Full Text of SB0417 94th General Assembly
SB0417 94TH GENERAL ASSEMBLY
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94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006 SB0417
Introduced 2/16/2005, by Sen. Jeffrey M. Schoenberg SYNOPSIS AS INTRODUCED: |
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30 ILCS 167/15 |
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30 ILCS 167/20 |
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30 ILCS 167/25 |
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30 ILCS 167/30 |
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30 ILCS 167/35 |
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Amends the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003. Deletes provisions concerning the Director of Revenue's powers and duties in relation to the registration of agents by non-participating manufacturers. In a provision concerning the reporting of information, authorizes the Attorney General to disclose information to the Director of Revenue (now, the Director is authorized to disclose information to the Attorney General). Upon a distributor's violation of certain provisions of the Act, authorizes the Director of Revenue to revoke or suspend the license of the distributor (now, the license of a stamping agent) and authorizes the Attorney General to seek injunctive relief against a distributor (now, a stamping agent). Provides that the administrative decisions of the Attorney General concerning inclusions on the directory of certified manufacturers and brand families are subject to administrative review under the Administrative Review Law (now, subject to review in a manner prescribed by rule). Effective immediately.
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A BILL FOR
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SB0417 |
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| AN ACT concerning finance.
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| Be it enacted by the People of the State of Illinois,
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| represented in the General Assembly:
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| Section 5. The Tobacco Products Manufacturers' Escrow | 5 |
| Enforcement Act of 2003 is amended by changing Sections 15, 20, | 6 |
| 25, 30, and 35 as follows:
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| (30 ILCS 167/15)
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| Sec. 15. Certifications; directory; tax stamps.
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| (a) Every tobacco product manufacturer whose cigarettes | 10 |
| are sold in this
State whether
directly or through a | 11 |
| distributor, retailer, or similar intermediary or
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| intermediaries shall execute and
deliver on a form prescribed | 13 |
| by the Attorney General a certification to the
Attorney | 14 |
| General, no
later than the thirtieth day of April each year, | 15 |
| certifying under penalty of
perjury that, as of the date
of the | 16 |
| certification, the tobacco product manufacturer either: (i) is | 17 |
| a
participating manufacturer and has generally performed its | 18 |
| financial
obligations under the Master Settlement Agreement; | 19 |
| or
(ii) is in full compliance with the Escrow Act, including | 20 |
| all quarterly
installment
payments.
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| (1) A participating manufacturer shall include in its | 22 |
| certification a list
of its brand
families. The | 23 |
| participating manufacturer shall update the list 30 days | 24 |
| prior to
any addition to or
modification of its brand | 25 |
| families by executing and delivering a supplemental
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| certification to the
Attorney General.
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| (2) A non-participating manufacturer shall include in | 28 |
| its certification a
complete
list of all of its brand | 29 |
| families: (i) separately listing brand families of
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| cigarettes and the number of
units sold for each brand | 31 |
| family that were sold in the State during the
preceding | 32 |
| calendar year; (ii)
listing all of its brand families that |
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| have been sold in the State at any time
during the current
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| calendar year; (iii) indicating by an asterisk, any brand | 3 |
| family sold in the
State during the preceding
calendar year | 4 |
| that is no longer being sold in the State as of the date of | 5 |
| the
certification; and (iv)
identifying by name and address | 6 |
| any other manufacturer of the brand families in
the | 7 |
| preceding
calendar year. The non-participating | 8 |
| manufacturer shall update the list 30 days
prior to any | 9 |
| addition
to or modification of its brand families by | 10 |
| executing and delivering a
supplemental certification to
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| the Attorney General.
