CCSB Contact: Matthew S. Erim Telephone (703) Item Description Class

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1 Re: Electronic Cigarettes (e-cigarettes or e-cigs), including e-liquid (e-juice) CCSB Contact: Matthew S. Erim Telephone (703) Proponent: Commodity Classification Standards Board Present Classification Provisions Item Description Class DRUGS, MEDICINES OR TOILET PREPARATIONS: subject to item NOTE Not Involved Drugs or Medicines, NOI, other than toxic or corrosive materials, see Notes, items and See item for class dependent upon released value: Sub 1 In carboys Sub 2 In bags, boxes, drums, pails or Packages 2180, 2407 or 2499, see Note, item NOTE Not Involved NOTE Not Involved. ELECTRICAL EQUIPMENT GROUP: subject to item Humidifiers or Vaporizers, portable, in boxes, subject to Items 170 and 171 and having a density in pounds per cubic foot of: Sub 1 Less than Sub 2 1 but less than Sub 3 2 but less than Sub 4 4 but less than Sub 5 6 but less than Sub 6 8 but less than Sub 7 10 but less than Sub 8 12 but less than Sub 9 15 but less than Sub but less than Sub or greater FOODSTUFFS GROUP: subject to item Extracts, NOI; Flavoring Compounds, NOI; Imitation Flavors, NOI; or Bottlers Flavoring Compounds, NOI, see Note, item 72917; liquid, paste or dry, see Notes, items 72912, and 72916; in boxes or drums or dry, in bulk in paper-lined cloth bags or four-ply multiple-wall paper bags, or in Packages 1000, 2358 or 2440, see Note, item NOTE Not Involved NOTE Not Involved NOTE Not Involved NOTE Not Involved NOTE Not Involved National Motor Freight Traffic Association, Inc. Subject 11, Page 1 of 5

2 Proposed Classification Provisions Item Description Class DRUGS, MEDICINES OR TOILET PREPARATIONS: subject to item NOTE No Change Drugs or Medicines, NOI, other than toxic or corrosive materials, see Notes, items and See item for class dependent upon released value, etc... No Change NOTE No Change NOTE No Change. ELECTRICAL EQUIPMENT GROUP: subject to item Humidifiers or Vaporizers, portable, see Note, item A-NEW, in boxes, subject to Items 170 and 171 and having a density in pounds per cubic foot of: Sub 1 Less than Sub 2 1 but less than Sub 3 2 but less than Sub 4 4 but less than Sub 5 6 but less than Sub 6 8 but less than Sub 7 10 but less than Sub 8 12 but less than Sub 9 15 but less than Sub but less than Sub or greater A-NEW NOTE Also applies on Electronic Cigarettes (e-cigs) or Electronic Nicotine Delivery Systems, with or without e-liquid or e-juice, other than toxic, in same package. B-NEW E-Liquid or E-Juice, other than toxic, see Note, item C-NEW, in boxes C-NEW NOTE Applies on liquid, whether or not containing nicotine, used in electronic cigarettes (e-cigs) or electronic nicotine delivery systems for producing vapor and simulating smoking. FOODSTUFFS GROUP: subject to item Extracts, NOI; Flavoring Compounds, NOI; Imitation Flavors, NOI; or Bottlers Flavoring Compounds, NOI, see Note, item 72917; liquid, paste or dry, see Notes, items 72912, and 72916, etc... No Change NOTE No Change NOTE No Change NOTE No Change NOTE No Change NOTE No Change. Subject 11, Page 2 of National Motor Freight Traffic Association, Inc.

3 Analysis Research Project 1246 This proposal is based on the information developed through Research Project 1246, which was initiated in January 2015 to address interpretation issues and to investigate the transportation characteristics of electronic cigarettes (e-cigarettes or e-cigs) and e-liquid (ejuice). Hereinafter, these products will be referred to as electronic cigarettes and e-liquid, respectively. The CCSB s opinion is that the applicable provisions for electronic cigarettes are currently found in item Additionally, the CCSB is of the opinion that the applicable provisions for e-liquid containing nicotine are found in item 58770, while the applicable provisions for e-liquid that does not contain nicotine are found in item About Electronic Cigarettes and E-Liquid An electronic cigarette is a handheld electronic device that simulates the feeling of tobacco smoking. It works by heating a liquid to generate an aerosol, commonly called a vapor, that the user inhales The liquid used in the electronic cigarette, called e-liquid, is usually made of nicotine, propylene glycol, glycerine, and flavorings. Not all e-liquids contain nicotine 2. The process of using an electronic cigarette is often referred to as vaping. Examples of electronic cigarettes and e-liquid are found below. Transportation Characteristics Density Overall, the information of record includes 143 density observations submitted by shippers and carriers, observed firsthand during CCSB dock surveys and obtained from the CCSB s Density Study 3. 1 E-liquid that is classified as toxic by the U.S. Department of Transportation and required to bear a Hazard Division 6.1 label is classified under the provisions of item for Poisonous or Toxic Materials and is not included in this proposal. 2 (accessed March 2018) 3 The Density Study is part of an ongoing effort by the CCSB to collect information on actual shipments; it is not tied to any particular research project, nor does it target any particular product category. Carriers that choose to participate in the study periodically submit shipment data captured through their respective freight auditing programs. The data is identified by NMFC item, and only verifiable data points, which include the weight and the dimensions and/or cube of the shipping unit involved, are used National Motor Freight Traffic Association, Inc. Subject 11, Page 3 of 5

