AN ACT to amend the Indiana Code concerning trade regulations and consumer sales and
credit.
Be it enacted by the General Assembly of the State of Indiana:
SECTION 1. IC 6-7-1-17, AS AMENDED BY P.L.192-2002(ss),
SECTION 136, IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2003]: Sec. 17. (a) Distributors who hold
certificates and retailers shall be agents of the state in the collection of
the taxes imposed by this chapter and the amount of the tax levied,
assessed, and imposed by this chapter on cigarettes sold, exchanged,
bartered, furnished, given away, or otherwise disposed of by
distributors or to retailers. Distributors who hold certificates shall be
agents of the department to affix the required stamps and shall be
entitled to purchase the stamps from the department at a discount of
one and two-tenths percent (1.2%) of the amount of the tax stamps
purchased, as compensation for their labor and expense.
(b) The department may permit distributors who hold certificates
and who are admitted to do business in Indiana to pay for revenue
stamps within thirty (30) days after the date of purchase. However, the
privilege is extended upon the express condition that:
(1) except as provided in subsection (c), a bond or letter of credit
satisfactory to the department, in an amount not less than the sales
price of the stamps, is filed with the department; and
(2) proof of payment is made of all local property, state income,
and excise taxes for which any such distributor may be liable. The
bond or letter of credit, conditioned to secure payment for the
stamps, shall be executed by the distributor as principal and by a
corporation duly authorized to engage in business as a surety
company or financial institution in Indiana.
(c) If
(1) there is an increase in the amount of the tax imposed upon
cigarettes under this chapter; and
(2) a distributor has at least five (5) consecutive years of good
credit standing with the state, as of the effective date of the tax
increase described in subdivision (1);
the amount of the bond required by subsection (b)(1) remains the same
as before the increase in the tax on cigarettes took effect. the
distributor shall not be required to post a bond or letter of credit
under subsection (b).
SECTION 2. IC 6-7-1-18 IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2003]: Sec. 18. Every distributor, upon the
receipt of cigarettes taxed under this chapter, shall cause each
individual package to have the requisite denomination and amount of
stamps firmly affixed. Every retailer, upon receipt of cigarettes not
having the proper amount of stamps firmly affixed, to each individual
package, or stamped by a meter stamping machine, by a distributor
shall stamp or firmly affix stamps immediately on each individual
package. Provided, however, that any distributor engaged in interstate
business, shall be permitted to set aside such part of his stock as may
be necessary for the conduct of such interstate business without
affixing the stamps required by this chapter. Every distributor, at the
time of shipping or delivering any cigarettes, shall make a duplicate
invoice, showing complete details of each transaction, and shall retain
the duplicate subject to the inspection by the department or its agent.
Every distributor shall include with each shipment or delivery of
cigarettes an invoice showing complete details of the transactions.
Every retailer shall retain for not less than two (2) weeks the
invoice included with each shipment or delivery of cigarettes
subject to inspection by the department or its agent. A retailer may
request a duplicate invoice from a distributor.
SECTION 3. IC 6-7-2-11 IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2003]: Sec. 11. The department:
(1) may revoke or suspend a license issued under this chapter for
any violation of this chapter or IC 6-7-1-18 by the licensee; and
(2) may not issue a license under this chapter to an applicant
within six (6) months after the revocation of that applicant's
license.
SECTION 4. IC 7.1-3-18.5-7, AS ADDED BY HEA 1788-2003,
SECTION 11, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]: Sec. 7. (a) A person who is required to have a
certificate under this chapter and who sells or distributes tobacco
products without a valid certificate commits a Class A infraction. Each
violation of this section constitutes a separate offense.
(b) Notwithstanding IC 34-28-5-5(c), civil penalties collected under
this section must be deposited in the Richard D. Doyle youth tobacco
education and enforcement fund established under IC 7.1-6-2-6.
SECTION 5. IC 7.1-6-2-6, AS AMENDED BY P.L.1-2002,
SECTION 36, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]: Sec. 6. (a) The Richard D. Doyle youth tobacco
education and enforcement fund is established. The fund shall be
administered by the commission.
