50-6a04. Tobacco product manufacturers; directory by attorney general; certification, contents; escrow deposits.
50-6a04
50-6a04. Tobacco product manufacturers; directory byattorney general; certification, contents; escrow deposits.(a) No person may:
(1) Affix, or cause to be affixed, tax indicia to a package of cigarettes, orotherwise pay the tax due upon such cigarettes, of a tobacco productmanufacturer brand family not included in the directory; or
(2) sell, offer, possess for sale or import for personal consumption in thisstate, cigarettes of a tobacco product manufacturer brand family not includedin the directory.
(b) (1) Not later than July 1, 2009, the attorneygeneral shall develop a directory, to be posted on theattorney general's website.Except as otherwise provided, the directory shall list all tobacco productmanufacturers and brand families of such tobacco product manufacturers thathave provided current and accurate certifications conforming to therequirements of subsection (c).
(2) The attorney general shall not include or retain in the directory anynon-participating manufacturer, or non-participating manufacturer's brandfamily, that has failed to provide the required certification, or whosecertification the attorney general determines is not in compliance withsubsection (c), unless such failure or noncompliance has been cured to thesatisfaction of the attorney general.
(3) In the case of a non-participating manufacturer, neither the tobaccoproduct manufacturer nor a brand family shall be included or retained in thedirectory if the attorney general concludes:
(A) That an escrow payment required pursuant to K.S.A. 50-6a03, andamendments thereto, for any period for any brand family, whether or not listedby such non-participating manufacturer, has not been fully paid into aqualified escrow fund governed by an escrow agreement that has been approved bythe attorney general;
(B) that an outstanding final judgment, including interest thereon, for aviolation of K.S.A. 50-6a03, and amendments thereto, has not been fullysatisfied for such tobacco product manufacturer; or
(C) that, within three calendar years prior to the date of submission orapproval of the most recent certification, such tobacco product manufacturerhas defaulted on escrow payments in any other state or jurisdiction that is aparty to the master settlement agreement and the default has not been curedwithin 90 calendar days of such default.
(4) The attorney general shall update the directory as necessary in order tocorrect mistakes and to add or remove a tobacco product manufacturer or brandfamily so as to keep the directory in conformity with the requirements of thisact.
(5) The attorney general shall promptly post in the directory and transmit byelectronic mail to each stamping agent that has provided an electronic mailaddress, notice of removal from the directory of a tobacco product manufactureror brand family.
(6) Unless otherwise provided by agreement between a stamping agent and atobacco product manufacturer, the stamping agent shall be entitled to a refundfrom a tobacco product manufacturer for any money paid by the stamping agent tothe tobacco product manufacturer for any cigarettes of the tobacco productmanufacturer in the possession of the stamping agent on the effective date ofremoval from the directory of that tobacco product manufacturer or brandfamily.
(7) Unless otherwise provided by agreement between a retail dealer or avending machine operator and a tobacco product manufacturer, a retail dealer ora vending machine operator shall be entitled to a refund from a tobacco productmanufacturer for any money paid by the retail dealer or vending machineoperator to a stamping agent for any cigarettes of the tobacco productmanufacturer still in the possession of the retail dealer or vending machineoperator on the effective date of removal from the directory of that tobaccoproduct manufacturer or brand family.
(c) (1) On or before April 30 of each year, every tobacco productmanufacturerwhose cigarettes are sold in this state, whether directly or through a stampingagent or similar intermediary or intermediaries, shall execute and deliver inthe manner prescribed by the attorney general a certification to the attorneygeneral certifying under penalty of perjury that, as of the date of suchcertification, such tobacco product manufacturer either is:
(A) A participating manufacturer; or
(B) in full compliance with K.S.A. 50-6a03, and amendments thereto, includingpayment of all quarterly installment payments as may be required by subsection(d).
(2) A participating manufacturer shall include in its certification a list ofits brand families. The participating manufacturer shall update such list 30calendar days prior to any addition to, or modification of its brand familiesby executing and delivering a supplemental certification to the attorneygeneral.
