Mastercard Regulations

[puffon]

Just got this notice in the mail:

BE AWARE!

MasterCard, in response to FDA regulations regarding tobacco products (which, unjustifiably, includes e-liquids and vaping equipment such as vape pens and accessories), in enforcing a series of strict and costly shipping regulations that affect the ENTIRE INDUSTRY!

The shipping regulations include the following:

• Electronic age verification (no longer in house, paid software now required)
• Adult (21 and older) signature verification upon delivery…which automatically incurs about a $6 charge per order upon the shipper (rates vary slightly)
• Shuts down interstate commerce to states such as Utah that prohibit vape sales outside of the state (Indiana customers, your fate is yet to be decided)

How this affects you?

• This forces ALL vaping businesses (sellers/manufacturers of e-liquids, vape pens, accessories, etc.) to increase shipping costs, get rid of free shipping options, raise merchandise cost, or some combination of all the latter.
• This alienates legal users and customers between ages 18-20 who cannot sign for vaping packages, not being 21 or older with ID to verify.

How this affects us?

• As a manufacturer of e-liquid, we have to buy into an annual registration through MasterCard that costs $500 a year currently. If we fail to “buy in” to this registration, we will no longer be recognized as a business and will be forced to close our doors, as will every other company involved in the vaping industry.
• Unfortunately, we don’t have the option to simply refuse MasterCard’s business. Again, to stay compliant as a business, we are forced to use MasterCard and register with them.
• We have to have a Legal Compliance Verification from an attorney, state agency, or the FDA to be submitted, in writing, to MasterCard proving we are a compliant business meeting regulations to continue operation. No need to say this is going to financially strain many of us.
• Less importantly, this will staunch our ability to provide “almost free” giveaways at a regular rate. Our team is currently discussing a number of plans for continuing providing the vaping community with fun giveaways under the new shipping regulations.

How you can help:
Go to https://www.change.org/p/mastercard-reverse-mastercard-s-anti-vape-policies?recruiter=68756697&utm_source=share_petition&utm_medium=copylink and sign this petition to halt MasterCard from oppressing our industry! Tell your friends, forward this link, and let’s make our voices heard.

Our promise to the customer:

• We will strive to keep cost of goods at an affordable level once the regulations take effect (January 15, 2017).
• We will strive to keep shipping affordable for the customer. We are currently exploring every avenue to maintain affordable shipping and have been in communication with all major shipping companies for deals and special rates to aid in this pursuit.
• We promise to keep our business practices transparent and explain any changes we make. Many businesses will be afraid to discuss these new regulations and will heavily push the incurred costs onto the customer. That’s not fair to you.

In Conclusion:
We do not enjoy sending you this letter. We try to keep positive communication with you. Unfortunately, this is something you should be aware of as you shop for vaping supplies in the future…not just with us, but any company you may patronize. We are sincerely sorry for any future affect this has upon you. We value each and every one of you and want to retain your business and provide you with great, creative products.

On a lighter note, we have decided to continue the current coupon-free sales. Most lines at omvapors.com are 50-70% off. Keep posted to our threads on Reddit, .................., ECF, and JuiceDB for unique offers and giveaways.

 

[Eskie]

Well, I'm not sure what kind of scare tactics this is supposed to achieve but,
"

• As a manufacturer of e-liquid, we have to buy into an annual registration through MasterCard that costs $500 a year currently. If we fail to “buy in” to this registration, we will no longer be recognized as a business and will be forced to close our doors, as will every other company involved in the vaping industry.
• Unfortunately, we don’t have the option to simply refuse MasterCard’s business. Again, to stay compliant as a business, we are forced to use MasterCard and register with them."

There has to be an annual registration with the FDA to continue to sell, not MasterCard. Any business can continue and cannot be shut down because they don't accept Mastercard.

There is zero basis for stating they have "no option". There are lots of options. Compliance and remaining in business has nothing to do with what credit card you take.

I agree the regs kicking in the beginning of next year are a bit annoying, but sending out misinformation will only discredit a business, at least to me. Oh, and the whole age verification thing kicked in back in May. Not sure why these guys just suddenly think they need a verification service in January.

