Deeming Regulations have been released!!!!

DaveP

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I learned a hard lesson with sweeping regulation during the financial meltdown. I was a partner in a mortgage banker/broker company from 1999 through 2010. We played by the rules and had a spotless history. The Dodd-Frank bill shut us down along with 90% of our peers. It was awful. The worst part for me wasn't losing the business. It was calling the staff into the room and telling them we were closing. Saddest day of my professional career.

The regulations seemed ominous in 2008 but we figured everything would work out. As they phased in over the next 2 years reality started setting in. Profitibility was out the window. Big banks won. They reclaimed the market share they were losing to the little guys.

It's not apples to apples with what is happening to the vape industry because the crisis was real and happening. Regulations were fast and furious across the entire financial sector. Banks won by default and not by design. But there are similarities and I fear the vape shop owners are doing exactly what I did. False sense of security because we were in business for a good while and it seems unthinkable that a swipe of a pen can shut it all down "just like that". Well...it happens just like that. Trust me.

The similarities are a little scary even though the circumstances are different. During the phase in process, business was still manageable but profits took a hit and doing business became more difficult. Then our available product line got squashed (mortgage business went from 31 flavors to just chocolate, vanilla, and a little bit of strawberry). With drastically less products available our margins shrank more and competition was fierce.

We had to close our credit line at our bank so we couldn't fund our own loans anymore and had to broker exclusively. We closed the line because strict Fed regulations about net worth requirements (among other things). Requirements that no small business could ever meet. So we were stuck only being able to sell other people's products for a measly commissions. My company along with thousands of others were gone in a blink. Big banks grabbed it all back and controlled the market again after steadily losing market share for a decade.

This FDA thing seems awful similar and complacent vape shop owners are in for it. There may be nothing they can do either way. The profit center is in juice by a wide margin. If juice consolidates to just a few manufacturers then all you can do is resell. If Walmart or any big box resells then you are done.

Sounds like the same period in which BankofAmerica bought Merryll Lynch. That was a shock.
 

Pictor

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I'm not positive, but I think a lot has to do with how hard it is to verify someone's age online, possibly opening them up to legal action if someone were caught selling to a minor.
If CC's withdraw their services, and perhaps PayPal, that would make things pretty difficult!

OTOH- a group of processors will grab it all. It's low ticket/high volume transactions with physical product changing hands. No chance that card processing will be eliminated from the vape industry. Well, at least not before a multi billion dollar black market gets rolling. We're a few years away from that. haha
Hope you're right! All my stuff is bought online.
Thought perhaps the CC companies would be afraid of being deemed 'nicotine delivery' systems! ;)

There is really only one true question. If this is about protecting the children, teens or the general public how is tobacco still available and a product that is scientifically proven to be 95% safer being banned.
I believe there is another questionable substance readily available in certain US states too!
 

Katya

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When does a ecig become a tobacco product?

Congress gave FDA the authority. So that point is moot for now. But e-cigs should be treated like other tobacco products, which are recreational products for adult users, like cigarettes and cigars. Period. The FDA doesn't ask BT to prove that cigarettes are "healthy" or "harmless." Au contraire, the FDA knows perfectly well that they are not.

Parity. :D
 

zoiDman

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The deeming is just cementing their authority, the REAL regulation has yet to begin.

The FDA can Not Do things Unless they are Legally Entitled to do so. They learned this the Hard Way back in Late 2009/Early 2010.

Deeming Doesn't Cement their Authority. It Provides it.
 

The Ocelot

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I don't remember where I saw it, but I think part of their guidance to manufacturers was to submit a list of their products for registration. Not part of the PMTA process, just a list of products so that the FDA knows what is currently out there.

Page 117/118:

This deeming rule will not require foreign manufacturing establishments to register their establishments or to list their tobacco products in order to sell them in the United States. However, foreign manufacturing establishments will be required to comply with the registration and listing requirements of section 905 of the FD&C Act after a registration and listing rule is final and effective.

I'm not sure what that means.
 

zoiDman

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Yes, but how DOES the FDA know nothing will slip in and it be business as usual just flying under the radar?

The FDA Knows that they Can't Stop Everything. Just look at Un-Taxed Black Market Cigarettes.

It's More of a Numbers Game. And someone at the FDA has come up with Percentage that they Think can be Stopped. And if they Make that Number, they call it Successful.
 

Sugar_and_Spice

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Congress gave FDA the authority. So that point is moot for now. But e-cigs should be treated like other tobacco products, which are recreational products for adult users, like cigarettes and cigars. Period. The FDA doesn't ask BT to prove that cigarettes are "healthy" or "harmless." Au contraire, the FDA knows perfectly well that they are not.

Parity. :D
I know, but it doesn't make it any less true.
 
