themselves. As such, the Postal
Service lacks any authority or basis to add businesses engaged in
marketing to the roster of eligible entities.
An ENDS manufacturer asserted that licensed independent mystery-
shopper contractors should count as entities ``engaged in . . .
testing, investigation, or research.'' To the extent that such a
contractor is a business entity, then it could potentially come within
the scope of the exception, depending on the Postal Service's
assessment of the documentation submitted with the relevant
application. To the extent that the contractor is an individual tester,
however, then it would appear to fall outside of the scope of the
exception, which is restricted to ``legally operating businesses that
have all applicable State and Federal Government licenses or permits.''
Rather, shipments from businesses to individual testers would appear to
be akin to the shipments governed by the Consumer Testing and Public
Health exceptions, which Congress narrowly circumscribed and, as
discussed in section III.I, did not make available for ENDS products in
any event. To the extent that individual testers may wish to send ENDS
products to a manufacturer, testing firm, or other entity, these
shipments would fall within the scope of the Certain Individuals
exception, subject to the relevant criteria and limitations.
The same manufacturer inquired whether ``between legally operating
businesses'' would be construed to include shipments between two
offices of the same eligible firm, in addition to shipments between
separate firms. The Postal Service agrees that this construction makes
sense, provided that all relevant intra-firm sender and recipient
addresses are listed in the firm's application and approved by the
Postal Service. Indeed, it is difficult to conceive of why Congress
would permit shipments between duly authorized facilities of separate
firms, while prohibiting them between identical facilities that happen
to be within the same corporate structure. This understanding accords
with the Postal Service's historical practice in administering the
exception prior to the POSECCA.
Certain pro-ENDS commenters suggested that the Business/Regulatory
Purposes exception could be used to facilitate the return of ENDS
products from consumers to businesses. The PACT Act does not permit
this use of the Business/Regulatory Purposes exception. Eligibility for
the Business/Regulatory Purposes exception is restricted to shipments
between eligible businesses or between such businesses and Federal or
State government agencies. By contrast, 18 U.S.C. 1716E(b)(3) does not
contain any indication of legislative intent to encompass shipments
either to or from individual consumers. That said, business-to-business
product returns and recycling- or reuse-related shipments may be
permissible between eligible and approved businesses, and consumer-to-
business shipments for such purposes may be permissible under the
Certain Individuals exception, as discussed in section III.H.
State and local attorneys general opined that a business's status
as ``legally operating'' implies compliance with all pertinent laws,
and that a business does not qualify as ``legally operating'' for
purposes of the Business/Regulatory Purposes exception if it markets
products that are counterfeit, that are not the subject of a timely
premarket application to the FDA, or that are otherwise inconsistent
with applicable law. The Postal Service agrees that all mailers must
comply with all applicable laws with respect to products that they
mail, and that a pattern of violations may rise to a level where a
business may no longer be considered ``legally operating.'' It seems
equally apparent, however, that a business may violate a law with
respect to certain of its products while operating legally in other
respects. Therefore, the Postal Service regards the question of whether
and when violations suffice to render a business no longer ``legally
operating'' to be a case-specific one, dependent on the totality of
relevant facts and circumstances in a particular situation. The Postal
Service encourages its Federal, State, local, and Tribal governmental
partners, as well as any other party, to bring to the attention of the
Postal Inspection Service any indication that an ENDS-industry business
mailer may have committed material legal violations such that it may no
longer be considered ``legally operating.''
The same commenters proposed that the Business/Regulatory Purposes
exception be restricted to recipients using their physical address as
the delivery address and that recipients using a different delivery
address (such as a Post Office Box or private rental mailbox) be barred
from eligibility. The Postal Service declines to adopt this
recommendation. Such a restriction is not among the statutory
eligibility criteria. Even if the Postal Service had the policy
discretion to adopt such a categorical restriction, the basis for such
a potentially overbroad rule is unclear. The Postal Service notes that
Post Office Boxes and private rental mailboxes are used by a variety of
business and governmental actors for a variety of reasons.\16\ Most
such uses are presumably lawful and legitimate, and while some such
mail recipients may engage in unlawful activity, the same is
[[Page 58413]]
true of persons who use a physical mailing address. The commenters
offer no empirical support for the implied notion that addressees who
use certain types of mailboxes are more likely than other addressees to
engage in activity disqualifying them from the Business/Regulatory
Purposes exception, let alone to such an overwhelming and disparate
degree as to warrant barring all persons using such mailboxes from
otherwise permissible eligibility for the exception. That said, if any
person or entity believes that a sender or recipient is using a Post
Office Box or private mailbox to violate the law, such persons and
entities are encouraged to notify the Postal Inspection Service and/or
to nominate the entity to the List of Unregistered or Noncompliant
Delivery Sellers compiled by the Attorney General under section 2A(e)
of the Jenkins Act (``Noncompliant List''), if appropriate.
---------------------------------------------------------------------------
\16\ Indeed, in subscribing to this set of comments, one of the
commenting State attorneys general provided contact information that
listed a Post Office Box address.
---------------------------------------------------------------------------
Two Federal agency partners inquired whether the Business/
Regulatory Purposes exception, or some other exception, would
accommodate shipments from one governmental actor to another, such as
between a governmental field agent and an agency laboratory or between
two separate agencies. Congress has made the Business/Regulatory
Purposes exception available only for shipments (1) from one covered
business to another and (2) from such a business and governmental actor
or vice versa, 18 U.S.C. 1716E(b)(3)(A)(i)-(ii), but not (3) from one
governmental actor to another. Nor does any other PACT Act exception
encompass such shipments. While the Postal Service understands that
effective regulation may require shipments of tobacco and ENDS products
between governmental actors, such shipments must occur through non-
postal channels unless and until Congress amends the PACT Act to permit
the use of the mails for such shipments.
3. Application Process
The PACT Act charges the Postal Service with verifying that any
person submitting an otherwise nonmailable tobacco product into the
mails, and any person receiving such a product through the mails, as
authorized under the Business/Regulatory Purposes exception, is a
business or government agency within the scope of the exception. 18
U.S.C. 1716E(b)(3)(B)(ii)(I)-(II); see also id. at (b)(3)(B)(ii)(VI)
(markings must enable Postal Service employees' awareness that the
mailing ``may be delivered only to a permitted government agency or
business''). To fulfill these eligibility verification requirements,
the Postal Service created a centralized application process. 76 FR at
24535-24536; 76 FR at 29665-29666. The Postal Service reasonably
determined that centralization of eligibility determinations would
allow for more effective and efficient assessment of eligibility, and
would be less disruptive to retail and delivery operations and the
customer experience, than the alternative of having retail and delivery
personnel attempt to verify documentation and other criteria for
eligibility each and every time an ENDS mailing is tendered or
delivered.\17\ Eleven years of the existing practice have provided no
fresh basis to think that a decentralized approach to eligibility
verification would work better.
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\17\ The Postal Service is statutorily obligated to pursue
economy and efficiency in its operations. 39 U.S.C. 101(a), 403(a),
(b)(1), 2010, 3661(a).
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In general, pro-ENDS commenters expressed concern that the
centralized authorization process set forth in Publication 52 section
472.221, in combination with the fact that the POSECCA's mailing
prohibition would take effect immediately upon adoption of the final
rule, would have an unduly disruptive effect on the ENDS industry, at
least to the extent that supply-chain-related and regulatory mailing
activity might ultimately be deemed permissible under the Business/
Regulatory Purposes exception.
Some industry commenters recommended that the Postal Service
develop a streamlined process involving an online application portal.
The Postal Service agrees that this recommendation might well benefit
applicants, as well as improve the effectiveness and efficiency of
Postal Service review. Unfortunately, the Postal Service's existing
information technology infrastructure does not allow for such a
solution in the near term, and the need for prompt implementation
precludes development and implementation of an online application
portal prior to adoption of the final rule. The Postal Service will
continue to explore the feasibility of digitizing the application
process and may amend its rules appropriately at a later time.
Particularly given the lack of a digital-based application process,
at least one industry commenter expressed concern that the Postal
Service may not be prepared for a potential flood of applications, and
two others asked the Postal Service to ensure adequate staffing to
process applications. The Postal Service recognizes that the ENDS
industry is less consolidated, more complex, and more reliant on the
mail than the industries previously subject to the PACT Act. As such,
the Postal Service shares the commenter's anticipation of a large
number of applications that far exceeds the historical rate of such
applications and involves numbers of parties and products far greater
than past applications. See 86 FR at 20288. The Postal Service is
therefore undertaking multiple steps in an effort to improve the
efficiency of the application review process and to mitigate the likely
increase in processing times:
The Postal Service provided advance guidance to ENDS
industry actors about application documentation that they could compile
while awaiting the final rule, in the interest of filing an application
as soon as possible following the final rule and minimizing the chances
of delayed processing due to insufficient supporting documentation. Id.
The Postal Service also provided advance guidance about
other mailability restrictions that might apply to ENDS products, so
that potential applicants may preemptively consider whether their
products would be nonmailable in any case and, in appropriate cases,
narrow the scope of their Business/Regulatory Purposes applications
accordingly or forgo applying altogether. See id. at 20,289.
For at least a temporary period, the Postal Service is
assigning additional analyst resources to assist the PCSC with
reviewing Business/Regulatory Purposes exception applications. This
internal workload-management change does not affect any aspect of the
rules themselves and therefore is not reflected in the text of the
final rule.
Despite these measures, it must be recognized that the Postal
Service has limited financial and other resources with which to fulfill
its universal service mission and fulfill myriad other statutory
obligations,\18\ and Congress did not provide the Postal Service with
any additional funding for POSECCA implementation activities. As such,
there are limits to the Postal Service's ability to timely process
substantial numbers of Business/Regulatory Purposes applications at any
given time. The statutory requirements for Postal Service verification
of mailers' and
[[Page 58414]]
recipients' eligibility, 18 U.S.C. 1716E(b)(3)(B)(ii)(I)-(II),
(b)(5)(C)(ii)(I), leave the Postal Service unable to simply suspend
such verification. Hence, applicants and other interested parties
should expect review of their applications to require potentially
substantial processing time. The duration of any review would be
determined by the number and complexity of the applications that the
Postal Service receives and the amount of engagement with applicants
during processing. The Postal Service recommends that applicants
provide complete, accurate information in their applications and limit
their current and anticipated mailing activity to bona fide mailable
content, so that applications can be processed as efficiently and
expeditiously as possible.
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\18\ Unlike most Federal agencies, the Postal Service is
supported almost entirely by revenues, not appropriations of
taxpayer dollars. See generally 39 U.S.C. 2401. The Postal Service
incurred multibillion-dollar net losses in each the past fourteen
years, with a cumulative deficiency of $87.0 billion as of the end
of FY 2020 and liquidity levels that place the current and future
fulfillment of its statutory mission at risk. U.S. Postal Serv.,
2020 Report on Form 10-K, at 68, https://about.usps.com/what/financials/10k-reports/fy2020.pdf.
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A number of pro-ENDS commenters expressed concern that an immediate
effective date, coupled with a time-consuming application process for
the Business/Regulatory Purposes exception, would disrupt the very
industry supply chains and regulatory activities that the exception is
intended to safeguard. To avoid such anticipated harms, these
commenters asked the Postal Service either to accept Business/
Regulatory Purposes exception applications in advance of the final
rule, or else to defer the mailing ban until applications can be
approved. In the April 2021 Guidance, the Postal Service explained that
it would not accept early applications, as it was yet undetermined to
what extent the exceptions would be available for ENDS products at all
and on what terms. 86 FR at 20288. It is tautological that the Postal
Service cannot announce and give effect to an exception to a mailing
ban before the ban takes effect; prior to the ban, mailability is the
rule, not an exception. As for accepting and processing applications in
advance of the final rule, the course of intra- and interagency
deliberations over the final rule--particularly in light of the
voluminous number and range of public comments--required an
extraordinary amount of time to process, to the point where any early
acceptance period would have been too short to provide the substantial
buffer that commenters sought. Nor is the Postal Service at liberty to
further defer the effective date simply for the sake of a small group
of pro-ENDS commenters, for the reasons discussed in section III.A.3.
As it was, the same complex deliberations required far more time to
complete the final rule than Congress had allotted in the POSECCA, and
the policy interests evident in the statutory text and legislative
history--none of which include solicitude toward industry supply chains
or regulatory activities--do not support additional, discretionary
delay beyond what was necessary to complete the final rule.\19\
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\19\ Moreover, it is difficult to see how the proposal to delay
effectiveness until applications can be approved would work in
practice. The Postal Service cannot predict how many applications it
will receive, their timing and pacing, or their extensiveness, and
so it cannot predict how long it will take to process even an
initial batch of applications.
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Out of similar concerns over at least temporary disruption of
industry supply chains, two ENDS industry commenters proposed that the
Postal Service allow applicants to continue mailing ENDS products
within the scope of the exception while awaiting approval of their
application, subject to a sworn certification of eligibility, a bond or
other security, or a provisional eligibility number provided by the
Postal Service. The Postal Service declines to adopt this proposal as
inconsistent with the aforementioned statutory requirements that the
mailing ban take effect immediately and that the Postal Service verify
the sender and recipient's eligibility prior to permitting any mailing
under the Business/Regulatory Purposes exception.
Even if 18 U.S.C. 1716E(b)(3)(B)(ii)(I)-(II) were arguably
ambiguous as to whether verification may happen after acceptance or
even after delivery, the Postal Service considers the only reasonable
interpretation to be that verification must occur prior to acceptance.
Congress clearly expressed its intent that verification of the
recipient occur prior to delivery: 18 U.S.C. 1716E(b)(3)(B)(ii)(VI)
requires package markings apprising Postal Service personnel that a
given mailing ``may be delivered only to a permitted government agency
or business.'' Hence, ``permitted'' status must be ascertained as a
condition precedent to delivery. Moreover, the exception is available
``only'' to eligible businesses and government agencies. 18 U.S.C.
1716E(b)(3)(A). The exception therefore may not be used to justify a
mailing to or from an ineligible entity, regardless of whether the
entity is the subject of a pending application. Because eligibility is
not determined until it is determined, the presumption must necessarily
be that a mailing is ineligible until demonstrated to be eligible, not
the other way around. Moreover, the Postal Service is mindful that the
Business/Regulatory Purposes exception is carved out from the general
rule that ENDS products ``shall not be deposited in or carried through
the mails.'' Id. at (a)(1). As such, the narrow construction typically
due exceptions, discussed in the preceding section, militates against a
liberal presumption of eligibility on the sheer basis of a mailer's
self-certification or payment of a bond. Even if such a presumption
were not inconsistent with the statute, the Postal Service would
decline to adopt it as a policy matter, given the undue opportunity for
abuse that it would present.
The same commenters urged the Postal Service to streamline or
eliminate the process for updates to approved applications, which, the
commenters argued, should not require a further application and
approval process. The requirements for approval of updated applications
were set forth and explained in the Postal Service's 2010 final rule
implementing the PACT Act. As the Postal Service explained then, the
PACT Act charges the Postal Service with verifying the eligibility of
senders and addressees pursuant to the Business/Regulatory Purposes
exception, and so mailers must be responsible for maintaining the
accuracy of all information in their applications and await
verification of eligibility before any mailing may be treated as
permissible under the exception. 76 FR at 29666.
