Senate Bill NO. 3050

By Representative(s) Committee

SECTION 1. As used in this act:

(a) "Commission" means the Mississippi State Tax Commission.

(b) "Cigarette" means any roll for smoking made wholly or in part of tobacco, irrespective of size or shape and whether such tobacco is flavored, adulterated or mixed with any other ingredient, the wrapper or cover of which is made or paper or any other substance or material except tobacco.

(c) "Person" means any individual, firm, association, agency, syndicate, the State of Mississippi, county, municipal corporation or other political subdivision of this state, receiver, trustee, fiduciary or trade association.

SECTION 2. It shall be unlawful for any person:

(a) To sell or distribute in this state or to acquire, hold, own, possess or transport, for sale or distribution in this state; or to import, or cause to be imported, into this state for sale or distribution in this state:

(i) Any cigarettes the package of which:

1. Bears any statement, label, stamp, sticker or notice indicating that the manufacturer did not intend the cigarettes to be sold, distributed or used in the United States, including, but not limited to, labels stating "For Export Only," "U.S. Tax-Exempt," "For Use Outside U.S." or similar wording; or

2. Does not comply with:

a. All requirements imposed by or pursuant to federal law regarding warnings and other information on packages of cigarettes manufactured, packaged or imported for sale, distribution or use in the United States, including, but not limited to, the precise warning labels specified in the Federal Cigarette Labeling and Advertising Act, 15 USCS 1333; and

b. All federal trademark and copyright laws;

(ii) Any cigarettes imported into the United States in violation of 26 USCS 5754 or any other federal law, or implementing federal regulations;

(iii) Any cigarettes that such person otherwise knows or has reason to know the manufacturer did not intend to be sold, distributed or used in the United States; or

(iv) Any cigarettes for which there has not been submitted to the Secretary of the United States Department of Health and Human Services the list or lists of the ingredients added to tobacco in the manufacture of such cigarettes required by the Federal Cigarette Labeling and Advertising Act, 15 USCS 1335a;

(b) To alter the package of any cigarettes, prior to sale or distribution to the ultimate consumer, so as to remove, conceal or obscure:

(i) Any statement, label, stamp, sticker or notice described in paragraph (a)(i)2 of this section;

(ii) Any health warning that is not specified in, or does not conform with the requirements of, the Federal Cigarette Labeling and Advertising Act, 15 USCS 1333; or

(c) To affix any stamp required pursuant to Chapter 69, Title 27, Mississippi Code of 1972, to the package of any cigarettes described in paragraph (a) of this section or altered in violation of paragraph (b) of this section.

SECTION 3. Any person who commits any of the acts prohibited by Section 2 of this act, either knowing or having reason to know he is doing so, shall be guilty of a felony, and upon conviction thereof shall be punished by a fine of not more than Five Thousand Dollars ($5,000.00) or imprisonment of not more than five (5) years, or both.

SECTION 4. (1) Upon finding a violation of this act or a regulation promulgated pursuant to this act, the commission may revoke or suspend the license or licenses of any permittee pursuant to the procedures set forth in Section 27-69-9 and may also impose on the permittee a civil penalty in an amount not to exceed the greater of five hundred percent (500%) of the retail value of the cigarettes involved or Five Thousand Dollars ($5,000.00).

(2) Cigarettes that are acquired, held, owned, possessed, transported in, imported into, or sold or distributed in this state in violation of this act shall be deemed contraband under Sections 27-69-53 through 27-69-57 and shall be subject to seizure and forfeiture as provided therein. Such cigarettes so seized and forfeited shall be destroyed. Such cigarettes shall be deemed contraband whether the violation of this act is knowing or otherwise.

SECTION 5. For purposes of Chapter 23, Title 75, Mississippi Code of 1972, cigarettes imported or reimported into the United States for sale or distribution under any trade name, trade dress or trademark that is the same as, or is confusingly similar to, any trade name, trade dress or trademark used for cigarettes manufactured in the United States for sale or distribution in the United States shall be presumed to have been purchased outside of the ordinary channels of trade.

