Illinois General Assembly - Full Text of HB2494
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Full Text of HB2494  98th General Assembly

HB2494sam002 98TH GENERAL ASSEMBLY

Sen. John J. Cullerton

Filed: 5/21/2014

 

 


 

 


 
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1
AMENDMENT TO HOUSE BILL 2494

2    AMENDMENT NO. ______. Amend House Bill 2494 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Department of Revenue Law of the Civil
5Administrative Code of Illinois is amended by changing Section
62505-380 as follows:
 
7    (20 ILCS 2505/2505-380)  (was 20 ILCS 2505/39b47)
8    Sec. 2505-380. Revocation of or refusal to issue or reissue
9a certificate of registration, permit, or license.
10    (a) The Department has the power, after notice and an
11opportunity for a hearing, to revoke a certificate of
12registration, permit, or license issued by the Department if
13the holder of the certificate of registration, permit, or
14license fails to file a return, or to pay the tax, fee,
15penalty, or interest shown in a filed return, or to pay any
16final assessment of tax, fee, penalty, or interest, as required

 

 

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1by the tax or fee Act under which the certificate of
2registration, permit, or license is required or any other tax
3or fee Act administered by the Department.
4    (b) The Department may refuse to issue, reissue, or renew a
5certificate of registration, permit, or license authorized to
6be issued by the Department if a person who is named as the
7owner, a partner, a corporate officer, or, in the case of a
8limited liability company, a manager or member, of the
9applicant on the application for the certificate of
10registration, permit or license, is or has been named as the
11owner, a partner, a corporate officer, or in the case of a
12limited liability company, a manager or member, on the
13application for the certificate of registration, permit, or
14license of a person that is in default for moneys due under the
15tax or fee Act upon which the certificate of registration,
16permit, or license is required or any other tax or fee Act
17administered by the Department. For purposes of this Section
18only, in determining whether a person is in default for moneys
19due, the Department shall include only amounts established as a
20final liability within the 20 years prior to the date of the
21Department's notice of refusal to issue or reissue the
22certificate of registration, permit, or license. For purposes
23of this Section, "person" means any natural individual, firm,
24partnership, association, joint stock company, joint
25adventure, public or private corporation, limited liability
26company, or a receiver, executor, trustee, guardian or other

 

 

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1representative appointed by order of any court.
2    (c) When revoking or refusing to issue or reissue a
3certificate of registration, permit, or license issued by the
4Department, the procedure for notice and hearing used shall be
5the procedure provided under the Act pursuant to which the
6certificate of registration, permit, or license was issued.
7(Source: P.A. 98-496, eff. 1-1-14.)
 
8    Section 10. The Cigarette Tax Act is amended by changing
9Sections 3-10, 4d, 4e, 4f, 6, 7, 8, 10, 11, 11a, 11b, 23, 24,
10and 26 and by adding Sections 4g, 4h, 9g, and 11c as follows:
 
11    (35 ILCS 130/3-10)
12    Sec. 3-10. Cigarette enforcement.
13    (a) Prohibitions. It is unlawful for any person:
14        (1) to sell or distribute in this State; to acquire,
15    hold, own, possess, or transport, for sale or distribution
16    in this State; or to import, or cause to be imported into
17    this State for sale or distribution in this State:
18            (A) any cigarettes the package of which:
19                (i) bears any statement, label, stamp,
20            sticker, or notice indicating that the
21            manufacturer did not intend the cigarettes to be
22            sold, distributed, or used in the United States,
23            including but not limited to labels stating "For
24            Export Only", "U.S. Tax Exempt", "For Use Outside

 

 

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1            U.S.", or similar wording; or
2                (ii) does not comply with:
3                    (aa) all requirements imposed by or
4                pursuant to federal law regarding warnings and
5                other information on packages of cigarettes
6                manufactured, packaged, or imported for sale,
7                distribution, or use in the United States,
8                including but not limited to the precise
9                warning labels specified in the federal
10                Cigarette Labeling and Advertising Act, 15
11                U.S.C. 1333; and
12                    (bb) all federal trademark and copyright
13                laws;
14            (B) any cigarettes imported into the United States
15        in violation of 26 U.S.C. 5754 or any other federal
16        law, or implementing federal regulations;
17            (C) any cigarettes that such person otherwise
18        knows or has reason to know the manufacturer did not
19        intend to be sold, distributed, or used in the United
20        States; or
21            (D) any cigarettes for which there has not been
22        submitted to the Secretary of the U.S. Department of
23        Health and Human Services the list or lists of the
24        ingredients added to tobacco in the manufacture of the
25        cigarettes required by the federal Cigarette Labeling
26        and Advertising Act, 15 U.S.C. 1335a;

 

 

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1        (2) to alter the package of any cigarettes, prior to
2    sale or distribution to the ultimate consumer, so as to
3    remove, conceal, or obscure:
4            (A) any statement, label, stamp, sticker, or
5        notice described in subdivision (a)(1)(A)(i) of this
6        Section;
7            (B) any health warning that is not specified in, or
8        does not conform with the requirements of, the federal
9        Cigarette Labeling and Advertising Act, 15 U.S.C.
10        1333; or
11        (3) to affix any stamp required pursuant to this Act to
12    the package of any cigarettes described in subdivision
13    (a)(1) of this Section or altered in violation of
14    subdivision (a)(2).
15    (b) Documentation. On the first business day of each month,
16each person licensed to affix the State tax stamp to cigarettes
17shall file with the Department, for all cigarettes imported
18into the United States to which the person has affixed the tax
19stamp in the preceding month:
20        (1) a copy of:
21            (A) the permit issued pursuant to the Internal
22        Revenue Code, 26 U.S.C. 5713, to the person importing
23        the cigarettes into the United States allowing the
24        person to import the cigarettes; and
25            (B) the customs form containing, with respect to
26        the cigarettes, the internal revenue tax information

 

 

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1        required by the U.S. Bureau of Alcohol, Tobacco and
2        Firearms;
3        (2) a statement, signed by the person under penalty of
4    perjury, which shall be treated as confidential by the
5    Department and exempt from disclosure under the Freedom of
6    Information Act, identifying the brand and brand styles of
7    all such cigarettes, the quantity of each brand style of
8    such cigarettes, the supplier of such cigarettes, and the
9    person or persons, if any, to whom such cigarettes have
10    been conveyed for resale; and a separate statement, signed
11    by the individual under penalty of perjury, which shall not
12    be treated as confidential or exempt from disclosure,
13    separately identifying the brands and brand styles of such
14    cigarettes; and
15        (3) a statement, signed by an officer of the
16    manufacturer or importer under penalty of perjury,
17    certifying that the manufacturer or importer has complied
18    with:
19            (A) the package health warning and ingredient
20        reporting requirements of the federal Cigarette
21        Labeling and Advertising Act, 15 U.S.C. 1333 and 1335a,
22        with respect to such cigarettes; and
23            (B) the provisions of Exhibit T of the Master
24        Settlement Agreement entered in the case of People of
25        the State of Illinois v. Philip Morris, et al. (Circuit
26        Court of Cook County, No. 96-L13146), including a

 

 

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1        statement indicating whether the manufacturer is, or
2        is not, a participating tobacco manufacturer within
3        the meaning of Exhibit T.
4    (c) Administrative sanctions.
5        (1) Upon finding that a distributor, secondary
6    distributor, retailer, or person has committed any of the
7    acts prohibited by subsection (a), knowing or having reason
8    to know that he or she has done so, or upon finding that a
9    distributor or person has failed to comply with any
10    requirement of subsection (b), the Department may revoke or
11    suspend the license or licenses of any distributor, or
12    secondary distributor, or retailer pursuant to the
13    procedures set forth in Section 6 and impose, on the
14    distributor, secondary distributor, retailer, or person, a
15    civil penalty in an amount not to exceed the greater of
16    500% of the retail value of the cigarettes involved or
17    $5,000.
18        (2) Cigarettes that are acquired, held, owned,
19    possessed, transported in, imported into, or sold or
20    distributed in this State in violation of this Section
21    shall be deemed contraband under this Act and are subject
22    to seizure and forfeiture as provided in this Act, and all
23    such cigarettes seized and forfeited shall be destroyed or
24    maintained and used in an undercover capacity. Such
25    cigarettes shall be deemed contraband whether the
26    violation of this Section is knowing or otherwise.

