February 11, 2005
SENATE BILL No. 379
_____
DIGEST OF SB 379
(Updated February 10, 2005 1:26 pm - DI 110)
Citations Affected: IC 24-3; IC 34-24.
Synopsis: Delivery sales of tobacco products. Prohibits the shipping
of tobacco products other than cigars to an Indiana resident who is not
a tobacco products distributor. Provides that the prohibition does not
apply to cigarette manufacturers that meet certain requirements.
Repeals statutes governing delivery sales of cigarettes.
Effective: July 1, 2005.
Weatherwax
January 11, 2005, read first time and referred to Committee on Commerce and
Transportation.
February 10, 2005, amended, reported favorably _ Do Pass.
February 11, 2005
First Regular Session 114th General Assembly (2005)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
Constitution) is being amended, the text of the existing provision will appear in this style type,
additions will appear in
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Additions: Whenever a new statutory provision is being enacted (or a new constitutional
provision adopted), the text of the new provision will appear in
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NEW will appear in that style type in the introductory clause of each SECTION that adds
a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in
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this style type reconciles conflicts
between statutes enacted by the 2004 Regular Session of the General Assembly.
SENATE BILL No. 379
A BILL FOR AN ACT to amend the Indiana Code concerning trade
regulation.
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 24-3-5-0.1; (05)SB0379.1.1. -->
SECTION 1. IC 24-3-5-0.1 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2005]: Sec. 0.1. As used in this chapter, "cigarette" has the
meaning set forth in IC 6-7-1-2.
SOURCE: IC 24-3-5-0.2; (05)SB0379.1.2. -->
SECTION 2. IC 24-3-5-0.2 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2005]: Sec. 0.2. As used in this chapter, "cigarette
manufacturer" means a person or an entity that does the
following:
(1) Manufactures cigarettes.
(2) Does one (1) of the following:
(A) Participates in the Master Settlement Agreement (as
defined in IC 24-3-3-6) and performs the person's or
entity's financial obligations under the Master Settlement
Agreement.
(B) Places the applicable amount into a qualified escrow
fund (as defined in IC 24-3-3-7).
(3) Pays all applicable taxes under IC 6-7-1.
SOURCE: IC 24-3-5-0.3; (05)SB0379.1.3. -->
SECTION 3. IC 24-3-5-0.3 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2005]: Sec. 0.3. As used in this chapter, "commission" refers to
the alcohol and tobacco commission created by IC 7.1-2-1-1.
SOURCE: IC 24-3-5-1; (05)SB0379.1.4. -->
SECTION 4. IC 24-3-5-1 IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2005]: Sec. 1. As used in this chapter, "delivery
sale" means a transaction for the purchase of tobacco products in which
an offer to purchase tobacco products is made:
(1) electronically using a computer network (as defined in
IC 35-43-2-3);
(2) by mail; or
(3) by telephone;
and acceptance of the offer results in delivery of the tobacco products
to a named individual or entity at a designated address.
SOURCE: IC 24-3-5-1.5; (05)SB0379.1.5. -->
SECTION 5. IC 24-3-5-1.5 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2005]: Sec. 1.5. As used in this chapter, "distributor" includes
the following:
(1) A distributor as defined in IC 6-7-1-6.
(2) A distributor as defined in IC 6-7-2-2.
SOURCE: IC 24-3-5-2; (05)SB0379.1.6. -->
SECTION 6. IC 24-3-5-2 IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2005]: Sec. 2. As used in this chapter,
"merchant" means a person or an entity that engages in the selling of
tobacco products by delivery sale. The term does not include a
cigarette manufacturer.
SOURCE: IC 24-3-5-3; (05)SB0379.1.7. -->
SECTION 7. IC 24-3-5-3 IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2005]: Sec. 3. As used in this chapter, "tobacco
product" has the meaning set forth in IC 7.1-6-1-3. However, the term
does not include a cigar.
SOURCE: IC 24-3-5-4; (05)SB0379.1.8. -->
SECTION 8. IC 24-3-5-4 IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2005]: Sec. 4.
(a) A
merchant cigarette
manufacturer may not mail or ship
tobacco products cigarettes as
part of a delivery sale unless, before mailing or shipping the
tobacco
products, cigarettes, the
merchant: cigarette manufacturer:
(1) obtains from the prospective customer a written statement
signed by the prospective customer under penalty of perjury:
(A) providing the prospective customer's address and date of
birth;
(B) advising the prospective customer that:
(i) signing another person's name to the statement required
under this subdivision may subject the person to a civil
monetary penalty of not more than one thousand dollars
($1,000); and
(ii) purchasing tobacco products cigarettes by a person less
than eighteen (18) years of age is a Class C infraction under
IC 35-46-1-10.5;
(C) confirming that the tobacco product cigarette order was
placed by the prospective customer;
(D) providing a warning under 15 U.S.C. 1333(a)(1); and
(E) stating the sale of tobacco products cigarettes by delivery
sale is a taxable event for purposes of IC 6-7-1; and IC 6-7-2;
(2) makes a good faith effort to verify the information in the
written statement obtained under subdivision (1) by using a
federal or commercially available data base; and
(3) receives payment for the delivery sale by a credit or debit card
issued in the name of the prospective purchaser.