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| (3) In the case of a non-participating manufacturer, | 13 |
| the certification
shall further certify:
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| (A) that the non-participating manufacturer is | 15 |
| registered to do business
in
this State or has | 16 |
| appointed a resident agent for service of process and
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| provided notice thereof as
required by Section 20
item | 18 |
| 4 of subsection (a) of this Section ;
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| (B) that the non-participating manufacturer has | 20 |
| (i) established and
continues to maintain a qualified | 21 |
| escrow fund as that term is defined in
Section 10 of | 22 |
| the Escrow
Act, and (ii) executed a qualified escrow | 23 |
| agreement that has been reviewed and
approved by the
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| Attorney General and that governs the qualified escrow | 25 |
| fund;
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| (C) that the non-participating manufacturer is in | 27 |
| full compliance with
the Escrow Act and this Act, and | 28 |
| any regulations promulgated pursuant thereto;
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| (D) the name, address and telephone number of the | 30 |
| financial institution
where the non-participating | 31 |
| manufacturer has established the qualified escrow
fund | 32 |
| required
pursuant to Section 15 of the Escrow Act and | 33 |
| all regulations promulgated
thereto;
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| (E) the account number of the qualified escrow fund | 35 |
| and sub-account
number for this State;
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| (F) the amount the non-participating manufacturer |
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| placed in the fund
for cigarettes sold in the State | 2 |
| during the preceding calendar year, including
the | 3 |
| dates and amount
of each deposit, and such evidence or | 4 |
| verification as may be deemed necessary
by the Attorney | 5 |
| General to confirm the foregoing; and
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| (G) the amounts of and dates of any withdrawal or | 7 |
| transfer of funds the
non-participating manufacturer | 8 |
| made at any time from the fund or from any other
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| qualified escrow
fund into which it ever made escrow | 10 |
| payments pursuant to Section 15 of the
Escrow Act and | 11 |
| all regulations promulgated thereto.
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| (4) A tobacco product manufacturer may not include a | 13 |
| brand family in its
certification unless: (i) in the case | 14 |
| of a participating manufacturer, the
participating | 15 |
| manufacturer
affirms that the brand family is to be deemed | 16 |
| to be its cigarettes for purposes
of calculating its
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| payments under the master settlement agreement for the | 18 |
| relevant year, in the
volume and shares
determined pursuant | 19 |
| to the master settlement agreement; and (ii) in the case of
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| a non-participating
manufacturer, the non-participating | 21 |
| manufacturer affirms that the brand family
is to be deemed | 22 |
| to
be its cigarettes for purposes of Section 15 of the | 23 |
| Escrow Act.
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| Nothing in this Section shall be construed as limiting | 25 |
| or otherwise
affecting
the State's right
to maintain that a | 26 |
| brand family constitutes cigarettes of a different tobacco
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| product manufacturer
for purposes of calculating payments | 28 |
| under the master settlement agreement or
for purposes of | 29 |
| Section 15 of the Escrow Act.
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| (5) The tobacco product manufacturers shall maintain | 31 |
| all invoices and
documentation of sales and other | 32 |
| information relied upon for certification for
a period of 5 | 33 |
| years,
unless otherwise required by law to maintain them | 34 |
| for a greater period of time.
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| (b) Not later than 6 months after the effective date of | 36 |
| this Act, the
Attorney General shall
develop and make available |
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| for public inspection, through publishing on its
website, a | 2 |
| directory
listing all tobacco product manufacturers that have | 3 |
| provided current and
accurate certifications
conforming to the | 4 |
| requirements of subsection (a) of Section 15 and all brand
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| families that are listed in the certifications, except for the | 6 |
| following:
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| (1) The Attorney General shall not include or retain in | 8 |
| the directory the
name or
brand families of any | 9 |
| non-participating manufacturer that fails to provide the
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| required certification
or whose certification the Attorney | 11 |
| General determines is not in compliance
with subsections | 12 |
| (a)(2)
or (a)(3) of Section 15, unless the Attorney General | 13 |
| has determined that the
violation has been
cured to the | 14 |
| satisfaction of the Attorney General.