 

 

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1    (d) Unfair trade practices. In addition to any other
2penalties provided for in this Act, a violation of subsection
3(a) or subsection (b) of this Section shall constitute an
4unlawful practice as provided in the Consumer Fraud and
5Deceptive Business Practices Act.
6    (d-1) Retailers issued a license under Section 4g of this
7Act and secondary distributors shall not be liable under
8subsections (c)(1) and (d) of this Section for unknowingly
9possessing, selling, or distributing to consumers or users
10cigarettes identified in subsection (a)(1) of this Section if
11the cigarettes possessed, sold, or distributed by the licensed
12retailer or secondary distributor were obtained from a
13distributor licensed under this Act.
14    (d-2) Criminal penalties. A distributor, secondary
15distributor, retailer, or person who violates subsection (a),
16or a distributor, secondary distributor, or person who violates
17subsection (b) of this Section shall be guilty of a Class 4
18felony.
19    (e) Unfair cigarette sales. For purposes of the Trademark
20Registration and Protection Act and the Counterfeit Trademark
21Act, cigarettes imported or reimported into the United States
22for sale or distribution under any trade name, trade dress, or
23trademark that is the same as, or is confusingly similar to,
24any trade name, trade dress, or trademark used for cigarettes
25manufactured in the United States for sale or distribution in
26the United States shall be presumed to have been purchased

 

 

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1outside of the ordinary channels of trade.
2    (f) General provisions.
3        (1) This Section shall be enforced by the Department;
4    provided that, at the request of the Director of Revenue or
5    the Director's duly authorized agent, the State police and
6    all local police authorities shall enforce the provisions
7    of this Section. The Attorney General has concurrent power
8    with the State's Attorney of any county to enforce this
9    Section.
10        (2) For the purpose of enforcing this Section, the
11    Director of Revenue and any agency to which the Director
12    has delegated enforcement responsibility pursuant to
13    subdivision (f)(1) may request information from any State
14    or local agency and may share information with and request
15    information from any federal agency and any agency of any
16    other state or any local agency of any other state.
17        (3) In addition to any other remedy provided by law,
18    including enforcement as provided in subdivision (f)
19    (a)(1), any person may bring an action for appropriate
20    injunctive or other equitable relief for a violation of
21    this Section; actual damages, if any, sustained by reason
22    of the violation; and, as determined by the court, interest
23    on the damages from the date of the complaint, taxable
24    costs, and reasonable attorney's fees. If the trier of fact
25    finds that the violation is flagrant, it may increase
26    recovery to an amount not in excess of 3 times the actual

 

 

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1    damages sustained by reason of the violation.
2    (g) Definitions. As used in this Section:
3    "Importer" means that term as defined in 26 U.S.C. 5702(1).
4    "Package" means that term as defined in 15 U.S.C. 1332(4).
5    (h) Applicability.
6        (1) This Section does not apply to:
7            (A) cigarettes allowed to be imported or brought
8        into the United States for personal use; and
9            (B) cigarettes sold or intended to be sold as
10        duty-free merchandise by a duty-free sales enterprise
11        in accordance with the provisions of 19 U.S.C. 1555(b)
12        and any implementing regulations; except that this
13        Section shall apply to any such cigarettes that are
14        brought back into the customs territory for resale
15        within the customs territory.
16        (2) The penalties provided in this Section are in
17    addition to any other penalties imposed under other
18    provision of law.
19(Source: P.A. 95-1053, eff. 1-1-10; 96-782, eff. 1-1-10;
2096-1027, eff. 7-12-10.)
 
21    (35 ILCS 130/4d)
22    Sec. 4d. Sales of cigarettes to and by retailers. In-state
23makers, manufacturers, and fabricators licensed as
24distributors under Section 4 of this Act and out-of-state
25makers, manufacturers, and fabricators holding permits under

 

 

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1Section 4b of this Act may not sell original packages of
2cigarettes to retailers. A retailer who is licensed under
3Section 4g of this Act may sell only original packages of
4cigarettes obtained from manufacturer representatives,
5licensed secondary distributors, or licensed distributors
6other than in-state makers, manufacturers, or fabricators
7licensed as distributors under Section 4 of this Act and
8out-of-state makers, manufacturers, or fabricators holding
9permits under Section 4b of this Act.
10(Source: P.A. 96-782, eff. 1-1-10; 96-1027, eff. 7-12-10;
1197-587, eff. 8-26-11.)
 
12    (35 ILCS 130/4e)
13    Sec. 4e. Sales of cigarettes to and by secondary
14distributors. In-state makers, manufacturers, and fabricators
15licensed as distributors under Section 4 of this Act and
16out-of-state makers, manufacturers, and fabricators holding
17permits under Section 4b of this Act may not sell original
18packages of cigarettes to secondary distributors. A secondary
19distributor may sell only original packages of cigarettes
20obtained from licensed distributors other than in-state
21makers, manufacturers, or fabricators licensed as distributors
22under Section 4 of this Act and out-of-state makers,
23manufacturers, or fabricators holding permits under Section 4b
24of this Act. Secondary distributors may sell cigarettes to
25Illinois retailers issued a license under Section 4g of this

 

 

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1Act for resale, and are also authorized to make retail sales of
2cigarettes at the location on the secondary distributor's
3license as long as the secondary distributor obtains a license
4under Section 4g of the Cigarette Tax Act and sells 75% or more
5of the cigarettes sold at such location to retailers issued a
6license under Section 4g of this Act for resale. All sales by
7secondary distributors to retailers issued a license under
8Section 4g of this Act must be made at the location on the
9secondary distributor's license. Retailers issued a license
10under Section 4g of this Act must take possession of all
11cigarettes sold by the secondary distributor at the secondary
12distributor's licensed address. Secondary distributors may not
13make deliveries of cigarettes to retailers.
14    Secondary distributors may not file a claim for credit or
15refund with the State under Section 9d of this Act.
16(Source: P.A. 96-1027, eff. 7-12-10.)
 
17    (35 ILCS 130/4f)
18    Sec. 4f. Manufacturer representatives.
19    (a) No manufacturer may market cigarettes produced by the
20manufacturer directly to retailers in this State issued a
21license under Section 4g of this Act without first having
22obtained authorization from the Department. Application for
23authority to maintain representatives in this State to market
24in this State cigarettes produced by the manufacturer shall be
25made to the Department on a form furnished and prescribed by

 

 

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1the Department. Each applicant under this Section shall furnish
2the following information to the Department on a form signed
3and verified by the applicant under penalty of perjury:
4        (1) the name and address of the applicant;
5        (2) the address of every location from which the
6    applicant proposes to engage in business in this State;
7        (3) the number of manufacturer representatives the
8    applicant requests to maintain in this State; and
9        (4) any other additional information as the Department
10    may reasonably require.
11    The following manufacturers are ineligible to receive
12authorization to maintain manufacturer representatives in this
13State:
14        (1) a manufacturer who owes, at the time of
15    application, any delinquent cigarette taxes that have been
16    determined by law to be due and unpaid, unless the
17    applicant has entered into an agreement approved by the
18    Department to pay the amount due;
19        (2) a manufacturer who has had a license revoked within
20    the past 2 years for misconduct relating to stolen or
21    contraband cigarettes or has been convicted of a state or
22    federal crime, punishable by imprisonment of one year or
23    more, relating to stolen or contraband cigarettes;
24        (3) a manufacturer who has been found, after notice and
25    a hearing, to have imported or caused to be imported into
26    the United States for sale or distribution any cigarette in

 

 

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1    violation of 19 U.S.C. 1681a;
2        (4) a manufacturer who has been found, after notice and
3    a hearing, to have imported or caused to be imported into
4    the United States for sale or distribution or manufactured
5    for sale or distribution in the United States any cigarette
6    that does not fully comply with the Federal Cigarette
7    Labeling and Advertising Act (15 U.S.C. 1331, et seq.);
8        (5) a manufacturer who has been found, after notice and
9    a hearing, to have made a material false statement in an
10    application or has failed to produce records required to be
11    maintained by this Act;
12        (6) a manufacturer who has been found, after notice and
13    hearing, to have violated any Section of this Act; or
14        (7) a manufacturer licensed as a distributor under
15    Section 4 of this Act or holding a permit under Section 4b
16    of this Act.
17    The Department, upon receipt of an application from a
18manufacturer who is eligible to maintain manufacturer
19representatives in this State, shall notify the applicant in
20writing, not more than 60 days after an application has been
21received, that the applicant may or may not maintain the
22requested number of manufacturer representatives in this
23State. A copy of the notice authorizing a manufacturer to
24maintain manufacturer representatives in this State shall be
25available for inspection by the Department at each place of
26business identified in the application and in the motor vehicle

 

 

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1operated by marketing representatives in the course of
2performing his or her duties in this State on behalf of the
3manufacturer.
4    A manufacturer representative shall notify the Department
5of any change in the information contained on the application
6form and shall do so within 30 days after any such change.
7    (b) Only directors, officers, and employees of the
8manufacturer may act as manufacturer representatives in this
9State. The manufacturer shall provide to the Department the
10names and addresses of the manufacturer representatives
11operating in this State and the make, model, and license plate
12number of each motor vehicle operated by a manufacturer
13representative in the course of performing his or her duties in
14this State on behalf of the manufacturer. The following
15individuals may not act as manufacturer representatives:
16        (1) an individual who owes any delinquent cigarette
17    taxes that have been determined by law to be due and
18    unpaid, unless the individual has entered into an agreement
19    approved by the Department to pay the amount due;
20        (2) an individual who has had a license revoked within
21    the past 2 years for misconduct relating to stolen or
22    contraband cigarettes or has been convicted of a state or
23    federal crime, punishable by imprisonment of one year or
24    more, relating to stolen or contraband cigarettes;
25        (3) an individual who has been found, after notice and
26    a hearing, to have made a material false statement in an

 

 

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1    application or has failed to produce records required to be
2    maintained by this Act; or
3        (4) an individual who has been found, after notice and
4    hearing, to have violated any Section of this Act.
5    (c) Manufacturer representatives may sell to retailers in
6this State who are licensed under Section 4g of this Act only
7original packages of cigarettes made, manufactured, or
8fabricated by the manufacturer and purchased or obtained from a
9distributor licensed under this Act, or the Cigarette Tax Use
10Act, and on which tax stamps have been affixed. Manufacturer
11representatives may sell up to 600 stamped original packages of
12cigarettes in a calendar year, for the purpose of promoting the
13manufacturer's brands of cigarettes. A manufacturer
14representative may not possess more than 500 stamped original
15packages of cigarettes made, manufactured, or fabricated by the
16manufacturer and purchased or obtained from a distributor
17licensed under this Act or the Cigarette Use Tax Act. Any
18original packages of cigarettes in the possession of a
19manufacturer representative that (i) are not made,
20manufactured, or fabricated by the manufacturer and purchased
21or obtained from a distributor licensed under this Act or the
22Cigarette Use Tax Act, other than cigarettes for personal use
23and consumption, (ii) exceed the maximum quantity of 500
24original packages of cigarettes, excluding packages of
25cigarettes for personal use and consumption; (iii) violate
26Section 3-10 of this Act; or (iv) do not have the proper tax

