093_HB0276sam001

 










                                     LRB093 04546 MKM 15269 a

 1                     AMENDMENT TO HOUSE BILL 276

 2        AMENDMENT NO.     .  Amend House Bill  276  by  replacing
 3    everything after the enacting clause with the following:

 4        "Section  1.  Short  title.  This Act may be cited as the
 5    Tobacco Products Manufacturers'  Escrow  Enforcement  Act  of
 6    2003.

 7        Section 5.  Findings; purpose. The General Assembly finds
 8    that  violations of the Tobacco Product Manufacturers' Escrow
 9    Act threaten the integrity of the tobacco  Master  Settlement
10    Agreement,  the fiscal soundness of the State, and the public
11    health. The General Assembly finds that  enacting  procedural
12    enhancements   will  help  prevent  violations  and  aid  the
13    enforcement of the Tobacco Product Manufacturers' Escrow  Act
14    and  thereby  safeguard  the Master Settlement Agreement, the
15    fiscal soundness of the State, and  the  public  health.  The
16    provisions  of  this Act are not intended to and shall not be
17    interpreted  to  amend  the  Tobacco  Product  Manufacturers'
18    Escrow Act.

19        Section 10.  Definitions. As used in this Act:
20        "Brand family" means all styles of cigarettes sold  under
21    the  same  trade  mark and differentiated from one another by
 
                            -2-      LRB093 04546 MKM 15269 a
 1    means of additional modifiers or descriptors, including,  but
 2    not limited to, menthol, lights, kings, and 100s and includes
 3    any  brand name (alone or in conjunction with any other word)
 4    trademark, logo, symbol, motto, selling message, recognizable
 5    pattern  of  colors,  or  any  other   indicia   of   product
 6    identification identical or similar to, or identifiable with,
 7    a previously known brand of cigarettes.
 8        "Cigarette"  has  the  same  meaning in Section 10 of the
 9    Escrow Act.
10        "Director" means the Director of Revenue.
11        "Distributor" has the same meaning prescribed in  Section
12    1  of  the  Cigarette Tax Act, Section 1 of the Cigarette Use
13    Tax  Act,  and,  in  addition,   means   a   distributor   of
14    roll-your-own  tobacco in accordance with Section 10-5 of the
15    Tobacco Products Tax Act of 1995, as appropriate.
16        "Escrow Act" means  the  Tobacco  Product  Manufacturers'
17    Escrow Act.
18        "Non-participating   manufacturer"   means   any  Tobacco
19    Product   Manufacturer   that   is   not   a    participating
20    manufacturer.
21        "Participating  manufacturer"  has the meaning given that
22    term in Section II(jj) of the Master Settlement Agreement and
23    all amendments thereto.
24        "Qualified escrow fund" has the same meaning as that term
25    is defined in Section 10 of the Escrow Act.
26        "Tobacco product manufacturer" has the  same  meaning  as
27    that term is defined in Section 10 of the Escrow Act.
28        "Units sold" has the same meaning as that term is defined
29    in Section 10 of the Escrow Act.

30        Section 15.  Certifications; directory; tax stamps.
31        (a)  Every  tobacco product manufacturer whose cigarettes
32    are  sold  in  this  State  whether  directly  or  through  a
33    distributor,   retailer,   or   similar    intermediary    or
 