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| (2) Neither a tobacco product manufacturer nor brand | 16 |
| family shall be
included or
retained in the directory if | 17 |
| the Attorney General concludes that: (i) in the
case of a | 18 |
| non-participating
manufacturer all escrow payments | 19 |
| required pursuant to Section 15 of the Escrow
Act for any | 20 |
| period
for any brand family, whether or not listed by the | 21 |
| non-participating
manufacturer, have not been
fully paid | 22 |
| into a qualified escrow fund governed by a qualified escrow
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| agreement that has been
approved by the Attorney General; | 24 |
| or (ii) all outstanding final judgments,
including | 25 |
| interest
thereon, for violations of Section 15 of the | 26 |
| Escrow Act have not been fully
satisfied for that brand | 27 |
| family and manufacturer.
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| (c) The Attorney General shall update the directory as | 29 |
| necessary in order
to correct
mistakes and to add or remove a | 30 |
| tobacco product manufacturer or brand families
to keep the | 31 |
| directory in conformity with the requirements of this Act.
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| (d) Every distributor shall provide and update as necessary | 33 |
| an electronic
mail
address to the Attorney General for the | 34 |
| purpose of receiving any notifications
as may be required by | 35 |
| this Act.
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| (e) It shall be unlawful for any person: (i) to affix a |
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| stamp to a package
or other container of
cigarettes of a | 2 |
| tobacco product manufacturer or brand family not included in
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| the directory; or (ii) to
sell, offer for sale, or possess for | 4 |
| sale in this State, or import for personal
consumption in this | 5 |
| State,
cigarettes of a tobacco product manufacturer or brand | 6 |
| family not included in
the directory.
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| (Source: P.A. 93-446, eff. 1-1-04; 93-930, eff. 1-1-05.)
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| (30 ILCS 167/20)
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| Sec. 20. Agent for service of process.
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| (a) Any non-resident or foreign non-participating | 11 |
| manufacturer that has not
registered to do
business in this | 12 |
| State as a foreign corporation or business entity shall, as a
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| condition precedent to
having its brand families listed or | 14 |
| retained in the directory, appoint and
continually engage | 15 |
| without
interruption the services of an agent in this State to | 16 |
| act as agent for the
service of process on whom
all process, | 17 |
| and any action or proceeding against it concerning or arising | 18 |
| out
of the enforcement of
this Act and the Escrow Act, may be | 19 |
| served in any manner authorized by law. The
service shall
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| constitute legal and valid service of process on the | 21 |
| non-participating
manufacturer. The non-participating | 22 |
| manufacturer shall provide the name,
address, phone number, and | 23 |
| proof of the
appointment and availability of the agent to and | 24 |
| to the satisfaction of the
Director and Attorney General.
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| (b) The non-participating manufacturer shall provide | 26 |
| notice to the
Director and
Attorney General 30 calendar days | 27 |
| prior to termination of the authority of an
agent and shall | 28 |
| further
provide proof to the satisfaction of the Attorney | 29 |
| General of the appointment of
a new agent no less
than 5 | 30 |
| calendar days prior to the termination of an existing agent | 31 |
| appointment.
In the event an agent
terminates an agency | 32 |
| appointment, the non-participating manufacturer shall
notify | 33 |
| the
Director and Attorney General of the termination within 5 | 34 |
| calendar days and
shall include
proof to the satisfaction of | 35 |
| the Attorney General of the appointment of a new
agent.
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| (c) Any non-participating manufacturer whose products are | 2 |
| sold in this
State, without
appointing or designating an agent | 3 |
| as herein required shall be deemed to have
appointed the
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| Secretary of State as the agent and may be proceeded against in | 5 |
| courts of this
State by service of
process upon the Secretary | 6 |
| of State; however, the appointment of the Secretary
of State as | 7 |
| an agent
shall not satisfy the condition precedent to having | 8 |
| its brand families listed
or retained in the directory.