Indeed, an update may be just as substantive as the original
application (e.g., the addition of parties or products), and it may
materially change circumstances relevant to mailability. Even updates
to a single entry on the form can be material: A change of address
could be legitimate or used to mask an ineligible party; ``legally
operating'' status can hinge on rescission or extension of a permit;
and a change in product composition may change its status vis-[agrave]-
vis controlled-substance or hazardous-materials rules. Vetting only an
initial application but not updates to it would invite efforts to evade
review through overreliance on unreviewed updates, in violation of both
the letter and the spirit of 18 U.S.C. 1716E(b)(3)(B)(ii)(I)-(II).
Nothing about the statutory verification requirement has changed
since 2010, and so there is no basis to rethink the need to verify
updated applications. That said, as noted earlier, the Postal Service
will undertake to explore possibilities for streamlining the
application process, including updates to applications, through
automation and digitization.
Some pro-ENDS commenters opined that the centralized application
process imposes red tape that favors large industry actors and poses
undue obstacles to smaller businesses. While
[[Page 58415]]
the Postal Service is sympathetic to the challenges faced by small and
medium-sized enterprises, Congress has mandated that use of the
Business/Regulatory Purposes exception be conditioned on Postal Service
verification of eligibility. The PACT Act's verification requirements
apply to all entities sending or receiving items under the exception,
without distinction as to size. The Postal Service considers the
alternative to centralized verification--verification at the point of
acceptance and delivery of each mailing--to pose similar obstacles in
terms of paperwork burden, as the sender or recipient would still need
to compile and present the same license, permit, and other
documentation to demonstrate eligibility. The only difference would be
that the sender and recipient would have to do so for each and every
mailing, rather than on a less frequent basis under the centralized
process. It is difficult to see how the decentralized-verification
alternative would be superior in terms of reducing administrative
burden for small and medium-sized enterprises, given Congress's
requirement of eligibility verification in all cases. That said,
smaller businesses may benefit from proportionally faster processing
times (within the bounds of application processing as discussed later
in this section), to the extent that their applications involve fewer
parties and products than those of larger businesses.
Two ENDS industry commenters suggested that the Postal Service
provide a checklist for applicant documentation. Simultaneously to the
final rule, the Postal Service is issuing a distinct version of its
application form to account for ENDS products. The amended form will
include detailed instructions and documentation requirements, as well
as supporting worksheets.
Two ENDS industry commenters requested that the Postal Service
confirm that it would process applications on a ``first in, first out''
(FIFO) basis, in the interest of equal treatment for all businesses.
The PCSC generally uses a FIFO system for each stage of application
processing, although the precise sequencing of application processing
may be complicated somewhat by the expanded distribution of workload
discussed earlier in this section.\20\ It is certainly not the case
that applications will be prioritized according to business size,
industry reputation, or other applicant-specific circumstances.
---------------------------------------------------------------------------
\20\ For example, if multiple analysts are conducting initial
review of a batch of applications received on the same day, a later-
filed application may advance in the review queue before an earlier-
filed one that is still being reviewed by a different analyst. It
would remain the case that any given reviewer will operate on a FIFO
basis, however.
---------------------------------------------------------------------------
State and local attorneys general proposed that the Postal Service
share applications with State and local law enforcement officials to
spread out the investigative workload. The Postal Service appreciates
the suggestion and is willing to consider possibilities for enhancing
application processing via intergovernmental and/or interagency
information-sharing, subject to feasibility, appropriate protections
for third-party information, and other pertinent conditions. The Postal
Service regards such intergovernmental cooperation as part of what
should be the normal administration of the PACT Act, see 18 U.S.C.
1716E(g), and looks forward to further dialogue with partners outside
of the ambit of this rulemaking.
State and local attorneys general also proposed that the Postal
Service use State and local governments' lists of licensees to verify
eligibility. This suggestion is facially reasonable, but the Postal
Service is unaware of any consolidated data source that would enable
efficient and fair incorporation of such a resource into the
application review process. Here, too, the Postal Service welcomes
further dialogue with its intergovernmental partners about potential
enhancements to PACT Act administration.
4. Documentation of Legally Operating Status
To support verification of eligibility as legally operating under
18 U.S.C. 1716E(b)(3)(A) and (b)(3)(B)(ii)(I), preexisting Publication
52 section 472.221.a required an applicant to submit information about
its legal status, any applicable licenses, and authority under which it
operates; information about the legal status, any applicable licenses,
and operational authority for all entities to which the applicant's
mailings under the exception would be addressed; and all locations
where mail containing cigarettes and smokeless tobacco would be
presented.
Some ENDS industry stakeholders expressed concern that the
documentation requirements were geared exclusively toward tobacco
licensing and would prejudice mailers of non-nicotine-related ENDS
products. This concern is unfounded. Nothing in either 18 U.S.C.
1716E(b)(3)(A) or Publication 52 section 472.221.a is specific to
tobacco or nicotine licensing. Instead, the statute conditions
eligibility on the sender and recipient having ``all applicable State
and Federal Government licenses or permits'': In other words, any
license or permits that entitle the sender or recipient to engage in
business activities relating to the product being shipped, whatever
that product may be. 18 U.S.C. 1716E(b)(3)(A) (emphasis added).
Similarly, Publication 52 section 472.221.a frames the documentation
requirements solely in terms of licenses, permits, and authority,
without specific reference to tobacco or nicotine or to documentation
used exclusively with tobacco or nicotine. The existing language
therefore requires no change to accommodate licensing, permit, or other
documentation that may demonstrate legal authority to engage in
business dealings concerning any or all types of ENDS products relevant
to a shipment.
Insofar as the concern may pertain to a separate phrase in 18
U.S.C. 1716E(b)(3)(A)--``engaged in tobacco product manufacturing [or
other specified types of business activity]''--it is evident that
Congress used ``tobacco product'' in the PACT Act as a catch-all term
encompassing all PACT Act-covered products, regardless of actual
tobacco content. See 86 FR at 10219. To be sure, the phrase's import
was clearer prior to POSECCA, when all PACT Act-covered products were
derived from tobacco. But even after POSECCA's inclusion of non-
tobacco-related ENDS products, see supra section III.D.1, the intent
remains sufficiently clear. Given the thorough reliance on ``tobacco
product'' throughout the PACT Act, construing the somewhat antiquated
phrase literally as covering only bona fide tobacco-derived products
and excluding non-tobacco-based ENDS products would vitiate the very
language whereby Congress has now subjected to the PACT Act ENDS
products related to delivery of any ``substance,'' including non-
tobacco-derived substances. Indeed, the POSECCA places ENDS products
within the definition of ``cigarette;'' however linguistically awkward
this may be, it is evident that ``cigarette'' is now a term of art
signaling the PACT Act's application to both tobacco and non-tobacco
products. It is reasonable to extend the same understanding to
``tobacco product,'' within which ``cigarettes'' are subsumed. Thus,
the only reasonable construction faithful to the POSECCA's text and
intent is to treat ``tobacco product'' not as a term of limitation, but
[[Page 58416]]
rather as a catch-all term encompassing all products subject to the
PACT Act.\21\
---------------------------------------------------------------------------
\21\ To promote clarity, however, the Postal Service will use a
different terminological approach in its regulations. See infra
section III.J.3.
---------------------------------------------------------------------------
In any event, the instance of ``tobacco product'' in 18 U.S.C.
1716E(b)(3)(A) cabins only the activity-based classes of entities
eligible for the exception, and not the nature of the licenses or
permits under which they may operate. Rather, licenses and permits go
to whether the entity--whatever its market and field of activity--is
legally operating.\22\ As such, a cigarette manufacturer, for example,
must have licenses and permits relating to cigarette manufacture, but
whether it is legally operating may additionally depend on more general
business licensure not specifically related to cigarettes. The same is
true of an ENDS-related business. Indeed, the business activity that is
the subject of an ENDS-related Business/Regulatory Purposes application
may implicate multiple levels of licensure. For example, consider a
business engaged in ENDS distribution and applying for the Business/
Regulatory Purposes exception in connection with CBD-related products:
``All applicable State and Federal Government licenses or permits''
bearing on ``legally operating'' status might include a general
operating license, permission to distribute ENDS products, and
permission to distribute hemp-derived (e.g., CBD) products, among other
things, to the extent that any such licenses are required by applicable
State or Federal law.
---------------------------------------------------------------------------
\22\ It is possible that the commenters' concern arises not from
the portion of the PACT Act that governs mailability, but from the
separate portion that governs delivery sales more generally via
modification of the Jenkins Act. See 15 U.S.C. 376a(a)(3)(B)
(requiring delivery sellers to comply with ``all State, local,
tribal, and other laws generally applicable to sales of cigarettes
and smokeless tobacco,'' including ``licensing and tax-stamping
requirements''). But that provision applies only to ``delivery
sales'' to consumers. See 15 U.S.C. 375(5). Except for intrastate
shipments within Alaska and Hawaii, such sales are beyond the scope
of the exceptions to the PACT Act's mailing ban, and so they cannot
be effectuated through the mails. As such, if the Jenkins Act
provision is the basis for the commenters' concern, then it appears
to be largely inapposite in this context. As noted in section
III.C.3, inquiries about the application of Jenkins Act requirements
to delivery-sale-related postal shipments of ENDS products within
Alaska and Hawaii should be directed to ATF.
---------------------------------------------------------------------------
Certain other ENDS industry commenters inquire about a situation
where neither Federal nor State law imposes any particular license or
permit requirements on the same of a given ENDS product. The commenters
propose that an applicant be permitted to simply cite a State statute
allowing general business operations. The Postal Service appreciates
the novelty of the situation, which would not have arisen with respect
to the comprehensively regulated products previously subject to the
PACT Act. As noted earlier, the PACT Act requires verification of all
applicable State and Federal Government licenses or permits. If there
are no applicable licenses or permits upon which ``legally operating''
status as to the relevant business activity depends, then that is that.
At the very least, however, it seems unlikely that any State's laws
would permit an applicant business to operate without a general
business license. To the extent that the applicant's relevant business
activity is not subject to any other license or permit requirements,
then the applicant should be prepared to attest to and document that
circumstance, either affirmatively or in response to further PCSC
inquiry. Particularly where no other documentation may exist, a
government-issued certificate of good standing may be helpful, although
not necessarily dispositive. Applicants are reminded that they bear the
burden of proof in establishing eligibility to the satisfaction of the
PCSC, and applications will likely be processed faster if applicants
affirmatively provide robust information about their legal status up
front.
It should be noted that the same verification requirements apply
with respect to all senders and recipients under the exception,
regardless of their status as business actors or government agencies.
See 18 U.S.C. 1716E(b)(3)(A), (b)(3)(B)(ii)(I)-(II). At the same time,
however, only businesses' eligibility is conditioned upon ``legally
operating'' status as evidenced by licenses and permits, compare id. at
(b)(3)(A)(i) with id. at (b)(3)(A)(ii), and indeed, government agencies
are not typically subject to licensure by other governmental bodies.
Nevertheless, because the Postal Service is required to verify
eligibility for governmental senders and recipients, applicants must
provide the Postal Service with sufficient information to determine
that the relevant governmental entity is an eligible one, and not
merely an ineligible entity using a name identical to or resembling
that of a bona fide governmental entity. Such information would include
not only the entity's name and address, but also citations to the legal
authority under which it operates.\23\
---------------------------------------------------------------------------
\23\ While the Postal Service will retain the preexisting rule
permitting waiver, upon request, of application requirements for
mailings sent by State or Federal Government agencies, such waivers
are not available to business applicants sending to government
agencies.
---------------------------------------------------------------------------
One ENDS business asked about how the documentation requirements
would apply to contract research organizations and trade shows. The
same principles would apply as discussed earlier in this section: To
the extent that lawful operation of a contract research organization or
trade show relating to the relevant PACT Act-covered products requires
Federal or State licensing or permitting, then copies of such
documentation must be included with an application concerning such a
party. Again, particularly where other license or permit documentation
may not exist, a government-issued certificate of good standing may be
helpful, albeit not necessarily dispositive.
It is emphasized that the Postal Service is required not merely to
collect Federal and State licenses and permits, but also to verify more
broadly that a business is ``legally operating'' and ``engaged in'' the
relevant business activity. This may require the submission of
documentation beyond merely licenses and permits. For example, a
university performing research on behalf of ENDS industry participants
may need to submit not only copies of relevant licenses and permits,
but also grant or contract documentation indicating that the research
is within the scope of a legally authorized undertaking.
State and local attorneys general proposed that the Postal Service
require applicants to provide information about the products that they
intend to ship under the Business/Regulatory Purposes exception. The
product suggestion is well-taken, given the various other regulatory
and mailability concerns apart from the PACT Act that may pertain to
certain ENDS products. The new application form and worksheet
incorporate requirements for applicants to provide brand names and
descriptions of each product that they intend to ship, as well as
additional supporting documentation regarding products that contain
lithium batteries, nicotine, THC, or CBD and any other ENDS liquids or
solutions.
State and local attorneys general also recommended that applicants
be required to certify that they will ship only between authorized
persons (i.e., persons whom the Postal Service has verified as
eligible). While the concern for attestation is valid, the Postal
Service believes that it is already adequately addressed, to the point
where attestation at the point of acceptance would be redundant. The
Business/Regulatory Purposes application form requires the customer to
completely list all intended recipients and to certify as to the
entries'
[[Page 58417]]
completeness and accuracy. Any materially false or fraudulent statement
or omission in the application could subject the applicant to liability
under the False Claims Act. See 18 U.S.C. 1001(a). Furthermore, the
PACT Act makes clear that the exception does not cover a shipment to an
ineligible party, and so a shipment to such a party could subject the
shipper to liability under the PACT Act. Moreover, the new rules, like
the former rules, require shippers to present their PCSC eligibility
determination letter to acceptance personnel for verification of the
sender and addressee's eligibility. Here, too, presentment of false or
misleading information, or concealment of relevant information, could
subject a shipper to False Claims Act liability. As such, there does
not appear to be any clear incremental value in adding a redundant
attestation at the point of acceptance, let alone such value as might
outweigh the administrative costs of doing so.
5. Qualifying Postal Service Products
Several pro-ENDS commenters asked the Postal Service not to limit
the use of the Business/Regulatory Purposes exception to shipments via
Priority Mail Express with Hold for Pickup service, but rather to allow
such shipments via Priority Mail as a more affordable alternative. This
concern appears to refer to the PACT Act rules initially implemented in
2010, and not to the current rules. Although Priority Mail Express with
Hold for Pickup service was the only combination of services available
at the time of original PACT Act implementation in 2010 that could
permit the Postal Service to fulfill the PACT Act's age-verification,
identity-verification, and tracking requirements, see 75 FR at 29665-
29666, the subsequent creation of Adult Signature service enabled the
Postal Service to expand the range of available product combinations to
Priority Mail Express or Priority Mail with Adult Signature service.