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Steamix

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So what you are saying is, Halo filed the law suit as a stunt to increase profits?

Don't matter, really. The outcome of the lawsuit doesn't apply to Halo alone. If the deeming regs get temporarily suspended or even kicked into the gutter by the court, that ruling applies to ALL. Means it would keep them alive and their competitors as well. But by picking up the gauntlet, they make it clear that they wish to continue selling juices. They have in-house counsel whose primary job is translating all that legalese into plain ole english.
They reacted in their best interests. It so happens that their best interests are congruent with the vaping community best interests. Simple as that. If vapers flush more money their way by ordering more than originally planned or ordering there in the first place -- they're going to need it. Law firms of that caliber aren't working for chump change.

Yup, somehow I do understand the small shops too with their 'forget the FDA sales'. Getting by with enough to feed yourself and maybe an employee or two, but way too little to afford even an initial consultation with a law firm of sufficient clout, you're left with but a smile and a few more swirls on the dance floor while the band keeps playing till the very last minute on the on yourver own version of the Titanic...

ANTZ has been going after menthol cigarettes for years. This article is from a couple of years ago. The Coming War on Menthol Cigarettes

"Cigarette smuggling — now largely focused on avoiding the many taxes imposed on tobacco — already got a boost in the late '90s when additional fees were added to comply with the tobacco industry's settlement deal with state attorneys general. If menthol cigarettes are banned entirely, a new and extremely lucrative market will open up.

"According to the ATF, more than $100,000 can be made right now from just a simple minivan full of contraband cigarettes smuggled into New York City. This puts money into the hands of the mob and even would-be terrorists while simultaneously depriving straining governments of tax revenue.

By the way, the Lorillard Tobacco Company, which sells these cigarettes, estimates that outlawing menthol cigarettes would reduce state and federal tax revenues by approximately $40 billion."

Dont't put me up to any fancy ideas here :D

Just checking the huge price differences within the USA on a pack of tobacco sticks and no customs and no brder patrols and no tunnel digging...gee why didn't I thank of that...

Anyone got a minivan to rent ?
Like you know, wanna help me auntie to move some her furniture from WV to NY .... :D
 

skoony

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Consignment and pawn shops are high risk...don't want an electronic transaction tied to a stolen goods sale
Your correct in that certain businesses come with certain risks. Pawn Shops are not a risk
for being tied to a sale of stolen goods as it pertains to electronic payments. All the pawn
shops here process electronic payments. All merchandise purchased directly or pawned
has to be held a certain amount of time and entered into a data base of stolen items
before sale. Most stolen items are pawned almost immediately and the system weeds
out the vast majority before any sale is made. If after this time period any sales of
suspect goods is so low as to not have an overall negative impact of ones relationship
between the vendor and CC company. No more so than CC fraud would in normal
circumstances.

What is the Basis for this Theoretically?

The Good Faith that the FDA Feels it has Done Enough to Regulate e-Cigarettes/e-Liquids? Or perhaps a Hesitancy of the FDA to Over-Regulate for Fear that Public Health could be Negatively Impacted?

:rolleyes:
You know Zoid it's hard to explain. All this as what we deem necessary and make this decision on a case by case and we will determine stuff in the regs gives me an uneasy feeling.
This process the last two years or so involving the pending and now actual regulations
of e-cigarettes was the first time I really got involved and interested in the finer nuances
of the actual process. Before this time I believed maybe naively that one proposed a regulation,
allowed comments on the proposed regulation,wrote the regulations,released the final regulations
explaining what you were regulating,why you were regulating it and, lastly how you were going
to regulate it in more or less certain terms. There's a lot of whats,a lot of whys but little if any of the
hows. What hows there are seem to be opened to interpretation and or are going to be made
up on the spot as they go along.
Regards
Mike
 

bobwho77

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Maybe we should reverse the parity a
Oh there will be Mods. Just not what we would Consider very Usable or Practicle.

See... If there Weren't going to be Any Mods, you would see the Gawd Awful Righteous Might of BT Rise Up and Bombard the FDA with a Legal Paper Storm.

But were Not going to See that. Because BT will get their PMTA Approvals. And even though the Silver Platter that e-Cigarettes are being handed to them Will Be Expensive, it is a Silver Platter all the Same.

And that is what BT has Wanted/Planned for since 2010.

From what I can see, the essentially open source development that we've had will be going away.
THIS passage in the Deeming regulations pretty much sums up their thinking...

Thus, with respect to apparatus, FDA expects that manufacturers
will be most successful where authorization is sought for entire delivery systems, rather than
individual components. In the case of these complete delivery systems--systems for which the
application covers all potential parts, including customizable options as applicable, and where
labeling, instructions for use and/or other measures are used to help ensure use as intended--FDA
expects that the range of possible outcomes may be narrow enough for the manufacturer to
demonstrate, and for FDA to assess, public health impact...

