Big Tobacco could get a lift from a USPS crackdown on illegal vape shipments

A crackdown by the U.S. Postal Service on distributors of unregulated vapes using its services for business shipments could benefit tobacco giants such as Altria (NYSE:MO) and British American Tobacco (BTI).

Letters reviewed by Reuters indicate that the USPS wrote to major New York-based distributor Demand Vape, blocking it from using its services. That development followed New York City’s Law Department providing evidence that the shipments broke laws. USPS officially revoked Demand Vape’s mailing exception last month after it received the evidence that the shipped vapes lacked FDA authorization and that violated a local flavor ban.

Altria (NYSE:MO), British American Tobacco, and other tobacco company interests have battled for years against a wave of unregulated vapes available on the market.

For its part, Demand Vape said it complied with relevant laws and was contesting the revocation on the reasoning that the industry operates in a “regulatory grey zone.”

Altria Group (MO) edged 0.1% higher in premarket trading, while British American Tobacco (BTI) was 0.8% higher.