See Adult Signature Services, 76 FR 30542 (2011); Publication 52
section 472.222.a. Hence, the Postal Service has long since offered
Priority Mail-based options. In this rulemaking, no commenter expressed
opposition to the continued availability of Priority Mail Express or
Priority Mail with Adult Signature Service for shipments under the
Business/Regulatory Purposes exception, and the Postal Service is aware
of no reason to restrict such availability in the context of ENDS
products.
Upon further consideration, however, it is apparent that Hold for
Pickup is now an inferior alternative for fulfilling the PACT Act's
verification requirements. Unlike Adult Signature service, Hold for
Pickup does not inherently require age or identity verification;
rather, personnel must be instructed and expected to identify when a
particular Hold for Pickup item requires such verification, based on
mailers' compliance with the marking requirement. Because Adult
Signature service now provides a more effective means to ensure
verification, the Postal Service is discontinuing the option of
Priority Mail Express with Hold for Pickup service for mailings under
the Business/Regulatory Purposes exception, as well as all other PACT
Act exceptions.
6. Methods of Tender
The Postal Service's preexisting PACT Act regulations require
Business/Regulatory Purposes shipments to be tendered via a face-to-
face transaction with a Postal Service employee, other than through
package pickup by a letter carrier. Publication 52 section 472.222.a. A
number of ENDS industry commenters asked the Postal Service to
reconsider what they characterized as a requirement to tender at a Post
Office and to allow Pickup on Demand, package pickup, or business mail
acceptance for excepted shipments. Some such commenters noted that the
purported requirement is not grounded in the text of the PACT Act.
The commenters misperceive somewhat the import of the face-to-face
transaction requirement. For customers using the Business/Regulatory
Purposes exception, only Pickup on Demand and package pickup are
precluded; nothing in Postal Service regulations prohibits tender at a
business mail entry unit or at authorized acceptance locations at a
Post Office other than the retail counter, so long as a Postal Service
employee accepts the items via an in-person, face-to-face encounter.
But see DMM section 503.8.1.3 (requiring tender at a retail counter for
customers using Adult Signature service to mail under the Certain
Individuals exception). To promote clarity, the final rule includes
explicit mentions of retail and/or business mail acceptance locations.
The Postal Service hopes that this clarification should help to dispel
the commenters' fears of bottlenecks at retail counters.
That said, the Postal Service declines to reconsider the
prohibition on Pickup on Demand and package pickup. The centralized
application process is intended to streamline the extent of
verification that would otherwise be required upon acceptance pursuant
to 18 U.S.C. 1716E(b)(3)(B)(ii)(I)-(II), but it cannot supplant
acceptance verification entirely. Something must be done to associate
the PCSC's determination of eligibility with a given mailing:
otherwise, the Postal Service personnel faced with an apparent mailing
of a prohibited product have no way to determine its legitimacy,
defeating the whole purpose of PCSC verification. For this reason,
while a mailer need not submit the entire dossier of eligibility
documentation with each mailing, the mailer must at least show a Postal
Service employee the PCSC's determination of eligibility, so that the
Postal Service can be assured that the package may lawfully be
accepted.
Pickup on Demand and package pickup do not provide adequate
assurance that the face-to-face interaction necessary to connect PCSC
authorization with a given package will occur in all cases. Much of the
customer convenience underlying Pickup on Demand and package pickup is
in the fact that packages may be left passively for a carrier to pick
up without the need for in-person interaction. If Pickup on Demand and
package pickup services were made available subject to a requirement
for face-to-face interaction and verification, then this would raise
secondary questions of how a carrier would know when the requirements
apply and, more importantly, how the Postal Service could guard against
circumvention by customers who do not engage in the requisite request
for face-to-face pickup. Moreover, requiring carriers to take the time
for face-to-face verification would increase the time required for
carriers to service their routes, with negative effects on efficiency
and service to other customers.\24\ Because allowing Pickup on Demand
and package pickup for excepted mailings would diminish the fulfillment
of the Postal Service's obligations under both the PACT Act (i.e.,
verification of eligibility prior to acceptance) and its governing
statutes more generally, the Postal Service determines that Pickup on
Demand and package pickup remain unacceptable.
---------------------------------------------------------------------------
\24\ As noted in section III.G.3, the Postal Service is
statutorily obligated to pursue economy and efficiency in its
operations.
---------------------------------------------------------------------------
7. Delivery Requirements
In addition to ensuring that the addressee is eligible to receive
shipments under the Business/Regulatory Purposes exception, the PACT
Act requires the Postal Service to ensure (1) that delivery is made
only to a verified employee of the addressee; (2) that the receiving
employee be verified to be at least the minimum age for
[[Page 58418]]
purchase or sale of the relevant products; and (3) that the receiving
employee be required to sign for the mailing. 18 U.S.C.
1716E(b)(3)(B)(ii)(II), (VII). Accordingly, the Postal Service's PACT
Act regulations have required recipients to show proof of employment
status with the addressee business or government agency; to show proof
of age; and to sign the return receipt. Publication 52 section 472.223.
The Postal Service did not propose to change these requirements.
Some ENDS industry commenters asked that delivery options be
expanded from Priority Mail Express with Hold for Pickup service to
allow carrier delivery. As discussed in section III.G.5, this request
has long since been fulfilled. The Postal Service in 2011 expanded the
range of available services to include Priority Mail Express or
Priority Mail with Adult Signature service. Unlike Hold for Pickup,
which requires a recipient to retrieve a package from a local Post
Office, Adult Signature service can be fulfilled by a letter carrier.
As such, the Postal Service's longstanding regulations already include
carrier delivery options. As also noted in section III.G.5, however,
the Postal Service has now determined to discontinue the availability
of the Hold for Pickup option; this does not affect the availability of
Adult Signature options that are compatible with carrier delivery.
One ENDS industry association recommended that the final rule
expressly contemplate a signed letter from an employer as proof of
employment. The Postal Service recognizes that the preexisting PACT Act
regulations are not specific on this point, and that lay readers may
benefit from additional clarity. Therefore, the final rule offers
examples of acceptable employment documentation, including an employee
identification badge or card, a recent letter on company or agency
letterhead attesting to the recipient's employment, or any other
documentation that the local postmaster deems to be of comparable
reliability. In addition, where delivery is made to a business address,
the carrier will be permitted to infer employment status from such
factors as the recipient's uniform and presence at a reception desk or
retail counter.
Finally, State and local attorneys general asked that the Postal
Service bar delivery of shipments under the Business/Regulatory
Purposes exception to Post Office Box or private mailbox addresses. The
Postal Service declines to do so, for the reasons discussed in section
III.G.2.
H. Certain Individuals Exception
As extended to ENDS, this exception allows individual adults to
mail a limited number of lightweight packages containing ENDS products
for noncommercial purposes. 18 U.S.C. 1716E(b)(4)(A). Some pro-ENDS
commenters requested clarification on whether the return of damaged
ENDS products to the manufacturer is covered by this exception. By way
of clarification, the statute requiring this exception expressly
includes the return by an individual of damaged or unacceptable goods
to the manufacturer. Id. This language is mirrored in Publication 52
section 472.23, which the final rule extends to ENDS.
For additional clarity, the final rule adds language making
explicit the permissibility of returning damaged or unacceptable
products under this exception. The new language also clarifies the
application of the exception's noncommercial-purpose condition to
returns of damaged or unacceptable products, in that a product return
remains noncommercial so long as any value offered to the sender is
limited to the consumer's original outlays for the returned product and
the cost of its return. Any additional exchange of value would not
merely restore the consumer to their status quo ante; it would be
tantamount to a higher-priced sale and thus no longer a noncommercial
transfer.
Noting the noncommercial-purpose requirement, some ENDS industry
commenters sought clarification regarding whether used disposable ENDS
products, which they claim have no commercial value and are similar to
damaged products, would be included as ``damaged or unacceptable''
goods under this exception if returned to manufacturers or other
businesses for recycling.
The Certain Individuals exception allows shipments by individuals
regardless of the type of recipient or the specific reason for mailing
(subject to various limitations, including the noncommercial-purpose
condition). Although the statute expressly lists the return of damaged
or unacceptable products as an example, the use of ``including'' before
this statutory phrase makes clear that it is merely illustrative, not
exhaustive.
As noted earlier in this section, the Certain Individuals exception
does contain a requirement that the mailing be ``for noncommercial
purposes.'' Id. As the commenters maintain, the depleted merchandise is
effectively scrap with no intrinsic commercial value to the consumer.
Thus, this exception permits the mailing of used ENDS products for
recycling purposes only so long as no net commercial value, such as a
rebate, credit, or discount on future purchases, is offered to the
mailer in exchange for the used or depleted merchandise. This
clarification is reflected in new language expressly discussing the
possibility of recycling-oriented shipments under this exception. It is
possible that some arrangements involving the recycling of used
merchandise might not constitute a commercial exchange and therefore
might be permissible under the Certain Individuals exception, such as
where the merchandise is merely loaned to an individual user subject to
a deposit payment that is refundable upon return of the material.
Persons seeking guidance about whether a particular program would
constitute a legitimate use of the Certain Individuals exception are
encouraged to seek a mailability ruling pursuant to Publication 52 part
215.
One commenter reasoned that, because the return of damaged or
unacceptable goods to the manufacturer is expressly allowed under this
exception, the manufacturer should be allowed to use the exception to
mail warranty replacement goods to adult consumers. However, the
Certain Individuals exception provides only for adult ``individuals''
to mail ENDS for ``noncommercial purposes.'' Id. The exception thus
does not authorize shipments by businesses (or other organizational
entities) for any purpose, not even to fulfill a repair or replacement
triggered by a consumer's use of the exception. Nor does any other PACT
Act exception permit business-to-individual mailings for such purposes.
A Federal agency partner inquired whether the availability of the
Certain Individuals exception for products exchanged as gifts could be
construed as allowing businesses to distribute free samples,
notwithstanding the FDA's general ban on free samples of tobacco
products. See 21 CFR 1140.16(d). The Postal Service emphasizes that its
mailability regulations, including those administering the PACT Act, do
not supersede any other applicable regulation that might restrict or
prohibit a given transfer, distribution, or other activity effected
through the mails. See Publication 52 part 412 (``The mailer is
responsible for ensuring that all Postal Service requirements, as well
as all federal and state laws and local ordinances that apply to the
shipment of an article of restricted matter, have been met.''). That
said, as the name indicates, the Certain Individuals exception is not
available for any and all noncommercial
[[Page 58419]]
shipment of PACT Act-covered products, but rather only for such
shipments by individuals. As such, while gifts from one individual to
another may be within the exception's scope, it does not permit
businesses to distribute free samples to consumers. Nor does any other
exception permit promotional samples to consumers.\25\
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\25\ The Consumer Testing exception does permit the distribution
of cigarettes to individual consumers solely for testing purposes,
subject to various conditions and, again, only to the extent
consistent with applicable laws and regulations. As discussed in
section III.I, the Consumer Testing exception does not apply to
smokeless tobacco or ENDS products.
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Some anti-ENDS commenters suggested that this exception should be
altogether abolished or disallowed, reasoning in one instance that the
return of damaged or unacceptable ENDS products through the mail by
individuals unlikely to be aware of hazmat requirements poses health
risks to Postal Service employees. As discussed in section III.A.2,
absent a legal impediment to its application to ENDS, the Postal
Service lacks a delegation of legislative authority to disallow this or
any other PACT Act exception on policy grounds.
Moreover, hazardous-materials concerns are already addressed
through comprehensive mailing requirements in Publication 52. Those
requirements have applied to individual mailers of ENDS products since
long before the POSECCA, and they will continue to apply to mailings
under the Certain Individuals exception. The hazardous-materials rules
will continue to function to protect the health and safety of all who
handle the mail. ENDS industry actors are strongly encouraged to
promote awareness of all relevant mailing restrictions and
requirements, including hazardous-materials rules, among ENDS
consumers. See DMM section 601.9.4.1 (advertising, promotional, and
sales matter soliciting or inducing the mailing of nonmailable
hazardous materials is itself nonmailable).
Some anti-ENDS commenters recommended that mailers using the
exception be required to sign a sworn, written statement or provide
other verification that the recipient is above the age of 21, as
opposed to the oral affirmation required under the preexisting rules
and the proposed rule. See Publication 52 section 472.231.d. These
commenters purported that such a measure is necessary because underage
recipients continue to access mailed products that are putatively
nonmailable under the PACT Act.
Such a requirement would be superfluous and unnecessarily
burdensome. Age verification is already required at delivery. 18 U.S.C.
1716E(b)(4)(B)(ii)(V)-(VI). By contrast, the mailer is required merely
to ``affirm that the recipient is not a minor.'' Id. at
(b)(4)(B)(ii)(II). To the extent that any minors allegedly continue to
receive mailings of products made nonmailable under the PACT Act, the
commenters have pointed to no evidence that this is due to a deficiency
in administration of the Certain Individuals exception.\26\ Therefore,
this recommended measure does not appear to address a demonstrable
shortcoming in the Certain Individuals exception, let alone to do so in
a way that would meaningfully improve compliance.
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\26\ The academic literature cited by these commenters is inapt.
One cited study purports to present findings about a lack of age
verification for postal deliveries of e-cigarettes in 2014 in
violation of the PACT Act, but neither the PACT Act nor any age-
verification condition on mailing applied to e-cigarettes at that
time. See generally Rebecca S. Williams et al., ``Electronic
Cigarette Sales to Minors Via the Internet,'' 169 JAMA Pediatrics
e1563 (2015). The other allegedly relevant article claims that
Postal Service letter carriers did not attempt to conduct age
verification for deliveries of cigarettes by online businesses (not
individuals, such as might be relevant to the Certain Individuals
exception). Rebecca S. Williams et al., ``Cigarette Sales to Minors
Via the Internet: How the Story Has Changed in the Wake of Federal
Regulation,'' 26 Tobacco Control 415 (2017). That article focuses on
the consumers' interactions with online vendors and the Postal
Service. As recipients, of course, consumers' knowledge or behavior
is not transparent to the Postal Service; rather, from the Postal
Service's perspective, the mailer (here, the internet vendor) is
responsible for compliance with mailing requirements. Publication 52
section 212. The article provides no basis to think that the mailers
gave the Postal Service (and thus letter carriers) any indication,
let alone a reasonable one, to perceive that the contents of their
packages might be nonmailable or require age verification. Indeed,
the researchers expressly allowed minor test subjects to
misrepresent their age and use their parents' drivers' licenses to
bypass age-verification questions. Rebecca S. Williams et al.,
``Cigarette Sales to Minors Via the Internet.'' Notably, another
study cited by the commenters attests that nearly 90 percent of
youth access to tobacco products (including ENDS products) occurs
via a third-party intermediary (e.g., one who purchased them either
lawfully or fraudulently), and not via an attempt by the underage
user to order and obtain delivery the products directly. Sherry T.
Liu, ``Youth Access to Tobacco Products in the United States, 2016-
2018,'' 5 Tobacco Regulatory Science 491 (2019).
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A coalition of State and local attorneys general urged the Postal
Service to impose a host of additional conditions on this exception by
reference to their proposals under the Business/Regulatory Purposes
exception. Although it was not entirely clear from the comment, the
recommended additional conditions presumably include requiring product
identification, certification of mailer and recipient eligibility,
exclusion of delivery to Post Office Boxes and commercial mail
receiving agencies (``CMRAs''), and signature upon delivery. These
commenters argued that delivery provisions set out in 15 U.S.C.
