Senate Bill 1526c1

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    Florida Senate - 2000                           CS for SB 1526

    By the Committee on Regulated Industries and Senators Dyer and
    King




    315-1832-00

  1                      A bill to be entitled

  2         An act relating to cigarettes; amending s.

  3         210.05, F.S.; requiring the Division of

  4         Alcoholic Beverages and Tobacco to design

  5         cigarette tax stamps that will permit

  6         identification of the agent or wholesale dealer

  7         that affixes the stamp; creating s. 210.185,

  8         F.S.; prohibiting the sale and distribution of

  9         certain cigarettes not intended for sale or

10         distribution in this country; providing for

11         criminal penalties, administrative sanctions,

12         and unfair trade practices; providing for

13         enforcement by the Division of Alcoholic

14         Beverages and Tobacco; amending s. 210.19,

15         F.S.; requiring the division to maintain

16         specified records; providing an effective date.

17

18  Be It Enacted by the Legislature of the State of Florida:

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20         Section 1.  Subsection (2) of section 210.05, Florida

21  Statutes, is amended to read:

22         210.05  Preparation and sale of stamps; discount.--

23         (2)  The division shall prescribe, prepare, and furnish

24  stamps of such denominations and quantities as may be

25  necessary for the payment of the tax imposed by this part, and

26  may from time to time and as often as it deems advisable

27  provide for the issuance and exclusive use of stamps of a new

28  design and forbid the use of stamps of any other design.

29  However, all stamps prescribed by the division must be

30  designed and furnished in a fashion that permits

31  identification of the agent or wholesale dealer that affixed

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    Florida Senate - 2000                           CS for SB 1526
    315-1832-00




  1  the stamp to the particular package of cigarettes by means of

  2  a serial number or other mark on the stamp. The division shall

  3  make provisions for the sale of such stamps at such places and

  4  at such time as it may deem necessary.

  5         Section 2.  Section 210.185, Florida Statutes, is

  6  created to read:

  7         210.185  Prohibition on sale or distribution of

  8  cigarettes; criminal penalties; administrative sanctions;

  9  applicability.--

10         (1)  PROHIBITIONS.--It is unlawful for any person:

11         (a)  To sell or distribute in this state; to acquire,

12  hold, own, possess, or transport, for sale or distribution in

13  this state; or to import, or cause to be imported, into this

14  state for sale or distribution in this state:

15         1.  Any cigarettes the package of which:

16         a.  Bears any statement, label, stamp, sticker, or

17  notice indicating that the manufacturer did not intend the

18  cigarettes to be sold, distributed, or used in the United

19  States, including but not limited to labels stating "For

20  Export Only," "U.S. Tax-Exempt," "For Use Outside U.S.," or

21  similar wording; or

22         b.  Does not comply with:

23         (I)  All requirements imposed by or under federal law

24  regarding warnings and other information on packages of

25  cigarettes manufactured, packaged, or imported for sale,

26  distribution, or use in the United States, including but not

27  limited to the precise warning labels specified in the Federal

28  Cigarette Labeling and Advertising Act, 15 U.S.C. 1333; and

29         (II)  All federal trademark and copyright laws;

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    Florida Senate - 2000                           CS for SB 1526
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  1         2.  Any cigarettes imported into the United States in

  2  violation of 26 U.S.C. 5754 or any other federal law, or

  3  implementing federal regulations;

  4         3.  Any cigarettes that a person otherwise knows or has

  5  reason to know the manufacturer did not intend to be sold,

  6  distributed, or used in the United States; or

  7         4.  Any cigarettes for which there has not been

  8  submitted to the Secretary of the U.S. Department of Health

  9  and Human Services the list or lists of the ingredients added

10  to tobacco in the manufacture of those cigarettes required by

11  the Federal Cigarette Labeling and Advertising Act, 15 U.S.C.

12  1335a;

13         (b)  To alter the package of any cigarettes, before

14  sale or distribution to the ultimate consumer, so as to

15  remove, conceal, or obscure any statement, label, stamp,

16  sticker, or notice described in sub-subparagraph (a)1.a. or

17  any health warning that is not specified in or does not

18  conform with the requirements of the Federal Cigarette

19  Labeling and Advertising Act, 15 U.S.C. 1333;

20         (c)  To affix any stamp required under this part to the

21  package of any cigarettes described in paragraph (a) or

22  altered in violation of paragraph (b).

23         (2)  DOCUMENTATION.--On or before the tenth day of each

24  month, each person permitted to affix the tax stamp to

25  cigarettes shall file with the division, for all cigarettes

26  imported into the United States to which the person has

27  affixed the tax stamp in the preceding month, a copy of the

28  permit issued under the Internal Revenue Code, 26 U.S.C. 5713,

29  to the person importing the cigarettes into the United States

30  which allows that person to import those cigarettes; a copy of

31  the customs form containing, with respect to the cigarettes,

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    Florida Senate - 2000                           CS for SB 1526
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  1  the internal revenue tax information required by the U.S.

  2  Bureau of Alcohol, Tobacco and Firearms; and a statement,

  3  signed by an officer of the manufacturer or importer under

  4  penalty of perjury, certifying that the manufacturer or

  5  importer has complied with the package health warning and

  6  ingredient reporting requirements of the Federal Cigarette

  7  Labeling and Advertising Act, 15 U.S.C. 1333 and 1335a, with

  8  respect to those cigarettes.