 

 

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1stamps affixed, are contraband and subject to seizure and
2forfeiture.
3    Manufacturer representatives may sell, on behalf of
4licensed distributors, stamped original packages of cigarettes
5to retailers who are licensed under Section 4g of this Act on
6behalf of licensed distributors. The manufacturer
7representative shall provide the distributor with a signed
8receipt for the cigarettes obtained from the distributor. The
9distributor shall invoice the licensed retailer, and the
10licensed retailer shall pay the distributor for all cigarettes
11provided to licensed retailers by manufacturer representatives
12on behalf of a distributor.
13    Manufacturer representatives may sell stamped original
14packages of cigarettes to licensed retailers that are purchased
15from licensed distributors. Distributors shall provide
16manufacturer representatives with invoices for stamped
17original packages of cigarettes sold to manufacturer
18representatives. Manufacturer representatives shall invoice
19licensed retailers, and the licensed retailers shall pay the
20manufacturer representatives for all original packages of
21cigarettes sold to licensed retailers.
22    (d) Any person aggrieved by any decision of the Department
23under this Section may, within 20 days after notice of the
24decision, protest and request a hearing. Upon receiving a
25request for a hearing, the Department shall give notice to the
26person requesting the hearing of the time and place fixed for

 

 

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1the hearing and shall hold a hearing in conformity with the
2provisions of this Act and then issue its final administrative
3decision in the matter to that person. In the absence of a
4protest and request for a hearing within 20 days, the
5Department's decision shall become final without any further
6determination being made or notice given.
7(Source: P.A. 97-587, eff. 8-26-11.)
 
8    (35 ILCS 130/4g new)
9    Sec. 4g. Retailer's license. Beginning on January 1, 2016,
10no person may engage in business as a retailer of cigarettes in
11this State without first having obtained a license from the
12Department. Application for license shall be made to the
13Department, by electronic means, in a form prescribed by the
14Department. Each applicant for a license under this Section
15shall furnish to the Department, in an electronic format
16established by the Department, the following information:
17        (1) the name and address of the applicant;
18        (2) the address of the location at which the applicant
19    proposes to engage in business as a retailer of cigarettes
20    in this State; and
21        (3) such other additional information as the
22    Department may lawfully require by its rules and
23    regulations.
24    The annual license fee payable to the Department for each
25retailer's license shall be $75. The fee shall be deposited

 

 

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1into the Tax Compliance and Administration Fund and shall be
2for the cost of tobacco retail inspection and contraband
3tobacco and tobacco smuggling with at least two-thirds of the
4money being used for contraband tobacco and tobacco smuggling
5operations and enforcement.
6    Each applicant for a license shall pay the fee to the
7Department at the time of submitting its application for a
8license to the Department. The Department shall require an
9applicant for a license under this Section to electronically
10file and pay the fee.
11    A separate annual license fee shall be paid for each place
12of business at which a person who is required to procure a
13retailer's license under this Section proposes to engage in
14business as a retailer in Illinois under this Act.
15    The following are ineligible to receive a retailer's
16license under this Act:
17        (1) a person who has been convicted of a felony related
18    to the illegal transportation, sale, or distribution of
19    cigarettes, or a tobacco-related felony, under any federal
20    or State law, if the Department, after investigation and a
21    hearing if requested by the applicant, determines that the
22    person has not been sufficiently rehabilitated to warrant
23    the public trust; or
24        (2) a corporation, if any officer, manager, or director
25    thereof, or any stockholder or stockholders owning in the
26    aggregate more than 5% of the stock of such corporation,

 

 

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1    would not be eligible to receive a license under this Act
2    for any reason.
3    The Department, upon receipt of an application and license
4fee, in proper form, from a person who is eligible to receive a
5retailer's license under this Act, shall issue to such
6applicant a license in form as prescribed by the Department.
7That license shall permit the applicant to whom it is issued to
8engage in business as a retailer under this Act at the place
9shown in his or her application. All licenses issued by the
10Department under this Section shall be valid for a period not
11to exceed one year after issuance unless sooner revoked,
12canceled, or suspended as provided in this Act. No license
13issued under this Section is transferable or assignable. The
14license shall be conspicuously displayed in the place of
15business conducted by the licensee in Illinois under such
16license. The Department shall not issue a retailer's license to
17a retailer unless the retailer is also registered under the
18Retailers' Occupation Tax Act. A person who obtains a license
19as a retailer who ceases to do business as specified in the
20license, or who never commenced business, or who obtains a
21distributor's license, or whose license is suspended or
22revoked, shall immediately surrender the license to the
23Department.
24    Any person aggrieved by any decision of the Department
25under this subsection may, within 30 days after notice of the
26decision, protest and request a hearing. Upon receiving a

 

 

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1request for a hearing, the Department shall give written notice
2to the person requesting the hearing of the time and place
3fixed for the hearing and shall hold a hearing in conformity
4with the provisions of this Act and then issue its final
5administrative decision in the matter to that person. In the
6absence of a protest and request for a hearing within 30 days,
7the Department's decision shall become final without any
8further determination being made or notice given.
 
9    (35 ILCS 130/4h new)
10    Sec. 4h. Purchases of cigarettes by licensed retailers. A
11person who possesses a retailer's license under Section 4g of
12this Act shall obtain cigarettes for sale only from a licensed
13distributor, secondary distributor, or manufacturer
14representative.
 
15    (35 ILCS 130/6)  (from Ch. 120, par. 453.6)
16    Sec. 6. Revocation, cancellation, or suspension of
17license. The Department may, after notice and hearing as
18provided for by this Act, revoke, cancel or suspend the license
19of any distributor, or secondary distributor, or retailer for
20the violation of any provision of this Act, or for
21noncompliance with any provision herein contained, or for any
22noncompliance with any lawful rule or regulation promulgated by
23the Department under Section 8 of this Act, or because the
24licensee is determined to be ineligible for a distributor's

 

 

09800HB2494sam002- 22 -LRB098 08122 HLH 59891 a

1license for any one or more of the reasons provided for in
2Section 4 of this Act, or because the licensee is determined to
3be ineligible for a secondary distributor's license for any one
4or more of the reasons provided for in Section 4c of this Act,
5or because the licensee is determined to be ineligible for a
6retailer's license for any one or more of the reasons provided
7for in Section 4g of this Act. However, no such license shall
8be revoked, cancelled or suspended, except after a hearing by
9the Department with notice to the distributor, or secondary
10distributor, or retailer, as aforesaid, and affording such
11distributor, or secondary distributor, or retailer a
12reasonable opportunity to appear and defend, and any
13distributor, or secondary distributor, or retailer aggrieved
14by any decision of the Department with respect thereto may have
15the determination of the Department judicially reviewed, as
16herein provided.
17    The Department may revoke, cancel, or suspend the license
18of any distributor for a violation of the Tobacco Product
19Manufacturers' Escrow Enforcement Act as provided in Section 30
20of that Act. The Department may revoke, cancel, or suspend the
21license of any secondary distributor for a violation of
22subsection (e) of Section 15 of the Tobacco Product
23Manufacturers' Escrow Enforcement Act.
24    If the retailer has a training program that facilitates
25compliance with minimum-age tobacco laws, the Department shall
26suspend for 3 days the license of that retailer for a fourth or

 

 

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1subsequent violation of the Prevention of Tobacco Use by Minors
2and Sale and Distribution of Tobacco Products Act, as provided
3in subsection (a) of Section 2 of that Act. For the purposes of
4this Section, any violation of subsection (a) of Section 2 of
5the Prevention of Tobacco Use by Minors and Sale and
6Distribution of Tobacco Products Act occurring at the
7retailer's licensed location during a 24-month period shall be
8counted as a violation against the retailer.
9    If the retailer does not have a training program that
10facilitates compliance with minimum-age tobacco laws, the
11Department shall suspend for 3 days the license of that
12retailer for a second violation of the Prevention of Tobacco
13Use by Minors and Sale and Distribution of Tobacco Products
14Act, as provided in subsection (a-5) of Section 2 of that Act.
15    If the retailer does not have a training program that
16facilitates compliance with minimum-age tobacco laws, the
17Department shall suspend for 7 days the license of that
18retailer for a third violation of the Prevention of Tobacco Use
19by Minors and Sale and Distribution of Tobacco Products Act, as
20provided in subsection (a-5) of Section 2 of that Act.
21    If the retailer does not have a training program that
22facilitates compliance with minimum-age tobacco laws, the
23Department shall suspend for 30 days the license of a retailer
24for a fourth or subsequent violation of the Prevention of
25Tobacco Use by Minors and Sale and Distribution of Tobacco
26Products Act, as provided in subsection (a-5) of Section 2 of

 

 

09800HB2494sam002- 24 -LRB098 08122 HLH 59891 a

1that Act.
2    A training program that facilitates compliance with
3minimum-age tobacco laws must include at least the following
4elements: (i) it must explain that only individuals displaying
5valid identification demonstrating that they are 18 years of
6age or older shall be eligible to purchase cigarettes or
7tobacco products; (ii) it must explain where a clerk can check
8identification for a date of birth; and (iii) it must explain
9the penalties that a clerk and retailer are subject to for
10violations of the Prevention of Tobacco Use by Minors and Sale
11and Distribution of Tobacco Products Act.
12    Any distributor, or secondary distributor, or retailer
13aggrieved by any decision of the Department under this Section
14may, within 20 days after notice of the decision, protest and
15request a hearing. Upon receiving a request for a hearing, the
16Department shall give notice in writing to the distributor, or
17secondary distributor, or retailer requesting the hearing that
18contains a statement of the charges preferred against the
19distributor, or secondary distributor, or retailer and that
20states the time and place fixed for the hearing. The Department
21shall hold the hearing in conformity with the provisions of
22this Act and then issue its final administrative decision in
23the matter to the distributor, or secondary distributor, or
24retailer. In the absence of a protest and request for a hearing
25within 20 days, the Department's decision shall become final
26without any further determination being made or notice given.

