Shopify to Ban Vapes on Its Platform Amid US Crackdown

Shopify Inc (NYSE: SHOP) will ban all vape products from its e-commerce platform as early as this week, following pressure from a group of US state attorneys general aiming to curb sales of illegal vaping products.

Details of the Action

According to sources, Shopify will prohibit any merchant from listing or selling vape products, including e-liquids and devices. The ban covers all types of vapes, whether containing nicotine or not. The company has not yet announced specific enforcement mechanisms or penalties for violators.

Company's Position

Shopify has not issued an official statement, but internal sources confirmed the decision came after direct communication with the California Attorney General's office and other states. The company aims to avoid potential legal liability.

Precedents and Context

Shopify has faced criticism for hosting stores selling unlicensed vape products, especially those targeting youth. In 2021, 23 state attorneys general filed a lawsuit against the company for allegedly facilitating sales of tobacco products to minors. The US Food and Drug Administration (FDA) has also been tightening regulations on the vape industry.

Potential Financial Impact

The ban is expected to affect Shopify's revenue from subscription and transaction fees from vape merchants, though the exact figure is undisclosed. However, avoiding lawsuits and fines may be more significant in the long run.