 

[puffon]

I thought it was odd. Haven't received anything like this, from other suppliers.
This came from Om Vapors.

 

[BreSha6869]

Meh. I have used my MC to buy vape gear in the last few months from China, Greece, Bulgaria, USA, Philippines and Canada. Never an issue. If it becomes one, I have PP, Visa, AMEX, etc.

 

[grandmato5]

These new requirements from the credit card companies for vendors (I've read both Visa and Mastercard) have been wandering around the internet for a few months. The ops letter is the first place I've seen a date that they actually plan to put it into effect.

Here's one of the places I've read about it.

Deeming regulations make card payments difficult for online sellers | ECigIntelligence

 

[Shawn Hoefer]

Well, I'm not sure what kind of scare tactics this is supposed to achieve but,
"

• As a manufacturer of e-liquid, we have to buy into an annual registration through MasterCard that costs $500 a year currently. If we fail to “buy in” to this registration, we will no longer be recognized as a business and will be forced to close our doors, as will every other company involved in the vaping industry.
• Unfortunately, we don’t have the option to simply refuse MasterCard’s business. Again, to stay compliant as a business, we are forced to use MasterCard and register with them."

There has to be an annual registration with the FDA to continue to sell, not MasterCard. Any business can continue and cannot be shut down because they don't accept Mastercard.

There is zero basis for stating they have "no option". There are lots of options. Compliance and remaining in business has nothing to do with what credit card you take.

I agree the regs kicking in the beginning of next year are a bit annoying, but sending out misinformation will only discredit a business, at least to me. Oh, and the whole age verification thing kicked in back in May. Not sure why these guys just suddenly think they need a verification service in January.

You're off the mark here...

This letter has nothing to do with the deeming. This is from a credit card company. They will no longer allow their card to be used to purchase vape gear or liquid without jumping through hoops. This leaves Visa and American Express as the only viable alternatives for online sales. PayPal is already off the table.

This does not affect face to face sales.

Sent from my SAMSUNG-SM-N910A using Tapatalk

 

[daviedog]

Another Tempest in a Teapot..

 

[GeorgeS]

 

[Tigerstyle90]

@GeorgeS
@daviedog
@Shawn Hoefer
@Eskie
@grandmato5

Mastercard triples vape mail shipping rates - ELiquid Depot

Let me shed a little light on the situation. Any vendor that accepts mastercard will have to follow these policies, no matter which card is used. I have spoken with several other online vendors, countless payment gateways and this is what is currently happening.This is not a scare tactic and every single online vendor will be affected by this. Master cards business risk assessment management department(Bram) are forcing online vendors to:

A.) Pay a registration fee (Not the biggest deal breaker)
B.) Use third party verification software. C.) Send every package with an adult signature. This adds $5.95 per package and the only way to obtain a signature is to purchase exclusively priority mail. This turn a $3.50 delivery fee into a $11.95 delivery fee. Which will substantially increase the price of online orders. Do a quick Google search and you will see that this is an industry wide issue.

This will force many businesses with low price business models to either change there practices, pass the cost on to the consumer/absorb it partially or shut down.

 

[Tigerstyle90]

You're off the mark

Well, I'm not sure what kind of scare tactics this is supposed to achieve but,
"

• As a manufacturer of e-liquid, we have to buy into an annual registration through MasterCard that costs $500 a year currently. If we fail to “buy in” to this registration, we will no longer be recognized as a business and will be forced to close our doors, as will every other company involved in the vaping industry.
• Unfortunately, we don’t have the option to simply refuse MasterCard’s business. Again, to stay compliant as a business, we are forced to use MasterCard and register with them."

There has to be an annual registration with the FDA to continue to sell, not MasterCard. Any business can continue and cannot be shut down because they don't accept Mastercard.

There is zero basis for stating they have "no option". There are lots of options. Compliance and remaining in business has nothing to do with what credit card you take.

I agree the regs kicking in the beginning of next year are a bit annoying, but sending out misinformation will only discredit a business, at least to me. Oh, and the whole age verification thing kicked in back in May. Not sure why these guys just suddenly think they need a verification service in January.

Unfortunately, you are very far off the mark. Any vendor that accepts mastercard, due to their personal policies, not the FDA regulations will have to:

pay an annual registration fee of $500 (in which the other 3 major cards will soon have to follow)

here...