                            -3-      LRB093 04546 MKM 15269 a
 1    intermediaries shall execute and deliver on a form prescribed
 2    by  the  Attorney  General  a  certification  to the Attorney
 3    General, no later than the thirtieth day of April each  year,
 4    certifying  under  penalty of perjury that, as of the date of
 5    the certification, the tobacco product  manufacturer  either:
 6    (i)   is  a  participating  manufacturer  and  has  generally
 7    performed  its  financial  obligations   under   the   Master
 8    Settlement  Agreement; or (ii) is in full compliance with the
 9    Escrow Act, including all quarterly installment payments.
10             (1)  A participating manufacturer shall  include  in
11        its  certification  a  list  of  its  brand families. The
12        participating manufacturer shall update the list 30  days
13        prior  to  any  addition  to or modification of its brand
14        families  by  executing  and  delivering  a  supplemental
15        certification to the Attorney General.
16             (2)  A non-participating manufacturer shall  include
17        in  its certification a complete list of all of its brand
18        families:  (i)  separately  listing  brand  families   of
19        cigarettes  and  the  number of units sold for each brand
20        family that were sold in the State during  the  preceding
21        calendar  year;  (ii)  listing  all of its brand families
22        that have been sold in the State at any time  during  the
23        current  calendar  year; (iii) indicating by an asterisk,
24        any brand family sold in the State during  the  preceding
25        calendar  year  that is no longer being sold in the State
26        as of the date of the certification; and (iv) identifying
27        by name and address any other manufacturer of  the  brand
28        families    in   the   preceding   calendar   year.   The
29        non-participating manufacturer shall update the  list  30
30        days  prior  to  any  addition  to or modification of its
31        brand families by executing and delivering a supplemental
32        certification to the Attorney General.
33             (3)  In   the   case    of    a    non-participating
34        manufacturer, the certification shall further certify:
 
                            -4-      LRB093 04546 MKM 15269 a
 1                  (A)  that the non-participating manufacturer is
 2             registered  to  do  business  in  this  State or has
 3             appointed a resident agent for  service  of  process
 4             and provided notice thereof as required by item 4 of
 5             subsection (a) of this Section;
 6                  (B)  that  the  non-participating  manufacturer
 7             has  (i)  established  and  continues  to maintain a
 8             qualified escrow fund as that  term  is  defined  in
 9             Section  10  of  the Escrow Act, and (ii) executed a
10             qualified escrow agreement that  has  been  reviewed
11             and  approved  by  the  Attorney  General  and  that
12             governs the qualified escrow fund;
13                  (C)  that the non-participating manufacturer is
14             in  full  compliance  with  the  Escrow Act and this
15             Section, and any  regulations  promulgated  pursuant
16             thereto;
17                  (D)  the  name, address and telephone number of
18             the     financial     institution     where      the
19             non-participating  manufacturer  has established the
20             qualified escrow fund required pursuant  to  Section
21             15 of the Escrow Act and all regulations promulgated
22             thereto;
23                  (E)  the account number of the qualified escrow
24             fund and sub-account number for this State;
25                  (F)  the     amount    the    non-participating
26             manufacturer placed in the fund for cigarettes  sold
27             in  the  State  during  the preceding calendar year,
28             including the dates and amount of each deposit,  and
29             such  evidence  or  verification  as  may  be deemed
30             necessary by the Attorney  General  to  confirm  the
31             foregoing; and
32                  (G)  the amounts of and dates of any withdrawal
33             or   transfer   of   funds   the   non-participating
34             manufacturer  made at any time from the fund or from
 
                            -5-      LRB093 04546 MKM 15269 a
 1             any other qualified escrow fund into which  it  ever
 2             made  escrow  payments pursuant to Section 15 of the
 3             Escrow Act and all regulations promulgated thereto.
 4             (4)  A tobacco product manufacturer may not  include
 5        a  brand  family  in its certification unless: (i) in the
 6        case of a participating manufacturer,  the  participating
 7        manufacturer  affirms  that  the  brand  family  is to be
 8        deemed to be its cigarettes for purposes  of  calculating
 9        its  payments  under  the master settlement agreement for
10        the relevant year, in the volume  and  shares  determined
11        pursuant  to the master settlement agreement; and (ii) in
12        the  case  of  a  non-participating   manufacturer,   the
13        non-participating  manufacturer  affirms  that  the brand
14        family is to be deemed to be its cigarettes for  purposes
15        of Section 15 of the Escrow Act.
16             Nothing  in  this  Section  shall  be  construed  as
17        limiting  or  otherwise  affecting  the  State's right to
18        maintain that a brand family constitutes cigarettes of  a
19        different  tobacco  product  manufacturer for purposes of
20        calculating  payments   under   the   master   settlement
21        agreement  or  for  purposes  of Section 15 of the Escrow
22        Act.
23             (5)  The   tobacco   product   manufacturers   shall
24        maintain all invoices  and  documentation  of  sales  and
25        other  information  relied  upon  for certification for a
26        period of 5 years, unless otherwise required  by  law  to
27        maintain them for a greater period of time.
28        (b)  Not  later than 6 months after the effective date of
29    this  Act,  the  Attorney  General  shall  develop  and  make
30    available for public inspection, through  publishing  on  its
31    website,    a   directory   listing   all   tobacco   product
32    manufacturers  that  have  provided  current   and   accurate
33    certifications  conforming  to the requirements of subsection
34    (a) of Section 15 and all brand families that are  listed  in
 