SOURCE: IC 24-3-5-4.5; (05)SB0379.1.9. -->
SECTION 9. IC 24-3-5-4.5 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2005]: Sec. 4.5. (a) A merchant may not mail or ship tobacco
products as part of a delivery sale to an Indiana resident or retailer
(as defined in IC 24-3-2-2(d)) that is not a distributor.
(b) If the commission determines that a merchant has violated
subsection (a):
(1) a distributor may not accept a shipment of tobacco
products from the merchant for a period, not to exceed one (1)
year, determined by the commission; and
(2) the commission may impose a civil penalty, not to exceed
five thousand dollars ($5,000), on the merchant for each
violation of subsection (a), as determined by the commission.
SOURCE: IC 24-3-5-5; (05)SB0379.1.10. -->
SECTION 10. IC 24-3-5-5 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 5. (a) A
merchant
cigarette manufacturer who mails or ships
tobacco products
cigarettes as part of a delivery sale shall:
(1) use a mailing or shipping service that requires the customer or
a person at least eighteen (18) years of age who is designated by
the customer to:
(A) sign to accept delivery of the
tobacco products; cigarettes;
and
(B) present a valid operator's license issued under IC 9-24-3 or
an identification card issued under IC 9-24-16 if the customer
or the customer's designee, in the opinion of the delivery agent
or employee of the mailing or shipping service, appears to be
less than twenty-seven (27) years of age;
(2) provide to the mailing or shipping service used under
subdivision (1) proof of compliance with section 6(a) of this
chapter; and
(3) include the following statement in bold type or capital letters
on an invoice or shipping document:
INDIANA LAW PROHIBITS THE MAILING OR SHIPPING
OF
TOBACCO PRODUCTS CIGARETTES TO A PERSON
LESS THAN EIGHTEEN (18) YEARS OF AGE AND
REQUIRES PAYMENT OF ALL APPLICABLE TAXES.
(b) The alcohol and tobacco commission may impose a civil penalty
of not more than one thousand dollars ($1,000) if a mailing or shipping
service:
(1) delivers
tobacco products cigarettes as part of a delivery sale
without first receiving proof from the
merchant cigarette
manufacturer of compliance with section 6(a) of this chapter; or
(2) fails to obtain a signature and proof of identification of the
customer or the customer's designee under subsection (a)(1).
The alcohol and tobacco commission shall deposit amounts collected
under this subsection into the youth tobacco education and enforcement
fund established by IC 7.1-6-2-6.
(c) The following apply to a
merchant cigarette manufacturer that
mails or ships
tobacco products cigarettes as part of a delivery sale
without using a third party service as required by subsection (a)(1):
(1) The
merchant cigarette manufacturer shall require the
customer or a person at least eighteen (18) years of age who is
designated by the customer to:
(A) sign to accept delivery of the
tobacco products; cigarettes;
and
(B) present a valid operator's license issued under IC 9-24-3 or
identification card issued under IC 9-24-16 if the customer or
the customer's designee, in the opinion of the
merchant
cigarette manufacturer or the
merchant's cigarette
manufacturer's employee making the delivery, appears to be
less than twenty-seven (27) years of age.
(2) The alcohol and tobacco commission may impose a civil
penalty of not more than one thousand dollars ($1,000) if the
merchant: cigarette manufacturer:
(A) delivers the
tobacco products cigarettes without first
complying with section 6(a) of this chapter; or
(B) fails to obtain a signature and proof of identification of the
customer or the customer's designee under subdivision (1).
The alcohol and tobacco commission shall deposit amounts
collected under this subdivision into the youth tobacco education
and enforcement fund established by IC 7.1-6-2-6.
SOURCE: IC 24-3-5-6; (05)SB0379.1.11. -->
SECTION 11. IC 24-3-5-6 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 6. (a) A merchant
cigarette manufacturer shall, before mailing or shipping tobacco
products cigarettes as part of a delivery sale, provide the department
of state revenue with a written statement containing the merchant's
cigarette manufacturer's name, address, principal place of business,
and each place of business in Indiana.
(b) A merchant cigarette manufacturer who mails or ships tobacco
products cigarettes as part of a delivery sale shall, not later than the
tenth day of the calendar month immediately following the month in
which the delivery sale occurred, file with the department of state
revenue a copy of the invoice for each delivery sale to a customer in
Indiana. The invoice must include the following information:
(1) The name and address of the customer to whom the tobacco
products cigarettes were delivered.