@GeorgeS
@daviedog
@

Mastercard triples vape mail shipping rates - ELiquid Depot

Let me shed a little light on the situation. Any vendor that accepts mastercard will have to follow these policies, no matter which card us used. I have spoken with several other online vendors, countless payment gateways and this is what is currently happening.This is not a scare tactic and every single online vendor will be affected by this. Master cards business risk assessment managent department(Bram) are forcing online vendors to:

A.) Pay a registration fee (Not the biggest deal breaker)
B.) Use third party verification software. C.) Send every package with an adult signature. This adds $5.95 per package and the only way to obtain a signature is to purchase exclusively priority mail. This turn a $3.50 delivery fee into a $11.00 delivery fee. Which will substantially increase the price of online orders. Do a quick Google search and you will see that this is an industry wide issue.

This will force many businesses with low price business models to either change there practices, pass the cost on to the consumer/absorb it partially or shut down.

This letter has nothing to do with the deeming. This is from a credit card company. They will no longer allow their card to be used to purchase vape gear or liquid without jumping through hoops. This leaves Visa and American Express as the only viable alternatives for online sales. PayPal is already off the table.

This does not affect face to face sales.

Sent from my SAMSUNG-SM-N910A using Tapatalk

You're off the mark here...

This letter has nothing to do with the deeming. This is from a credit card company. They will no longer allow their card to be used to purchase vape gear or liquid without jumping through hoops. This leaves Visa and American Express as the only viable alternatives for online sales. PayPal is already off the table.

This does not affect face to face sales.

Sent from my SAMSUNG-SM-N910A using Tapatalk

You are completely correct. It has NOTHING to do with the FDA. These regulations are the restrictions that Mastercard has put in place to do business with them. They are real kickers to small businesses. Especially, online vendors.

1.)$500 annual registration fee, soon to be $2000 after the other major cc companies decided to implement the same practices due to risk management.
2.)A notarized letter by a reputable attorney that we are in compliance with all federal and state regulations($500-$1000)
3.) Adult signature required with all packages($5.95 + $6.00 = 11.95 for shipping) 11.95 vs $3.50 for a first class shipment

 

[Tigerstyle90]

Well, I'm not sure what kind of scare tactics this is supposed to achieve but,
"

• As a manufacturer of e-liquid, we have to buy into an annual registration through MasterCard that costs $500 a year currently. If we fail to “buy in” to this registration, we will no longer be recognized as a business and will be forced to close our doors, as will every other company involved in the vaping industry.
• Unfortunately, we don’t have the option to simply refuse MasterCard’s business. Again, to stay compliant as a business, we are forced to use MasterCard and register with them."

There has to be an annual registration with the FDA to continue to sell, not MasterCard. Any business can continue and cannot be shut down because they don't accept Mastercard.

There is zero basis for stating they have "no option". There are lots of options. Compliance and remaining in business has nothing to do with what credit card you take.

I agree the regs kicking in the beginning of next year are a bit annoying, but sending out misinformation will only discredit a business, at least to me. Oh, and the whole age verification thing kicked in back in May. Not sure why these guys just suddenly think they need a verification service in January.

We do have age verification and this is not misinformation. The FDA has stated that it was up to vendors to determine their method of age verification for online sales. Mastercard's rules imply that vendors will be force to pay for Veartad, Evs, Bluechek, etc.

 

[Tigerstyle90]

These new requirements from the credit card companies for vendors (I've read both Visa and Mastercard) have been wandering around the internet for a few months. The ops letter is the first place I've seen a date that they actually plan to put it into effect.

Here's one of the places I've read about it.

Deeming regulations make card payments difficult for online sellers | ECigIntelligence

These are a little bit older. The update that we provided was recently aquired from our merchant processor. In addition to this, MasterCard is stating that all online merchants must add signature delivery to there packages. This will increase shipping prices from $3.50 for a first class package to over $11.95. This will make offering free shipping nearly impossible, and may cause smaller orders to lose us profit. Not to mention anyone between 18-20 will not be able to sign for their package. USPS, UPS and Fed Ex are all 21+ for adult signature verification.

