SF 1175

1st Engrossment - 83rd Legislature (2003 - 2004) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to commerce; regulating certain sales and 
  1.3             deliveries of tobacco products; proposing coding for 
  1.4             new law in Minnesota Statutes, chapter 325F. 
  1.5   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.6      Section 1.  [325F.781] [REQUIREMENTS; TOBACCO PRODUCT 
  1.7   DELIVERY SALES.] 
  1.8      Subdivision 1.  [SCOPE OF DEFINITIONS.] The terms used in 
  1.9   this section have the following meanings unless otherwise 
  1.10  provided for by text. 
  1.11     Subd. 2.  [CONSUMER.] "Consumer" means an individual who 
  1.12  purchases, receives, or possesses tobacco products for personal 
  1.13  consumption and not for resale. 
  1.14     Subd. 3.  [DELIVERY SALE.] "Delivery sale" means: 
  1.15     (1) a sale of tobacco products to a consumer in this state 
  1.16  when: 
  1.17     (i) the purchaser submits the order for the sale by means 
  1.18  of a telephonic or other method of voice transmission, the mail 
  1.19  or any other delivery service, or the Internet or other on-line 
  1.20  service; or 
  1.21     (ii) the tobacco products are delivered by use of the mail 
  1.22  or other delivery service; or 
  1.23     (2) a sale of tobacco products that satisfies the criteria 
  1.24  in clause (1), item (i), regardless of whether the seller is 
  1.25  located inside or outside of the state. 
  2.1      For purposes of this subdivision, a sale of tobacco 
  2.2   products to an individual in this state must be treated as a 
  2.3   sale to a consumer, unless the individual is licensed as a 
  2.4   distributor or retailer of tobacco products. 
  2.5      Subd. 4.  [DELIVERY SERVICE.] "Delivery service" means a 
  2.6   person, including the United States Postal Service, that is 
  2.7   engaged in the commercial delivery of letters, packages, or 
  2.8   other containers. 
  2.9      Subd. 5.  [DISTRIBUTOR.] "Distributor" means a person, 
  2.10  whether located inside or outside of this state, other than a 
  2.11  retailer, who sells or distributes tobacco products in the state.
  2.12  Distributor does not include a tobacco products manufacturer, 
  2.13  export warehouse proprietor, or importer with a valid permit 
  2.14  under United States Code, title 26, section 5712 (1997), if the 
  2.15  person sells or distributes tobacco products in this state only 
  2.16  to distributors who hold valid and current licenses under the 
  2.17  laws of a state, or to an export warehouse proprietor or another 
  2.18  manufacturer.  Distributor does not include a common or contract 
  2.19  carrier that is transporting tobacco products under a proper 
  2.20  bill of lading or freight bill that states the quantity, source, 
  2.21  and destination of tobacco products, or a person who ships 
  2.22  tobacco products through this state by common or contract 
  2.23  carrier under a bill of lading or freight bill. 
  2.24     Subd. 6.  [RETAILER.] "Retailer" means a person, whether 
  2.25  located inside or outside this state, who sells or distributes 
  2.26  tobacco products to a consumer in this state. 
  2.27     Subd. 7. [REQUIREMENTS FOR ACCEPTING ORDER FOR DELIVERY 
  2.28  SALE.] (a) This subdivision applies to acceptance of an order 
  2.29  for a delivery sale of tobacco products. 
  2.30     (b) When accepting the first order for a delivery sale from 
  2.31  a consumer, the tobacco retailer shall obtain the following 
  2.32  information from the person placing the order: 
  2.33     (1) a copy of a valid government-issued document that 
  2.34  provides the person's name, current address, photograph, and 
  2.35  date of birth; and 
  2.36     (2) an original written statement signed by the person 
  3.1   documenting that the person: 
  3.2      (i) is of legal age to purchase tobacco products in the 
  3.3   state; 
  3.4      (ii) has made a choice whether to receive mailings from a 
  3.5   tobacco retailer; 
  3.6      (iii) understands that providing false information may be a 
  3.7   violation of law; and 
  3.8      (iv) understands that it is a violation of law to purchase 
  3.9   tobacco products for subsequent resale or for delivery to 
  3.10  persons who are under the legal age to purchase tobacco products.
  3.11     (c) If an order is made as a result of advertisement over 
  3.12  the Internet, the tobacco retailer shall request the e-mail 
  3.13  address of the purchaser and shall receive payment by credit 
  3.14  card or check prior to shipping. 
  3.15     (d) Prior to shipping the tobacco products, the tobacco 
  3.16  retailer shall verify the information provided under paragraph 
  3.17  (b) against a commercially available database.  Any such 
  3.18  database or databases may also include age and identity 
  3.19  information from other government or validated commercial 
  3.20  sources, if that additional information is regularly used by 
  3.21  government and businesses for the purpose of identity 
  3.22  verification and authentication, and if the additional 
  3.23  information is used only to supplement and not to replace the 
  3.24  government-issued identification data in the age and identity 
  3.25  verification process. 