(2) The brand name of the tobacco products cigarettes that were
delivered to the customer.
(3) The quantity of tobacco products cigarettes that were
delivered to the customer.
(c) A merchant cigarette manufacturer who complies with 15
U.S.C. 376 for the delivery sale of cigarettes is considered to satisfy the
requirements of this section.
SOURCE: IC 24-3-5-7; (05)SB0379.1.12. -->
SECTION 12. IC 24-3-5-7 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 7. (a) A
merchant
cigarette manufacturer who delivers
tobacco products cigarettes to
a customer as part of a delivery sale shall:
(1) collect and pay all applicable taxes under IC 6-7-1;
and
IC 6-7-2; or
(2) place a legible and conspicuous notice on the outside of the
container in which the
tobacco products cigarettes are shipped.
The notice shall be placed on the same side of the container as the
address to which the container is shipped and must state the
following:
"If these
tobacco products cigarettes have been shipped to you
from a
merchant cigarette manufacturer located outside the
state in which you reside, the
merchant cigarette
manufacturer has under federal law reported information
about the sale of these
tobacco products, cigarettes, including
your name and address, to your state tax collection agency.
You are legally responsible for all applicable unpaid state
taxes on these tobacco products. cigarettes.".
(b) For a violation of this section the alcohol and tobacco
commission may impose, in addition to any other remedies, civil
penalties as follows:
(1) If the person has one (1) judgment for a violation of this
section committed during a five (5) year period, a civil penalty of
at least one thousand dollars ($1,000) but not more than two
thousand dollars ($2,000).
(2) If the person has two (2) unrelated judgments for violations of
this section committed during a five (5) year period, a civil
penalty of at least two thousand five hundred dollars ($2,500) but
not more than three thousand five hundred dollars ($3,500).
(3) If the person has three (3) unrelated judgments for violations
of this section committed during a five (5) year period, a civil
penalty of at least four thousand dollars ($4,000) but not more
than five thousand dollars ($5,000).
(4) If the person has four (4) unrelated judgments for violations
of this section committed during a five (5) year period, a civil
penalty of at least five thousand five hundred dollars ($5,500) but
not more than six thousand five hundred dollars ($6,500).
(5) If the person has at least five (5) unrelated judgments for
violations of this section committed during a five (5) year period,
a civil penalty of ten thousand dollars ($10,000).
SOURCE: IC 24-3-5-8; (05)SB0379.1.13. -->
SECTION 13. IC 24-3-5-8 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 8. The alcohol and
tobacco commission may impose a civil penalty of not more one
thousand dollars ($1,000) on a:
(1) customer who signs another person's name to a statement
required under section 4(1) section 4(a)(1) of this chapter; or
(2) merchant cigarette manufacturer who sells tobacco products
cigarettes by delivery sale to a person less than eighteen (18)
years of age.
The alcohol and tobacco commission shall deposit amounts collected
under this section into the youth tobacco education and enforcement
fund established by IC 7.1-6-2-6.
SOURCE: IC 34-24-1-1; (05)SB0379.1.14. -->
SECTION 14. IC 34-24-1-1 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 1. (a) The following
may be seized:
(1) All vehicles (as defined by IC 35-41-1), if they are used or are
intended for use by the person or persons in possession of them to
transport or in any manner to facilitate the transportation of the
following:
(A) A controlled substance for the purpose of committing,
attempting to commit, or conspiring to commit any of the
following:
(i) Dealing in or manufacturing cocaine, a narcotic drug, or
methamphetamine (IC 35-48-4-1).
(ii) Dealing in a schedule I, II, or III controlled substance
(IC 35-48-4-2).
(iii) Dealing in a schedule IV controlled substance
(IC 35-48-4-3).
(iv) Dealing in a schedule V controlled substance
(IC 35-48-4-4).
(v) Dealing in a counterfeit substance (IC 35-48-4-5).
(vi) Possession of cocaine, a narcotic drug, or
methamphetamine (IC 35-48-4-6).
(vii) Dealing in paraphernalia (IC 35-48-4-8.5).
(viii) Dealing in marijuana, hash oil, or hashish
(IC 35-48-4-10).
(B) Any stolen (IC 35-43-4-2) or converted property
(IC 35-43-4-3) if the retail or repurchase value of that property
is one hundred dollars ($100) or more.
(C) Any hazardous waste in violation of IC 13-30-6-6.
(D) A bomb (as defined in IC 35-41-1-4.3) or weapon of mass
destruction (as defined in IC 35-41-1-29.4) used to commit,
used in an attempt to commit, or used in a conspiracy to
commit an offense under IC 35-47 as part of or in furtherance
of an act of terrorism (as defined by IC 35-41-1-26.5).