 

 

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1    No license so revoked, as aforesaid, shall be reissued to
2any such distributor, or secondary distributor, or retailer
3within a period of 6 months after the date of the final
4determination of such revocation. No such license shall be
5reissued at all so long as the person who would receive the
6license is ineligible to receive a distributor's license under
7this Act for any one or more of the reasons provided for in
8Section 4 of this Act, or is ineligible to receive a secondary
9distributor's license under this Act for any one or more of the
10reasons provided for in Section 4c of this Act, or is
11determined to be ineligible for a retailer's license under the
12Act for any one or more of the reasons provided for in Section
134g of this Act.
14    The Department upon complaint filed in the circuit court
15may by injunction restrain any person who fails, or refuses, to
16comply with any of the provisions of this Act from acting as a
17distributor, or secondary distributor, or retailer of
18cigarettes in this State.
19(Source: P.A. 96-1027, eff. 7-12-10.)
 
20    (35 ILCS 130/7)  (from Ch. 120, par. 453.7)
21    Sec. 7. The Department or any officer or employee of the
22Department designated, in writing, by the Director thereof,
23shall at its or his or her own instance, or on the written
24request of any distributor, secondary distributor, retailer,
25manufacturer with authority to maintain manufacturer

 

 

09800HB2494sam002- 26 -LRB098 08122 HLH 59891 a

1representatives, or other interested party to the proceeding,
2issue subpoenas requiring the attendance of and the giving of
3testimony by witnesses, and subpoenas duces tecum requiring the
4production of books, papers, records or memoranda. All
5subpoenas and subpoenas duces tecum issued under the terms of
6this Act may be served by any person of full age. The fees of
7witnesses for attendance and travel shall be the same as the
8fees of witnesses before the circuit court of this State; such
9fees to be paid when the witness is excused from further
10attendance. When the witness is subpoenaed at the instance of
11the Department or any officer or employee thereof, such fees
12shall be paid in the same manner as other expenses of the
13Department, and when the witness is subpoenaed at the instance
14of any other party to any such proceeding, the cost of service
15of the subpoena or subpoena duces tecum and the fee of the
16witness shall be borne by the party at whose instance the
17witness is summoned. In such case the Department, in its
18discretion, may require a deposit to cover the cost of such
19service and witness fees. A subpoena or subpoena duces tecum so
20issued shall be served in the same manner as a subpoena or
21subpoena duces tecum issued out of a court.
22    Any circuit court of this State, upon the application of
23the Department or any officer or employee thereof, or upon the
24application of any other party to the proceeding, may, in its
25discretion, compel the attendance of witnesses, the production
26of books, papers, records or memoranda and the giving of

 

 

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1testimony before the Department or any officer or employee
2thereof conducting an investigation or holding a hearing
3authorized by this Act, by an attachment for contempt, or
4otherwise, in the same manner as production of evidence may be
5compelled before the court.
6    The Department or any officer or employee thereof, or any
7other party in an investigation or hearing before the
8Department, may cause the depositions of witnesses within the
9State to be taken in the manner prescribed by law for like
10depositions, or depositions for discovery in civil actions in
11courts of this State, and to that end compel the attendance of
12witnesses and the production of books, papers, records or
13memoranda, in the same manner hereinbefore provided.
14(Source: P.A. 96-1027, eff. 7-12-10; 97-587, eff. 8-26-11.)
 
15    (35 ILCS 130/8)  (from Ch. 120, par. 453.8)
16    Sec. 8. The Department may make, promulgate and enforce
17such reasonable rules and regulations relating to the
18administration and enforcement of this Act as may be deemed
19expedient.
20    Whenever notice is required by this Act, such notice may be
21given by United States certified or registered mail, addressed
22to the person concerned at his last known address, and proof of
23such mailing shall be sufficient for the purposes of this Act.
24Notice of any hearing provided for by this Act and held before
25the Department shall be so given not less than 7 days prior to

 

 

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1the day fixed for the hearing.
2    Hearings provided for in this Act, other than hearings
3before the Illinois Independent Tax Tribunal, shall be held:
4        (1) In Cook County, if the taxpayer's or licensee's
5    principal place of business is in that county;
6        (2) At the Department's office nearest the taxpayer's
7    or licensee's principal place of business, if the
8    taxpayer's or licensee's principal place of business is in
9    Illinois but outside Cook County;
10        (3) In Sangamon County, if the taxpayer's or licensee's
11    principal place of business is outside Illinois.
12    The Circuit Court of the County wherein the hearing is held
13has power to review all final administrative decisions of the
14Department in administering this Act. The provisions of the
15Administrative Review Law, and all amendments and
16modifications thereof, and the rules adopted pursuant thereto,
17shall apply to and govern all proceedings for the judicial
18review of final administrative decisions of the Department
19under this Act. The term "administrative decision" is defined
20as in Section 3-101 of the Code of Civil Procedure.
21    Service upon the Director of Revenue or Assistant Director
22of Revenue of summons issued in any action to review a final
23administrative decision shall be service upon the Department.
24The Department shall certify the record of its proceedings if
25the distributor, secondary distributor, retailer, or
26manufacturer with authority to maintain manufacturer

 

 

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1representatives pays to it the sum of 75˘ per page of testimony
2taken before the Department and 25˘ per page of all other
3matters contained in such record, except that these charges may
4be waived where the Department is satisfied that the aggrieved
5party is a poor person who cannot afford to pay such charges.
6Before the delivery of such record to the person applying for
7it, payment of these charges must be made, and if the record is
8not paid for within 30 days after notice that such record is
9available, the complaint may be dismissed by the court upon
10motion of the Department.
11    No stay order shall be entered by the Circuit Court unless
12the distributor, secondary distributor, retailer, or
13manufacturer with authority to maintain manufacturer
14representatives files with the court a bond in an amount fixed
15and approved by the court, to indemnify the State against all
16loss and injury which may be sustained by it on account of the
17review proceedings and to secure all costs which may be
18occasioned by such proceedings.
19    Whenever any proceeding provided by this Act is begun
20before the Department, either by the Department or by a person
21subject to this Act, and such person thereafter dies or becomes
22a person under legal disability before such proceeding is
23concluded, the legal representative of the deceased person or
24of the person under legal disability shall notify the
25Department of such death or legal disability. Such legal
26representative, as such, shall then be substituted by the

 

 

09800HB2494sam002- 30 -LRB098 08122 HLH 59891 a

1Department for such person. If the legal representative fails
2to notify the Department of his or her appointment as such
3legal representative, the Department may, upon its own motion,
4substitute such legal representative in the proceeding pending
5before the Department for the person who died or became a
6person under legal disability.
7    Hearings to contest an administrative decision under this
8Act conducted as a result of a protest filed with the Illinois
9Independent Tax Tribunal on or after July 1, 2013 shall be
10conducted pursuant to the provisions of the Illinois
11Independent Tax Tribunal Act of 2012.
12(Source: P.A. 96-1027, eff. 7-12-10; 97-587, eff. 8-26-11;
1397-1129, eff. 8-28-12.)
 
14    (35 ILCS 130/10)  (from Ch. 120, par. 453.10)
15    Sec. 10. The Department, or any officer or employee
16designated in writing by the Director thereof, for the purpose
17of administering and enforcing the provisions of this Act, may
18hold investigations and, except as otherwise provided in the
19Illinois Independent Tax Tribunal Act of 2012, may hold
20hearings concerning any matters covered by this Act, and may
21examine books, papers, records or memoranda bearing upon the
22sale or other disposition of cigarettes by a distributor,
23secondary distributor, retailer, manufacturer with authority
24to maintain manufacturer representatives under Section 4f of
25this Act, or manufacturer representative, and may issue

 

 

09800HB2494sam002- 31 -LRB098 08122 HLH 59891 a

1subpoenas requiring the attendance of a distributor, secondary
2distributor, retailer, manufacturer with authority to maintain
3manufacturer representatives under Section 4f of this Act, or
4manufacturer representative, or any officer or employee of a
5distributor, secondary distributor, retailer, manufacturer
6with authority to maintain manufacturer representatives under
7Section 4f of this Act, or any person having knowledge of the
8facts, and may take testimony and require proof, and may issue
9subpoenas duces tecum to compel the production of relevant
10books, papers, records and memoranda, for the information of
11the Department.
12    All hearings to contest administrative decisions of the
13Department conducted as a result of a protest filed with the
14Illinois Independent Tax Tribunal on or after July 1, 2013
15shall be subject to the provisions of the Illinois Independent
16Tax Tribunal Act of 2012.
17    In the conduct of any investigation or hearing provided for
18by this Act, neither the Department, nor any officer or
19employee thereof, shall be bound by the technical rules of
20evidence, and no informality in the proceedings nor in the
21manner of taking testimony shall invalidate any rule, order,
22decision or regulation made, approved or confirmed by the
23Department.
24    The Director of Revenue, or any duly authorized officer or
25employee of the Department, shall have the power to administer
26oaths to such persons required by this Act to give testimony

 

 

09800HB2494sam002- 32 -LRB098 08122 HLH 59891 a

1before the said Department.
2    The books, papers, records and memoranda of the Department,
3or parts thereof, may be proved in any hearing, investigation
4or legal proceeding by a reproduced copy thereof under the
5certificate of the Director of Revenue. Such reproduced copy
6shall, without further proof, be admitted into evidence before
7the Department or in any legal proceeding.
8(Source: P.A. 96-1027, eff. 7-12-10; 97-587, eff. 8-26-11;
997-1129, eff. 8-28-12.)
 