  3.26     Subd. 8.  [REQUIREMENTS FOR SHIPPING A DELIVERY SALE.] (a) 
  3.27  This subdivision applies to a tobacco retailer shipping tobacco 
  3.28  products pursuant to a delivery sale. 
  3.29     (b) The tobacco retailer shall clearly mark the outside of 
  3.30  the package of tobacco products to be shipped "tobacco products -
  3.31  adult signature required" and to show the name of the tobacco 
  3.32  retailer. 
  3.33     (c) The tobacco retailer shall utilize a delivery service 
  3.34  that imposes the following requirements: 
  3.35     (1) an adult must sign for the delivery; and 
  3.36     (2) if the person signing for the delivery is believed to 
  4.1   be under 27 years of age, the person signing for the delivery 
  4.2   must show valid government-issued identification that contains a 
  4.3   photograph of the person signing for the delivery and indicates 
  4.4   that the person signing for the delivery is of legal age to 
  4.5   purchase tobacco products and resides at the delivery address. 
  4.6      (d) The retailer must provide delivery instructions that 
  4.7   clearly indicate the requirements of this subdivision and must 
  4.8   declare that state law requires compliance with the requirements.
  4.9      Subd. 9.  [COMMON CARRIERS.] This section may not be 
  4.10  construed as imposing liability upon any common carrier, or 
  4.11  officers or employees of the common carrier, when acting within 
  4.12  the scope of business of the common carrier. 
  4.13     Subd. 10.  [REGISTRATION REQUIREMENT.] Prior to making 
  4.14  delivery sales or shipping tobacco products in connection with 
  4.15  any sales, a distributor shall file with the Department of 
  4.16  Revenue a statement setting forth the distributor's name, trade 
  4.17  name, and the address of the distributor's principal place of 
  4.18  business and any other place of business. 
  4.19     Subd. 11.  [REPORTING REQUIREMENTS.] No later than the 
  4.20  tenth day of each calendar month, a tobacco retailer that has 
  4.21  made a delivery sale of tobacco products or shipped or delivered 
  4.22  tobacco products into the state in a delivery sale in the 
  4.23  previous calendar month shall file with the Department of 
  4.24  Revenue a memorandum or a copy of each invoice that provides for 
  4.25  each delivery sale the name and address of the purchaser and the 
  4.26  brand or brands and quantity of tobacco products sold.  A 
  4.27  tobacco retailer that meets the requirements of United States 
  4.28  Code, title 15, section 375 et seq. satisfies the requirements 
  4.29  of this subdivision.  
  4.30     Subd. 12.  [COLLECTION OF TAXES.] (a) Prior to shipping any 
  4.31  tobacco products to a purchaser in this state, the distributor 
  4.32  shall ensure that all state excise taxes that apply to such 
  4.33  tobacco products have been collected and paid to the state and 
  4.34  that all related state excise tax stamps or other indicators of 
  4.35  state excise tax payment have been properly affixed to those 
  4.36  tobacco products. 
  5.1      (b) A distributor who fails to pay any tax due according to 
  5.2   paragraph (a) shall pay, in addition to any other penalty, a 
  5.3   penalty of 50 percent of the tax due but unpaid. 
  5.4      Subd. 13.  [APPLICATION OF STATE LAWS.] All state laws that 
  5.5   apply to in-state tobacco product retailers shall apply to 
  5.6   Internet and mail-order sellers that sell into this state. 
  5.7      Subd. 14.  [FORFEITURE.] Any tobacco product sold or 
  5.8   attempted to be sold in a delivery sale that does not meet the 
  5.9   requirements of this section is deemed to be contraband and is 
  5.10  subject to forfeiture in the same manner as and in accordance 
  5.11  with the provisions of section 297F.21. 
  5.12     Subd. 15.  [CIVIL PENALTIES.] (a) A tobacco retailer or 
  5.13  distributor who violates this section or rules adopted under 
  5.14  this section is subject to the following fines: 
  5.15     (1) for the first violation, a fine of not more than 
  5.16  $1,000; and 
  5.17     (2) for the second and any subsequent violation, a fine of 
  5.18  not more than $5,000. 
  5.19     (b) A person who submits ordering information under 
  5.20  subdivision 7, paragraph (b), in another person's name is 
  5.21  subject to a fine of not more than $1,000. 
  5.22     Subd. 16.  [ENFORCEMENT.] The attorney general may bring an 
  5.23  action to enforce this section and may seek injunctive relief, 
  5.24  including a preliminary or final injunction, and fines, 
  5.25  penalties, and equitable relief and may seek to prevent or 
  5.26  restrain actions in violation of this section by any person or 
  5.27  any person controlling such person.  In addition, a violation of 
  5.28  this section is a violation of the Unfair Trade Practices Act.