                            -6-      LRB093 04546 MKM 15269 a
 1    the certifications, except for the following:
 2             (1)  The  Attorney  General  shall  not  include  or
 3        retain in the directory the name or brand families of any
 4        non-participating  manufacturer that fails to provide the
 5        required  certification  or   whose   certification   the
 6        Attorney  General  determines  is  not in compliance with
 7        subsections (a)(2) or (a)(3) of Section  15,  unless  the
 8        Attorney  General  has  determined that the violation has
 9        been cured to the satisfaction of the Attorney General.
10             (2)  Neither  a  tobacco  product  manufacturer  nor
11        brand  family  shall  be  included  or  retained  in  the
12        directory if the Attorney General concludes that: (i)  in
13        the  case  of a non-participating manufacturer all escrow
14        payments required pursuant to Section 15  of  the  Escrow
15        Act  for  any period for any brand family, whether or not
16        listed by the non-participating  manufacturer,  have  not
17        been  fully paid into a qualified escrow fund governed by
18        a qualified escrow agreement that has  been  approved  by
19        the  Attorney  General;  or  (ii)  all  outstanding final
20        judgments, including interest thereon, for violations  of
21        Section  15  of  the  Escrow  Act  have  not  been  fully
22        satisfied for that brand family and manufacturer.
23             (3)  The Attorney General shall update the directory
24        as  necessary  in order to correct mistakes and to add or
25        remove a tobacco product manufacturer or  brand  families
26        to keep the directory in conformity with the requirements
27        of this Act.
28             (4)  Every  distributor  shall provide and update as
29        necessary an electronic  mail  address  to  the  Attorney
30        General for the purpose of receiving any notifications as
31        may be required by this Act.
32        (c)  It  shall be unlawful for any person: (i) to affix a
33    stamp to a package or other  container  of  cigarettes  of  a
34    tobacco  product manufacturer or brand family not included in
 
                            -7-      LRB093 04546 MKM 15269 a
 1    the directory or to sell, offer, or possess for sale in  this
 2    State; or (ii) import for personal consumption in this State,
 3    cigarettes  of a tobacco product manufacturer or brand family
 4    not included in the directory.

 5        Section 20.  Agent for service of process.
 6        (a)  Any  non-resident   or   foreign   non-participating
 7    manufacturer  that  has not registered to do business in this
 8    State as a foreign corporation or business entity shall, as a
 9    condition precedent to having its brand  families  listed  or
10    retained  in  the  directory,  appoint and continually engage
11    without interruption the services of an agent in  this  State
12    to  act  as  agent  for  the  service  of process on whom all
13    process, and any action or proceeding against  it  concerning
14    or  arising out of the enforcement of this Act and the Escrow
15    Act, may be served in  any  manner  authorized  by  law.  The
16    service  shall  constitute legal and valid service of process
17    on the non-participating manufacturer. The  non-participating
18    manufacturer  shall  provide the name, address, phone number,
19    and proof of the appointment and availability of the agent to
20    and to the satisfaction of the Director and Attorney General.
21        (b)  The  non-participating  manufacturer  shall  provide
22    notice to the Director and Attorney General 30 calendar  days
23    prior  to  termination of the authority of an agent and shall
24    further provide proof to the  satisfaction  of  the  Attorney
25    General  of  the  appointment  of  a new agent no less than 5
26    calendar days prior to the termination of an  existing  agent
27    appointment.  In  the  event  an  agent  terminates an agency
28    appointment, the non-participating manufacturer shall  notify
29    the Director and Attorney General of the termination within 5
30    calendar  days and shall include proof to the satisfaction of
31    the Attorney General of the appointment of a new agent.
32        (c)  Any non-participating  manufacturer  whose  products
33    are  sold in this State, without appointing or designating an
 