SECTION 6. (1) This act shall be prosecuted by the Attorney General, local district attorneys and local county prosecuting attorneys. The authority prosecuting this act may request the assistance of local law enforcement agencies, and local law enforcement agencies receiving a request for assistance in the prosecution of this act shall provide the necessary assistance.

(2) The commission may provide assistance to the prosecuting authority, including, but not limited to, the providing of information to the prosecuting authority. The commission and any prosecuting authority may request information from each other and from any other state agency, local or federal agency, or permittee.

(3) In addition to any other remedy provided by law, any person may bring an action for appropriate injunctive or other equitable relief, actual damages, if any, sustained by reason of a violation of this act, interest, reasonable attorney's fees and court costs. For purposes of promoting enforcement of this act, information identifying which permittee affixed the tax stamp to a particular package of cigarettes shall be public information.

(4) If the trier of fact finds that the violation is egregious, it may increase recovery to an amount not in excess of three (3) times the actual damages sustained by reason of the violation.

SECTION 7. (1) This act shall not apply to:

(a) Cigarettes allowed to be imported or brought into the United States for personal use; and

(b) Cigarettes sold or intended to be sold as duty-free merchandise by a duty-free sales enterprise in accordance with the provisions of 19 USCS 1555(b) and any implementing regulations; provided, however, that this act shall apply to any such cigarettes that are brought back into the customs territory for resale within the customs territory.

(2) The penalties provided in this act are in addition to any other penalties imposed under other law.

SECTION 8. The provisions of Sections 1 through 7 this act shall be codified as a new article in Chapter 23, Title 75, Mississippi Code of 1972.

SECTION 9. This act shall take effect and be in force from and after its passage.

AN ACT TO PROHIBIT THE SALE OR DISTRIBUTION IN THIS STATE, OR THE ACQUISITION, OWNING, POSSESSING OR TRANSPORTING FOR SALE OR DISTRIBUTION IN THIS STATE, ANY CIGARETTES IN A PACKAGE THAT INDICATES THEY WERE NOT MANUFACTURED TO BE SOLD IN THE UNITED STATES, DOES NOT COMPLY WITH REQUIREMENTS IMPOSED BY FEDERAL LAW ON THE PACKAGING OF CIGARETTES FOR SALE IN THE UNITED STATES OR DOES NOT COMPLY WITH FEDERAL TRADEMARK AND COPYRIGHT LAW; TO PROHIBIT THE SALE OF CIGARETTES IMPORTED INTO THE UNITED STATES IN VIOLATION OF FEDERAL LAW; TO PROHIBIT THE SALE OF ANY CIGARETTES THAT A PERSON KNOWS OR HAS REASON TO KNOW THE MANUFACTURER DID NOT INTEND TO BE SOLD, DISTRIBUTED OR USED IN THE UNITED STATES OR FOR WHICH THERE HAS NOT BEEN SUBMITTED TO THE U.S. DEPARTMENT OF HEALTH THE LIST OF INGREDIENTS ADDED TO THE TOBACCO IN THE MANUFACTURING PROCESS; TO PROHIBIT CERTAIN ALTERATION OF CIGARETTE PACKAGES; TO PROVIDE CRIMINAL AND CIVIL PENALTIES FOR VIOLATIONS OF THIS ACT; TO PROVIDE THAT ANY CIGARETTES IMPORTED INTO THE UNITED STATES FOR SALE OR DISTRIBUTION UNDER ANY TRADE NAME, TRADE DRESS OR TRADEMARK THAT IS THE SAME AS OR CONFUSINGLY SIMILAR TO ANY TRADE NAME, TRADE DRESS OR TRADEMARK USED FOR CIGARETTES MANUFACTURED IN THE UNITED STATES FOR SALE OR DISTRIBUTION IN THE UNITED STATES SHALL BE PRESUMED TO HAVE BEEN PURCHASED OUTSIDE THE ORDINARY CHANNELS OF TRADE; TO PROVIDE FOR THE ENFORCEMENT OF THIS ACT; AND FOR RELATED PURPOSES.