(b) Expenses of administering the fund shall be paid from money in
the fund.
(c) The treasurer of state shall invest the money in the fund not
currently needed to meet the obligations of the fund in the same
manner as other public money may be invested.
(d) Money in the fund at the end of a state fiscal year does not revert
to the state general fund.
(e) Money in the fund shall be used for the following purposes:
(1) For youth smoking prevention education. The commission
may contract with the state department of health or the office of
the secretary of family and social services for youth smoking
prevention education programs.
(2) For education and training of retailers who sell tobacco
products. The commission may contract with education and
training programs of the office of the secretary of family and
social services, the division of mental health and addiction,
enforcement officers, or a program approved by the commission.
(3) For the commission, for enforcement of youth tobacco laws.
SECTION 6. IC 7.1-6-2-8, AS ADDED BY P.L.204-2001,
SECTION 58, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]: Sec. 8. (a) This section applies whenever a civil
penalty payable to the Richard D. Doyle youth tobacco education and
enforcement fund is imposed.
(b) The person liable for the civil penalty shall pay the full amount
of the civil penalty to the commission within thirty (30) days after final
judgment.
(c) A person who fails to pay a civil penalty within the time
specified in subsection (b) is liable for a late penalty equal to the
greater of the following:
commissioner, fiduciary, trustee, executor, administrator, institution,
bank, consignee, firm, partnership, limited liability company, joint
vendor, pool, syndicate, bureau, association, cooperative association,
society, club, fraternity, sorority, lodge, corporation, municipal
corporation, or other political subdivision of the state engaged in
private or proprietary activities or business, estate, trust, or any other
group or combination acting as a unit, and the plural as well as the
singular number, unless the intention to give a more limited meaning
is disclosed by the context.
(c) "Distributor" shall mean and include every person who sells,
barters, exchanges, or distributes cigarettes in the state of Indiana to
retail dealers for the purpose of resale, or who purchases for resale
cigarettes from a manufacturer of cigarettes or from a wholesaler,
jobber, or distributor outside the state of Indiana who is not a
distributor holding a registration certificate issued under the provisions
of IC 6-7-1.
(d) "Retailer" shall mean every person, other than a distributor, who
purchases, sells, offers for sale, or distributes cigarettes to consumers
or to any person for any purpose other than resale, irrespective of
quantity or amount or the number of sales.
(e) "Sell at retail", "sale at retail", and "retail sales" shall mean and
include any transfer of title to cigarettes for a valuable consideration
made in the ordinary course of trade or usual conduct of the seller's
business to the purchaser for consummation or use.
(f) "Sell at wholesale", "sale at wholesale", and "wholesale sales"
shall mean and include any transfer of title to cigarettes for a valuable
consideration made in the ordinary course of trade or usual conduct of
a distributor's business.
(g) "Basic cost of cigarettes" shall mean the invoice cost of
cigarettes to the retailer or distributor, as the case may be, or the
replacement cost of cigarettes to the retailer or distributor, as the case
may be, within thirty (30) days prior to the date of sale, in the quantity
last purchased, whichever is the lower, less all trade discounts and
customary discounts for cash, plus the cost at full face value of any
stamps which may be required by IC 6-7-1, if not included by the
manufacturer in his selling price to the distributor.
(h) "Department" shall mean the alcohol and tobacco commission
or its duly authorized assistants and employees. and any other board,
commission, agency, or other entity of the state of Indiana which may
be designated by the governor to administer and enforce the provisions
of this chapter; and the governor is hereby vested with power and
authority to designate and to transfer to another department, board,
commission, agency, or other entity of the state of Indiana the
administration and enforcement of the provisions of this chapter.