                            -8-      LRB093 04546 MKM 15269 a
 1    agent as herein required shall be deemed  to  have  appointed
 2    the  Secretary  of  State  as  the agent and may be proceeded
 3    against in courts of this State by service  of  process  upon
 4    the  Secretary  of  State;  however,  the  appointment of the
 5    Secretary  of  State  as  an  agent  shall  not  satisfy  the
 6    condition precedent to having its brand  families  listed  or
 7    retained in the directory.

 8        Section    25.  Reporting    of    information;    escrow
 9    installments.
10        (a)  Not  later  than  20  days  after  the  end  of each
11    calendar quarter, and more frequently if so directed  by  the
12    Attorney   General,   each   distributor   shall  submit  the
13    information as the Attorney General  requires  to  facilitate
14    compliance  with this Section, including, but not limited to,
15    a list by brand family of the total number of  cigarettes  or
16    in  the case of roll-your-own, the equivalent stick count for
17    which the distributor  affixed  stamps  during  the  previous
18    calendar  quarter  or  otherwise  paid  the tax due for these
19    cigarettes.  The  distributor  shall   maintain,   and   make
20    available   to   the   Attorney  General,  all  invoices  and
21    documentation of sales of all non-participating  manufacturer
22    cigarettes and any other information relied upon in reporting
23    to the Attorney General for a period of 5 years.
24        (b)  The  Director  is  authorized  to  disclose  to  the
25    Attorney  General any information received under this Act and
26    requested by the Attorney General for purposes of determining
27    compliance with and enforcing the provisions of this Act. The
28    Director and Attorney General shall share with each other the
29    information received  under  this  Act,  and  may  share  the
30    information with other federal, State, or local agencies only
31    for  purposes  of enforcement of this Act, the Escrow Act, or
32    corresponding laws of other states.
33        (c)  The Attorney General may require at any  time,  from
 
                            -9-      LRB093 04546 MKM 15269 a
 1    the  non-participating manufacturer, proof from the financial
 2    institution in  which  the  manufacturer  has  established  a
 3    qualified  escrow fund for the purpose of compliance with the
 4    Escrow Act of the amount of money in the fund being  held  on
 5    behalf  of  the  State and the dates of deposits, and listing
 6    the amounts of all withdrawals from the fund  and  the  dates
 7    thereof.
 8        (d)  In  addition  to  the  information  required  to  be
 9    submitted  pursuant  to  this  Act,  the Attorney General may
10    require a distributor  or  tobacco  product  manufacturer  to
11    submit  any additional information including, but not limited
12    to, samples of  the  packaging  or  labeling  of  each  brand
13    family,  as  is  necessary  to enable the Attorney General to
14    determine  whether  a  tobacco  product  manufacturer  is  in
15    compliance with this Act.
16        (e)  To promote compliance with the  provisions  of  this
17    Act,   the   Attorney   General  may  promulgate  regulations
18    requiring a  tobacco  product  manufacturer  subject  to  the
19    requirements  of  subsection (a)(2) of Section 15 to make the
20    escrow deposits required in quarterly installments during the
21    year in which the sales covered by the deposits are made. The
22    Attorney  General  may  require  production  of   information
23    sufficient  to  enable  the Attorney General to determine the
24    adequacy of the amount of the installment deposit.

