House Bill 920

AN ACT TO AMEND SECTION 27-69-9, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT MANUFACTURERS AND WHOLESALE DEALERS IN TOBACCO PRODUCTS SHALL NOT SELL, OFFER TO SELL, OR DELIVER ANY TOBACCO PRODUCTS TO RETAIL DEALERS IN TOBACCO PRODUCTS AND THAT RETAIL DEALERS SHALL NOT BUY OR ACCEPT DELIVERY FOR ANY SUCH PRODUCT FOR ANY CONSIDERATION OTHER THAN CASH OR ON TERMS; TO PROVIDE THAT IF PAYMENT IS NOT RECEIVED WHEN DUE OR PAYMENT IS RETURNED FOR INSUFFICIENT FUNDS, THE VENDOR, WITHIN FIVE BUSINESS DAYS, SHALL NOTIFY THE COMMISSIONER OF REVENUE AND THE COMMISSIONER OF REVENUE SHALL PROMPTLY NOTIFY ALL MANUFACTURERS AND WHOLESALE DEALERS IN THE STATE OF THE DEFAULT IN PAYMENT AND THAT NO PERSON SHALL SELL ANY TOBACCO PRODUCTS TO THE RETAILER IN DEFAULT ON ANY OTHER TERMS THAN CASH DELIVERY, UNTIL OTHERWISE AUTHORIZED BY THE COMMISSIONER OF REVENUE; TO AUTHORIZE THE COMMISSIONER OF REVENUE TO SUSPEND OR REVOKE THE PERMIT OF A RETAIL DEALER FOR NONPAYMENT; TO BRING FORWARD SECTIONS 27-69-5, 75-23-37 AND 97-32-5, MISSISSIPPI CODE OF 1972, FOR THE PURPOSE OF POSSIBLE AMENDMENT; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 27-69-9, Mississippi Code of 1972, is amended as follows:

27-69-9. (1) In addition to the penalties imposed in this chapter, after the second offense for any violation, the commissioner may revoke any permit * * *~~which~~ that may have been issued to any person, or persons, violating any provisions of this chapter, or any rules or regulations promulgated by the commissioner under authority of this chapter.

(2) (a) No manufacturer or wholesale dealer shall sell, offer to sell, or deliver any tobacco products to any retail dealer in this state and no retail dealer in tobacco products shall buy or accept delivery for any such product for any consideration other than cash or on terms. If payment is not received when due or payment is returned for insufficient funds, the vendor, within five (5) business days, shall notify the commissioner thereof and the commissioner shall promptly notify all manufacturers and wholesale dealers in the state of the default in payment and thereafter no person shall sell any tobacco products to the retailer in default on any other terms than cash delivery, until otherwise authorized by the commissioner. Under penalty of suspension of the permit, the retailer who is in default shall pay his obligation in full within thirty (30) days from the date it became due.

(b) Any permittee that violates the provisions of this section may have his permit suspended for not more than thirty (30) days for each offense. Each failure of a retail dealer to make payment for any default before the expiration period of suspension constitutes a separate offense. The commissioner may permanently revoke the permit of any permittee who is suspended for default in payment for more than six (6) months in any twelve (12) month period.

(c) In addition, the commissioner may require the retail dealer to make payment in cash for all tobacco products subsequently sold or delivered to him.

(3) The commissioner, in the event a permit is suspended or revoked, is required to notify all manufacturers, wholesalers and distributors having a permit required by this chapter, that the permit has been suspended or revoked, and such manufacturer, wholesaler and distributor is henceforth prohibited from selling taxable tobacco to such dealer or retailer. The commissioner may notify manufacturers, wholesalers and distributors as required by this paragraph either manually or electronically and shall specify by rule or regulation the method by which the notification shall be made.

SECTION 2. Section 27-69-5, Mississippi Code of 1972, is brought forward as follows:

27-69-5. (1) Every distributor, wholesaler, dealer or retailer who desires to become engaged in the sale or use of tobacco upon which a tax is required to be paid shall file with the commissioner an application for a permit to engage in such business. The application for a permit shall be filed on blanks to be furnished by the commissioner for that purpose. The application must be subscribed and sworn to by the person owning the business, or having an ownership interest in the business. If the applicant is a corporation, a duly authorized agent shall execute the application. The application shall show the name of such person, and in case of partnership, the name of each partner, the person's post-office address, the location of the place of business to which the permit shall apply, and the nature of the business in which engaged, and any other information the commissioner may require. No distributor, wholesaler, dealer or retailer shall sell any tobacco until the application has been filed, the prescribed permit fee paid, and the permit obtained. Except as otherwise provided in this subsection, the permit shall expire on January 31 of each year. However, a retail permit shall continue in force during the time that the permit holder to whom it is issued continues in the same business at the same location unless such permit is revoked by the commissioner for cause or is revoked pursuant to any provision of Section 27-70-1 et seq., Section 75-23-l et seq. or the Mississippi Juvenile Tobacco Access Prevention Act in Sections 97-32-1 through 97-32-23.

(2) An application shall be filed, and a permit obtained for each place of business owned or operated by each distributor, wholesaler, dealer or retailer.