 

[Tigerstyle90]

Meh. I have used my MC to buy vape gear in the last few months from China, Greece, Bulgaria, USA, Philippines and Canada. Never an issue. If it becomes one, I have PP, Visa, AMEX, etc.

You may be in the clear since you are in to Canada, however the regulations are unclear at this point. Even though Visa does not currently have these restrictions, merchants agree to accept all cards as part of their agreement. Our processors will not allow us to simply forgo these procedures if we process a Visa, American express or Discover card. We must send all domestic orders stating January 15th with an adult signature confirmation.

 

[Tigerstyle90]

Well, I'm not sure what kind of scare tactics this is supposed to achieve but,
"

• As a manufacturer of e-liquid, we have to buy into an annual registration through MasterCard that costs $500 a year currently. If we fail to “buy in” to this registration, we will no longer be recognized as a business and will be forced to close our doors, as will every other company involved in the vaping industry.
• Unfortunately, we don’t have the option to simply refuse MasterCard’s business. Again, to stay compliant as a business, we are forced to use MasterCard and register with them."

There has to be an annual registration with the FDA to continue to sell, not MasterCard. Any business can continue and cannot be shut down because they don't accept Mastercard.

There is zero basis for stating they have "no option". There are lots of options. Compliance and remaining in business has nothing to do with what credit card you take.

I agree the regs kicking in the beginning of next year are a bit annoying, but sending out misinformation will only discredit a business, at least to me. Oh, and the whole age verification thing kicked in back in May. Not sure why these guys just suddenly think they need a verification service in January.

I thought it was odd. Haven't received anything like this, from other suppliers.
This came from Om Vapors.

Here are a couple of companies that have went public about the issue. Most are just stunned at the potential consequences that this may have on the industry and have not posted a response. In these threads you can see responses from various vendors as well as links to the articles.

We technically do not have any options when we decide which credit cards we take. Our merchant processor make all of the rules regarding our terms of service and what we display on our sites.

The increased costs of complying with private regualtions is what our newsletter is about, not the FDA. Think of it as a civil case vs a criminal case. We have a public contract to adhere to the FDA's laws, while we have a private contract to adhere to the terms of our merchant.

Is this true ? Mastercard making it harder for vapers ? • /r/electronic_cigarette

MasterCard is trying to bone us too? Got this info in an email from Om Vapors. • /r/electronic_cigarette

New mastercard rules set to double or triple vape mail shipping rates! • /r/electronic_cigarette

 

[Shawn Hoefer]

You are completely correct. It has NOTHING to do with the FDA. These regulations are the restrictions that Mastercard has put in place to do business with them. They are real kickers to small businesses. Especially, online vendors.

1.)$500 annual registration fee, soon to be $2000 after the other major cc companies decided to implement the same practices due to risk management.
2.)A notarized letter by a reputable attorney that we are in compliance with all federal and state regulations($500-$1000)
3.) Adult signature required with all packages($5.95 + $6.00 = 11.95 for shipping) 11.95 vs $3.50 for a first class shipment

Um.... That's what I said...

Sent from my SAMSUNG-SM-N910A using Tapatalk

 

[Dubminer]

This is weird,i have bought vape goods with my Mastercard several times this week with no problem.Straight Mastercard and via paypal.

 

[Tigerstyle90]

Um.... That's what I said...

Sent from my SAMSUNG-SM-N910A using Tapatalk

Sorry for the confusion. I was agreeing with you. Just explaining it further to everyone else.

 

[Tigerstyle90]

This is weird,i have bought vape goods with my Mastercard several times this week with no problem.Straight Mastercard and via paypal.

In the United States vape companies cannot accept Paypal. These rules for MasterCard do not go in effect until the 15th of January. They may also be US only.

 

[Shawn Hoefer]

This is weird,i have bought vape goods with my Mastercard several times this week with no problem.Straight Mastercard and via paypal.

Via PayPal? This implies you purchased from China. Different ball of wax, altogether...

Sent from my SAMSUNG-SM-N910A using Tapatalk

 

[Dubminer]

Yes the paypal was from China.I also bought with straight mastercard from the usa.It is a debit card with Mastercard if that makes any difference?