25        Section 30.  Penalties and other remedies.
26        (a)  In addition to or in lieu  of  any  other  civil  or
27    criminal  remedy provided by law, upon a determination that a
28    distributor has violated subsection (c) of Section 15 or  any
29    regulation  adopted pursuant thereto, the Director may revoke
30    or suspend the license of any stamping agent  in  the  manner
31    provided  by Section 6 of the Cigarette Tax Act, Section 6 of
32    the Cigarette Use Tax Act, or Section 10-25  of  the  Tobacco
33    Products  Tax Act of 1995, as appropriate. Each stamp affixed
 
                            -10-     LRB093 04546 MKM 15269 a
 1    and each offer to sell cigarettes in violation of  subsection
 2    (c)  of Section 15 shall constitute a separate violation. For
 3    each violation, the Director may also impose a civil  penalty
 4    in  an amount not to exceed the greater of 500% of the retail
 5    value of the cigarettes sold or $5,000 upon  a  determination
 6    of   violation  of  subsection  (c)  of  Section  15  or  any
 7    regulations adopted pursuant thereto.
 8        (b)  Any cigarettes that  have  been  sold,  offered  for
 9    sale,  or  possessed  for sale in this State, or imported for
10    personal consumption in this State in violation of subsection
11    (c) of Section 15 shall be subject to seizure and  forfeiture
12    as  provided in Sections 18, 18a, and 20 of the Cigarette Tax
13    Act and Sections 24, 25, 25a and 26 of the Cigarette Use  Tax
14    Act,  and  all  cigarettes  so  seized and forfeited shall be
15    destroyed and not resold.
16        (c)  The Attorney  General  may  seek  an  injunction  to
17    restrain  a  threatened or actual violation of subsection (c)
18    of Section 15, subsection (a) of Section  25,  or  subsection
19    (d)  of  Section  25  by  a  stamping agent and to compel the
20    stamping agent to comply with such subsections. In any action
21    brought pursuant to this Section, the State shall be entitled
22    to recover the costs of investigation, costs of  the  action,
23    and reasonable attorney fees.
24        (d)  It  shall  be  unlawful for a person to: (i) sell or
25    distribute cigarettes; or (ii) acquire, hold,  own,  possess,
26    transport,  import,  or  cause to be imported cigarettes that
27    the person knows or should know are intended for distribution
28    or sale in the  State  in  violation  of  subsection  (c)  of
29    Section  15.  A  violation of this Section shall be a Class 2
30    felony.
31        (e)  A person who violates subsection (c) of  Section  15
32    engages   in  an  unfair  and  deceptive  trade  practice  in
33    violation of the Uniform Deceptive Trade Practices Act.
 
                            -11-     LRB093 04546 MKM 15269 a
 1        Section 35.  Miscellaneous provisions.
 2        (a)  A determination of the Attorney General to not  list
 3    or  to  remove  from  the directory a brand family or tobacco
 4    product manufacturer shall be subject to review in the manner
 5    prescribed by rule.
 6        (b)  No person shall be issued a  license  or  granted  a
 7    renewal  of  a  license  to  act  as a distributor unless the
 8    person has certified in writing, under  penalty  of  perjury,
 9    that the person will comply fully with this Section.
10        (c)  The  Attorney  General  may  promulgate  regulations
11    necessary to effect the purposes of this Act.
12        (d)  In  any  action brought by the State to enforce this
13    Act, the State shall be entitled  to  recover  the  costs  of
14    investigation,  expert witness fees, costs of the action, and
15    reasonable attorney fees.
16        (e)  If a court determines that  a  person  has  violated
17    this  Act,  the  court  shall  order any profits, gain, gross
18    receipts, or other benefit from the violation to be disgorged
19    and paid to the General Revenue Fund.
20        (f)  Unless otherwise expressly provided the remedies  or
21    penalties  provided  by this Act are cumulative to each other
22    and to the remedies or penalties available  under  all  other
23    laws of this State.

24        Section 40.  Severability.
25        (a)  If  any  provision of this Act or its application to
26    any person or circumstance is held  invalid,  the  invalidity
27    does  not affect other provisions or applications of this Act
28    that can be given effect without  the  invalid  provision  or
29    application.
30        (b)  If  a court of competent jurisdiction finds that the
31    provisions of this Act and of the  Escrow  Act  conflict  and
32    cannot  be  harmonized, then the provisions of the Escrow Act
33    shall control.
 