(2) All money, negotiable instruments, securities, weapons,
communications devices, or any property used to commit, used in
an attempt to commit, or used in a conspiracy to commit an
offense under IC 35-47 as part of or in furtherance of an act of
terrorism or commonly used as consideration for a violation of
IC 35-48-4 (other than items subject to forfeiture under
IC 16-42-20-5 or IC 16-6-8.5-5.1 before its repeal):
(A) furnished or intended to be furnished by any person in
exchange for an act that is in violation of a criminal statute;
(B) used to facilitate any violation of a criminal statute; or
(C) traceable as proceeds of the violation of a criminal statute.
(3) Any portion of real or personal property purchased with
money that is traceable as a proceed of a violation of a criminal
statute.
(4) A vehicle that is used by a person to:
(A) commit, attempt to commit, or conspire to commit;
(B) facilitate the commission of; or
(C) escape from the commission of;
murder (IC 35-42-1-1), kidnapping (IC 35-42-3-2), criminal
confinement (IC 35-42-3-3), rape (IC 35-42-4-1), child molesting
(IC 35-42-4-3), or child exploitation (IC 35-42-4-4), or an offense
under IC 35-47 as part of or in furtherance of an act of terrorism.
(5) Real property owned by a person who uses it to commit any of
the following as a Class A felony, a Class B felony, or a Class C
felony:
(A) Dealing in or manufacturing cocaine, a narcotic drug, or
methamphetamine (IC 35-48-4-1).
(B) Dealing in a schedule I, II, or III controlled substance
(IC 35-48-4-2).
(C) Dealing in a schedule IV controlled substance
(IC 35-48-4-3).
(D) Dealing in marijuana, hash oil, or hashish (IC 35-48-4-10).
(6) Equipment and recordings used by a person to commit fraud
under IC 35-43-5-4(11).
(7) Recordings sold, rented, transported, or possessed by a person
in violation of IC 24-4-10.
(8) Property (as defined by IC 35-41-1-23) or an enterprise (as
defined by IC 35-45-6-1) that is the object of a corrupt business
influence violation (IC 35-45-6-2).
(9) Unlawful telecommunications devices (as defined in
IC 35-45-13-6) and plans, instructions, or publications used to
commit an offense under IC 35-45-13.
(10) Any equipment used or intended for use in preparing,
photographing, recording, videotaping, digitizing, printing,
copying, or disseminating matter in violation of IC 35-42-4-4.
(11) Destructive devices used, possessed, transported, or sold in
violation of IC 35-47.5.
(12) Cigarettes that are sold in violation of IC 24-3-5.2, cigarettes
that a person attempts to sell in violation of IC 24-3-5.2, and other
personal property owned and used by a person to facilitate a
violation of IC 24-3-5.2.
(13) (12) Tobacco products that are sold in violation of IC 24-3-5,
tobacco products that a person attempts to sell in violation of
IC 24-3-5, and other personal property owned and used by a
person to facilitate a violation of IC 24-3-5.
(b) A vehicle used by any person as a common or contract carrier in
the transaction of business as a common or contract carrier is not
subject to seizure under this section, unless it can be proven by a
preponderance of the evidence that the owner of the vehicle knowingly
permitted the vehicle to be used to engage in conduct that subjects it to
seizure under subsection (a).
(c) Equipment under subsection (a)(10) may not be seized unless it
can be proven by a preponderance of the evidence that the owner of the
equipment knowingly permitted the equipment to be used to engage in
conduct that subjects it to seizure under subsection (a)(10).
(d) Money, negotiable instruments, securities, weapons,
communications devices, or any property commonly used as
consideration for a violation of IC 35-48-4 found near or on a person
who is committing, attempting to commit, or conspiring to commit any
of the following offenses shall be admitted into evidence in an action
under this chapter as prima facie evidence that the money, negotiable
instrument, security, or other thing of value is property that has been
used or was to have been used to facilitate the violation of a criminal
statute or is the proceeds of the violation of a criminal statute:
(1) IC 35-48-4-1 (dealing in or manufacturing cocaine, a narcotic
drug, or methamphetamine).
(2) IC 35-48-4-2 (dealing in a schedule I, II, or III controlled
substance).
(3) IC 35-48-4-3 (dealing in a schedule IV controlled substance).
(4) IC 35-48-4-4 (dealing in a schedule V controlled substance)
as a Class B felony.
(5) IC 35-48-4-6 (possession of cocaine, a narcotic drug, or
methamphetamine) as a Class A felony, Class B felony, or Class
C felony.
(6) IC 35-48-4-10 (dealing in marijuana, hash oil, or hashish) as
a Class C felony.
SOURCE: IC 24-3-5.2; (05)SB0379.1.15. -->
SECTION 15. IC 24-3-5.2 IS REPEALED [EFFECTIVE JULY 1,
2005].