10    (35 ILCS 130/11)  (from Ch. 120, par. 453.11)
11    Sec. 11. Every distributor of cigarettes, who is required
12to procure a license under this Act, shall keep within
13Illinois, at his licensed address, complete and accurate
14records of cigarettes held, purchased, manufactured, brought
15in or caused to be brought in from without the State, and sold,
16or otherwise disposed of, and shall preserve and keep within
17Illinois at his licensed address all invoices, bills of lading,
18sales records, copies of bills of sale, inventory at the close
19of each period for which a return is required of all cigarettes
20on hand and of all cigarette revenue stamps, both affixed and
21unaffixed, and other pertinent papers and documents relating to
22the manufacture, purchase, sale or disposition of cigarettes.
23Every sales invoice issued by a licensed distributor to a
24retailer in this State shall contain the distributor's
25cigarette distributor license number. All books and records and

 

 

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1other papers and documents that are required by this Act to be
2kept shall be kept in the English language, and shall, at all
3times during the usual business hours of the day, be subject to
4inspection by the Department or its duly authorized agents and
5employees. The Department may adopt rules that establish
6requirements, including record forms and formats, for records
7required to be kept and maintained by taxpayers. For purposes
8of this Section, "records" means all data maintained by the
9taxpayer, including data on paper, microfilm, microfiche or any
10type of machine-sensible data compilation. Those books,
11records, papers and documents shall be preserved for a period
12of at least 3 years after the date of the documents, or the
13date of the entries appearing in the records, unless the
14Department, in writing, authorizes their destruction or
15disposal at an earlier date. At all times during the usual
16business hours of the day any duly authorized agent or employee
17of the Department may enter any place of business of the
18distributor, without a search warrant, and inspect the premises
19and the stock or packages of cigarettes and the vending devices
20therein contained, to determine whether any of the provisions
21of this Act are being violated. If such agent or employee is
22denied free access or is hindered or interfered with in making
23such examination as herein provided, the license of the
24distributor at such premises shall be subject to revocation by
25the Department.
26(Source: P.A. 88-480.)
 

 

 

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1    (35 ILCS 130/11a)
2    Sec. 11a. Secondary distributors; records. Every secondary
3distributor of cigarettes, who is required to procure a license
4under this Act, shall keep within Illinois, at his licensed
5address, complete and accurate records of cigarettes held,
6purchased, brought in from without the State, and sold, or
7otherwise disposed of, and shall preserve and keep within
8Illinois at his licensed address all invoices, bills of lading,
9sales records, copies of bills of sale, inventory at the close
10of each period for which a report is required of all cigarettes
11on hand, and other pertinent papers and documents relating to
12the purchase, sale, or disposition of cigarettes. Every sales
13invoice issued by a secondary distributor to a retailer in this
14State shall contain the distributor's secondary distributor
15license number. All books and records and other papers and
16documents that are required by this Act to be kept shall be
17kept in the English language, and shall, at all times during
18the usual business hours of the day, be subject to inspection
19by the Department or its duly authorized agents and employees.
20The Department may adopt rules that establish requirements,
21including record forms and formats, for records required to be
22kept and maintained by secondary distributors. For purposes of
23this Section, "records" means all data maintained by the
24secondary distributors, including data on paper, microfilm,
25microfiche or any type of machine sensible data compilation.

 

 

09800HB2494sam002- 35 -LRB098 08122 HLH 59891 a

1Those books, records, papers, and documents shall be preserved
2for a period of at least 3 years after the date of the
3documents, or the date of the entries appearing in the records,
4unless the Department, in writing, authorizes their
5destruction or disposal at an earlier date. At all times during
6the usual business hours of the day any duly authorized agent
7or employee of the Department may enter any place of business
8of the secondary distributor without a search warrant and may
9inspect the premises and the stock or packages of cigarettes
10therein contained to determine whether any of the provisions of
11this Act are being violated. If such agent or employee is
12denied free access or is hindered or interfered with in making
13such examination as herein provided, the license of the
14secondary distributor at such premises shall be subject to
15revocation by the Department.
16(Source: P.A. 96-1027, eff. 7-12-10.)
 
17    (35 ILCS 130/11b)
18    Sec. 11b. Manufacturer representatives; records. Every
19manufacturer with authority to maintain manufacturer
20representatives under Section 4f of this Act shall keep within
21Illinois, at his business address identified under Section 4f
22of this Act, complete and accurate records of cigarettes
23purchased, sold, or otherwise disposed of, and shall preserve
24and keep within Illinois at his business address all invoices,
25sales records, copies of bills of sale, inventory at the close

 

 

09800HB2494sam002- 36 -LRB098 08122 HLH 59891 a

1of each period for which a report is required of all cigarettes
2on hand, and other pertinent papers and documents relating to
3the purchase, sale, or disposition of cigarettes. Every sales
4invoice issued by a manufacturer representative to a retailer
5in this State shall contain the manufacturer's manufacturer
6representative license number. All books and records and other
7papers and documents that are required by this Act to be kept
8shall be kept in the English language, and shall, at all times
9during the usual business hours of the day, be subject to
10inspection by the Department or its duly authorized agents and
11employees. The Department may adopt rules that establish
12requirements, including record forms and formats, for records
13required to be kept and maintained by manufacturers with
14authority to maintain manufacturer representatives under
15Section 4f of this Act and their manufacturer representatives.
16For purposes of this Section, "records" means all data
17maintained by the manufacturers with authority to maintain
18manufacturer representatives under Section 4f of this Act and
19their manufacturer representatives, including data on paper,
20microfilm, microfiche or any type of machine sensible data
21compilation. Those books, records, papers, and documents shall
22be preserved for a period of at least 3 years after the date of
23the documents, or the date of the entries appearing in the
24records, unless the Department, in writing, authorizes their
25destruction or disposal at an earlier date. At all times during
26the usual business hours of the day, any duly authorized agent

 

 

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1or employee of the Department may enter any place of business
2of the manufacturers with authority to maintain manufacturer
3representatives under Section 4f of this Act and their
4manufacturer representatives, or inspect any motor vehicle
5used by a manufacturer representative in the course of
6business, without a search warrant and may inspect the
7premises, motor vehicle, and any packages of cigarettes therein
8contained to determine whether any of the provisions of this
9Act are being violated. If such agent or employee is denied
10free access or is hindered or interfered with in making such
11examination as herein provided, the ability to maintain
12marketing representatives in Illinois may be withdrawn by the
13Department.
14(Source: P.A. 97-587, eff. 8-26-11.)
 
15    (35 ILCS 130/11c new)
16    Sec. 11c. Retailers; records. Every retailer who is
17required to procure a license under this Act shall keep within
18Illinois complete and accurate records of cigarettes
19purchased, sold, or otherwise disposed of. It shall be the duty
20of every retail licensee to make sales records, copies of bills
21of sale, and inventory at the close of each period for which a
22report is required of all cigarettes on hand available upon
23reasonable notice for the purpose of investigation and control
24by the Department. Such records need not be maintained on the
25licensed premises, but must be maintained in the State of

 

 

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1Illinois; however, if access is available electronically, the
2records may be maintained out of state. However, all original
3invoices or copies thereof covering purchases of cigarettes
4must be retained on the licensed premises for a period of 90
5days after such purchase, unless the Department has granted a
6waiver in response to a written request in cases where records
7are kept at a central business location within the State of
8Illinois or in cases where records that are available
9electronically are maintained out of state. The Department may
10adopt rules that establish requirements, including record
11forms and formats, for records required to be kept and
12maintained by the retailer.
13    For purposes of this Section, "records" means all data
14maintained by the retailer, including data on paper, microfilm,
15microfiche or any type of machine sensible data compilation.
16Those books, records, papers, and documents shall be preserved
17for a period of at least 3 years after the date of the
18documents, or the date of the entries appearing in the records,
19unless the Department, in writing, authorizes their
20destruction or disposal at an earlier date. At all times during
21the usual business hours of the day, any duly authorized agent
22or employee of the Department may enter any place of business
23of the retailer without a search warrant and may inspect the
24premises to determine whether any of the provisions of this Act
25are being violated. If such agent or employee is denied free
26access or is hindered or interfered with in making such

 

 

09800HB2494sam002- 39 -LRB098 08122 HLH 59891 a

1examination as herein provided, the license of the retailer
2shall be subject to suspension or revocation by the Department.
 