                            -12-     LRB093 04546 MKM 15269 a
 1        (c)  If any Section, subsection, subdivision,  paragraph,
 2    sentence,  clause,  or  phrase  of  this  Act  (excluding the
 3    amendatory provisions of Section 300) causes the  Escrow  Act
 4    to  no  longer  constitute  a qualifying or model statute, as
 5    those terms are defined in the Master  Settlement  Agreement,
 6    then that portion of this Act shall not be valid.

 7        (30 ILCS 169/Act rep.)
 8        Section  200.  The Tobacco Products Manufacturers' Escrow
 9    Enforcement Act is repealed.

10        Section 300.  The Tobacco Product  Manufacturers'  Escrow
11    Act  is  amended by changing Section 15 and by adding Section
12    20 as follows:

13        (30 ILCS 168/15)
14        Sec. 15.  Requirements.
15        (a)  Any tobacco product manufacturer selling  cigarettes
16    to  consumers  within the State of Illinois (whether directly
17    or through a distributor, retailer, or  similar  intermediary
18    or intermediaries) after the effective date of this Act shall
19    do one of the following:
20             (1)  become  a  participating  manufacturer (as that
21        term  is  defined  in  Section  II(jj)  of   the   Master
22        Settlement    Agreement)  and   generally   perform   its
23        financial  obligations  under   the   Master   Settlement
24        Agreement; or
25             (2) (A)  place into a qualified escrow fund by April
26             15  of  the  year following the year in question the
27             following amounts (as such amounts are adjusted  for
28             inflation):
29                       (i)  For  1999:   $0.0094241 per unit sold
30                  after the effective date of this Act;
31                       (ii)  For 2000:  $0.0104712 per unit sold;
 
                            -13-     LRB093 04546 MKM 15269 a
 1                       (iii)  For  each   of   2001   and   2002:
 2                  $0.0136125  per unit sold;
 3                       (iv)  For   each  of  2003  through  2006:
 4                  $0.0167539  per unit sold;
 5                       (v)  For  each  of  2007  and  each   year
 6                  thereafter:  $0.0188482 per unit sold.
 7                  (B)  A tobacco product manufacturer that places
 8             funds  into escrow pursuant to subdivision (a)(2)(A)
 9             shall receive the interest or other appreciation  on
10             the  funds as earned.  The funds themselves shall be
11             released  from  escrow  only  under  the   following
12             circumstances:
13                       (i)  to  pay  a  judgment or settlement on
14                  any released claim brought against the  tobacco
15                  product   manufacturer  by  the  State  or  any
16                  releasing party  located  or  residing  in  the
17                  State.   Funds  shall  be  released from escrow
18                  under this  subdivision  (a)(2)(B)(i):  (I)  in
19                  the  order  in  which  they  were  placed  into
20                  escrow; and (II)  only to the extent and at the
21                  time  necessary to make payments required under
22                  such judgment or settlement;
23                       (ii)  to the extent that a tobacco product
24                  manufacturer establishes that the amount it was
25                  required to place into  escrow  on  account  of
26                  units  sold  in  the State in a particular year
27                  was  greater   than   the   Master   Settlement
28                  Agreement  payments,  as determined pursuant to
29                  Section  IX(i)  of  that  Agreement,  including
30                  after final determination of  all  adjustments,
31                  that such manufacturer would have been required
32                  to  make  on  account  of  such  units sold the
33                  State's allocable share of the  total  payments
34                  that such manufacturer would have been required
 