(i) "Cost to the retailer" shall mean the basic cost of cigarettes to the
retailer, plus the cost of doing business by the retailer as evidenced by
the standards and methods of accounting regularly employed by him in
his allocation of overhead costs and expenses paid or incurred and must
include without limitation labor (including salaries of executives and
officers), rent, depreciation, selling costs, maintenance of equipment,
delivery costs, all types of licenses, taxes, insurance, and advertising;
however, any retailer who, in connection with the retailer's purchase,
receives not only the discounts ordinarily allowed upon purchases by
a retailer, but also, in whole or in part, discounts ordinarily allowed on
purchases by a distributor shall, in determining costs to the retailer
pursuant to this section, add the cost to the distributor, as defined in
paragraph (j), to the basic cost of cigarettes to said retailer as well as
the cost of doing business by the retailer. In the absence of proof of a
lesser or higher cost of doing business by the retailer making the sale,
the cost of doing business by the retailer shall be presumed to be eight
percent (8%) of the basic cost of cigarettes to the retailer. In the
absence of proof of a lesser or higher cost of doing business, the cost
of doing business by the retailer, who in connection with the retailer's
purchase receives not only the discounts ordinarily allowed upon
purchases by a retailer, but also, in whole or in part, the discounts
ordinarily allowed upon purchases by a distributor, shall be presumed
to be eight percent (8%) of the sum of the basic cost of cigarettes plus
the cost of doing business by the distributor.
(j) "Cost to the distributor" shall mean the basic cost of cigarettes to
the distributor, plus the cost of doing business by the distributor as
evidenced by the standards and methods of accounting regularly
employed by him in his allocation of overhead costs and expenses, paid
or incurred, and must include without limitation labor costs (including
salaries of executives and officers), rent, depreciation, selling costs,
maintenance of equipment, delivery costs, all types of licenses, taxes,
insurance, and advertising. In the absence of proof of a lesser or higher
cost of doing business by the distributor making the sale, the cost of
doing business by the wholesaler shall be presumed to be four percent
(4%) of the basic cost of cigarettes to the distributor, plus cartage to the
retail outlet, if performed or paid for by the distributor, which cartage
cost, in the absence of proof of a lesser or higher cost, shall be deemed
to be one-half of one percent (0.5%) of the basic cost of cigarettes to
the distributor.
(k) "Registration certificate" refers to the registration
certificate issued to cigarette distributors by the department of
state revenue under IC 6-7-1-16.
SECTION 13. IC 24-3-2-3 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 3. (a) It is a Class C
Class A infraction for a retailer or distributor, with intent to injure
competitors or destroy or substantially lessen competition, to offer to
sell or sell at retail or wholesale cigarettes at less than the cost to him.
The registration certificate held by such a distributor under IC 6-7-1
may be revoked by the department for the balance of the term thereof.
(b) Evidence of offering to sell or sale of cigarettes by any retailer
or distributor at less than the cost to him is prima facie evidence of
intent to injure competitors and to destroy or substantially lessen
competition.
(c) Notwithstanding IC 34-28-5-5(c), a judgment for a violation
of this section shall be deposited in the enforcement and
administration fund established under IC 7.1-4-10-1.
SECTION 14. IC 24-3-2-4.7 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2003]: Sec. 4.7. (a) A retailer shall produce an invoice or other
documentary evidence proving that the retailer obtained cigarettes
or a tobacco product (as defined in IC 6-7-2-5) from a distributor
that holds a valid registration certificate.
(b) Each day a retailer fails to produce an invoice or other
evidence under subsection (a) constitutes a separate violation of
this section.
(c) This subsection applies in addition to or instead of any other
civil or criminal penalty. The department or the department of
state revenue may impose on a retailer that violates subsection (a)
a civil penalty that does not exceed the greater of:
(1) five hundred percent (500%) of the retail value of the
cigarettes described in subsection (a); or
(2) five thousand dollars ($5,000);
for each violation.
(d) In addition to any other penalty described in this section, the
department or the department of state revenue may seize the
cigarettes or other tobacco products for which the retailer is
unable to produce the invoice or documentary evidence described
in subsection (a). The seized cigarettes or other tobacco products
shall be forfeited to the state and destroyed.