3    (35 ILCS 130/23)  (from Ch. 120, par. 453.23)
4    Sec. 23. Every distributor, secondary distributor,
5retailer, manufacturer with authority to maintain manufacturer
6representatives under Section 4f of this Act and their
7manufacturer representatives, or other person who shall
8knowingly and wilfully sell or offer for sale any original
9package, as defined in this Act, having affixed thereto any
10fraudulent, spurious, imitation or counterfeit stamp, or stamp
11which has been previously affixed, or affixes a stamp which has
12previously been affixed to an original package, or who shall
13knowingly and wilfully sell or offer for sale any original
14package, as defined in this Act, having imprinted thereon
15underneath the sealed transparent wrapper thereof any
16fraudulent, spurious, imitation or counterfeit tax imprint,
17shall be deemed guilty of a Class 2 felony.
18(Source: P.A. 96-1027, eff. 7-12-10; 97-587, eff. 8-26-11.)
 
19    (35 ILCS 130/24)  (from Ch. 120, par. 453.24)
20    Sec. 24. Punishment for sale or possession of packages of
21contraband cigarettes.
22    (a) Possession or sale of 100 or less packages of
23contraband cigarettes. With the exception of licensed
24distributors, licensed secondary distributors, or licensed

 

 

09800HB2494sam002- 40 -LRB098 08122 HLH 59891 a

1transporters, as defined in Section 9c of this Act, any person
2who has in his or her possession or sells 100 or less original
3packages of contraband cigarettes is guilty of a Class A
4misdemeanor and a Class 4 felony for each subsequent offense
5occurring within 12 months of a prior offense.
6    (b) Possession or sale of more than 100 but less than 251
7packages of contraband cigarettes. With the exception of
8licensed distributors, licensed secondary distributors, or
9licensed transporters, as defined in Section 9c of this Act,
10any person who has in his or her possession or sells more than
11100 but less than 251 original packages of contraband
12cigarettes is guilty of a Class A misdemeanor for a first
13offense and a Class 4 felony for each subsequent offense.
14    (c) Possession or sale of more than 250 but less than 1,001
15packages of contraband cigarettes. With the exception of
16licensed distributors, licensed secondary distributors, or
17licensed transporters, as defined in Section 9c of this Act,
18any person who has in his or her possession or sells more than
19250 but less than 1,001 original packages of contraband
20cigarettes is guilty of a Class 4 felony.
21    (d) Possession or sale of more than 1,000 packages of
22contraband cigarettes. With the exception of licensed
23distributors, licensed secondary distributors, or licensed
24transporters, as defined in Section 9c of this Act, any person
25who has in his or her possession or sells more than 1,000
26original packages of contraband cigarettes is guilty of a Class

 

 

09800HB2494sam002- 41 -LRB098 08122 HLH 59891 a

13 felony.
2    (e) Any person licensed as a distributor, secondary
3distributor, or transporter, as defined in Section 9c of this
4Act, who has in his or her possession or sells 100 or less
5original packages of contraband cigarettes is guilty of a Class
6A misdemeanor and a Class 4 felony for each subsequent offense
7occurring within 12 months of a prior offense.
8    (f) Any person licensed as a distributor, secondary
9distributor, or transporter, as defined in Section 9c of this
10Act, who has in his or her possession or sells more than 100
11original packages of contraband cigarettes is guilty of a Class
124 felony.
13    (g) Notwithstanding subsections (e) through (f), licensed
14distributors and transporters, as defined in Section 9c of this
15Act, may possess unstamped packages of cigarettes.
16Notwithstanding subsections (e) through (f), licensed
17distributors may possess cigarettes that bear a tax stamp of
18another state or taxing jurisdiction. Notwithstanding
19subsections (e) through (f), a licensed distributor or licensed
20secondary distributor may possess contraband cigarettes
21returned to the distributor or licensed secondary distributor
22by a retailer if the distributor or licensed secondary
23distributor immediately conducts an inventory of the
24cigarettes being returned, the distributor or licensed
25secondary distributor and the retailer returning the
26contraband cigarettes sign the inventory, the distributor or

 

 

09800HB2494sam002- 42 -LRB098 08122 HLH 59891 a

1licensed secondary distributor provides a copy of the signed
2inventory to the retailer, and the distributor retains the
3inventory in its books and records and promptly notifies the
4Department of Revenue.
5    (h) Notwithstanding subsections (a) through (d) of this
6Section, a retailer unknowingly possessing contraband
7cigarettes obtained from a licensed distributor or licensed
8secondary distributor or knowingly possessing contraband
9cigarettes obtained from a licensed distributor is not subject
10to penalties under this Section if the retailer, within 48
11hours after discovering that the cigarettes are contraband
12cigarettes, excluding Saturdays, Sundays, and holidays: (i)
13notifies the Department and the licensed distributor or
14licensed secondary distributor from whom the cigarettes were
15obtained, orally and in writing, that he or she possesses
16contraband cigarettes obtained from a licensed distributor or
17licensed secondary distributor; (ii) places the contraband
18cigarettes in one or more containers and seals those
19containers; and (iii) places on the containers the following or
20similar language: "Contraband Cigarettes. Not For Sale." All
21contraband cigarettes in the possession of a retailer remain
22subject to forfeiture under the provisions of this Act.
23    Any retailer who knowingly possesses packages of
24cigarettes with a counterfeit stamp with intent to sell is
25guilty of a Class 2 felony. Any retailer who knowingly
26possesses unstamped packages of cigarettes with intent to sell

 

 

09800HB2494sam002- 43 -LRB098 08122 HLH 59891 a

1is guilty of a Class 4 felony. A retailer shall not be liable
2for unknowingly possessing, selling, or distributing to
3consumers cigarettes that contain an old stamp if the correct
4tax was collected at the point of sale and the cigarettes were
5obtained from a distributor licensed under this Act.
6(Source: P.A. 96-782, eff. 1-1-10; 96-1027, eff. 7-12-10.)
 
7    (35 ILCS 130/26)  (from Ch. 120, par. 453.26)
8    Sec. 26. Whoever acts as a distributor, or secondary
9distributor, retailer, or manufacturer representative of
10original packages without having a license, as required by this
11Act, shall be guilty of a Class 4 felony.
12(Source: P.A. 96-1027, eff. 7-12-10.)
 
13    Section 15. The Cigarette Use Tax Act is amended by
14changing Sections 2-10, 3-10, 4d, 4e, 28, and 30 as follows:
 
15    (35 ILCS 135/3-10)
16    Sec. 3-10. Cigarette enforcement.
17    (a) Prohibitions. It is unlawful for any person:
18        (1) to sell or distribute in this State; to acquire,
19    hold, own, possess, or transport, for sale or distribution
20    in this State; or to import, or cause to be imported into
21    this State for sale or distribution in this State:
22            (A) any cigarettes the package of which:
23                (i) bears any statement, label, stamp,

 

 

09800HB2494sam002- 44 -LRB098 08122 HLH 59891 a

1            sticker, or notice indicating that the
2            manufacturer did not intend the cigarettes to be
3            sold, distributed, or used in the United States,
4            including but not limited to labels stating "For
5            Export Only", "U.S. Tax Exempt", "For Use Outside
6            U.S.", or similar wording; or
7                (ii) does not comply with:
8                    (aa) all requirements imposed by or
9                pursuant to federal law regarding warnings and
10                other information on packages of cigarettes
11                manufactured, packaged, or imported for sale,
12                distribution, or use in the United States,
13                including but not limited to the precise
14                warning labels specified in the federal
15                Cigarette Labeling and Advertising Act, 15
16                U.S.C. 1333; and
17                    (bb) all federal trademark and copyright
18                laws;
19            (B) any cigarettes imported into the United States
20        in violation of 26 U.S.C. 5754 or any other federal
21        law, or implementing federal regulations;
22            (C) any cigarettes that such person otherwise
23        knows or has reason to know the manufacturer did not
24        intend to be sold, distributed, or used in the United
25        States; or
26            (D) any cigarettes for which there has not been

 

 

09800HB2494sam002- 45 -LRB098 08122 HLH 59891 a

1        submitted to the Secretary of the U.S. Department of
2        Health and Human Services the list or lists of the
3        ingredients added to tobacco in the manufacture of the
4        cigarettes required by the federal Cigarette Labeling
5        and Advertising Act, 15 U.S.C. 1335a;
6        (2) to alter the package of any cigarettes, prior to
7    sale or distribution to the ultimate consumer, so as to
8    remove, conceal, or obscure:
9            (A) any statement, label, stamp, sticker, or
10        notice described in subdivision (a)(1)(A)(i) of this
11        Section;
12            (B) any health warning that is not specified in, or
13        does not conform with the requirements of, the federal
14        Cigarette Labeling and Advertising Act, 15 U.S.C.
15        1333; or
16        (3) to affix any stamp required pursuant to this Act to
17    the package of any cigarettes described in subdivision
18    (a)(1) of this Section or altered in violation of
19    subdivision (a)(2).
20    (b) Documentation. On the first business day of each month,
21each person licensed to affix the State tax stamp to cigarettes
22shall file with the Department, for all cigarettes imported
23into the United States to which the person has affixed the tax
24stamp in the preceding month:
25        (1) a copy of:
26            (A) the permit issued pursuant to the Internal

 

 

