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New year, new laws: regulations and proposals for vape and other age-restricted markets
Published Thursday, January 3, 2019

New year, new laws: regulations and proposals for vape and other age-restricted markets


Age-restricted ecommerce can be a slippery slope. Businesses can reach larger audiences online and increase sales, but they also risk selling to minors and breaking the law. Online age verification is helping age-regulated merchants find solid ground in this area. Starting with a broad look at the regulatory environment of the e-cigarette industry, given its landmark year in 2018, we’ll break down different applications of age verification software for specific age-restricted markets.

E-cigarettes, e-juice, and all vape-related products

The U.S. Food and Drug Administration’s (FDA) efforts to reduce youth vaping are taking shape with new proposals and stricter enforcement of existing regulations following a widespread investigation of e-cigarette businesses in 2018. With a multi-pronged approach to the problem of underage vaping, the FDA is addressing several main issues:

Sale of flavored e-cigarettes in convenience stores/gas stations

In late 2018, the FDA announced plans to ban flavored e-cigarettes from brick-and-mortar stores that don’t have age-restricted entry, or a barrier to an age-restricted area where those products are displayed. For example, cotton candy flavored e-juice could no longer be offered at a convenience store, unless that store has a separate room with an appropriate barrier and an age-checking system that keeps minors out of it. A curtain or section of the store that’s not completely walled off would be insufficient. Only tobacco, mint, and menthol flavors (which are more popular among adults than kids) will be allowed at such retail outlets. According to the new proposal, sales of flavored vapes will be limited to smoke shops and online vape stores, where all entry and sales are age-restricted.

Product packaging and advertising

One of the FDA’s initiatives is to make vape products less appealing to children. According to a 2013-2014 survey, 81% of underage e-cigarette users said the appealing flavors were their primary reason for use. The FDA has banned packaging with cartoons or other youth-oriented designs, such as lollipops, cookies, soda, etc. The vape industry as a whole has already taken great strides to fix this problem since then, but there’s still a long way to go.

Beginning in 2018, the FDA worked with other organizations to remove these kid-friendly flavors from the market. They partnered with the Federal Trade Commission to more aggressively target e-liquid manufacturers of products containing youth-oriented imagery, and worked with eBay to remove online listings of such products.

Brand infringement is another issue. For example, vape flavors cannot be named after specific cereals or at all resemble the branding of other companies. As of Aug. 10, 2018, packaging and all product advertisements must contain a health warning statement that says the product contains nicotine, and that nicotine is addicting.

Minimum age to buy vape products

The FDA requires vape customers to be at least 18 years old. Retailers must check photo IDs for any customer appearing under 27, may not offer free samples, and may not offer products through a vending machine. This law has been in effect since Aug. 8th, 2016, but because of the rise in underage sales, it’s being more intensely enforced. More than 1,300 warning letters and fines were issued to offenders connected to underage sales last year.

While some speculate that the FDA will raise the minimum age to 21, others argue that such a move would cause minors to turn to more harmful combustible cigarettes. Some states have made their own moves regarding the minimum age to buy vape products. While still 18 in most states, it is now:

  • 19+ in Alabama, Alaska, and Utah
  • 21+ in California, Hawaii, New Jersey, and Oregon
  • 21+ in Maine and Massachusetts with certain exceptions*

*Maine has a grandfather clause that allows people who are between 18 and 20 at the time of its new law to still buy e-cigarettes, while those turning 18 after the date of the new law are subject to the 21+ requirement. Massachusetts’ new 21+ law went into effect on Dec. 31, 2018. Similar to Maine, a grandfather clause accompanies it. Certain municipalities in Massachusetts have already raised the minimum age, but for those which haven’t, 18 to 20-year-olds will still be able to purchase tobacco products if they are of age at the time the law went into effect.

Online sales

Online sales will still be allowed, but only under “heightened practices for age verification,” the FDA says. In a Nov. 15th, 2018 release FDA Commissioner Scott Gottlieb, M.D., said he’s directing the FDA’s Center for Tobacco Products (CTP) to publish additional information regarding best practices for online sales as soon as possible. AgeChecker.Net is prepared to adapt to any of these specifications once they are published by the FDA.

Pre-market approval

The current law for e-cigarettes says that products must undergo pre-market approval by the FDA before they enter the market, but in 2017 the FDA extended the compliance deadline to 2022, allowing the sale of vape products without those approvals. By Aug. 8, 2022, manufacturers must submit a pre-market application to the FDA for “new” e-cig products.