376a(b)(4)(ii) should apply because they assert that 18 U.S.C.
1716E(b)(4)(B), supposedly lacking comparably stringent age
verification protocols, does not go far enough to prevent illegal
deliveries.
As noted in section III.A.2, the Postal Service has no discretion
to impose additional conditions that Congress did not specify in 18
U.S.C. 1716E(b)(4)(B). If anything, the contrast with measures that
Congress simultaneously adopted through amendments to the Jenkins Act
indicates that Congress did not intend for such measures to govern
mailability. As such, the final rule maintains the age-verification and
delivery requirements set out for this exception in Publication 52
section 472.23.
An industry coalition suggested that the Postal Service allow
prepaid mailing labels to be used for this exception, so that consumers
would not bear the costs of returns to manufacturers. As explained in
section III.G.5, the Postal Service has determined that Adult Signature
service permits the fulfillment of the Postal Service's verification
responsibilities under the PACT Act. At present, Adult Signature
service is not available in conjunction with domestic return services
that would allow for the use of prepaid mailing labels in this manner.
See DMM ex. 503.1.4.1, .1.4.3; Postal Regulatory Comm'n, Mail
Classification Schedule sections 2120.5, 2645.1.1.d (last edited Oct.
3, 2021), available at https://go.usa.gov/xFmHg.
I. Consumer Testing and Public Health Exceptions
The Consumer Testing exception allows ``legally operating cigarette
manufacturer[s]'' (and their legally authorized agents) ``to mail
cigarettes to verified adult smoker[s] solely for consumer testing
purposes.'' 18 U.S.C. 1716E(b)(5)(A). The exception is subject to a
number of conditions regarding manufacturer permitting, cigarette
quantity, shipment frequency, tax compliance, payments from the
manufacturer to recipients (not the other way around), age and identity
verification, tracking and delivery confirmation, and recordkeeping,
among other things. Id. at (b)(5)(A)-(C).
The Public Health exception permits Federal agencies ``engaged in
the consumer testing of cigarettes for public health purposes'' to mail
``cigarettes'' in the same manner as manufacturers under the Consumer
Testing exception,
[[Page 58420]]
except that the payment requirement is waived. Id. at (b)(6).
As relevant to both exceptions, ``consumer testing'' is limited to
``formal data collection and analysis for the specific purpose of
evaluating the product for quality assurance and benchmarking purposes
of cigarette brands or sub-brands among existing adult smokers.'' Id.
at (b)(5)(D).
In the notice of proposed rulemaking, the Postal Service noted that
the use of ``cigarettes'' in these provisions raises an interpretive
question. On the one hand, the POSECCA subsumes ENDS products within
the term ``cigarettes.'' 15 U.S.C. 375(7). On the other hand, the
exceptions are confined to packages containing ``not more than 12 packs
of cigarettes (240 cigarettes)''--quantities that denote standard
packaging of combustible cigarettes but not ENDS products--and Congress
did not amend those provisions to indicate how the quantity limits
should apply to ENDS products. 18 U.S.C. 1716E(b)(5)(A)(ii),
(C)(ii)(III). The Postal Service tentatively opined that it would be
reasonable to construe the lack of accommodation for ENDS products here
as rendering the exceptions inapplicable to ENDS products, and the
Postal Service invited views and proposed alternative standards from
commenters. 86 FR at 10220.
1. Testing by Manufacturers
Public-health commenters generally opposed extending the Consumer
Testing exception to ENDS manufacturers. One group of public-health
organizations agreed with the notice of proposed rulemaking, in that
the wide variety of ENDS packaging and Congressional silence on the
matter indicate that Congress did not intend the exception to cover
ENDS products. Another public-health organization noted that ENDS
products do not have the same degree of standardization as cigarettes:
For example, an ENDS pod containing 5 percent nicotine liquid may
contain a roughly comparable amount of nicotine to 1-1.5 packs of
combustible cigarettes, but more of the combustible cigarettes'
nicotine is wasted, and less delivered to the user, due to so-called
``sidestream smoke.'' Moreover, ENDS liquids' sizes and concentrations
vary widely. A third such organization raised policy objections
regarding the likelihood that ENDS shipments would contain hazardous
materials, would promote dangerous product returns under the Certain
Individuals exception, and would pose difficulties in policing
companies' representations about bona fide consumer testing.
On the other hand, one public-health organization, two law
students, and certain ENDS industry commenters advocated for making the
exception available to ENDS manufacturers. ENDS industry commenters
relied on the POSECCA's inclusion of ENDS products within the term
``cigarette,'' concluding that ENDS products' entitlement to the
exception must precede construction of the quantity condition, rather
than the other way around. One such commenter, after repeating its
general view that Congress did not intend to make ENDS products
nonmailable, pointed out that consumer testing is necessary for ENDS
manufacturers to fulfill requirements for FDA authorization. These and
other commenters proposed various approaches to the quantity condition:
Nicotine-content equivalency: Limit liquids to 12 units or
cartridges, as the purported equivalent to 12 packs of cigarettes
(based on the assumption that one 5 percent-nicotine ENDS pod equals
one pack of cigarettes); either no limit on devices, or limit devices
to the amount necessary to enable the use of that quantity of liquid.
Nicotine-consumption equivalency: The quantity needed to
supply the average user for the same period as 240 cigarettes. For
example, if the average smoker consumes 14 cigarettes per day, then 240
cigarettes equates to 17 days of average consumption.\27\ According to
this commenter, most human studies of CBD use dosages ranging between
20 and 1,500 milligrams per day.\28\ Thus, a median dosage of 740
milligrams per day would translate into 12,580 milligrams for 17 days.
---------------------------------------------------------------------------
\27\ See CDC, Press Release, Smoking Is Down, But Almost 38
Million American Adults Still Smoke, Jan. 18, 2018, https://go.usa.gov/x6qSt (2016 data).
\28\ Sian Ferguson, ``CBD Dosage: Figuring Out How Much to
Take,'' Healthline, Aug. 1, 2019, https://www.healthline.com/health/cbd-dosage.
---------------------------------------------------------------------------
Weight limit: 5 pounds.
Package limit: One package, regardless of contents, as the
Postal Service allegedly cannot investigate the contents of shipments
anyway; defer to FDA as to limits of consumer tests themselves.
Size limit: Package dimensions equivalent to a package
containing 12 packs of combustible cigarettes. This commenter submitted
that one pack is typically 3.5 inches by 2.25 inches by 0.88 inch, for
a volume of 6.93 cubic inches, hence 12 packs would be 83.16 cubic
inches. The commenter noted that these external characteristics are
objective and observable, thereby averting the need to open a package
and inspect contents.
To be determined: Collaborate with FDA and CDC to devise
an appropriate equivalency standard, which may evolve with further
data.
The Postal Service appreciates these thoughtful suggestions, which
are discussed in greater depth later in this section. Upon further
review, however, it is unnecessary to evaluate the suitability of a
quantity standard for ENDS products in connection with the Consumer
Testing exception. Beyond the interpretive difficulties posed by the
quantity limit, Congress has provided at least two other indications of
legislative intent that the Consumer Testing exception applies only to
combustible cigarettes and not to ENDS products, notwithstanding their
technical inclusion within the term ``cigarette'' generally. After all,
even statutorily defined terms can give way where context indicates
that Congress intended a different meaning. See, e.g., Int'l Primate
Prot. League v. Adm'rs of Tulane Educ. Fund, 500 U.S. 72, 80, 83
(1991); In re Korean Air Lines Co., 642 F.3d 685, 692-93 (9th Cir.
2011).
First, the exception is available only to ``cigarette
manufacturer[s]'' with a permit ``issued under section 5713 of the
Internal Revenue Code of 1986.'' Id. at (b)(5)(A)(i). The only entities
eligible for such permits are manufacturers and importers of cigars,
cigarettes, smokeless tobacco, pipe tobacco, and roll-your-own tobacco,
with ``cigarette'' restricted here to rolls of tobacco wrapped in paper
or another substance. 26 U.S.C. 5702(b)-(c), 5713(a). This definition
does not describe ENDS products, and so manufacturers of ENDS products
are not subject to the Internal Revenue Code section 5713 permit
requirement. Accordingly, ENDS manufacturers are not within the ambit
of manufacturers eligible to use the mails under the Consumer Testing
exception. Here, too, the POSECCA contains no amendment expanding the
scope of eligible manufacturers to cover ENDS.
Second, the exception refers repeatedly to cigarettes in connection
with a ``smoker.'' 18 U.S.C. 1716E(b)(5)(A), (b)(5)(C)(ii)(II)(aa),
(b)(5)(D)(ii). This language clearly denotes combustion, rather than
the sub-combustion-level heating that occurs in most ENDS products.\29\
The
[[Page 58421]]
POSECCA contains no amendment that expands the term ``smoker'' to
encompass the manner in which ENDS products are consumed.
---------------------------------------------------------------------------
\29\ ``E-cigarettes purportedly do not produce a combusted
smoke; rather, they deliver an aerosol containing nicotine and other
tobacco-related compounds.'' Megan J. Schroeder & Allison C.
Hoffman, ``Electronic Cigarettes and Nicotine Clinical
Pharmacology,'' 23 Tobacco Control ii30 (2014), https://tobaccocontrol.bmj.com/content/tobaccocontrol/23/suppl_2/ii30.full.pdf. ``Smoking'' and ``vaping'' are frequently placed in
opposition to one another in popular discourse. See, e.g., Julia
Savacool, ``Vaping Vs. Smoking: Is One Better for Your Lungs? Here's
What Experts Say,'' Parade, Feb. 20, 2021, https://parade.com/1093720/julia-savacool/vaping-vs-smoking; Scott Roberts Law,
``What's the Difference Between Smoking and Vaping?,'' Michigan
Cannabis Business Blog, May 14, 2020, https://scottrobertslaw.com/whats-the-difference-between-smoking-and-vaping; Nick English, ``I
Started Vaping to Quit Smoking, and It Was a Huge Mistake,'' Men's
Health, Oct. 22, 2018, https://www.menshealth.com/health/a23937726/vaping-vs-smoking. Pro-ENDS commenters engaged in the same tendency
when touting ENDS use as a beneficial alternative to combustible
cigarettes. Two industry associations even styled themselves as
promoters of ``smoke-free alternatives'' and ``smoking
alternatives.''
---------------------------------------------------------------------------
It should be noted that the Consumer Testing exception is unique
among the PACT Act's exceptions in that it pertains specifically to
``cigarettes'' and not to the full range of ``mailings'' or ``tobacco
products'' covered by the PACT Act. Compare id. at (b)(2)-(4) with id.
at (b)(5). Prior to the POSECCA, it was therefore clear that the
Consumer Testing exception was confined to combustible cigarettes and
did not apply to smokeless tobacco. While this history alone might not
be relevant if Congress had used broader language in the Consumer
Testing exception, Congress's retention of combustible-cigarette-
specific conditions in the post-POSECCA Consumer Testing exception
shows Congress's continuing intent that the exception apply only to
combustible cigarettes, and not to other products that might now be
encompassed within the otherwise-applicable statutory definition of
``cigarettes.''
Against this backdrop regarding Congress's intent to apply the
Consumer Testing exception only to combustible cigarettes and not to
ENDS products, it is all the more clear that the quantity limit of ``12
packs of cigarettes (240 cigarettes)'' is intended to govern only
combustible cigarettes, in which context such quantities are
commonplace, and not ENDS products, which are not so standardized. The
language itself suggests this conclusion; the context solidifies it.
While the commenters have proposed a range of original ideas for a
potential equivalency standard, the Postal Service finds no occasion to
consider application of such a standard here, where Congress's intent
to exclude ENDS products from the exception is clear. That decision is
buttressed by the fact that no proposed equivalency standard is self-
evident or compelling.
Proposals focused on the exterior of the package, rather than its
contents, would impose virtually no limit on the amount or type of ENDS
products sent in an ostensible consumer testing shipment. This
unfettered latitude is far from Congress's design of limiting the
quantity of product within a package.
Proposals focused on the amount of nicotine fail to account for the
multiple layers of variability that complicate such an exercise: The
range of nicotine content among combustible cigarettes,\30\ the range
of nicotine delivered to smokers \31\ and users of nicotine-related
ENDS products,\32\ and the range of nicotine contained in ENDS
products, which may contain as little as zero nicotine or be used with
a limitless quantity of nicotine-containing solution, and which may
vary even within the same brand and batch.\33\ The difficulties in
comparability are further compounded when considering how to equate
combustible cigarettes with ENDS products related to non-nicotine
substances, such as CBD.\34\ And the ranges of variation increase still
further when scaled up from a single cigarette to 240. Thus, it does
not appear that an equivalency standard can be readily devised to
reliably translate 240 cigarettes into some comparable number of ENDS
products. The apparent impossibility of shoehorning ENDS products into
the 240-cigarette limit underscores the conclusion--already apparent
from other conditions of the Consumer Testing exception--that Congress
intended this exception to be available only for combustible cigarettes
and not for ENDS.
---------------------------------------------------------------------------
\30\ The nicotine content of combustible cigarettes in the
United States has been measured to range from 7.2 to 13.4 mg per
cigarette, or about 30 percent around the mean of 10.2
mg per cigarette. Lynn T. Kozlowski et al., ``Filter Ventilation and
Nicotine Content of Tobacco in Cigarettes from Canada, the United
Kingdom, and the United States,'' 7 Tobacco Control 369, 370 (1998),
https://tobaccocontrol.bmj.com/content/tobaccocontrol/7/4/369.full.pdf; see also Tobacco Product Standard for Nicotine Level
of Combusted Cigarettes, 83 FR 11818, 11826 (2018) (10-14 mg of
nicotine per cigarette in the United States, per Kozlowski et al.
and others).
\31\ One study measured nicotine delivery from the combustible
cigarettes surveyed as averaging 1.04 mg 0.36 mg, or a
range of about 35 percent. Neal L. Benowitz & Peyton Jacob III,
``Daily Intake of Nicotine During Cigarette Smoking,'' 35 Clinical
Pharmacology & Therapeutics 499 (1984), available at https://ascpt.onlinelibrary.wiley.com/doi/abs/10.1038/clpt.1984.67; see also
83 FR at 11826 (1.1-1.7 mg nicotine yield per cigarette)). In the
Benowitz/Jacob study, cigarette smokers' daily nicotine intake
averaged 37.6 mg 17.7 mg at 1 standard deviation, but
ranged overall from 10.5 to 78.6 mg, for a total range of more than
75 percent around the median.
\32\ The amount of nicotine emitted depends on multiple
variables: Device power, nicotine concentration, ratio of propylene
glycol to vegetable glycerin, and puff duration. Kathleen Stratton
et al., Public Health Consequences of E-Cigarettes 92-94 (Nat'l
Acads. of Scis., Eng'g, & Med. 2018), https://www.ncbi.nlm.nih.gov/books/NBK507171/pdf/Bookshelf_NBK507171.pdf; Soha Talih et al.,
``Transport Phenomena Governing Nicotine Emissions from Electronic
Cigarettes: Model Formulation and Experimental Investigation,'' 51
Aerosol Sci. & Tech. 1, 8-13 (2016); Ivan Gene Gillman et al.,
``Effect of Variable Power Levels on the Yield of Total Aerosol Mass
and Formation of Aldehydes in E-Cigarette Aerosols,'' 75 Reg.