  9         (3)  CRIMINAL PENALTIES.--Any person who violates

10  subsection (1), either knowing or having reason to know he or

11  she is doing so, or who fails to comply with subsection (2),

12  commits a felony of the third degree, punishable as provided

13  in s. 775.082, s. 775.083, or s. 775.084.

14         (4)  ADMINISTRATIVE SANCTIONS.--

15         (a)  The division may revoke or suspend the permit of

16  any distributing agent or wholesale dealer, or the retail

17  tobacco dealer permit of any retailer, and impose on the

18  permittee a civil penalty, in an amount not to exceed the

19  greater of 500 percent of the retail value of the cigarettes

20  involved or $5,000, upon finding a violation of this section

21  or any implementing rule adopted by the division.

22         (b)  Cigarettes that are acquired, held, owned,

23  possessed, transported in, imported into, or sold or

24  distributed in this state in violation of this section are

25  considered contraband and are subject to seizure and

26  forfeiture under this part. Any cigarettes so seized and

27  forfeited shall be destroyed. The cigarettes are considered

28  contraband whether the violation of this section is knowing or

29  otherwise.

30         (5)  UNFAIR TRADE PRACTICES.--A violation of subsection

31  (1) or subsection (2) constitutes an unlawful trade practice

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    Florida Senate - 2000                           CS for SB 1526
    315-1832-00




  1  under part II of chapter 501 and, in addition to any remedies

  2  or penalties set forth in this section is subject to any

  3  remedies or penalties available for a violation of that part.

  4         (6)  GENERAL PROVISIONS.--

  5         (a)  The division shall enforce this section. However,

  6  at the request of the division, any law enforcement agency

  7  shall enforce this section.

  8         (b)  For the purpose of enforcing this act, the

  9  division and any agency to which the division has delegated

10  enforcement responsibility may request information from any

11  state or local agency, and may share information with, and

12  request information from, any federal agency or any agency of

13  any other state or any local agency thereof.

14         (c)  In addition to any other remedy provided by law,

15  including enforcement as provided in paragraph (a), any person

16  may bring an action for appropriate injunctive or other

17  equitable relief for a violation of this section; for actual

18  damages, if any, sustained by reason of the violation; and, as

19  determined by the court, for interest on the damages from the

20  date of the complaint, taxable costs, and reasonable

21  attorney's fees. If the trier of fact finds that the violation

22  is flagrant, it may increase recovery to an amount not in

23  excess of 3 times the actual damages sustained by reason of

24  the violation.

25         (7)  DEFINITIONS.--As used in this section, the term:

26         (a)  "Cigarette" means:

27         1.  Any roll of tobacco wrapped in paper or tobacco

28  leaf or in any substance not containing tobacco, including a

29  bidi, kretek, or other similar product, which is to be burned;

30         2.  Any roll of tobacco wrapped in any substance

31  containing tobacco, including a bidi, kretek, or other similar

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    Florida Senate - 2000                           CS for SB 1526
    315-1832-00




  1  product, which , because of its appearance, the type of

  2  tobacco used in the filler, or its packaging or labeling is

  3  likely to be offered to or purchased by consumers as a

  4  cigarette described in subparagraph 1.; or

  5         3.  Loose rolling tobacco that, because of its

  6  appearance, type, packaging, or labeling, is likely to be

  7  offered to or purchased by consumers as tobacco for making

  8  cigarettes.

  9         (b)  "Importer" means "importer" as that term is

10  defined in 26 U.S.C. 5702(l).

11         (c)  "Package" means "package" as that term is defined

12  in 15 U.S.C. 1332(4).

13         (8)  APPLICABILITY.--

14         (a)  This section does not apply to cigarettes allowed

15  to be imported or brought into the United States for personal

16  use and cigarettes sold or intended to be sold as duty-free

17  merchandise by a duty-free sales enterprise in accordance with

18  19 U.S.C. 1555(b) and any implementing regulations, but this

19  section does apply to any such cigarettes that are brought

20  back into the customs territory for resale within the customs

21  territory.

22         (b)  The penalties provided in this section are in

23  addition to any penalties imposed under any other law.

24         Section 3.  Section 210.19, Florida Statutes, is

25  amended to read:

26         210.19  Records to be kept by division.--The division

27  shall keep records showing the total amount of taxes

28  collected, which records shall be open to the public during

29  the regular office hours of the division. The division shall

30  maintain records that identify which agent or wholesale dealer

31  affixed the tax stamp to each package of cigarettes. The

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    Florida Senate - 2000                           CS for SB 1526
    315-1832-00




  1  identifying records must be made available for public

  2  inspection and retained for at least 3 years.

  3         Section 4.  If any provision of this act or the

  4  application thereof to any person or circumstance is held

  5  invalid, the invalidity does not affect other provisions or

  6  applications of the act which can be given effect without the

  7  invalid provision or application, and to this end the

  8  provisions of this act are declared severable.

  9         Section 5.  This act shall take effect August 1, 2000.

10

11          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
12                         Senate Bill 1526

13

14  The Committee Substitute for Senate Bill 1526 contains the
    following substantial changes:
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    -     Defines "cigarette" for purposes of newly created s.
16        210.185, F.S., to include "bidis" and similar products;
          and
17
    -     Requires the Division to design cigarette tax stamps and
18        maintain records in a way that permits identification of
          the agent or wholesale dealer who affixed the stamp to a
19        particular pack of cigarettes.

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