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| (Source: P.A. 93-446, eff. 1-1-04.)
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| (30 ILCS 167/25)
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| Sec. 25. Reporting of information; escrow installments.
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| (a) Not later than 20 days after the end of each calendar | 13 |
| quarter, and more
frequently if so
directed by the Attorney | 14 |
| General, each distributor shall submit the information
as the | 15 |
| Attorney
General requires to facilitate compliance with this | 16 |
| Act, including, but not
limited to, a list by
brand family of | 17 |
| the total number of cigarettes or in the case of roll-your-own,
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| the equivalent stick
count for which the distributor affixed | 19 |
| stamps during the previous calendar
quarter or otherwise
paid | 20 |
| the tax due for these cigarettes. The distributor shall | 21 |
| maintain, and make
available to the
Attorney General, all | 22 |
| invoices and documentation of sales of all
non-participating | 23 |
| manufacturer
cigarettes and any other information relied upon | 24 |
| in reporting to the Attorney
General for a period of 5 years.
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| (b) The Attorney General
Director is authorized to disclose | 26 |
| to the Director
Attorney General any
information received
under | 27 |
| this Act and requested by the Attorney General for purposes of
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| determining compliance with
and enforcing the provisions of | 29 |
| this Act. The Director and Attorney General
shall share with | 30 |
| each
other the information received under this Act, and may | 31 |
| share the information
with other federal,
State, or local | 32 |
| agencies only for purposes of enforcement of this Act, the
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| Escrow Act, or corresponding laws of other states.
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| (c) The Attorney General may require at any time, from the | 35 |
| non-participating
manufacturer,
proof from the financial |
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| institution in which the manufacturer has established
a | 2 |
| qualified escrow
fund for the purpose of compliance with the | 3 |
| Escrow Act of the amount of money
in the fund being
held on | 4 |
| behalf of the State and the dates of deposits, and listing the | 5 |
| amounts
of all withdrawals from the fund and the dates thereof.
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| (d) In addition to the information required to be submitted | 7 |
| pursuant to this
Act, the
Attorney General may require a | 8 |
| distributor or tobacco product manufacturer to
submit any
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| additional information including, but not limited to, samples | 10 |
| of the packaging
or labeling of each
brand family, as is | 11 |
| necessary to enable the Attorney General to determine
whether a | 12 |
| tobacco
product manufacturer is in compliance with this Act.
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| (e) To promote compliance with the provisions of this Act, | 14 |
| the Attorney
General may
promulgate regulations requiring a | 15 |
| tobacco product manufacturer subject to the
requirements of
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| subsection (a)(2) of Section 15 to make the escrow deposits | 17 |
| required in
quarterly installments
during the year in which the | 18 |
| sales covered by the deposits are made. The
Attorney General | 19 |
| may
require production of information sufficient to enable the | 20 |
| Attorney General to
determine the adequacy of the amount of the | 21 |
| installment deposit.
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| (Source: P.A. 93-446, eff. 1-1-04.)
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| (30 ILCS 167/30)
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| Sec. 30. Penalties and other remedies.
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| (a) In addition to or in lieu of any other civil or | 26 |
| criminal remedy provided
by law, upon a
determination that a | 27 |
| distributor has violated subsection (e) of Section 15 or
any | 28 |
| regulation adopted
pursuant thereto, the Director may revoke or | 29 |
| suspend the license of any distributor
stamping agent in the
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| manner provided by Section 6 of the Cigarette Tax Act, Section | 31 |
| 6 of the
Cigarette Use Tax Act, or
Section 10-25 of the Tobacco | 32 |
| Products Tax Act of 1995, as appropriate. Each
stamp affixed | 33 |
| and
each offer to sell cigarettes in violation of subsection | 34 |
| (e) of Section 15
shall constitute a separate
violation. For | 35 |
| each violation, the Director may also impose a civil
penalty in |
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| an amount not
to exceed the greater of 500% of the retail value | 2 |
| of the cigarettes sold or
$5,000 upon a
determination of | 3 |
| violation of subsection (e) of Section 15 or any regulations
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| adopted pursuant thereto.