However, in the same Nov. 15th release, Dr. Gottlieb announced that he’s directing the CTP to revisit this compliance policy as it applies to vape products of all flavors except tobacco, mint, and menthol. The FDA cited a study showing that 21% of underage vapers used tobacco, mint, and menthol flavors, while 41% of adult vapers used those flavors, and recognize that they are a popular cigarette alternative for adults trying to quit.

Nicotine awareness and cessation programs

Additionally, the FDA launched and expanded “The Real Cost” Youth E-Cigarette Prevention Campaign, among other programs, to educate minors about the health risks of using and becoming addicted to e-cigarettes. Public hearings on the matter continue. It already aims to create and strengthen drug therapies specifically set up to help minors quit, increase access to medicinal nicotine products like patches and gums, and educate the public about common misperceptions about vaping. According to FDA studies, some underage users don’t even realize there’s nicotine in vape products when they first try them.

All in all, we expect the FDA’s Comprehensive Plan for Tobacco and Nicotine Regulation to greatly affect the vaping community, and we’re ready to help businesses thrive in its future.

Striking the right balance

The FDA, like many other organizations and individuals, recognizes that vaping is a healthier alternative to smoking combustible cigarettes. Emphasized in recent releases is how to strike the right balance between making the products available to adults who benefit from them while blocking youth access. As Dr. Gottlieb states in his November release, “Any policy accommodation to advance the innovations that could present an alternative to smoking—particularly as it relates to e-cigarettes—cannot, and will not, come at the expense of addicting a generation of children to nicotine through these same delivery vehicles. This simply will not happen. I will take whatever steps I must to prevent this.”

Vape merchants must realize that their businesses’ future depends on active participation in the fight against underage vaping.

CBD products

Like the vape industry, cannabidiol (CBD) products make up another burgeoning market that is proving difficult to regulate. One of the causes for the recent surge in sales is scientific proof of CBD’s legitimate applications to treat health conditions, especially those in children and the elderly.

Several marijuana constituents have been approved by the FDA for very specific ailments. For example, on June 25th, 2018 the FDA approved a purified form of the drug CBD, isolated as just one of hundreds of compounds in marijuana. It was approved to treat seizures associated with two severe forms of pediatric epilepsy. While this market is narrow, since these two forms of epilepsy are rare, the approval was a major benchmark for the CBD market’s progress. And, research continues.

What about other kinds of CBD?

The problem is that there are many different kinds of CBD products, and most of them are not approved by the FDA. If CBD products contain less than .3 percent THC, they are considered hemp-derived and allowed in any state, even via ecommerce. On December 20th, 2018, the FDA confirmed this by signing the Agriculture Improvement Act, which removed hemp (with less than .3% THC on a dry weight basis) from the Controlled Substances Act, meaning it will no longer be an illegal substance. Hemp-derived CBD is commonly sold at health/wellness stores and vape shops, and while it is legal, it may not make unsubstantiated health claims without FDA approval.

Even though CBD derived from a legal hemp growing facility is legal for all ages in theory, many businesses choose to place age restrictions on these products since they may be associated with marijuana, and because interpretations of hemp growing laws are murky. Some believe that the hemp market is so saturated that all of the products couldn’t possibly be from a federally licensed hemp growing facility.

In addition, the .3 percent rule draws a fine regulatory line. Both marijuana and marijuana-derived CBD are still classified as schedule I drugs by the U.S. Drug Enforcement Agency (DEA), and remain in a transitional period as different states adopt their own regulations for the many different forms of them.

Marijuana-derived CBD, which contains more than .3 percent THC, is allowed in the 10 states (plus the District of Columbia) that allow medical and recreational marijuana for consumers at least 18 years old. 23 states allow medical marijuana and marijuana-derived CBD, but have not legalized them for recreational use. A smaller group of states classify marijuana and marijuana-derived CBD differently, allowing CBD for specific medical purposes. So, there’s a lot to keep up with if you sell these products.

CBD ecommerce businesses are implementing age verification software to comply with these different state regulations. Age verification software is designed to allow business owners to customize it; stores can set the minimum age for buyers in CBD and marijuana-friendly states, while blocking sales for consumers in states where they are prohibited. Similarly, if your website sells a variety of products, the software can be automatically applied only to the age-restricted ones. If you sell both hemp-derived CBD and marijuana-derived CBD, for instance, you may choose to only require age verification for the latter.

There’s also a case for age verification software in a brick-and-mortar setting. Many businesses provide customers with a “research online, purchase offline” experience by advertising products online, where customers can browse and even order products, and have the choice to either pick them up at the retail location or have them delivered, at which point the payment is made. Age verification happens in person, right before payment.