                            -14-     LRB093 04546 MKM 15269 a
 1                  to   make   in   that  year  under  the  Master
 2                  Settlement Agreement (as determined pursuant to
 3                  Section  IX(i)(2)  of  the  Master   Settlement
 4                  Agreement, and before any of the adjustments or
 5                  offsets  described  in Section IX(i)(3) of that
 6                  Agreement other than the Inflation  Adjustment)
 7                  had  it  been a Participating Manufacturer, the
 8                  excess shall be released from escrow and revert
 9                  back to such tobacco product manufacturer; or
10                       (iii)  to the  extent  not  released  from
11                  escrow   under   subdivisions  (a)(2)(B)(i)  or
12                  (a)(2)(B)(ii), funds  shall  be  released  from
13                  escrow  and revert back to such tobacco product
14                  manufacturer 25 years after the date  on  which
15                  they were placed into escrow.
16                  (C)  Each  tobacco  product  manufacturer  that
17             elects  to  place funds into escrow pursuant to this
18             subdivision (a)(2) shall  annually  certify  to  the
19             Attorney  General that it is in compliance with this
20             subdivision (a)(2).  The Attorney General may  bring
21             a  civil  action  on behalf of the State of Illinois
22             against any tobacco product manufacturer that  fails
23             to  place  into escrow the funds required under this
24             subdivision    (a)(2).     Any    tobacco    product
25             manufacturer that fails in any year  to  place  into
26             escrow  the  funds  required  under this subdivision
27             (a)(2) shall:
28                       (i)  be required within 15 days  to  place
29                  such  funds  into escrow as shall bring it into
30                  compliance with this Section.  The court,  upon
31                  a  finding  of  a violation of this subdivision
32                  (a)(2), may impose a civil penalty to  be  paid
33                  into  the General Revenue Fund in an amount not
34                  to exceed 5% of the amount improperly  withheld
 
                            -15-     LRB093 04546 MKM 15269 a
 1                  from  escrow  per day of the violation and in a
 2                  total amount not to exceed 100% of the original
 3                  amount improperly withheld from escrow;
 4                       (ii)  in the case of a knowing  violation,
 5                  be  required within 15 days to place such funds
 6                  into escrow as shall bring it  into  compliance
 7                  with  this  Section.  The court, upon a finding
 8                  of a  knowing  violation  of  this  subdivision
 9                  (a)(2),  may  impose a civil penalty to be paid
10                  into the General Revenue Fund in an amount  not
11                  to exceed 15% of the amount improperly withheld
12                  from  escrow  per day of the violation and in a
13                  total amount not to exceed 300% of the original
14                  amount improperly withheld from escrow; and
15                       (iii)  in the case  of  a  second  knowing
16                  violation,    be    prohibited   from   selling
17                  cigarettes to consumers  within  the  State  of
18                  Illinois   (whether   directly   or  through  a
19                  distributor, retailer, or similar intermediary)
20                  for a period not to exceed 2 years.
21        (b)  Each failure to  make  an  annual  deposit  required
22    under this Section shall constitute a separate violation.  If
23    a  tobacco product manufacturer is successfully prosecuted by
24    the Attorney General for a violation of  subdivision  (a)(2),
25    the tobacco product manufacturer must pay, in addition to any
26    fine  imposed  by  a  court, the State's costs and attorney's
27    fees incurred in the prosecution.
28    (Source: P.A. 91-41, eff. 6-30-99.)

29        (30 ILCS 168/20 new)
30        Sec. 20.  If this amendatory  Act  of  the  93rd  General
31    Assembly  or  any  portion  of  the  amendment to subdivision
32    (2)(B)(ii) of subsection (a)  of  Section  15  made  by  this
33    amendatory  Act  of  the  93rd  General Assembly is held by a
 
                            -16-     LRB093 04546 MKM 15269 a
 1    court of competent jurisdiction to be unconstitutional,  then
 2    such  subdivision  (2)(B)(ii) of subsection (a) of Section 15
 3    shall  be  deemed  to  be  repealed  in  its  entirety.    If
 4    subdivision  (2)(B)(ii) of subsection (a) of Section 15 shall
 5    thereafter be held by a court of competent jurisdiction to be
 6    unconstitutional,  then  this  amendatory  Act  of  the  93rd
 7    General Assembly shall be  deemed  repealed  and  subdivision
 8    (2)(B)(ii)  of subsection (a) of Section 15 shall be restored
 9    as if no such amendments had been made.  Neither any  holding
10    of   unconstitutionality   nor   the  repeal  of  subdivision
11    (2)(B)(ii) of subsection (a)  of  Section  15  shall  affect,
12    impair,  or invalidate any other portion of Section 15 or the
13    application  of  such  Section  to  any   other   person   or
14    circumstance, and such remaining portions of Section 15 shall
15    at all times continue in full force and effect.".