(e) Civil penalties collected under this chapter shall be deposited
as follows:
(1) Seventy percent (70%) to the enforcement and
administration fund established under IC 7.1-4-10.
(2) Thirty percent (30%) to the state general fund for the use
of the department of state revenue.
SECTION 15. IC 24-3-3-13, AS ADDED BY P.L.223-1999,
SECTION 1, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]: Sec. 13. (a) Subsection (b) applies unless and until
all or any part of subsection (b) is held to be unconstitutional or
otherwise unenforceable. If all or any part of subsection (b) or the
application of all or any part of subsection (b) to a person, an
entity, or a circumstance is held to be unconstitutional or invalid
by a court, the unconstitutionality or invalidity does not affect
other provisions of this chapter, and subsection (c) controls.
Subsection (c) applies unless and until all or any part of subsection
(c) is held to be unconstitutional or otherwise unenforceable. If all
or any part of subsection (c) or the application of all or any part of
subsection (c) to a person, an entity, or a circumstance is held to be
unconstitutional or invalid by a court, the unconstitutionality or
invalidity does not affect other provisions of this chapter, and
subsection (d) controls.
(b) A tobacco product manufacturer that places funds into
escrow under section 12(2) of this chapter shall receive the interest
or other appreciation on such funds as earned. The funds shall be
released from escrow only under the following circumstances:
(1) To pay a judgment or settlement on any released claim
brought against the tobacco product manufacturer by the
state or any releasing party located or residing in Indiana.
Funds shall be released from escrow under this subdivision:
(A) in the order in which they were placed into escrow;
and
(B) only to the extent and at the time necessary to make
payments required under such a judgment or settlement.
(2) To the extent that a tobacco product manufacturer
establishes that the amount the tobacco product manufacturer
is required to place in escrow on account of units sold in
Indiana in a particular year exceeds the master settlement
agreement payments the tobacco product manufacturer
would have been required to make on account of units sold in
Indiana if the tobacco product manufacturer were a
participating manufacturer, as determined under section IX(i)
of the master settlement agreement and after final
determination of all adjustments, the excess payments shall be
released from escrow and shall revert to the tobacco product
manufacturer.
(3) To the extent not released from escrow under subdivision
(1) or (2), funds shall be released from escrow and revert back
to the tobacco product manufacturer twenty-five (25) years
after the date on which the funds were placed into escrow.
(c) This subsection applies only if subsection (b) is held to be
unconstitutional or otherwise unenforceable. A tobacco product
manufacturer that places funds into escrow under section 12(2) of
this chapter shall receive the interest or other appreciation on the
funds as earned. The funds shall be released from escrow only
under the following circumstances:
(1) To pay a judgment or settlement on any released claim
brought against the tobacco product manufacturer by the
state or any releasing party located or residing in Indiana.
Funds shall be released from escrow under this subdivision:
(A) in the order in which they were placed into escrow;
and
(B) only to the extent and at the time necessary to make
payments required under such a judgment or settlement.
(2) To the extent not released from escrow under subdivision
(1), funds shall be released from escrow and revert back to the
tobacco product manufacturer twenty-five (25) years after the
date on which the funds were placed into escrow.
(d) This subsection applies only if subsections (b) and (c) are
held to be unconstitutional or otherwise unenforceable. A tobacco
product manufacturer that places funds into escrow under section 12(2)
of this chapter shall receive the interest or other appreciation on such
funds as earned. Such funds themselves shall be released from escrow
only under the following circumstances:
(1) To pay a judgment or settlement on any released claim
brought against such tobacco product manufacturer by the state
or any releasing party located or residing in Indiana. Funds shall
be released from escrow under this subdivision:
(A) in the order in which they were placed into escrow; and
(B) only to the extent and at the time necessary to make
payments required under such a judgment or settlement.
(2) To the extent that a tobacco product manufacturer establishes
that the amount it was required to place into escrow in a particular
year was greater than the state's allocable share of the total
payments that the manufacturer would have been required to
make in that year under the Master Settlement Agreement (as
determined pursuant to section IX(i)(2) of the Master Settlement
Agreement, and before any of the adjustments or offsets described
in section IX(i)(3) of that Agreement other than the Inflation
Adjustment) had it been a participating manufacturer, the excess
shall be released from escrow and revert back to the tobacco
product manufacturer.