4 Information of record pertaining to electronic cigarettes reveals a density range from 7.27 to pcf, with an overall average of pcf. The densities are distributed throughout the range. Information of record for e-liquid shows a range in density from 4.90 to pcf, with an average of pcf. Over 90% of the figures are clustered between 12 and 30 pcf, and almost 65% of the figures are between 15 and 22.5 pcf. Handling and Stowability The information of record indicates that electronic cigarettes and e-liquid are generally shipped in boxes securely fastened to lift truck skids or pallets. There have been no reports of unusual or significant handling or stowability problems. Liability Electronic cigarettes and non-toxic e-liquid are not perishable, hazardous in nature, unusually liable to damage, nor do they appear likely to damage other freight. Information of record does not indicate that these products are unusually susceptible to theft. A responding shipper reported one claim per year for electronic cigarettes, and carriers reported minimal claims. Responding shippers reported two values of $64.42 and $95.15 per pound. With regards to e-liquid, a responding shipper reported 24 claims per year, and carriers reported minimal claims. A responding shipper reported three values for e-liquid, which ranged from $75.00 to $90.00 per pound, with an average of $82.78 per pound. Relationship to CCSB Policies and Guidelines CCSB policy calls for the establishment or amendment of classifications for commodities that are a source, or potential source, of interpretation disputes so as to eliminate or avoid those disputes. The CCSB has received numerous interpretation inquiries regarding the applicable provisions for electronic cigarettes and e-liquid. This proposal would address the interpretation issue by specifically naming these products for clarification purposes. CCSB policy also calls for establishing or amending classification provisions to reflect a commodity s known transportation characteristics. Based on the information of record, there have been no negative handling or stowability considerations identified when analyzing the transportability of electronic cigarettes or e-liquid. While the value per pound might be relatively high, the other liability elements do not appear to significantly impact the transportability of these products. Therefore, per CCSB policy, density is the governing characteristic in the assignment of classes. Subject 11, Page 4 of National Motor Freight Traffic Association, Inc.

5 Information of record indicates that electronic cigarettes range in density from 7.27 to pcf, with an average of pcf, and the densities are distributed throughout the range. In light of these characteristics, and to address the interpretation issue, this proposal would establish a new Note attendant to item 62270, which provides classes based on the CCSB s standard 11-subprovision density scale 4. The Note would specify that the provisions of item also apply on Electronic Cigarettes (e-cigs) or Electronic Nicotine Delivery Systems, with or without e-liquid or e-juice, other than toxic, in same package. Furthermore, information of record for e-liquid shows that these products range in density from 4.90 to pcf, with an average of pcf, and the preponderance of density figures concentrated around the overall average. An average density of pcf is generally associated with class 70 under CCSB density guidelines, which call for a minimum average density of 15 pcf. In keeping with CCSB policy, this proposal would establish a new item, naming E-Liquid or E-Juice, other than toxic, at class 70. Concurrently, a new Note would also be established and referenced by the new item, clarifying what the provisions apply on. A similar approach was taken on Docket , Subject 8 (January 2017) involving indoor or outdoor kitchens or food preparation stations. No significant handling, stowability or liability problems were reported, and, as such, density was determined to be the primary transportation characteristic. To address interpretation issues, the density-based provisions of item were amended to add a listing for Kitchens or Kitchen Islands, outdoor, along with an attendant Note clarifying what those provisions apply on. Concurrently, a new item was established for indoor Tables or Stations, food preparation. As with e-liquid, indoor food preparation tables or stations exhibited a range of densities from 2.39 to pcf with a significant concentration of density observations over 82% clustered around the overall average density of 5.83 pcf. Based on the information of record, and in keeping with CCSB guidelines, class 175 was assigned to the new item for indoor food preparation tables or stations, and the changes first appeared in Supplement 1 to NMF 100-AQ, effective April 15, Based on the information of record, this proposal, as docketed, is in keeping with CCSB policy and precedent. 4 Item includes reference to Item (Rule) 170, the inadvertence clause, and Item (Rule) 171, the bumping privilege National Motor Freight Traffic Association, Inc. Subject 11, Page 5 of 5