09800HB2494sam002- 46 -LRB098 08122 HLH 59891 a

1        Revenue Code, 26 U.S.C. 5713, to the person importing
2        the cigarettes into the United States allowing the
3        person to import the cigarettes; and
4            (B) the customs form containing, with respect to
5        the cigarettes, the internal revenue tax information
6        required by the U.S. Bureau of Alcohol, Tobacco and
7        Firearms;
8        (2) a statement, signed by the person under penalty of
9    perjury, which shall be treated as confidential by the
10    Department and exempt from disclosure under the Freedom of
11    Information Act, identifying the brand and brand styles of
12    all such cigarettes, the quantity of each brand style of
13    such cigarettes, the supplier of such cigarettes, and the
14    person or persons, if any, to whom such cigarettes have
15    been conveyed for resale; and a separate statement, signed
16    by the individual under penalty of perjury, which shall not
17    be treated as confidential or exempt from disclosure,
18    separately identifying the brands and brand styles of such
19    cigarettes; and
20        (3) a statement, signed by an officer of the
21    manufacturer or importer under penalty of perjury,
22    certifying that the manufacturer or importer has complied
23    with:
24            (A) the package health warning and ingredient
25        reporting requirements of the federal Cigarette
26        Labeling and Advertising Act, 15 U.S.C. 1333 and 1335a,

 

 

09800HB2494sam002- 47 -LRB098 08122 HLH 59891 a

1        with respect to such cigarettes; and
2            (B) the provisions of Exhibit T of the Master
3        Settlement Agreement entered in the case of People of
4        the State of Illinois v. Philip Morris, et al. (Circuit
5        Court of Cook County, No. 96-L13146), including a
6        statement indicating whether the manufacturer is, or
7        is not, a participating tobacco manufacturer within
8        the meaning of Exhibit T.
9    (c) Administrative sanctions.
10        (1) Upon finding that a distributor, secondary
11    distributor, retailer, or a person has committed any of the
12    acts prohibited by subsection (a), knowing or having reason
13    to know that he or she has done so, or upon finding that a
14    distributor or person has failed to comply with any
15    requirement of subsection (b), the Department may revoke or
16    suspend the license or licenses of any distributor,
17    retailer, or secondary distributor pursuant to the
18    procedures set forth in Section 6 and impose on the
19    distributor, secondary distributor, retailer, or person, a
20    civil penalty in an amount not to exceed the greater of
21    500% of the retail value of the cigarettes involved or
22    $5,000.
23        (2) Cigarettes that are acquired, held, owned,
24    possessed, transported in, imported into, or sold or
25    distributed in this State in violation of this Section
26    shall be deemed contraband under this Act and are subject

 

 

09800HB2494sam002- 48 -LRB098 08122 HLH 59891 a

1    to seizure and forfeiture as provided in this Act, and all
2    such cigarettes seized and forfeited shall be destroyed or
3    maintained and used in an undercover capacity. Such
4    cigarettes shall be deemed contraband whether the
5    violation of this Section is knowing or otherwise.
6    (d) Unfair trade practices. In addition to any other
7penalties provided for in this Act, a violation of subsection
8(a) or subsection (b) of this Section shall constitute an
9unlawful practice as provided in the Consumer Fraud and
10Deceptive Business Practices Act.
11    (d-1) Retailers who are licensed under Section 4g of the
12Cigarette Tax Act and secondary distributors shall not be
13liable under subsections (c)(1) and (d) of this Section for
14unknowingly possessing, selling, or distributing to consumers
15or users cigarettes identified in subsection (a)(1) of this
16Section if the cigarettes possessed, sold, or distributed by
17the licensed retailer were obtained from a distributor or
18secondary distributor licensed under this Act or the Cigarette
19Tax Act.
20    (d-2) Criminal Penalties. A distributor, secondary
21distributor, retailer, or person who violates subsection (a),
22or a distributor, secondary distributor, or person who violates
23subsection (b) of this Section shall be guilty of a Class 4
24felony.
25    (e) Unfair cigarette sales. For purposes of the Trademark
26Registration and Protection Act and the Counterfeit Trademark

 

 

09800HB2494sam002- 49 -LRB098 08122 HLH 59891 a

1Act, cigarettes imported or reimported into the United States
2for sale or distribution under any trade name, trade dress, or
3trademark that is the same as, or is confusingly similar to,
4any trade name, trade dress, or trademark used for cigarettes
5manufactured in the United States for sale or distribution in
6the United States shall be presumed to have been purchased
7outside of the ordinary channels of trade.
8    (f) General provisions.
9        (1) This Section shall be enforced by the Department;
10    provided that, at the request of the Director of Revenue or
11    the Director's duly authorized agent, the State police and
12    all local police authorities shall enforce the provisions
13    of this Section. The Attorney General has concurrent power
14    with the State's Attorney of any county to enforce this
15    Section.
16        (2) For the purpose of enforcing this Section, the
17    Director of Revenue and any agency to which the Director
18    has delegated enforcement responsibility pursuant to
19    subdivision (f)(1) may request information from any State
20    or local agency and may share information with and request
21    information from any federal agency and any agency of any
22    other state or any local agency of any other state.
23        (3) In addition to any other remedy provided by law,
24    including enforcement as provided in subdivision (f)
25    (a)(1), any person may bring an action for appropriate
26    injunctive or other equitable relief for a violation of

 

 

09800HB2494sam002- 50 -LRB098 08122 HLH 59891 a

1    this Section; actual damages, if any, sustained by reason
2    of the violation; and, as determined by the court, interest
3    on the damages from the date of the complaint, taxable
4    costs, and reasonable attorney's fees. If the trier of fact
5    finds that the violation is flagrant, it may increase
6    recovery to an amount not in excess of 3 times the actual
7    damages sustained by reason of the violation.
8    (g) Definitions. As used in this Section:
9    "Importer" means that term as defined in 26 U.S.C. 5702(1).
10    "Package" means that term as defined in 15 U.S.C. 1332(4).
11    (h) Applicability.
12        (1) This Section does not apply to:
13            (A) cigarettes allowed to be imported or brought
14        into the United States for personal use; and
15            (B) cigarettes sold or intended to be sold as
16        duty-free merchandise by a duty-free sales enterprise
17        in accordance with the provisions of 19 U.S.C. 1555(b)
18        and any implementing regulations; except that this
19        Section shall apply to any such cigarettes that are
20        brought back into the customs territory for resale
21        within the customs territory.
22        (2) The penalties provided in this Section are in
23    addition to any other penalties imposed under other
24    provision of law.
25(Source: P.A. 95-1053, eff. 1-1-10; 96-782, eff. 1-1-10;
2696-1027, eff. 7-12-10.)
 

 

 

09800HB2494sam002- 51 -LRB098 08122 HLH 59891 a

1    (35 ILCS 135/4d)
2    Sec. 4d. Sales of cigarettes to and by retailers. In-state
3makers, manufacturers, or fabricators licensed as distributors
4under Section 4 of this Act and out-of-state makers,
5manufacturers, or fabricators holding permits under Section 7
6of this Act may not sell original packages of cigarettes to
7retailers. A retailer who is licensed under Section 4g of the
8Cigarette Tax Act may sell only original packages of cigarettes
9obtained from licensed secondary distributors or licensed
10distributors other than in-state makers, manufacturers, or
11fabricators licensed as distributors under Section 4 of this
12Act and out-of-state makers, manufacturers, or fabricators
13holding permits under Section 7 of this Act.
14(Source: P.A. 96-782, eff. 1-1-10; 96-1027, eff. 7-12-10.)
 
15    (35 ILCS 135/4e)
16    Sec. 4e. Sales of cigarettes to and by secondary
17distributors. In-state makers, manufacturers, and fabricators
18licensed as distributors under Section 4 of this Act and
19out-of-state makers, manufacturers, and fabricators holding
20permits under Section 7 of this Act may not sell original
21packages of cigarettes to secondary distributors. A secondary
22distributor may sell only original packages of cigarettes
23obtained from licensed distributors other than in-state
24makers, manufacturers, or fabricators licensed as distributors

 

 

09800HB2494sam002- 52 -LRB098 08122 HLH 59891 a

1under Section 4 of this Act and out-of-state makers,
2manufacturers, or fabricators holding permits under Section 7
3of this Act. Secondary distributors may sell cigarettes to
4Illinois retailers who are licensed under Section 4g of the
5Cigarette Tax Act for resale, and are also authorized to make
6retail sales of cigarettes at the location on the secondary
7distributor's license as long as the secondary distributor
8obtains a license under Section 4g of the Cigarette Tax Act and
9sells 75% or more of the cigarettes sold at such location to
10retailers who are licensed under Section 4g of the Cigarette
11Tax Act for resale.
12    All sales by secondary distributors to Illinois retailers
13who are licensed under Section 4g of the Cigarette Tax Act must
14be made at the location on the secondary distributor's license.
15Retailers who are issued a license under Section 4g of the
16Cigarette Tax Act must take possession of all cigarettes sold
17by the secondary distributor at the secondary distributor's
18licensed address. Secondary distributors may not make
19deliveries of cigarettes to Illinois retailers who are licensed
20under Section 4g of the Cigarette Tax Act.
21    Secondary distributors may not file a claim for credit or
22refund with the State under Section 14a of this Act.
23(Source: P.A. 96-1027, eff. 7-12-10.)
 
24    (35 ILCS 135/28)  (from Ch. 120, par. 453.58)
25    Sec. 28. Any person who (a) falsely or fraudulently makes,

 

 

09800HB2494sam002- 53 -LRB098 08122 HLH 59891 a

1forges, alters or counterfeits any stamp provided for herein,
2(b) causes or procures to be falsely or fraudulently made,
3forged, altered or counterfeited any such stamp, (c) knowingly
4and wilfully utters, publishes, passes or tenders as genuine
5any such false, altered, forged or counterfeited stamp, (d)
6falsely or fraudulently makes, forges, alters or counterfeits
7any tax imprint on an original package of cigarettes inside a
8sealed transparent wrapper, (e) causes or procures falsely or
9fraudulently to be made, forged, altered or counterfeited any
10such tax imprint or (f) knowingly and wilfully utters,
11publishes, passes or tenders as genuine any such false,
12altered, forged or counterfeited tax imprint, for the purpose
13of evading the tax imposed by this Act, shall be guilty of a
14Class 2 3 felony.
15(Source: P.A. 77-2229.)
 