Toxicology & Pharmacology 58, 60 (2016); Maciej L. Goniewicz et al.,
``Nicotine Content of Electronic Cigarettes, Its Release in Vapour
and Its Consistency Across Batches: Regulatory Implications,'' 109
Addiction 500, 503 (2014). Although Gillman et al. describe the
amount of total aerosol produced, the same percent range should
apply to the amount of nicotine aerosolized, given the homogeneity
of constituents throughout a solution. Variability in nicotine
delivered by ENDS does not end with nicotine emitted, however; the
amount delivered to a user's bloodstream also depends on user- and
product-specific factors. See generally Schroeder & Hoffman,
``Electronic Cigarettes and Nicotine Clinical Pharmacology.''
\33\ Stratton et al., Public Health Consequences of E-Cigarettes
89-92; Goniewicz et al., ``Nicotine Content of Electronic
Cigarettes,'' 109 Addiction at 502.
\34\ With respect to the proposal to equate CBD to combustible
cigarettes based on daily use, even the CBD-dosage figures provided
by the commenter present a range that is so wide (20-1,500 mg/day)
as to render the commenter's focus on the average essentially
meaningless. Moreover, the scholarly article referenced in the
commenter's popular source does not discuss whether these dosages
are representative of therapeutic practice; rather, they are
characterized only as quantities that have been shown to be
tolerated by humans from a safety perspective. Kerstin Iffland &
Franjo Grotenhermen, ``An Update on Safety and Side Effects of
Cannabidiol: A Review of Clinical Data and Relevant Animal
Studies,'' 2 Cannabis & Cannabinoid Research 139, 140 (2017),
https://go.usa.gov/x6cWG, cited in Ferguson, ``CBD Dosage.''
---------------------------------------------------------------------------
For these reasons, the Postal Service concludes that the PACT Act
does not make the Consumer Testing exception available for ENDS
products. It should be noted that the Intra-Alaska/Intra-Hawaii
exception would permit the mailing of ENDS products for any purpose,
including consumer testing, with the only restriction being that the
mailing occur entirely within Alaska or Hawaii. Otherwise, barring
further legislative change, such activities must employ transportation
and delivery methods that do not involve the mails.
2. Testing by Federal Agencies
Two of the public-health organizations that opposed allowing the
Consumer Testing exception for ENDS products nonetheless favored
allowing the Public Health exception. One such commenter analogized the
situation to the restrictions on mailing dangerous goods, which contain
exceptions for scientific-use mailings, see 18 U.S.C. 1716(c), (e), and
suggested that the Postal Service make the exception available only
upon agreement with the relevant Federal agency. Federal agency
partners with which the Postal Service consulted also expressed an
interest in making the Public Health exception available for ENDS
products, in order
[[Page 58422]]
for them to carry out testing activities that they consider necessary
for effective regulation. Law-student commenters asserted that Congress
likely intended to permit continued Federal testing of ENDS products
for public-health regulation, which one such commenter submitted is
unlikely to contribute materially to youth-access and other policy
concerns that motivated the POSECCA and the PACT Act. Although ENDS
industry commenters did not express views specifically about the Public
Health exception, the linkage between the Public Health and Consumer
Testing exceptions suggests that such commenters' views on the
availability of the Consumer Testing exception would likewise carry
over to the Public Health exception.
The Postal Service reiterates that it must be guided by the
parameters and policy decisions expressed in the statute; Congress did
not authorize the Postal Service to make its own policy decisions about
whether any exception, including the Public Health exception, ought to
be extended to ENDS products. Particularly given that lack of policy
discretion, the Postal Service is not at liberty to speculate about
what Congress might have intended regarding public-health testing of
ENDS products by Federal regulatory agencies, in the absence of any
statutory language or legislative history clearly addressing the
question.
Like the Consumer Testing exception, the statutory language
establishing the Public Health exception, which Congress likewise did
not amend in the POSECCA, makes clear that the exception applies only
to combustible cigarettes and not to ENDS products.
First, the Public Health exception repeatedly uses the term
``consumer testing,'' a defined term restricted to testing involving
``smokers.'' 18 U.S.C. 1716(b)(5)(D)(ii), (b)(6). As discussed in the
preceding section, the plain meaning of ``smoker'' indicates that the
context is combustible cigarettes, not ENDS products.
Second, the Public Health exception allows Federal agencies to
``mail cigarettes under most of the same requirements, restrictions,
and rules and procedures that apply to consumer testing mailings of
cigarettes by manufacturers under'' the Consumer Testing exception. Id.
at (b)(6).\35\ Among those applicable requirements is that the entity
mailing any shipments verify ``that the recipient is an adult
established smoker'': a term that, again, indicates application only to
combustible cigarettes and not to ENDS products. Id. at
(b)(5)(C)(ii)(II)(aa).
---------------------------------------------------------------------------
\35\ One requirement is specifically excepted in the statute.
Moreover, it is also reasonable to construe the Internal Revenue
Code permit requirement as inapplicable to Federal regulatory
agencies, given Congress's clear intent that they be eligible to
mail under the Public Health exception notwithstanding their
ineligibility for such permits.
---------------------------------------------------------------------------
Third, the quantity limit discussed in the preceding section also
governs the Public Health exception in the same manner as the Consumer
Testing exception. As discussed in the preceding section, the quantity
limit reinforces the conclusion that only combustible cigarettes, and
not ENDS products, are amenable to these exceptions.
Given these clear indications of Congressional intent and the
Postal Service's general lack of statutory authority over the scope of
PACT Act exceptions, the Postal Service finds no basis to treat the two
exceptions as differing in scope due to policy reasons that were not
expressed by Congress.\36\ It may be that Federal regulatory agencies,
like manufacturers, will continue to conduct consumer testing without
using the mails, or via use of the mails only within Alaska and Hawaii
(as permitted by the Intra-Alaska/Intra-Hawaii exception). To the
extent that Federal agencies find those options to be insufficient,
then Congress, not the Postal Service, is the appropriate outlet for
policy concerns regarding this statutory scheme.
---------------------------------------------------------------------------
\36\ Regarding one commenter's comparison to 18 U.S.C. 1716(c)-
(e) as a suggested basis for decoupling the Consumer Testing and
Public Health exceptions vis-[agrave]-vis their applicability to
ENDS products, the comparison is inapt. First, that statute is
distinct from the PACT Act, which expressly provides that the same
requirements apply to activities conducted under the Consumer
Testing and Public Health exceptions. Second, 18 U.S.C. 1716(c)-(e)
expressly confer discretion upon the Postal Service over the
mailability of dangerous items for scientific purposes; the PACT Act
does not provide such discretion. Third, 18 U.S.C. 1716(c)-(e) do
not concern the mailing of otherwise nonmailable items to
individuals, as the Consumer Testing and Public Health exceptions
do; rather, the mailings covered by those provisions are more
analogous to mailings under the PACT Act's Business/Regulatory
Purposes exception. See 18 U.S.C. 1716(c) (shipments of live
scorpions ``to be used for purposes of medical research or for the
manufacture of antivenom''); id. at (d) (shipments of poisonous
drugs and medicines from manufacturers or dealers to licensed
medical professionals); id. at (e) (shipments of poisons for
scientific use between manufacturers, dealers, laboratories, and
Federal, State, or local government agencies).
---------------------------------------------------------------------------
3. Testing by Public-Health Researchers
Certain public-health-oriented commenters urged the Postal Service
to permit the mailing of ENDS products from independent researchers or
research organizations--not manufacturers or Federal agencies--to
individuals for purposes of federally-funded public health research.
As explained in section III.A.1, the Postal Service lacks statutory
authority to create new exceptions. Congress provided narrow exceptions
for consumer testing only by manufacturers and Federal agencies, and
not by any other entity. Moreover, as explained in the preceding two
sections, even those exceptions do not cover ENDS products. Therefore,
other than mailings entirely within Alaska and Hawaii (as authorized by
the Intra-Alaska/Intra-Hawaii exception), researchers must find ways to
conduct their consumer testing that do not involve use of the mails. To
the extent that a policy case can be made for this use of the mails,
that case should be directed to Congress, which has reserved to itself
the discretion to modify or augment the PACT Act's exceptions.
J. Other Issues
1. International, Military, and Diplomatic Mail
Except for the Intra-Alaska/Intra-Hawaii exception, the PACT Act's
exceptions are not expressly confined to domestic mail. As the Postal
Service explained in the 2010 rulemaking concerning PACT Act
implementation, however, the complex verification requirements for the
PACT Act's exceptions, combined with the strict consequences of any
noncompliance, render it impracticable, if not impossible, for these
requirements to be fulfilled as to mail originating or destinating
outside of the United States. 75 FR at 29665; 75 FR at 24535. In the
notice of proposed rulemaking, the Postal Service proposed to maintain
the same approach to the exceptions in the context of ENDS products,
except potentially with respect to any products that may eventually be
covered by the tobacco-cessation/therapeutic exclusion. 86 FR at 10219.
One group of public-health-oriented commenters applauded the
disallowance of exceptions for international mail and the extension of
that policy to ENDS products. Contrariwise, one ENDS manufacturer
asserted that the policy violates the statute, which, according to the
commenter, frames the exceptions in terms that provide an affirmative
entitlement to mail without restriction to domestic mail. The commenter
noted that the Business/Regulatory Purposes exception expressly
encompasses businesses involved in ``export'' and ``import,'' see 18
U.S.C. 1716E(b)(3)(A)(i), and opined that the statutory conditions for
each exception
[[Page 58423]]
can be applied to international as well as domestic mail, without any
statutory basis for distinction on the basis of feasibility. One
Federal agency partner also asked the Postal Service to reconsider the
restriction, in the interest of facilitating effective Federal
regulation of foreign parties' tobacco and ENDS products.
The final rule maintains the approach outlined in the notice of
proposed rulemaking. The issue is not whether the statute expressly
addresses international mail or whether it expressly provides for
feasibility-based discretion. Rather, the statutory exceptions permit
mailing only to the extent that the Postal Service is able to verify
certain things about the mailer and/or recipient. See, e.g., id. at
(b)(3)(B)(ii)(I)-(II), (b)(3)(B)(ii)(VII), (b)(4)(B)(ii)(I)-(II),
(b)(4)(B)(ii)(V). In contrast to private-sector delivery carriers'
integrated international networks, the Postal Service does not collect
or deliver international mail outside of the United States (other than
in the Freely Associated States); it must rely on foreign postal
operators and other third-party agents to perform acceptance and
delivery abroad. Given the specificity of the statutory verification
obligations and their lack of extraterritorial applicability to or
contemplation of foreign postal operators and agents, the Postal
Service is unable to fulfill, and is not confident in its ability to
ensure reliable fulfillment of, the verification tasks upon which these
exceptions condition mailability. To the extent that the Postal Service
cannot ensure verification, then the statute bars exceptional
mailability for the relevant class of shipments.
As the industry commenter observes, the Business/Regulatory
Purposes exception is available to legally operating businesses
``engaged in tobacco product . . . export [and] import.'' Id. at
(b)(3)(A)(i). But these descriptors are used only to define the class
of businesses that may be eligible to mail to other eligible parties
under the exception; it does not, by itself, establish entitlement to
use the mails for export and import activities. Thus, upon fulfilling
all of the conditions for the exception, an export business could
receive ENDS products from a domestic manufacturer or wholesaler, for
example, and an import business could send ENDS products to domestic
wholesalers and distributors. To the extent that the Postal Service can
verify all required facts about these senders and recipients, their
shipments are mailable under the exception. But because the Postal
Service cannot conduct the statutorily required verification for
overseas parties, the exporter's exports and importer's imports cannot
themselves qualify for use of the mails. Those legs of the products'
journey must be accomplished through commercial export and import
channels, not through the international mail channel.
In response to the Federal agency partner's concern regarding
effective regulation, the Postal Service is sympathetic to this policy
interest. Again, however, Congress has imposed verification conditions
for use of the mails that the Postal Service is unable to fulfill with
respect to international shipments. Non-postal delivery channels may be
available to facilitate the transfer of samples and covered items
between foreign businesses and U.S. regulators. To the extent that use
of the mails would be necessary or expedient to effective regulation,
it is for Congress to weigh whether that policy interest warrants
relaxation of the PACT Act's verification mandates, creation of a new
exception, or some other legislative accommodation.
Certain pro-ENDS commenters urged the Postal Service to ensure that
ENDS products will be mailable to U.S. military service members
overseas on the same terms as cigarettes and smokeless tobacco. As
stated in the notice of proposed rulemaking, the PACT Act exceptions
have long been inapplicable to ``mail presented at overseas Army Post
Office (APO), Fleet Post Office (FPO), or Diplomatic Post Office (DPO)
locations and destined to addresses in the United States.'' 86 FR at
10219 (emphasis added). This is because these overseas acceptance
locations are operated not by the Postal Service, but by the Department
of Defense's Military Postal Service Agency (MPSA) and by the
Department of State. Although U.S. postal laws and regulations apply to
U.S. mail operations in these locations, it was determined that the
acceptance conditions for the PACT Act's exceptions cannot reliably be
fulfilled at these overseas sites.
Upon further review and interagency consultation, it appears that
the same is true for the PACT Act exceptions' requirements of age,
employment, and identity verification at the place of delivery. See 18
U.S.C. 1716E(b)(3)(B)(ii)(II), (b)(3)(B)(ii)(VII),
(b)(4)(B)(ii)(V),\37\ (b)(5)(C)(ii)(VI)-(VII). The postal services that
enable fulfillment of these requirements--Adult Signature Required and
Adult Signature Restricted Delivery--are not currently available for
items sent to APO/FPO/DPO addresses. Because the verification
requirements cannot reliably be fulfilled upon delivery to APO/FPO/DPO
addressees, shipments to such addressees are incompatible with the
statutory criteria for the exceptions.
---------------------------------------------------------------------------
\37\ Under the Certain Individuals exception, the Postal Service
is not itself required to perform the age verification, so long as
it duly transfers the items to MPSA. 18 U.S.C.
1716E(b)(4)(B)(ii)(VI). However, the age-verification requirement
remains, pursuant to a standalone condition that MPSA would be
obliged to fulfill. Id. at (b)(4)(B)(ii)(V).
---------------------------------------------------------------------------
2. Reasonable Cause
The PACT Act bars the acceptance or transmission of mailed packages
as to which the Postal Service ``knows or has reasonable cause to
believe contains'' matter made nonmailable by the PACT Act. 18 U.S.C.
1716E(a)(1). ``Reasonable cause'' can be based upon certain public
statements of intent to mail nonmailable items or the presence of a
person on the Noncompliant List. Id. at (a)(2). Under the Postal
Service's longstanding PACT Act regulations, the presence of reasonable
cause imposes on the mailer a burden of establishing eligibility to
mail. Publication 52 section 472.1.