(3) To the extent not released from escrow under subdivision (1)
or (2), funds shall be released from escrow and revert back to
such tobacco product manufacturer twenty-five (25) years after
the date on which the funds were placed into escrow.
SECTION 16. IC 24-3-5.4 IS ADDED TO THE INDIANA CODE
AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]:
Chapter 5.4. Master Settlement Agreement Protection Act
Sec. 1. As used in this chapter, "brand family" means cigarettes
that are:
(1) sold under the same trademark; and
(2) differentiated from one another by means of modifiers
such as menthol, lights, kings, or 100s.
The term includes the use of a brand name, trademark, logo,
symbol, motto, selling message, recognizable pattern of colors, or
other indicia of product identification that is identical or similar to
or identifiable with a previously known brand of cigarettes.
Sec. 2. As used in this chapter, "cigarette" has the meaning set
forth in IC 24-3-3-5.
Sec. 3. As used in this chapter, "commission" means the alcohol
and tobacco commission created by IC 7.1-2-1-1.
Sec. 4. As used in this chapter, "department" means the
department of state revenue.
Sec. 5. As used in this chapter, "distributor" means a person
that:
(1) purchases cigarettes on which the tax under IC 6-7-1 is not
paid; and
(2) stores, sells, or otherwise disposes of the cigarettes.
Sec. 6. As used in this chapter, "master settlement agreement"
has the meaning set forth in IC 24-3-3-6.
Sec. 7. As used in this chapter, "nonparticipating
manufacturer" means a tobacco product manufacturer that is not
a participating manufacturer.
Sec. 8. As used in this chapter, "participating manufacturer"
has the meaning set forth in IC 24-3-3-12(1).
Sec. 9. As used in this chapter, "qualified escrow fund" has the
meaning set forth in IC 24-3-3-7.
Sec. 10. As used in this chapter, "stamping agent" means a
person that may affix a stamp to a package of cigarettes under
IC 6-7-1-15.
Sec. 11. As used in this chapter, "tobacco product
manufacturer" has the meaning set forth in IC 24-3-3-10.
Sec. 12. As used in this chapter, "units sold" has the meaning set
forth in IC 24-3-3-11.
Sec. 13. (a) Not later than April 30 of each year, a tobacco
product manufacturer whose cigarettes are sold in Indiana,
whether directly or through a distributor, retailer, or similar
intermediary, shall certify to the department and the attorney
general that, as of the date of the certification, the tobacco product
manufacturer is:
(1) a participating manufacturer; or
(2) in full compliance with IC 24-3-3.
The department shall prescribe the form of the certification.
(b) A participating manufacturer shall include in a certification
under subsection (a) a list of the participating manufacturer's
brand families. The participating manufacturer shall update the
list by filing a supplemental certification with the department and
the attorney general not less than thirty (30) days before the
participating manufacturer adds a brand family or otherwise
modifies the list of brand families.
(c) A nonparticipating manufacturer shall include in a
certification under subsection (a) a list of the nonparticipating
manufacturer's brand families, including the following:
(1) A separate listing of each brand family that was sold in
Indiana during the calendar year before the year in which the
certification is filed.
(2) A separate listing of the number of units sold for each
brand family that was sold in Indiana during the calendar
year before the year in which the certification is filed.
(3) An indication of any brand family that was sold in Indiana
during the calendar year before the year in which the
certification is filed and that is not sold in Indiana as of the
date of the certification.
(4) The name and address of any other manufacturer of a
brand family that was sold in Indiana during the calendar
year before the year in which the certification is filed.
(d) A nonparticipating manufacturer shall file a supplemental
certification with the attorney general not less than thirty (30) days
before the nonparticipating manufacturer adds to or otherwise
modifies its list of brand families.