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| (b) Any cigarettes that have been sold, offered for sale, | 6 |
| or possessed for
sale in this State,
or imported for personal | 7 |
| consumption in this State in violation of subsection (e) of | 8 |
| Section 15 shall
be subject to seizure and forfeiture as | 9 |
| provided in Sections 18, 18a, and 20 of
the Cigarette Tax Act
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| and Sections 24, 25, 25a and 26 of the Cigarette Use Tax Act, | 11 |
| and all
cigarettes so seized and forfeited shall be destroyed | 12 |
| and not resold.
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| (c) The Attorney General may seek an injunction to restrain | 14 |
| a threatened or
actual violation
of subsection (e) of Section | 15 |
| 15, subsection (a) of Section 25, or subsection
(d) of Section | 16 |
| 25 by a distributor
stamping agent and to compel the | 17 |
| distributor
stamping agent to comply with such
subsections. In | 18 |
| any action
brought pursuant to this Section, the State shall be | 19 |
| entitled to recover the
costs of investigation,
costs of the | 20 |
| action, and reasonable attorney fees.
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| (d) It shall be unlawful for a person to: (i) sell or | 22 |
| distribute cigarettes;
or (ii) acquire, hold,
own, possess, | 23 |
| transport, import, or cause to be imported cigarettes that the
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| person knows or should
know are intended for distribution or | 25 |
| sale in the State in violation of
subsection (e) of Section 15. | 26 |
| A
violation of this Section shall be a Class 2 felony.
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| (e) A person who violates subsection (e) of Section 15 | 28 |
| engages in an unfair
and deceptive
trade practice in violation | 29 |
| of the Uniform Deceptive Trade Practices Act.
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| (Source: P.A. 93-446, eff. 1-1-04; 93-930, eff. 1-1-05.)
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| (30 ILCS 167/35)
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| Sec. 35. Miscellaneous provisions.
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| (a) Every final administrative decision
A determination of | 34 |
| the Attorney General to not list or to remove from
the | 35 |
| directory a
brand family or tobacco product manufacturer shall |
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| be subject to judicial review only under and in accordance with | 2 |
| the Administrative Review Law. The provisions of the | 3 |
| Administrative Review Law, and the rules adopted pursuant | 4 |
| thereto, apply to and govern all proceedings for the judicial | 5 |
| review of final administrative decisions of the Attorney | 6 |
| General under this subsection. The term "administrative | 7 |
| decision" is defined as in Section 3-101 of the Code of Civil | 8 |
| Procedure
in the
manner prescribed
by rule .
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| (b) No person shall be issued a license or granted a | 10 |
| renewal of a license to
act as a
distributor unless the person | 11 |
| has certified in writing, under penalty of
perjury, that the | 12 |
| person will comply fully with this Act.
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| (c) The Attorney General may promulgate rules necessary to | 14 |
| effect the
purposes of this Act.
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| (d) In any action brought by the State to enforce this Act, | 16 |
| the State shall
be entitled to
recover the costs of | 17 |
| investigation, expert witness fees, costs of the action,
and | 18 |
| reasonable attorney fees.
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| (e) If a court determines that a person has violated this | 20 |
| Act, the court
shall order any
profits, gain, gross receipts, | 21 |
| or other benefit from the violation to be
disgorged and paid to | 22 |
| the General Revenue Fund.
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| (f) Unless otherwise expressly provided the remedies or | 24 |
| penalties provided
by this Act are
cumulative to each other and | 25 |
| to the remedies or penalties available under all
other laws of | 26 |
| this State.
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| (Source: P.A. 93-446, eff. 1-1-04.)
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| Section 99. Effective date. This Act takes effect upon | 29 |
| becoming law.
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