(3) Upon receipt of the application and any permit fee provided for in this chapter, the commissioner may issue to every distributor, wholesaler, dealer or retailer, for the place of business designated, a nonassignable permit, authorizing the sale or use of tobacco in the state. The permit shall provide that it is revocable, and may be forfeited or suspended upon violation of any provision of this chapter, the Mississippi Tobacco Youth Access Prevention Act of 1997, Section 27-70-7 et seq., Section 75-23-1 et seq. or any rule or regulation adopted by the commissioner. If the permit is revoked or suspended, the distributor, wholesaler, dealer or retailer shall not sell any tobacco from the place of business until a new permit is granted, or the suspension of the old permit removed.

(4) A permit cannot be transferred from one person to another, and the permit shall at all times be publicly displayed by the distributor, wholesaler, dealer or retailer in his place of business so as to be seen easily by the public. A permit may be refused to any person previously convicted of violations of this chapter or Section 27-70-1 et seq.

(5) Information contained on a permit may be disclosed to the holder of a wholesaler's permit, to law enforcement agencies of the federal government, state or any political subdivision of the state, and to the Attorney General and federal agencies responsible for administering tobacco laws.

SECTION 3. Section 75-23-37, Mississippi Code of 1972, is brought forward as follows:

75-23-37. (1) Upon finding a violation of this article or a regulation promulgated pursuant to this article, 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 article 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 article is knowing or otherwise.

SECTION 4. Section 97-32-5, Mississippi Code of 1972, is brought forward as follows:

97-32-5. It shall be unlawful for any person, or retailer, to sell, barter, deliver or give tobacco products to any individual under eighteen (18) years of age unless the individual under eighteen (18) years of age holds a retailer's license to sell tobacco under Section 27-69-1 et seq., Mississippi Code of 1972.

It shall be an absolute affirmative defense that the person selling, bartering, delivering or giving tobacco products over the counter in a retail establishment to an individual under eighteen (18) years of age in violation of this article had requested and examined a government-issued photographic identification from such person establishing his age as at least eighteen (18) years prior to selling such person a tobacco product. The failure of a seller, barterer, deliverer or giver of tobacco products over the counter in a retail establishment to request and examine photographic identification from a person under eighteen (18) years of age prior to the sale of a tobacco product to such person if the individual is not known to the seller, barterer, deliverer or giver of the tobacco product to be over the age of eighteen (18) years, shall be construed against the seller, barterer, deliverer or giver and form a conclusive basis for the seller's violation of this section.

It shall be an absolute affirmative defense that the person or entity giving tobacco products through the mail to an individual under eighteen (18) years of age in violation of this article had requested and received documentary or written evidence from such person purportedly establishing his age to be at least eighteen (18) years of age.

Any person who violates this section shall be liable as follows: For a first conviction, a fine of Fifty Dollars ($50.00); for a second conviction, a fine of Seventy-five Dollars ($75.00); and for all subsequent convictions, a fine of One Hundred Fifty Dollars ($150.00) shall be imposed.

Any person found in violation of this section shall be issued a citation and the holder of the retailer permit shall be sent notification of this citation by registered mail by the law enforcement agency issuing the citation. Notification shall include the opportunity for hearing before the appropriate court. For a first conviction, the retailer shall be sent a warning letter informing him of the retailer's responsibility in the selling of tobacco products. For a second conviction, the retailer, or retailer's designee, shall be required to enroll in and complete a "Retailer Tobacco Education Program."

For a third or subsequent violation of this section by any retailer, within one (1) year of the two (2) prior violations, any retailer's permit issued pursuant to Section 27-69-1 et seq., Mississippi Code of 1972, may be revoked or suspended for a period of at least one (1) year after notice and opportunity for hearing. If said permit is revoked by the Tax Commission, the retailer may not reapply for a permit to sell tobacco for a period of six (6) months. For the purposes of this section, "subsequent violations" are those committed at the same place of business.

It is the responsibility of all law enforcement officers and law enforcement agencies of this state to ensure that the provisions of this article are enforced.

It shall not be considered a violation of this section on the part of any law enforcement officer or person under eighteen (18) years of age for any law enforcement officer of this state to use persons under eighteen (18) years of age to purchase or attempt to purchase tobacco products for the purpose of monitoring compliance with this section, as long as those persons are supervised by duly authorized law enforcement agency officials.

Any law enforcement agency conducting enforcement efforts undertaken pursuant to this article shall prepare a report as prescribed by the Attorney General which includes the number of unannounced inspections conducted by the agency, a summary of enforcement actions taken pursuant to this article, the name and permit number of the retailer pursuant to Section 27-69-1 et seq., Mississippi Code of 1972, and final judicial disposition on all enforcement actions. Reports shall be forwarded to the Office of the Attorney General within twenty (20) working days of the final judicial disposition.

On notification from local law enforcement that a retailer has violated this article so as to warrant a revocation of the retailer's permit, the Attorney General shall notify in writing the State Tax Commission within twenty (20) working days.

In accordance with the procedures of Section 27-69-9, Mississippi Code of 1972, the State Tax Commission shall initiate revocation procedures of the retailer's permit. The Office of the Attorney General shall provide legal assistance in revocation procedures when requested by the Tax Commission.

SECTION 5. This act shall take effect and be in force from and after July 1, 2016.