(e) A nonparticipating manufacturer shall certify the following
in a certification under subsection (a):
(1) The nonparticipating manufacturer:
(A) is registered to do business in Indiana; or
(B) has appointed an agent for service of process and
provided notice under section 16 of this chapter.
(2) The nonparticipating manufacturer has:
(A) established and continues to maintain a qualified
escrow fund; and
(B) executed a qualified escrow agreement that:
(i) the attorney general has approved; and
(ii) governs the qualified escrow fund.
(3) The nonparticipating manufacturer is in full compliance
with:
(A) this section; and
(B) IC 24-3-3.
(4) The name, address, and telephone number of the financial
institution that holds the nonparticipating manufacturer's
qualified escrow fund.
(5) The account number and any subaccount numbers of the
nonparticipating manufacturer's qualified escrow fund.
(6) The amounts and dates of deposits that the
nonparticipating manufacturer placed in the qualified escrow
fund for cigarettes sold in Indiana during the calendar year
before the year in which the certification is filed, including
any verification required by the attorney general.
(7) The amounts and dates of withdrawals or transfers of
funds that the nonparticipating manufacturer made from a
qualified escrow fund into which the nonparticipating
manufacturer made or makes escrow payments under
IC 24-3-3.
(f) A tobacco product manufacturer shall not include a brand
family in the tobacco product manufacturer's certification under
subsection (a) unless:
(1) in the case of a participating manufacturer, the
participating manufacturer affirms that the brand family is
considered the participating manufacturer's cigarettes for
purposes of calculating the participating manufacturer's
payments under the master settlement agreement for the year
in which the certification is filed in the volume and shares
determined under the master settlement agreement; or
not registered to do business in Indiana shall, as a condition
precedent to having the foreign nonparticipating manufacturer's
brand families listed in a directory under section 14 of this chapter,
appoint and engage without interruption the services of an agent
in Indiana to act as the foreign nonparticipating manufacturer's
agent for the service of process. Service on an agent under this
section constitutes legal and valid service of process on the foreign
nonparticipating manufacturer that appointed and engaged the
services of the agent. The foreign nonparticipating manufacturer
shall provide the following information to the department and the
attorney general:
(1) The name, address, and telephone number of the agent.
(2) Proof of the appointment of the agent.
(3) The availability of the agent.
(4) Any other information required by the department or the
attorney general.
(b) A foreign nonparticipating manufacturer shall provide
notice to the department and the attorney general not less than
thirty (30) days before the foreign nonparticipating manufacturer
terminates the authority of an agent appointed under this section.
The foreign nonparticipating manufacturer shall provide proof to
the satisfaction of the attorney general of the appointment of a new
agent not less than five (5) days before the foreign nonparticipating
manufacturer terminates an existing agency appointment.
(c) If an agent terminates an agency appointment, the foreign
nonparticipating manufacturer shall:
(1) notify the department and the attorney general of the
termination not more than five (5) days after the termination;
and
(2) provide proof to the satisfaction of the attorney general of
the appointment of a new agent.
(d) A foreign nonparticipating manufacturer that:
(1) sells products in Indiana; and
(2) has not appointed an agent under this section;
is considered to have appointed the secretary of state as the foreign
nonparticipating manufacturer's agent. The appointment of the
secretary of state under this subsection as the foreign
nonparticipating manufacturer's agent does not satisfy the
condition precedent to having the foreign nonparticipating
manufacturer's brand families listed in a directory under section
14 of this chapter.
Sec. 17. (a) This section applies after July 31, 2003.
be imported;
cigarettes that the person knows or should know are intended for
distribution or sale in Indiana in violation of section 15 of this
chapter.
(b) A person who violates this section commits a Class C
misdemeanor.
Sec. 25. A person who violates section 15 of this chapter engages
in an unfair and deceptive business practice.
Sec. 26. A determination by the attorney general to not list in or
to remove from a directory under section 14 of this chapter a
brand family or a tobacco product manufacturer is subject to
review only by the Marion County circuit court.