The FDA doesn't WANT applications for ANYTHING like our current mix and match components. It may be open tank, but it will have to be a stand alone system that DOESN'T work with anything else.
Honesty, I really don't see BT really doing much more than they already have. Why should they bother? They'll be the only game in town. They may even start killing off their current products, after the regulations are fully in place, and everything has shaken out. Analog cigarettes are MUCH cheaper to make, after all.
 

DaveP

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I watched the Mitch Zeller interview up topic and it's clear that they are using "Save the Children" as their marching song.

Heck, it's ALREADY ILLEGAL for people under 18 to purchase an electronic cigarette or the juice that makes it work. That won't change, so they are bound to shut down small shops that make a living selling juice and hardware. Sampling will be illegal for any age, so you have to buy it to try it.

Juice bars where you can sample a flavor will go away. 10ml bottles will probably rise in price to $10 or more under the strain of FDA control.

Unless the Deeming regulations are squashed and gutted, we will be back to mail order or DIY. I'm thinking that we will see some of that occurring. You know that everyone asks for more than they plan to get. They know where they'd like to be, so they have a significant portion of the plan set up to offer concessions so the public will be happy to deal through their lawmakers. They don't hope to retain it as written, but they'd gladly take it all if no one fights back.
 
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Bob Chill

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Skoony, all pawn shops process electronic payments but every single one of them process those payments through a high risk processor. Same with catering companies (chargebacks).

The reason pawn shops will always have to use a high fee/high risk processor is because of stolen goods. And possibly because of used goods like consignment.

Vape shops are in a high risk category because of "fringe" goods. Processors are pretty smart. Wild west industries always get reigned in. Many prefer just not to get involved.
 

zoiDman

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You know Zoid it's hard to explain. All this as what we deem necessary and make this decision on a case by case and we will determine stuff in the regs gives me an uneasy feeling.
This process the last two years or so involving the pending and now actual regulations
of e-cigarettes was the first time I really got involved and interested in the finer nuances
of the actual process. Before this time I believed maybe naively that one proposed a regulation,
allowed comments on the proposed regulation,wrote the regulations,released the final regulations
explaining what you were regulating,why you were regulating it and, lastly how you were going
to regulate it in more or less certain terms. There's a lot of whats,a lot of whys but little if any of the
hows. What hows there are seem to be opened to interpretation and or are going to be made
up on the spot as they go along.
Regards
Mike

All of this Should give you an Uneasy Feeling.

Because instead of the FDA Setting Bars and saying you need to Jump This High. They just say... "Jump as High as you Can. Then We'll tell you if it was High Enough. And BTW, we Don't have to Explain how we will do the Measuring."

 

The Ocelot

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Dont't put me up to any fancy ideas here :D

Just checking the huge price differences within the USA on a pack of tobacco sticks and no customs and no brder patrols and no tunnel digging...gee why didn't I thank of that...

Anyone got a minivan to rent ?
Like you know, wanna help me auntie to move some her furniture from WV to NY .... :D

"Beyond smokers road-tripping across the border for a cheap pack, increases in cigarette prices have also made way for a multi-million dollar cigarette black market, with 57 percent of packs sold in New York coming from out of state and many bodegas covertly selling them below market or offering "loosies" (single cigarettes) to customers off the books.

A report by the Mackinac Center for Public Policy concludes that more than a third of cigarettes consumed in New York, Arizona, Washington, and New Mexico in the year 2013 were smuggled in from out of state."

Here's What Cigarettes Cost by State
 

Katya

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57 percent of packs sold in New York coming from out of state and many bodegas covertly selling them below market or offering "loosies" (single cigarettes) to customers off the books.

Which already lead to one very well documented death...(that we know of).
 

skoony

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there will be zero PMTAs approved for eLiquid manufacturers wanting to supply juice for refilling the devices we have today.
Some one still has to make the juice for the carto's unless of course bulk juice makers who are not covered simply sell wholesale to BT who puts it in there complete tamper proof vaping system that happens to come with e-juice already in it. It will be disposable because rechargeable's will be banned
as being responsible for most of the real serious injuries and as long as the juice wasn't bottled and labeled for individual sale it's all good. OMG,what did I just do and or why isn't the FDA giving me job
offers?
The F.D.A. also announced that it would conduct a public education campaign focused on young people this year, and said it was commissioning three new pieces of research related to menthol, including one on genetic differences in taste perceptions that might explain why some racial and ethnic populations are more likely to smoke menthol cigarettes.
Someone already mentioned discrimination. Lets not forget the current reason du jure,
profiling.
:thumb:
Mike
 
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