In the notice of proposed rulemaking, the Postal Service noted that
the statute's use of ``includes'' before these enumerations of
``reasonable cause'' plainly indicates that the list is illustrative,
rather than exhaustive, and the Postal Service proposed to make
explicit in its regulations the possibility that other indicia
regarding a package, individually or in combination with other
packages, may give rise to reasonable cause. 86 FR at 10219. In the
highly circumstantial context of ENDS products, the Postal Service
further proposed to elaborate on the burden-shifting principle by
calling for affirmative, credible, and verifiable indications of
mailability in order to dispel the presumed nonmailability of such
products. Id. at 10219-10220.
Some anti-ENDS commenters expressed general support for these
changes, and no party expressed opposition. Therefore, the Postal
Service adopts the proposed changes in this final rule.
State and local attorneys general, a public-health organization,
and a law student proposed enumerating additional bases for identifying
parties whose association with a package may give rise to reasonable
cause:
Identification of a party in scientific journal articles
about ENDS products;
Involvement of an ENDS manufacturer or distributor in
litigation;
Public statements on social media;
Other media sources;
[[Page 58424]]
The presence of markings on a package pursuant to section
2A(b)(1) of the Jenkins Act;
Lists of entities licensed by a State or local government
to engage in tobacco or ENDS industry activities;
The use of a Post Office Box or CMRA; and
A mailer's past practice of sending or receiving items
made nonmailable under the PACT Act.
The Postal Service finds it unnecessary to incorporate these
suggestions into the final rules. Statements in social media and other
media are covered by 18 U.S.C. 1716E(a)(2)(A) and existing Publication
52 section 472.1(a). Information on a mailpiece (e.g., Jenkins Act
markings and address information) would be among the indicia taken into
account under the new provision. So, too, would a mailer's past
practices, insofar as the new provision accounts for information about
a mailing ``in combination with other packages.''
Because the list of ``reasonable cause'' indicia in Publication 52
section 472.1 is merely illustrative, the other proposed information
sources remain potentially available, even if they are not expressly
enumerated. To the extent that any relevant information not only exists
at large, but is brought to the actual attention of Postal Service
personnel authorized to determine how to interpret and act upon that
information, then that awareness may reasonably justify the Postal
Service's treatment of associated mailings as nonmailable, absent
contrary information sufficient to dispel reasonable cause.
One law-student commenter expressed concern that the Noncompliant
List may be unreliable, given the purported ease with which listed
actors could rebrand or establish a new address. The Postal Service is
not responsible for maintaining the Noncompliant List. However, it
should be noted that section 2A(e)(1)(C) of the Jenkins Act directs the
Attorney General to update and distribute the Noncompliant List at
least once every four months, and related provisions require the
Attorney General to include entities identified by State, local, and
Tribal governments and to maintain the accuracy and completeness of the
list. Moreover, no provision bars other parties from identifying
inaccuracies or suggesting updates to the Attorney General.
State and local attorneys general requested a point of contact for
non-Postal-Service law-enforcement actors, the industry, and the
general public to report suspicious mailing behavior. The Postal
Inspection Service (https://www.uspis.gov) is the law-enforcement
component of the Postal Service, and suspicious mailing behavior may be
reported through the Postal Inspection Service hotline (1-877-876-
2455). Mailing addresses for local Postal Inspection Service division
offices can be found at https://postalpro.usps.com/ppro-tools/inspection-service.
One law-student commenter encouraged the Postal Service to ensure
that relevant personnel are trained and given up-to-date information
about the Noncompliant List and market research on ENDS mailers. The
Postal Service has internal processes to communicate such information
to relevant personnel, and it will take this comment under advisement
in administering those internal communications.
Another law-student commenter proposed that a suspected ENDS mailer
be required to furnish a sworn certification of mailability, punishable
by a fine. The Postal Service finds such a measure to be unnecessary.
Under the reasonable cause standard, mailability is based on indicia of
suspicion--a collection of facts indicating for and against
mailability--weighed in the administrative and law-enforcement
discretion of Postal Service personnel. It is difficult to conceive of
why facts tending in one direction should require the submission of
paperwork when other facts would not. Moreover, the making of
materially false statements or representations to the Postal Service is
punishable under 18 U.S.C. 1001, regardless of whether the person has
made a sworn declaration or received specific notice of potential
punishment. As such, the Postal Service does not perceive any practical
benefit that would arise from this suggestion.
3. Terminology
In the notice of proposed rulemaking, the Postal Service discussed
the semantic difficulties posed by the POSECCA's technical inclusion of
ENDS within the relevant statutory definition of ``cigarettes.'' 86 FR
at 10219. While this has a pronounced legal effect--generally
subjecting ENDS to the same legal treatment as combustible cigarettes--
there are clear differences in the two types of products, particularly
given the broad scope of POSECCA-covered ENDS products. Hence, using
the term ``cigarette'' in Publication 52 to denote ENDS products as
well as combustible cigarettes might not offer sufficient clarity to a
lay reader. The Postal Service proposed to use ``tobacco products'' as
a catch-all term to encompass combustible cigarettes, smokeless
tobacco, and ENDS products, due to Congress's use of that term in the
PACT Act (and the lack of any amendment to that usage in the POSECCA).
In doing so, the Postal Service acknowledged that even ``tobacco
products'' is imperfect as applied to ENDS products, many of which do
not derive from tobacco, and solicited commenters' suggestions.
Commenters presented various views, often independent of their
position on ENDS products generally. Some commenters accepted and even
agreed with ``tobacco products'' as a catch-all term, noting that at
least some ENDS liquids contain tobacco-derived nicotine and that
Congress intended ENDS to be regulated in the same manner as cigarettes
and smokeless tobacco. Others supported a slightly disaggregated catch-
all term, such as ``tobacco and vapor products,'' ``cigarettes and
alternative tobacco products,'' ``nicotine products and delivery
devices,'' or ``tobacco and nicotine-related delivery products.'' Still
other commenters opposed the use of a catch-all term, but rather
proposed a continued serial listing (``cigarettes, ENDS, and smokeless
tobacco''). This last group opposed the use of an umbrella term for
various reasons: ENDS products might not be thought of as ``tobacco
products;'' ``tobacco products'' is a term with special significance
but a different scope in other legal contexts; and ENDS products should
not be equated with cigarettes due to purported differences in their
level of harmfulness.
Upon consideration of these views, the Postal Service agrees that
the umbrella term ``tobacco products,'' while consistent with statutory
usage, might pose an undue risk of misleading lay readers of the
regulations. Notwithstanding the post-POSECCA PACT Act's continued use
of ``tobacco products'' as an apparent (albeit undefined) umbrella
term, catch-all terms relying on ``tobacco'' or ``nicotine'' do not
adequately capture the wide range of ENDS products covered by the
POSECCA. Of the proffered options, ``tobacco and vapor products'' best
captures the distinction between cigarettes and smokeless tobacco, on
the one hand, and potentially non-nicotine-based ENDS products, on the
other hand. Yet even it has its shortcomings: It elides the degree of
overlap between the two categories, and the level of generality may
sacrifice clarity.
The Postal Service has determined that the well-taken semantic
concerns can be avoided through use of the more generic, all-
encompassing term ``covered products'' to refer collectively to
cigarettes, smokeless tobacco, and
[[Page 58425]]
ENDS products subject to the PACT Act.\38\ At the same time, because
certain requirements pertain uniquely to ENDS products, the final rule
treats ENDS products as a standalone category of covered products,
rather than subsuming them within the definition of ``cigarette'' as
the POSECCA does. Although this terminological approach differs
formally from the statutory framework, the Postal Service is confident
that its regulations yield the same functional result. To the extent of
any inadvertent conflict, however, the statute would naturally control.
---------------------------------------------------------------------------
\38\ The Postal Service recognizes that the FDA uses the term
``covered tobacco product'' in reference to ENDS products subject to
FDA regulation as ``deemed'' tobacco products. See 21 CFR 1140.3. As
discussed in section III.C.1, the scope of such FDA-regulated ENDS
products differs from the scope of PACT Act-covered products. Given
the explicit definitions in each set of regulations and the
differing regulatory contexts, the Postal Service is confident that
readers of Publication 52 chapter 47 will understand ``covered
products'' to mean products covered by that chapter and the PACT
Act, and not ``covered tobacco products'' for purposes of 21 CFR
part 1140.
---------------------------------------------------------------------------
4. Communications
Three ENDS industry commenters asked the Postal Service to issue an
updated Field Information Kit regarding the mailability of ENDS
products, similar to the ones that it issued upon implementing the
original and earlier amended PACT Act. See Postal Service, Field
Information Kit: PACT Act, Postal Bulletin No. 22,287, June 17, 2010,
at 3-17, https://about.usps.com/postal-bulletin/2010/pb22287/pdf/pb22287.pdf; Postal Service, Field Information Kit: PACT Act, Postal
Bulletin No. 22,292, Aug. 26, 2010, at 3-18, https://about.usps.com/postal-bulletin/2010/pb22292/pdf/pb22292.pdf. One law student also
recommended that the Postal Service set up web pages to educate the
public about the new requirements, as well as trainings for employees.
In conjunction with this Federal Register notice, the Postal
Service is issuing a Field Information Kit. Like its 2010 counterparts,
the Field Information Kit contains training materials and job aids to
be distributed to Postal Service employees, as well as background
information and frequently asked questions for both employees and the
public. The Postal Bulletin is available at https://about.usps.com/postal-bulletin/2021.
5. Enforcement
A group of State and local attorneys general asked the Postal
Service not to return to sender matter made nonmailable under the PACT
Act, but to seize and destroy it instead. These commenters adverted to
ongoing litigation that some of them have brought on this issue. See
generally City of New York v. U.S. Postal Serv., No. 1:19-CV-05934
(E.D.N.Y. filed Oct. 22, 2019). Because this matter is the subject of
ongoing litigation, the Postal Service declines to address it at this
time.
One ENDS consumer expressed skepticism that the POSECCA will be
enforceable, to the extent that vendors send products below the
supposed weight threshold for Postal Service enforcement without
publicly advertising or marking their product. While it is conceivable
that some illegal activity will evade detection in any law-enforcement
scheme, each of the commenter's premises is false. First, there is no
weight threshold for Postal Service enforcement of mailability; the
Postal Service can and does enforce mailability laws regardless of
weight, shape, or other mailpiece characteristics. Second, a vendor
that does not advertise its sales is unlikely to remain a vendor for
long. Third, the presence of identifying markings is not a prerequisite
for detection of nonmailable matter; indeed, few shippers of the
substantial quantities of nonmailable contraband detected by the Postal
Inspection Service and its Federal law-enforcement partners
transparently indicate the illicit contents that they are shipping.
Finally, a commercial mailing agent asked for clarification of its
duty to enforce the POSECCA and PACT Act and its liability for its
customers' mailings. As already provided in Postal Service regulations,
all mailers, including mail service providers and mailing agents, must
comply with applicable Postal Service laws and regulations governing
mailability and preparation for mailing, as well as non-postal laws and
regulations on the shipment of particular matter. Publication 52
section 212. In other words, a mail service provider or mailing agent,
as a mailer on behalf of a third party, is liable for violations of
mailing laws in the same manner as any other mailer. Mail service
providers and mailing agents may limit their liability risk by taking
robust measures to identify attempts to use their services for unlawful
purposes.
6. Availability of Rules' Text
Some commenters urged the Postal Service to make the text of the
proposed or new rules available as soon as possible. At the time of the
notice of proposed rulemaking, Publication 52 was incorporated by
reference in 39 CFR 113.2. As such, the Office of the Federal Register
did not permit the text of revisions or proposed revisions to
Publication 52 to appear in the attendant Federal Register notice. In
the interest of transparency and facilitating informed public comment,
the Postal Service posted the proposed rules' text on its website and
directed readers of the Federal Register notice of proposed rulemaking
to that posting. This afforded commenters a reasonable opportunity to
review the proposed revisions, and several of the comments demonstrate
that their authors did so. Subsequently, the Postal Service, in
consultation with the Office of the Federal Register, amended Title 39,
CFR, and the DMM to clarify the status of Publication 52. 86 FR 53220.
As a result of those changes, the text of revisions to Publication 52
is now permitted to be published with the attendant Federal Register
notice, as is the case with this final rule.
Three ENDS industry commenters urged the Postal Service to publish
the text of the final rules in advance of formal publication. It is
unclear what this suggestion is supposed to mean. The Postal Service is
unaware of any rulemaking practice whereby a final rule is published
twice, once ``informally'' and once ``formally.'' There is only
publication of the final rule, which, in this case, immediately
triggers the nonmailability of ENDS products. If the commenters' idea
is that the Postal Service should publish the rules first and the
response to comments later, then this, too, does not appear to comport
with regular Federal rulemaking practices, and it might raise concerns
about due process and APA compliance. As such, the Postal Service has
opted for consistency with normal practices, while attempting to
enhance awareness and clarity through issuance of the April 2021
Guidance.
7. Updates
One law student recommended that the Postal Service periodically
review the final rule for potential revisions to account for subsequent
research regarding ENDS products. The commenter suggested that the
review occur one year after the end of the FDA's period for premarket
tobacco product applications and every three years thereafter.
The Postal Service appreciates that research on the public-health
risks and benefits arising from ENDS products, as well as the market
for ENDS products itself, is in a state of rapid evolution. This final
rule itself is likely to have its own effects on the ENDS market and on
public health.
As discussed in section III.A, however, this rulemaking is not an
[[Page 58426]]
instance of policy discretion by the Postal Service, such as the Postal
Service might revisit as facts and policy considerations change. The
Postal Service is fulfilling a severely circumscribed statutory command
to make ENDS products nonmailable except in certain limited
circumstances. The decision about the public-health risks and benefits
was made by Congress. While further scientific research may alter
Congress's policy decision, the Postal Service does not anticipate that
it will bear on the limited manner in which it is carrying out
Congress's mandate. As such, the Postal Service also does not
anticipate a need to revisit this final rule on the basis of further
scientific research.
That said, the Postal Service may eventually have other reasons to
revisit this final rule, such as further changes in applicable law;
evolution in the ENDS market; further guidance from ATF on the scope of
covered ENDS products; potential FDA approval of ENDS products for
tobacco-cessation or other therapeutic uses; advances in technology
that may facilitate alternative methods for administering the Business/
Regulatory Purposes exception; and the development of regulatory and
enforcement experience regarding ENDS products. Because these (and
other, unforeseen) circumstances are not predictable, the Postal
Service finds it imprudent to prescribe a schedule of revisions at this
time.
IV. Explanation of Changes From Proposed Rule
The final rule includes substantive revisions and additions to
Publication 52, as well as non-substantive corrections for consistency
and organization, such as extensive renumbering to accommodate
substantive revisions.
Material substantive revisions from the proposed rule that are
incorporated throughout the final rule include the following:
``Covered products,'' defined in section 471.6 as any
cigarette, smokeless tobacco, or ENDS, replaces ``tobacco products''
where applicable.
Marking requirements for mailings under nonmailability
exceptions are revised to provide options for distinguishing among
covered products and eligible recipients where applicable.