Sec. 27. The department shall not issue a registration certificate
under IC 6-7-1-16(a) to a distributor unless the distributor certifies
in writing that the distributor will comply with this chapter.
Sec. 28. In an action brought by the state to enforce this chapter,
the state may recover:
(1) the costs of investigation;
(2) expert witness fees;
(3) the costs of the action; and
(4) attorney's fees.
Sec. 29. If a court determines that a person has violated this
chapter, the court shall order any profits, gain, gross receipts, or
other benefit from the violation to be disgorged and paid to the
treasurer of state for deposit in the Indiana tobacco master
settlement agreement fund under IC 4-12-1-14.3.
Sec. 30. All:
(1) civil penalties imposed under; and
(2) judgments for violations of;
this chapter shall be deposited in the enforcement and
administration fund established under IC 7.1-4-10-1.
SECTION 17. IC 35-46-1-10, AS AMENDED BY P.L.204-2001,
SECTION 65, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]: Sec. 10. (a) A person who knowingly:
(1) sells or distributes tobacco to a person less than eighteen (18)
years of age; or
(2) purchases tobacco for delivery to another person who is less
than eighteen (18) years of age;
commits a Class C infraction. For a sale to take place under this
section, the buyer must pay the seller for the tobacco product.
(b) It is not a defense that the person to whom the tobacco was sold
or distributed did not smoke, chew, or otherwise consume the tobacco.
this section must be imposed as follows:
(1) If the retail establishment at that specific business location has
not been issued a citation or summons for a violation of this
section in the previous ninety (90) days, a civil penalty of fifty
dollars ($50).
(2) If the retail establishment at that specific business location has
had one (1) citation or summons issued for a violation of this
section in the previous ninety (90) days, a civil penalty of one
hundred dollars ($100).
(3) If the retail establishment at that specific business location has
had two (2) citations or summonses issued for a violation of this
section in the previous ninety (90) days, a civil penalty of two
hundred fifty dollars ($250).
(4) If the retail establishment at that specific business location has
had three (3) or more citations or summonses issued for a
violation of this section in the previous ninety (90) days, a civil
penalty of five hundred dollars ($500).
A retail establishment may not be issued a citation or summons for a
violation of this section more than once every twenty-four (24) hours
for each specific business location.
(b) It is not a defense that the person to whom the tobacco was sold
or distributed did not smoke, chew, or otherwise consume the tobacco.
(c) The following defenses are available to a retail establishment
accused of selling or distributing tobacco to a person who is less than
eighteen (18) years of age:
(1) The buyer or recipient produced a driver's license bearing the
purchaser's or recipient's photograph showing that the purchaser
or recipient was of legal age to make the purchase.
(2) The buyer or recipient produced a photographic identification
card issued under IC 9-24-16-1 or a similar card issued under the
laws of another state or the federal government showing that the
purchaser or recipient was of legal age to make the purchase.
(3) The appearance of the purchaser or recipient was such that an
ordinary prudent person would believe that the purchaser or
recipient was not less than the age that complies with regulations
promulgated by the federal Food and Drug Administration.
(d) It is a defense that the accused retail establishment sold or
delivered the tobacco to a person who acted in the ordinary course of
employment or a business concerning tobacco:
(1) agriculture;
(2) processing;
(3) transporting;
after a citation or summons has been issued, a civil judgment for an
infraction committed under this section must include a civil penalty of
one hundred dollars ($100) for each day that the advertisement was in
violation of this section.
(e) Notwithstanding IC 34-28-5-5(c), civil penalties collected under
this section must be deposited in the Richard D. Doyle youth tobacco
education and enforcement fund (IC 7.1-6-2-6).
SECTION 20. IC 35-46-1-11.5, AS AMENDED BY P.L.1-2001,
SECTION 40, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]: Sec. 11.5. (a) Except for a coin machine that is placed
in or directly adjacent to an entranceway or an exit, or placed in a
hallway, a restroom, or another common area that is accessible to
persons who are less than eighteen (18) years of age, this section does
not apply to a coin machine that is located in the following:
(1) That part of a licensed premises (as defined in IC 7.1-1-3-20)
where entry is limited to persons who are at least eighteen (18)
years of age.