(3) A non-participating manufacturer shall include in its certification:
(A) The number of units sold for each brand family sold in the state duringthe preceding calendar year;
(B) a list of all of its brand families sold in the state at any time duringthe current calendar year, including any brand family sold in the state duringthe preceding calendar year that is no longer being sold in the state as of thedate of such certification;
(C) the identity, by name and address, of any other tobacco productmanufacturer who manufactured such brand families in the preceding or currentcalendar year;
(D) a declaration that such non-participating manufacturer is registered todo business in the state, or has appointed a resident agent for service ofprocess, and provided notice thereof as required by K.S.A. 2009 Supp. 50-6a08,and amendmentsthereto;
(E) a declaration that such non-participating manufacturer:
(i) Has established and continues to maintain a qualified escrow fund; and
(ii) has executed an escrow agreement that governs the qualified escrow fundand that such escrow agreement has been reviewed and approved by the attorneygeneral;
(F) a declaration that such non-participating manufacturer consents to thejurisdiction of the district court of the third judicial district, Shawneecounty, Kansas, for purposes of enforcing this act, or rules or regulationspromulgated pursuant thereto, as required by subsection (c) of K.S.A. 2009Supp. 50-6a08, andamendments thereto;
(G) a declaration that such non-participating manufacturer is in fullcompliance with subsection (b) of K.S.A. 50-6a03, and amendments thereto, andany rules or regulations promulgated pursuant to this act;
(H) (i) the name, address and telephone number of the financial institutionwhere the non-participating manufacturer has established such qualified escrowfund required pursuant to subsection (b) of K.S.A. 50-6a03, and amendmentsthereto;
(ii) the account number of such qualified escrow fund and any sub-accountnumber for the state of Kansas;
(iii) the amount such non-participating manufacturer placed in such qualifiedescrow fund for cigarettes sold in this state during the preceding calendaryear, the date and amount of each such deposit and such evidence orverification as may be deemed necessary by the attorney general to confirm theforegoing; and
(iv) the amount and date of any withdrawal or transfer of funds thenon-participating manufacturer made at any time from such qualified escrow fundor from any other qualified escrow fund into which it ever made escrow paymentspursuant to subsection (b) of K.S.A. 50-6a03, and amendments thereto; and
(I) in the case of a non-participating manufacturer located outside of theUnited States, a declaration from each of its importers to the United States ofany of its brand families to be sold in Kansas that such importer accepts jointand several liability with the non-participating manufacturer for:
(i) All escrow deposits due under subsection (b) of K.S.A. 50-6a03, andamendments thereto;
(ii) all penalties assessed under subsection (b) of K.S.A. 50-6a03, andamendments thereto; and
(iii) payment of all costs and attorney fees pursuant to any successfulaction under this act against said manufacturer.
Such declarations by importers of a non-participating manufacturer shallappoint for the declarant a resident agent for service of process in Kansas inaccordance with K.S.A. 2009 Supp. 50-6a08, and amendments thereto, and consentto jurisdictionin accordance with K.S.A. 2009 Supp. 50-6a08, and amendments thereto.
(4) A tobacco product manufacturer may not include a brand family in itscertification unless:
(A) In the case of a participating manufacturer, said participatingmanufacturer affirms that the brand family shall be deemed to be its cigarettesfor purposes of calculating its payments under the master settlement agreementfor the relevant year in the volume and shares determined pursuant to themaster settlement agreement; or
(B) in the case of a non-participating manufacturer, said non-participatingmanufacturer affirms that the brand family shall be deemed to be its cigarettesfor purposes of subsection (b) of K.S.A. 50-6a03, and amendments thereto.
Nothing in this paragraph shall be construed as limiting or otherwise affectingthe state's right to maintain that a brand family constitutes cigarettes of adifferent tobacco product manufacturer for purposes of calculating paymentsunder the master settlement agreement or subsection (b) of K.S.A. 50-6a03, andamendments thereto.
(5) Invoices and documentation of sales and other such information reliedupon for such certification shall be maintained by tobacco productmanufacturersfor a period of at least five years.
(d) The attorney general may require a tobacco product manufacturer subject tothe requirements of subsection (c) to make the escrow deposits required bysubsection (b) of K.S.A. 50-6a03, and amendments thereto, in quarterlyinstallments during the calendar year in which the sales covered by suchdeposits are made. The attorney general may require production of informationsufficient to enable the attorney general to determine the adequacy of theamount of the installment deposit.
History: L. 2002, ch. 74, § 1;L. 2009, ch. 110, § 16; July 1.