Application requirements for the Business/Regulatory
Purposes, Consumer Testing, and Public Health exceptions are revised to
(1) allow for submission of applications by email to a specified Postal
Service email address; (2) require submission of specified Postal
Service forms and/or worksheets; (3) clarify that copies of licenses
may be furnished (in lieu of originals); (4) clarify the timeframe
(i.e., at least 15 days) for updating application materials prior to
mailings to or from parties to which the updated information relates;
and (5) clarify that Postal Service personnel will have access to
current lists of authorized senders/recipients under applicable
exceptions.
Application requirements for the Business/Regulatory
Purposes and Public Health exceptions are revised to specify that the
PCSC Director may suspend, modify, or rescind discretionary waivers for
federal or state government agencies of certain application
requirements.
Mailing requirements for the Business/Regulatory Purposes
and Consumer Testing exceptions are revised to require that a current
PCSC eligibility letter be presented at acceptance, to acknowledge that
lists of authorized senders and recipients will be made available to
acceptance personnel, and to clarify that such mailings may be tendered
at retail or BME locations.
Mailing requirements for the Business/Regulatory Purposes
and Certain Individuals exceptions are revised to reflect current
Postal Service offerings by requiring the use of a combination of
Priority Mail Express or Priority Mail with Adult Signature Required or
Adult Signature Restricted Delivery. Mailing requirements for the
Consumer Testing and Public Health exceptions are similarly revised to
require the use of a combination of Priority Mail Express or Priority
Mail with Adult Signature Restricted Delivery.\39\ For all exceptions,
the former option of Priority Mail Express with Hold for Pickup is
deleted.
---------------------------------------------------------------------------
\39\ The PACT Act conditions use of the Consumer Testing and
Public Health exceptions on delivery only to the named recipient.
See 18 U.S.C. 1716E(b)(5)(A), (b)(5)(C)(ii)(VI)-(VII). This
condition can be fulfilled via the use of Adult Signature Restricted
Delivery, which restricts delivery to the named addressee, but not
Adult Signature Required, which does not.
---------------------------------------------------------------------------
Delivery requirements for the Business/Regulatory Purposes
and Consumer Testing exceptions are revised to clarify that mailings
lacking the PCSC eligibility number in the return block will not be
released to recipients.
Delivery requirements for the Certain Individuals and
Consumer Testing exceptions are revised to clarify that the minimum age
of recipients must be confirmed by Postal Service personnel before
mailings may be released or delivered to recipients.
Discrete substantive revisions include the following:
The proposed definition of ``e-liquid'' in proposed
section 471.3 is deleted as redundant.
A consolidated definition of ``minimum age,'' defined as
21 years of age, or older where required by local law for acceptance or
delivery, is added in section 471.9.
General provisions regarding nonmailability and reasonable
cause in proposed 472.1 are reorganized as sections 472.1 and .2. The
circumstances giving rise to nonmailability are delineated more
specifically; the treatment of nonmailable matter found in the mails
and not seized is clarified through a cross-reference to general
provisions on that topic; and clarification is made that nonmailable
covered products must not be accepted, forwarded, or delivered.
The ``reasonable cause'' standard for Postal Service
personnel in proposed section 472.1 is clarified to allow consideration
of any potentially relevant circumstances.
A new section 473.b clarifies that the PACT Act exceptions
do not apply to mail from the United States to APO, FPO, or DPO
addresses. As explained in section III.J.1, the postal services
necessary to reliably fulfill the PACT Act exceptions' verification
requirements are not currently available at such locations, and at this
time, there does not appear to be any sufficiently reliable alternative
means of ensuring that those requirements are fulfilled. In conformance
with this change, provisions are removed from the Certain Individuals
section that had formerly prescribed how shipments can be made to APO/
FPO addresses.
A new section 473.1.e consolidates the requirement, common
to all PACT Act exceptions, that all excepted shipments must be
tendered through a face-to-face transaction with a Postal Service
employee. For clarity, the requirement is framed here in the negative,
as a prohibition on all other entry methods, and enumerates examples of
prohibited entry methods.
Language is added to the preamble of the Business/
Regulatory Purposes exception provisions to clarify not only the types
of parties eligible to mail under the exception, but the specific
sender-addressee pairings permitted by the PACT Act (i.e., business-to-
business, business-to-government, or government-to-business, but not
government-to-government).
Application requirements for the Business/Regulatory
Purposes exception are further revised to include additional required
information relating to (1) the
[[Page 58427]]
nature of the relevant business(es); and (2) for ENDS only, brand
name(s) and product description(s), including information sufficient to
confirm mailability under other applicable provisions (e.g.,
restrictions related to hazardous materials or controlled substances).
Delivery requirements for the Business/Regulatory Purposes
exception are revised to provide examples of methods for verifying a
recipient's employment. Specifically, proof of employment may take the
form of an employee identification card or badge containing the name
and phone number of the employer/agency along with the name of the
employee; a signed letter on employer/agency letterhead; or any form of
identification the postmaster deems to be of comparable reliability.
Further clarification is made that employee status may be inferred by
Postal Service personnel based on observable factors.
Provisions are added regarding the Certain Individuals
exception to emphasize the noncommercial-purpose requirement and to
clarify how it applies in the context of returns of damaged or
unacceptable merchandise and of used products sent for recycling.
Application requirements for the Consumer Testing
exception are revised to require submission of a copy of the permit
issued under 26 U.S.C. 5713. Conversely, language is added to the
Public Health exception provision to clarify that a manufacturer's
permit is not required for government agencies applying under that
exception.
The additional requirements set out in proposed section
472.27 are relocated to section 472.3 and revised to clarify the
applicability of other laws and regulations.
Mailers' requirements to retain eligibility documentation
under applicable nonmailability exceptions are increased from three to
six years to align with potentially applicable statutes of limitations
and are set out separately in section 472.4.
Revisions and additions are made to clarify that
applicants bear the burden, during initial determinations or appeals,
of establishing eligibility for each sender and recipient, and must
submit additional documentation as necessary. Further clarification is
made that the PCSC Director may approve or deny applications in whole
or with respect to certain mailers or recipients, and that eligibility
may be suspended, modified, or revoked, in whole or in part, for
failure to comply with applicable laws or regulations.
A new section 474.1 is added to clarify that ATF
administers the relevant statutory definition of ENDS and the exclusion
of FDA-approved tobacco-cessation and therapeutic products. Persons
interested in interpretive guidance concerning these two subjects are
advised to contact ATF at the listed address, with a copy to the PCSC.
The statutory exclusion of FDA-approved tobacco cessation/
therapeutic products from the definition of ENDS in proposed section
471.2 is set out separately in section 474.2, and a requirement is
added for persons who believe that a product qualifies for this
exclusion to submit documentation to ATF, with a copy to the PCSC.
Joshua J. Hofer,
Attorney, Ethics & Legal Compliance.
The Postal Service adopts the following changes to Publication 52,
Hazardous, Restricted, and Perishable Mail, incorporated by reference
into Mailing Standards of the United States Postal Service, Domestic
Mail Manual (DMM), section 601.8.1, which is further incorporated by
reference in the Code of Federal Regulations. 39 CFR 111.1, 111.3.
Publication 52 is also a regulation of the Postal Service, changes to
which may be published in the Federal Register. 39 CFR 211.2(a).
Accordingly, for the reasons stated in the preamble, the Postal Service
amends Publication 52 as follows:
* * * * *
4 Restricted Matter
* * * * *
[Revise title of 47 to read as follows:]
47 Cigarettes, Smokeless Tobacco, and Electronic Nicotine Delivery
Systems
* * * * *
471 Definitions
[Revise the last sentence of 471.1 to read as follows:]
471.1 Cigarette
* * * The term cigarette includes roll-your-own tobacco and
excludes cigars.
* * * * *
[Revise the title of 471.4 to read as follows:]
471.4 Roll-Your-Own Tobacco
* * * * *
[Renumber 471.5 through 471.6 as 471.7 through 471.8, respectively,
and insert after 471.4 the following:]
471.5 Electronic Nicotine Delivery System (ENDS)
Any electronic device that, through an aerosolized solution,
delivers nicotine, flavor, or any other substance to the user inhaling
from the device. ENDS include but are not limited to, electronic
cigarettes (e-cigarettes), electronic hookahs (e-hookahs), electronic
cigars (e-cigars), vape pens, advanced refillable personal vaporizers,
and electronic pipes. Any reference to ENDS also includes any
component, liquid, part, or accessory of an ENDS device, regardless of
whether the component, liquid, part, or accessory is sold or provided
separately from the device.
471.6 Covered Product
For purposes of chapter 47, any cigarette, smokeless tobacco, or
ENDS.
* * * * *
[Add after 471.8, as renumbered, the following:]
471.9 Minimum Age
21 years of age (the federal minimum age for the sale or purchase
of covered products), or such higher age that a state or municipality
may impose for the legal sale or purchase of covered products at the
place of acceptance or delivery, as appropriate.
* * * * *
[Revise 472 to read as follows:]
472 Covered Products Generally Nonmailable
472.1 General
The following are nonmailable:
a. Shipments of covered products described in 473.1.a through .e.
b. Shipments of covered products that are not described in 473.1.a
through .e and that do not qualify for an exception under 473.2 through
.6.
c. Shipments of covered products that are not described in 473.1.a
through .e and that would generally qualify for an exception under
473.2 through .6, but for a failure to meet one or more conditions for
the applicable exception. For example, a recipient may fail to be
verified as being of at least the minimum age (see 473.34.a, .44.a,
.54.a), or a Return Receipt may be absent or may lack the mailer's
eligibility number (see 473.32.b, .52.c).
472.2 Treatment of Nonmailable Covered Products
472.21 Refusal of Acceptance and Transmission
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.
[[Page 58428]]
472.22 Seizure and Forfeiture
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.
472.23 Disposition of Nonmailable Covered Products Not Seized and
Forfeited
Any nonmailable covered products not seized and forfeited shall be
handled in accordance with 216 and 414.
472.24 Penalties
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.
472.3 Reasonable Cause To Suspect Covered Products
Among any other potentially relevant circumstances, the Postal
Service has reasonable cause to suspect the presence of covered
products based on:
a. A statement on a publicly available website, or an
advertisement, by any person that the person will mail matter which is
nonmailable under this section in return for payment;
b. The fact that the mailer or other person on whose behalf a
mailing is being made is on the U.S. Attorney General's List of
Unregistered or Noncompliant Delivery Sellers; or
c. Any other characteristics of a package or label, individually or
in combination with other packages or labels, that reasonably indicate
the likely presence of covered products.
472.4 Applicability of Other Laws and Regulations
Shipments permitted under 473 are subject to all other applicable
federal, state, and local laws and regulations. For example, ENDS that
consist of or contain controlled substances (including cannabis and
cannabis derivatives), drug paraphernalia, lithium batteries, liquids,
or any toxic or flammable substance (e.g., nicotine, diacetyl (butane-
2,3-dione), propanol, and other components of ENDS liquids) may be
subject to prohibitions, restrictions, or additional requirements
stated elsewhere in this publication. Mailers, recipients, and
applicants are solely responsible for complying with all applicable
Postal Service regulations and other federal, state, and local laws
when mailing covered products.
472.5 Recordkeeping
Mailers, recipients, and applicants must maintain records to
establish compliance with the requirements in 473 for a 6-year period
and must make such records available to the Postal Service upon
request.
* * * * *
[Insert after 472 the following:]
473 Mailability Exceptions
473.1 Scope of Exceptions
Covered products are mailable if one of the conditions in 473.2
through 473.6 is met. These exceptions do not apply to the following:
a. Mail treated as domestic under DMM 608.2.2.
b. Mail sent to Air/Army Post Office (APO), Fleet Post Office
(FPO), or Diplomatic Post Office (DPO) addresses.
c. Mail presented at APO, FPO, or DPO installations and destined to
addresses in the United States.
d. International mail as defined in DMM 608.2.3.
e. Mail presented outside of a face-to-face transaction with a
Postal Service employee at a Postal Service retail or business mail
acceptance location. Examples of prohibited entry methods include, but
are not limited to, Pickup on Demand; package pickup; an Approved
Shipper location or other third-party acceptance location; a Contract
Postal Unit; a Village Post Office; and placement in a customer
mailbox, collection box, or Postal Service lobby drop.
473.2 Intra-Alaska and Intra-Hawaii Shipments
Intra-Alaska and intra-Hawaii shipments of covered products are
mailable, provided that such mailings:
a. Are presented in a face-to-face transaction with a Postal
Service employee within the state, and not through any entry method
prohibited under 473.1.e;
b. Destinate in the same state of origin;
c. Bear a valid complete return address that is within the state of
origin; and,
d. Are marked with the following exterior marking on the address
side of the mailpiece, with the relevant type of item selected:
``INTRASTATE SHIPMENT OF [CIGARETTES/SMOKELESS TOBACCO/ENDS].''
473.3 Exception for Business/Regulatory Purposes
Eligibility to mail and to receive mail under the business/
regulatory purposes exception is limited to federal and state
government agencies and legally operating businesses that have all
applicable state and federal government licenses or permits and are
engaged in the manufacturing, distribution, wholesale, export, import,
testing, investigation, or research of covered products. Mailings under
this exception are permitted only for business purposes between
eligible businesses or for regulatory purposes between such businesses
and eligible government agencies. Mailability is further restricted to
mailings that comply with all conditions in 473.31 to 473.34.
473.31 Application
Each customer seeking to mail covered products under the business/
regulatory purposes exception must submit a complete application (PS
Form 4615 or 4615E, as appropriate) and, for ENDS, complete Worksheets
4615-EM and 4615-ER as appropriate, along with all supporting
documentation requested on those forms and worksheets.
a. Along with any other information requested on PS Form 4615 or
4615E and Worksheets 4615-EM and 4615-ER, the applicant must furnish:
1. Information about its legal status, copies of any applicable
licenses, and authority under which it operates.
2. Information about the legal status, copies of any applicable
licenses, and operational authority for all recipients to which the
mailings under this exception will be addressed.
3. All locations where mail containing covered products will be
presented.
4. For each business mailer and/or recipient, the nature of the
relevant business activities (e.g., manufacturing, wholesale,
distribution, testing, investigation, import, export).
5. The brand name and a description of each product intended to be
mailed. For ENDS, descriptions must include information about the
source of any CBD; the concentration of any THC; and safety data sheets
or technical specification documentation for any hazardous materials
(e.g., lithium batteries, nicotine, diacetyl (butane-2,3-dione),
propanol).
b. The applicant is responsible for establishing the eligibility of
each sender and recipient and for the accuracy, completeness, and
currency of all information provided in the application.
c. Applications must be submitted as follows:
1. For cigarettes and smokeless tobacco (PS Form 4615): by email to
[email protected].
2. For ENDS (PS Form 4615E and Worksheets 4615-EM and 4615-ER): by
email to [email protected].