(2) Private industrial or office locations that are customarily
accessible only to persons who are at least eighteen (18) years of
age.
(3) Private clubs if the membership is limited to persons who are
at least eighteen (18) years of age.
(4) Riverboats where entry is limited to persons who are at least
twenty-one (21) years of age and on which lawful gambling is
authorized.
(b) As used in this section, "coin machine" has the meaning set forth
in IC 35-43-5-1.
(c) Except as provided in subsection (a), an owner of a retail
establishment may not:
(1) distribute or sell tobacco by use of a coin machine; or
(2) install or maintain a coin machine that is intended to be used
for the sale or distribution of tobacco.
(d) An owner of a retail establishment who violates this section
commits a Class C infraction. A citation or summons issued under this
section must provide notice that the coin machine must be moved
within two (2) business days. Notwithstanding IC 34-28-5-4(c), a civil
judgment for an infraction committed under this section must be
imposed as follows:
(1) If the owner of the retail establishment has not been issued a
citation or summons for a violation of this section in the previous
ninety (90) days, a civil penalty of fifty dollars ($50).
(2) If the owner of the retail establishment has had one (1) citation
or summons issued for a violation of this section in the previous
ninety (90) days, a civil penalty of two hundred fifty dollars
($250).
(3) If the owner of the retail establishment has had two (2)
citations or summonses issued for a violation of this section in the
previous ninety (90) days for the same machine, the coin machine
shall be removed or impounded by a law enforcement officer
having jurisdiction where the violation occurs.
An owner of a retail establishment may not be issued a citation or
summons for a violation of this section more than once every two (2)
business days for each business location.
(e) Notwithstanding IC 34-28-5-5(c), civil penalties collected under
this section must be deposited in the Richard D. Doyle youth tobacco
education and enforcement fund established under IC 7.1-6-2-6.
SECTION 21. IC 35-46-1-11.7, AS AMENDED BY P.L.1-2001,
SECTION 41, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2003]: Sec. 11.7. (a) A retail establishment that has as its
primary purpose the sale of tobacco products may not allow an
individual who is less than eighteen (18) years of age to enter the retail
establishment.
(b) An individual who is less than eighteen (18) years of age may
not enter a retail establishment described in subsection (a).
(c) A retail establishment described in subsection (a) must
conspicuously post on all entrances to the retail establishment a sign in
boldface type that states "NOTICE: It is unlawful for a person less than
18 years old to enter this store.".
(d) A person who violates this section commits a Class C infraction.
Notwithstanding IC 34-28-5-4(c), a civil judgment for an infraction
committed under this section must be imposed as follows:
(1) If the person has not been cited for a violation of this section
in the previous ninety (90) days, a civil penalty of fifty dollars
($50).
(2) If the person has had one (1) violation in the previous ninety
(90) days, a civil penalty of one hundred dollars ($100).
(3) If the person has had two (2) violations in the previous ninety
(90) days, a civil penalty of two hundred fifty dollars ($250).
(4) If the person has had three (3) or more violations in the
previous ninety (90) days, a civil penalty of five hundred dollars
($500).
A person may not be cited more than once every twenty-four (24)
hours.
(e) Notwithstanding IC 34-28-5-5(c), civil penalties collected under
this section must be deposited in the Richard D. Doyle youth tobacco
education and enforcement fund established under IC 7.1-6-2-6.
SECTION 22. [EFFECTIVE JULY 1, 2003] (a) Notwithstanding
IC 24-3-5.4-13(a), as added by this act, a tobacco manufacturer
shall file a certification under IC 24-3-5.4-13, as added by this act,
not later than August 15, 2003.
(b) Notwithstanding IC 24-3-5.4-14(a), as added by this act, the
attorney general shall publish a directory under IC 24-3-5.4-14, as
added by this act, not later than October 1, 2003.
(c) This SECTION expires December 31, 2003.