Even when the sale takes place in person, these CBD companies experience inefficiencies when they fulfill orders, only to discover that the buyer is underage or without a valid ID upon delivery. Worse, age verification is subject to unpredictability since it’s carried out at the delivery person’s sole discretion. Age verification software before an order is processed on a CBD and/or marijuana website helps conserve business resources by preventing these situations. Ideally, both methods of age verification should be used to ensure the order information matches the recipient’s upon delivery.

Social, dating, and adult content sites

This group of industries are regulated as well, and pose threats to minors if age restrictions are evaded.

Social

The digital age of consent refers to the minimum age a user must be before a social media company can collect, process, or store their data. The European Union defaults the digital age of consent at 16, although member states are given the option of adopting a lower age (no lower than 13).

Big networks like Facebook, Instagram, Twitter, Google Mail, and Yahoo Mail require users to be at least 13 to sign up, in keeping with the Children Online Privacy Protection Act. But there is no age verification at the time of sign-up—underage accounts are only disabled if they’re discovered by the company, usually through reports from other users.

Social start-ups, and smaller established companies, may target specific age groups, demographics, etc., and benefit from age verification software to protect customers—and those who should not be accessing the site.

Online dating and adult sites

Online dating sites are wise to implement age verification software to prevent youth access and keep their site accessible only to users 18 or 21+. It’s not only a matter of complying with the law, it’s also a matter of protecting children from the dangers of stalking, kidnapping, bullying, and a host of other cyber threats.

Trusting users to self-certify that they are of legal age to access your adult social or dating site is not enough to prevent underage use; advanced age verification must be at play to confirm it. And as the internet continues to become a bigger and bigger part of our children’s lives, it’s important to restrict access to age-appropriate sites.

New age regulations are surfacing each year. For example, the U.K.’s Digital Economy Act of 2017 states that commercial pornography providers must have an age verification system in place that prevents users under the age of 18 from accessing their sites. The age verification system must be approved by the British Board of Film Classification (BBFC), the watchdog group responsible for enforcing this law once it’s deployed (it was originally set to be effective in 2018, and is tentatively looking at an Easter 2019 effective date now).

The BBFC will start checking websites, working their way down from the largest, in what has become known as the “porn block.” Offenders will have three months to implement appropriate age verification systems. It applies to any porn site in the world delivering content to British people, and sites that don’t comply will potentially be blocked by British internet service providers. Even though it’s not in effect yet, there are already plans being made to make age verification for social sites mandatory as well.

As this illustrates, regulations for age-sensitive ecommerce, and even free social networks, are rapidly intensifying. Whether you fall into the social, dating, adult content, adult-rated games, or gambling industries, age verification software is filling a valuable role in regulation compliance, and in turn making the internet safer for children.

Beer, wine, and spirits

Liquor stores that deliver. Wine of the month clubs that ship directly to your home. Micro-brewery gift basket promotions. Wineries, breweries, distilleries, and alcohol retailers gain access to a much bigger pool of customers when they sell online, and it’s becoming more and more common.

In a lot of ways, alcohol seems like a simpler beast to tackle than newer age-restricted products, like e-cigarettes, because the drinking age is 21 in every U.S. state. However, the laws of your state, the state you want to ship to, and the regulations of the shipping companies all come into play for alcohol ecommerce. Age verification before payment and before delivery to ensure both sets of information match is the standard for accepting payments for alcohol products online.

Many companies have internalized the task of checking IDs, using their own staff to verify ages. However, this can be time-consuming and prone to issues arising from staff availability, existing responsibilities, working in an area outside of their expertise without the proper resources to validate IDs, and more. Outsourcing age verification to a company that specializes in it lets you and your employees rest assured and focus on other priorities to keep your business running smoothly.

Weapons and self-defense products

Knives and other bladed items may not be sold online or in store to anyone under the age of 18. Two-factor authentication (age verification upon online payment and again upon delivery) is, again, the standard to avoid sales to minors. Likewise, pepper spray, tasers, crossbows, and many other products that are dangerous for children may only be sold to customers 18+. Online, this can be difficult to monitor. So we see here, too, a large need for age verification software as ecommerce becomes increasingly popular.

In conclusion

This is not an exhaustive list—age-restricted ecommerce can drill down to thousands of specific products and services not mentioned in this blog. Here are just a few:

  • An online fireworks store that needs to comply with different state regulations
  • The online business owner who wants to confirm who really qualifies for his 65+ senior discount
  • The entrepreneur launching a social site for female business owners in their 20s
  • A gaming site meant for ages 16-17 that needs to keep adults out

Regulations are changing quickly, and enforcement is becoming stricter, causing age verification software to become a major resource for age-regulated merchants. However, we must also acknowledge the other side of the coin—age verification is not just a compliance tool. It helps regulated and unregulated businesses alike reach and protect their target audiences.