[[Page 58429]]
d. The Director, PCSC, will make a determination of eligibility to
mail under the business/regulatory purposes exception. The mailer bears
the burden of establishing eligibility and must furnish any additional
supporting documentation requested by the Director, PCSC, upon request
as necessary to establish eligibility. The Director, PCSC, may approve
or deny an application in its entirety or only with respect to certain
mailers and/or recipients. A number is assigned to each letter of
eligibility.
e. The applicant must update the information in its application,
including any updated documentation, in a timely manner, as necessary,
at least 15 days prior to conducting any mailing to or from an entity
to which the information pertains.
f. Upon written request by a state or federal agency, the Director,
PCSC, may, in his or her discretion, waive certain application
requirements for mailings entered by the requesting state or federal
agency for regulatory purposes. The Director, PCSC, may suspend,
rescind, or modify any waiver at any time.
g. Any determination of eligibility to mail under this exception
shall lapse if the authorized mailer does not tender any mail under
this exception within any 3-year period. After that time, the affected
mailer must apply for and receive new authorization for any mailings
under this exception.
473.32 Mailing
All mailings tendered under the business/regulatory purposes
exception must:
a. Use one of the following combinations of services:
1. Priority Mail Express with Adult Signature Required or Adult
Signature Restricted Delivery service (see DMM 503.8.0).
2. Priority Mail with Adult Signature Required or Adult Signature
Restricted Delivery service.
b. Be accompanied by a Domestic Return Receipt (PS Form 3811). The
sender`s address block must bear the eligibility number issued by the
PCSC and be made returnable to the address as shown below:
PCSC, PACT MAILING OFFICE, USPS ELIGIBILITY NO. XX-00-0000, 90
Church St., Ste. 3100, New York, NY 10007-2951.
c. Bear the following marking, with the relevant type of item and
recipient selected: ``[CIGARETTE/SMOKELESS TOBACCO/ENDS] MAILING--
DELIVER ONLY TO EMPLOYEE OF ADDRESSEE [BUSINESS/AGENCY] UPON AGE
VERIFICATION'' on the address side of the mailpiece.
d. Bear the business or government agency name and full mailing
addresses of both the sender and recipient, both of which must match
exactly those listed on the authorized mailer's application on file
with the Postal Service.
e. Be entered at a retail and/or business mail acceptance location
specified in the application and authorized by the PCSC.
473.33 Entry and Acceptance
Mailings under the business/regulatory purposes exception must be
entered under the following conditions:
a. Covered products must be tendered via a face-to-face transaction
with a Postal Service employee. Applicable mailings may not be tendered
through any entry method prohibited under 473.1.e.
b. The mailer must present Postal Service acceptance personnel with
the following:
1. For shipments of cigarettes and/or smokeless tobacco, a letter
from the PCSC showing that the PCSC has authorized the mailer,
addressee, and acceptance location.
2. For shipments of ENDS:
i. A letter from the PCSC showing that the PCSC has authorized the
mailer and has not withheld authorization as to the addressee;
ii. A PCSC-approved Worksheet 4615-EM showing that the PCSC has
authorized the mailer and the acceptance location; and
iii. A PCSC-approved Worksheet 4615-ER showing that the PCSC has
authorized the addressee.
473.34 Delivery
Mailings bearing the marking for business/regulatory purposes are
eligible for delivery only to a verified employee of the addressee
business or government agency under the following conditions:
a. The recipient must be an adult of at least the minimum age (see
471.9) at the place of delivery. The recipient's age must be verified
by a postal employee before releasing or delivering the item to the
recipient. The recipient must furnish proof of age via a driver's
license, passport, or other government-issued photo identification that
lists age or date of birth.
b. The recipient must demonstrate status as an employee of the
business or government agency identified as the addressee on the
mailing label. Proof of employment may take the form of an employee
identification badge or card issued by the employer and including the
employee's name, the employer's name, and the employer's telephone
number; a signed letter on company or agency letterhead from a
supervisor or human relations office attesting to the recipient's
current employment; or any other form of identification that the
postmaster deems to be of comparable reliability. Where delivery is
made to a business address, employment status may be inferred from the
carrier's observation of such factors as the recipient's uniform and
presence at a reception desk or retail counter.
c. Once the recipient's age and identity as an employee of the
addressee are established, the recipient must sign for receipt of
delivery and in the appropriate signature block of PS Form 3811.
473.4 Exception for Certain Individuals
The exception for certain individuals permits the mailing of small
quantities of covered products by individual adults for noncommercial
purposes. Mailability is further restricted to mailings that comply
with all conditions in 473.41 to 473.44. Eligible shipments may be made
to any type of recipient (individual, business, government, or other
organization).
473.41 Noncommercial Purposes
Noncommercial purposes may include, but are not limited to, the
following:
a. Covered products exchanged as gifts between individual adults.
For purposes of this rule, ``gifts'' do not include covered products
purchased by one individual for another from a third-party vendor
through a mail-order transaction, or the inclusion of covered tobacco
products at no additional charge with other matter pursuant to a
commercial transaction.
b. Damaged or unacceptable covered products returned by a consumer
to the manufacturer or other business. For purposes of the
noncommerciality requirement, the manufacturer or other business may
provide the consumer with a refund, credit, replacement product, or
other form of value in exchange for the damaged or unacceptable covered
product, so long as it does not exceed the amount that the consumer
paid for the damaged or unacceptable product plus the cost of return
shipping for the damaged or unacceptable product.
c. Used covered products sent by a consumer to a manufacturer or
other business for recycling. For purposes of this rule, the consumer
must not receive anything of value (e.g., a discount, credit, or
rebate) in exchange for a returned item.
[[Page 58430]]
473.42 Mailing
No customer may send or cause to be sent more than 10 mailings
under this exception in any 30-day period. Each mailing under the
certain individuals exception must:
a. Weigh no more than 10 ounces.
b. Use one of the following combinations of services:
1. Priority Mail Express with Adult Signature Required or Adult
Signature Restricted Delivery service (see DMM 503.8.0).
2. Priority Mail with Adult Signature Required or Adult Signature
Restricted Delivery service.
c. Bear the full name and mailing address of the sender and
recipient on the Priority Mail Express or Priority Mail label.
d. Bear the following exterior marking on the address side of the
mailpiece, with the relevant type of item selected: ``PERMITTED
[CIGARETTE/SMOKELESS TOBACCO/ENDS] MAILING--DELIVER ONLY UPON AGE
VERIFICATION.''
473.43 Entry and Acceptance
Mailings under the certain individuals exception must be entered
under the following conditions:
a. Covered products must be tendered via a face-to-face transaction
with a Postal Service employee. Applicable mailings may not be tendered
through any entry method prohibited under 473.1.e.
b. The individual presenting the mailing must furnish a driver's
license, passport, or other government-issued photo identification that
lists age or date of birth. The name on the identification must match
the name of the sender appearing in the return address block of the
mailpiece. The customer must be an adult of at least the minimum age at
the place of acceptance (see 471.9).
c. For mailings addressed to an individual, at the time the mailing
is presented, the customer must orally confirm that the addressee is an
adult of at least the minimum age at the place of delivery (see 471.9).
473.44 Delivery
Mailings bearing the marking for certain individuals are eligible
for delivery only under the following conditions:
a. The recipient receiving or signing for the article must be an
adult of at least the minimum age at the place of delivery (see 471.9).
This must be confirmed by postal employees before releasing or
delivering the item to the recipient. The recipient must furnish proof
of age via a driver's license, passport, or other government-issued
photo identification that lists age or date of birth.
b. Once age is established, the recipient must sign for receipt of
delivery.
473.5 Consumer Testing Exception
The consumer testing exception permits a legally operating
cigarette manufacturer or a legally authorized agent of a legally
operating cigarette manufacturer to mail cigarettes to verified adult
smokers solely for consumer testing purposes. The manufacturer for
which mailings are entered under this exception must have a permit, in
good standing, issued under 26 U.S.C. 5713. The consumer testing
exception applies only to cigarettes and not to smokeless tobacco or
ENDS. Mailability is further restricted to mailings that comply with
all conditions in 473.51 to 473.54.
473.51 Application
Each person seeking to mail cigarettes under the consumer testing
exception must submit a complete application (PS Form 4616), along with
all supporting documentation requested on that form, by email to
[email protected]. For each application, the following conditions must be
met:
a. The applicant must furnish the following information:
1. A copy of the relevant manufacturer's permit issued under 26
U.S.C. 5713.
2. If the applicant is an agent of a manufacturer, complete details
about the agency relationship with the manufacturer.
3. All locations where mail containing cigarettes for consumer
testing will be presented.
b. As part of its application, the applicant must certify in
writing that it will comply with the following requirements:
1. Any recipient of consumer testing samples of cigarettes is an
adult established smoker.
2. No recipient has made any payment for the cigarettes.
3. Every recipient will sign a statement indicating that the
recipient wishes to receive the mailings.
4. The manufacturer or the legally authorized agent of the
manufacturer will offer the opportunity for any recipient to withdraw
the recipient's written statement at least once in every 3-month
period.
5. Any package mailed under this exception will contain no more
than 12 packs of cigarettes (maximum of 240 cigarettes) on which all
taxes levied on the cigarettes by the state and locality of delivery
have been paid and all related state tax stamps or other tax-payment
indicia have been applied.
c. The application must be submitted to the Director, Pricing and
Classification Service Center (PCSC) via email to [email protected]. The
applicant bears the burden of establishing eligibility.
d. The applicant must provide any requested copies of records
establishing compliance to the Director, PCSC, and/or the Director,
Product Classification (see 214 for address), upon request, no later
than 10 business days after the date of the request.
e. The Director, PCSC, will make a determination of eligibility to
mail under the consumer testing exception. The Director, PCSC, may
approve or deny an application in its entirety or only with respect to
certain mailers and/or recipients. A number is assigned to each letter
of eligibility.
f. An applicant or authorized mailer must update the information in
its application with the Director, PCSC, as necessary, in a timely
manner upon becoming aware of a change in application information, not
later than 15 days prior to conducting any mailing, for as long as it
continues to mail under the consumer testing exception.
g. Any determination of eligibility to mail under this exception
shall lapse if the authorized mailer does not tender any mail under
this exception within any 3-year period. After that time, the mailer
must apply for and receive new authorization for any further mailings
under this exception.
473.52 Mailing
All mailings under the consumer testing exception:
a. Must be limited in tobacco content to no more than 12 packs of
cigarettes (maximum 240 cigarettes) on which all taxes levied on the
cigarettes by the destination state and locality have been paid and all
related state tax stamps or other tax-payment indicia have been
applied.
b. Must use one of the following combinations of services:
1. Priority Mail Express with Adult Signature Restricted Delivery
service (see DMM 503.8.0).
2. Priority Mail with Adult Signature Restricted Delivery service.
c. Be accompanied by a Domestic Return Receipt (PS Form 3811). The
sender's address block must bear the eligibility number issued by the
PCSC and be made returnable to the address as shown below:
PCSC, PACT MAILING OFFICE, USPS ELIGIBILITY NO. XX-00-0000, 90
[[Page 58431]]
Church St., Ste. 3100, New York, NY 10007-2951.
d. Must bear the following marking: ``PERMITTED CIGARETTE MAILING--
DELIVER ONLY TO ADDRESSEE UPON AGE VERIFICATION'' on the address side
of the mailpiece.
e. Must bear the name and full mailing addresses of both the mailer
and recipient, both of which must match exactly those listed on the
authorized mailer's application on file with the Postal Service.
f. May not be addressed to an addressee located in a state that
prohibits the delivery or shipment of cigarettes to individuals in the
destination state.
g. May be sent only to an addressee who has not made any payment
for the cigarettes, is being paid a fee for participation in consumer
tests and has agreed to evaluate the cigarettes and furnish feedback to
the manufacturer in connection with the consumer test.
h. May not exceed more than one package from any one manufacturer
to an adult smoker during any 30-day period.
i. Must be entered at a retail and/or business mail acceptance
location specified in the application and authorized by the PCSC.
473.53 Entry and Acceptance
Mailings under the consumer testing exception must be entered under
the following conditions:
a. Covered products must be tendered via a face-to-face transaction
with a Postal Service employee. Applicable mailings may not be tendered
through any entry method prohibited under 473.1.e.
b. The mailer must present Postal Service acceptance personnel with
a letter from the PCSC showing that the PCSC has authorized the mailer
and acceptance location.
473.54 Delivery
Mailings bearing the marking for consumer testing are eligible for
delivery only to the named addressee under the following conditions:
a. The recipient signing for the article must be an adult of at
least 21 years of age. The recipient's age must be verified by a postal
employee before releasing or delivering the item to the recipient. The
recipient must furnish proof of age via a driver's license, passport,
or other government-issued photo identification that lists age or date
of birth. The name on the identification must match the name of the
addressee on the Priority Mail Express or Priority Mail label.
b. Once the recipient's age and identity are established, the
recipient must sign for receipt of delivery and in the appropriate
signature block of PS Form 3811.
473.6 Public Health Exception
Federal government agencies involved in the consumer testing of
tobacco products solely for public health purposes may mail cigarettes
(this does not apply to smokeless tobacco or ENDS) under the mailing
standards of 473.5, except as follows:
a. The federal agency is not required to have a manufacturer's
permit issued under 26 U.S.C. 5713.
b. The recipient is not required to be paid a fee for participation
in consumer tests.
c. Upon written request, the Director, PCSC, may waive certain
application requirements for mailings entered by the requesting federal
agency. The Director, PCSC, may suspend, rescind, or modify any waiver
at any time.
473.7 Suspension or Revocation of Eligibility
Eligibility to mail under one or more exceptions in 473.2 through
.6 may be suspended or revoked by the Director, PCSC, in the event of
failure to comply with any applicable law or regulation. A customer may
appeal an adverse initial decision to the Director, Product
Classification (see 214 for address). The mailer bears the burden of
proof in establishing eligibility in any appeal of a suspension or
revocation decision and of furnishing all supporting documentation when
requested. Decisions by the Director, Product Classification, to revoke
a customer`s eligibility under any exception may be appealed to the
Judicial Officer under 39 CFR part 953.
* * * * *
474 Additional Guidance
474.1 Interpretative Guidance
The definitions in 471.1 through. 5 and the exclusion in 474.2 are
pursuant to section 1 of the Jenkins Act (15 U.S.C. 375), which is
administered by the Bureau of Alcohol, Tobacco, Firearms, and
Explosives (ATF). Interpretative guidance regarding these provisions
may be requested by contacting ATF at the following address, with a
copy to the Pricing and Classification Service Center (PCSC) (see 213
for address): Bureau of Alcohol, Tobacco, Firearms and Explosives, 99
New York Avenue NE, c/o 90 K St. NE, Ste. 250, Washington, DC 20226.
474.2 Exclusion of Products Approved for Tobacco Cessation or
Therapeutic Purposes
A product is excluded from the definition of ENDS in 471.5 (15
U.S.C. 375(7)(C)) if:
a. It is approved by the Food and Drug Administration for sale as a
tobacco cessation product or any other therapeutic purpose; and
b. Is marketed and sold solely for such purposes.
Any party who believes that a product to be sent through the mails
qualifies for this exclusion should provide appropriate documentation
to ATF at the address in 474.1, with a copy to the PCSC.
[FR Doc. 2021-22787 Filed 10-20-21; 8:45 am]
BILLING CODE P