16    (35 ILCS 135/30)  (from Ch. 120, par. 453.60)
17    Sec. 30. Punishment for sale or possession of unstamped
18packages of cigarettes, other than by a licensed distributor or
19transporter.
20    (a) Possession or sale of more than 9 but less than 101
21unstamped packages of cigarettes. With the exception of
22licensed distributors, licensed secondary distributors, or
23licensed transporters, as defined in Section 9c of the
24Cigarette Tax Act, any person who has in his or her possession
25or sells more than 9 but less than 101 original packages of

 

 

09800HB2494sam002- 54 -LRB098 08122 HLH 59891 a

1contraband cigarettes is guilty of a Class A misdemeanor and a
2Class 4 felony for each subsequent offense occurring within 12
3months of a prior offense.
4    (b) Possession or sale of more than 100 but less than 251
5unstamped packages of cigarettes. With the exception of
6licensed distributors, licensed secondary distributors, or
7licensed transporters, as defined in Section 9c of the
8Cigarette Tax Act, any person who has in his or her possession
9or sells more than 100 but less than 251 original packages of
10contraband cigarettes is guilty of a Class A misdemeanor for
11the first offense and a Class 4 felony for each subsequent
12offense.
13    (c) Possession or sale of more than 250 but less than 1,001
14unstamped packages of cigarettes. With the exception of
15licensed distributors, licensed secondary distributors, or
16licensed transporters, as defined in Section 9c of the
17Cigarette Tax Act, any person who has in his or her possession
18or sells more than 250 but less than 1,001 original packages of
19contraband cigarettes is guilty of a Class 4 felony.
20    (d) Possession or sale of more than 1,000 contraband
21packages of cigarettes. With the exception of licensed
22distributors, licensed secondary distributors, or licensed
23transporters, as defined in Section 9c of the Cigarette Tax
24Act, any person who has in his or her possession or sells, more
25than 1,000 original packages of contraband cigarettes is guilty
26of a Class 3 felony.

 

 

09800HB2494sam002- 55 -LRB098 08122 HLH 59891 a

1    (e) Any person licensed as a distributor, secondary
2distributor, or transporter, as defined in Section 9c of the
3Cigarette Tax Act, who has in his or her possession or sells
4100 or less original packages of contraband cigarettes is
5guilty of a Class A misdemeanor and a Class 4 felony for each
6subsequent offense occurring within 12 months of a prior
7offense.
8    (f) Any person licensed as a distributor, secondary
9distributor, or transporter, as defined in Section 9c of the
10Cigarette Tax Act, who has in his or her possession or sells
11more than 100 original packages of contraband cigarettes is
12guilty of a Class 4 felony.
13    (g) Notwithstanding subsections (e) through (f), licensed
14distributors and transporters, as defined in Section 9c of the
15Cigarette Tax Act, may possess unstamped packages of
16cigarettes. Notwithstanding subsections (e) through (f),
17licensed distributors may possess cigarettes that bear a tax
18stamp of another state or taxing jurisdiction. Notwithstanding
19subsections (e) through (f), a licensed distributor or licensed
20secondary distributor may possess contraband cigarettes
21returned to the distributor or licensed secondary distributor
22by a retailer if the distributor or licensed secondary
23distributor immediately conducts an inventory of the
24cigarettes being returned, the distributor or licensed
25secondary distributor and the retailer returning the
26contraband cigarettes sign the inventory, the distributor or

 

 

09800HB2494sam002- 56 -LRB098 08122 HLH 59891 a

1licensed secondary distributor provides a copy of the signed
2inventory to the retailer, and the distributor or licensed
3secondary distributor retains the inventory in its books and
4records and promptly notifies the Department of Revenue.
5    (h) Notwithstanding subsections (a) through (d) of this
6Section, a retailer unknowingly possessing contraband
7cigarettes obtained from a licensed distributor or licensed
8secondary distributor or knowingly possessing contraband
9cigarettes obtained from a licensed distributor or licensed
10secondary distributor is not subject to penalties under this
11Section if the retailer, within 48 hours after discovering that
12the cigarettes are contraband cigarettes, excluding Saturdays,
13Sundays, and holidays: (i) notifies the Department and the
14licensed distributor or licensed secondary distributor from
15whom the cigarettes were obtained, orally and in writing, that
16he or she possesses contraband cigarettes obtained from a
17licensed distributor or licensed secondary distributor; (ii)
18places the contraband cigarettes in one or more containers and
19seals those containers; and (iii) places on the containers the
20following or similar language: "Contraband Cigarettes. Not For
21Sale." All contraband cigarettes in the possession of a
22retailer remain subject to forfeiture under the provisions of
23this Act.
24    Any retailer who knowingly possesses packages of
25cigarettes with a counterfeit stamp with intent to sell is
26guilty of a Class 2 felony. Any retailer who knowingly

 

 

09800HB2494sam002- 57 -LRB098 08122 HLH 59891 a

1possesses unstamped packages of cigarettes with intent to sell
2is guilty of a Class 4 felony. A retailer shall not be liable
3for unknowingly possessing, selling, or distributing to
4consumers cigarettes that contain an old stamp if the correct
5tax was collected at the point of sale and the cigarettes were
6obtained from a distributor licensed under this Act.
7(Source: P.A. 96-782, eff. 1-1-10; 96-1027, eff. 7-12-10.)
 
8    Section 20. The Tobacco Products Tax Act of 1995 is amended
9by changing Sections 10-5, 10-20, 10-25, 10-35, and 10-50 and
10by adding Sections 10-21, 10-22, 10-37, and 10-53 as follows:
 
11    (35 ILCS 143/10-5)
12    Sec. 10-5. Definitions. For purposes of this Act:
13    "Business" means any trade, occupation, activity, or
14enterprise engaged in, at any location whatsoever, for the
15purpose of selling tobacco products.
16    "Cigarette" has the meaning ascribed to the term in Section
171 of the Cigarette Tax Act.
18    "Contraband little cigar" means:
19        (1) packages of little cigars containing 20 or 25
20    little cigars that do not bear a required tax stamp under
21    this Act;
22        (2) packages of little cigars containing 20 or 25
23    little cigars that bear a fraudulent, imitation, or
24    counterfeit tax stamp;

 

 

09800HB2494sam002- 58 -LRB098 08122 HLH 59891 a

1        (3) packages of little cigars containing 20 or 25
2    little cigars that are improperly tax stamped, including
3    packages of little cigars that bear only a tax stamp of
4    another state or taxing jurisdiction; or
5        (4) packages of little cigars containing other than 20
6    or 25 little cigars in the possession of a distributor,
7    retailer or wholesaler, unless the distributor, retailer,
8    or wholesaler possesses, or produces within the time frame
9    provided in Section 10-27 or 10-28 of this Act, an invoice
10    from a stamping distributor, distributor, or wholesaler
11    showing that the tax on the packages has been or will be
12    paid.
13    "Correctional Industries program" means a program run by a
14State penal institution in which residents of the penal
15institution produce tobacco products for sale to persons
16incarcerated in penal institutions or resident patients of a
17State operated mental health facility.
18    "Department" means the Illinois Department of Revenue.
19    "Distributor" means any of the following:
20        (1) Any manufacturer or wholesaler in this State
21    engaged in the business of selling tobacco products who
22    sells, exchanges, or distributes tobacco products to
23    retailers or consumers in this State.
24        (2) Any manufacturer or wholesaler engaged in the
25    business of selling tobacco products from without this
26    State who sells, exchanges, distributes, ships, or

 

 

09800HB2494sam002- 59 -LRB098 08122 HLH 59891 a

1    transports tobacco products to retailers or consumers
2    located in this State, so long as that manufacturer or
3    wholesaler has or maintains within this State, directly or
4    by subsidiary, an office, sales house, or other place of
5    business, or any agent or other representative operating
6    within this State under the authority of the person or
7    subsidiary, irrespective of whether the place of business
8    or agent or other representative is located here
9    permanently or temporarily.
10        (3) Any retailer who receives tobacco products on which
11    the tax has not been or will not be paid by another
12    distributor.
13    "Distributor" does not include any person, wherever
14resident or located, who makes, manufactures, or fabricates
15tobacco products as part of a Correctional Industries program
16for sale to residents incarcerated in penal institutions or
17resident patients of a State operated mental health facility.
18    "Little cigar" means and includes any roll, made wholly or
19in part of tobacco, where such roll has an integrated cellulose
20acetate filter and weighs less than 4 pounds per thousand and
21the wrapper or cover of which is made in whole or in part of
22tobacco.
23    "Manufacturer" means any person, wherever resident or
24located, who manufactures and sells tobacco products, except a
25person who makes, manufactures, or fabricates tobacco products
26as a part of a Correctional Industries program for sale to

 

 

09800HB2494sam002- 60 -LRB098 08122 HLH 59891 a

1persons incarcerated in penal institutions or resident
2patients of a State operated mental health facility.
3    Beginning on January 1, 2013, "moist snuff" means any
4finely cut, ground, or powdered tobacco that is not intended to
5be smoked, but shall not include any finely cut, ground, or
6powdered tobacco that is intended to be placed in the nasal
7cavity.
8    "Person" means any natural individual, firm, partnership,
9association, joint stock company, joint venture, limited
10liability company, or public or private corporation, however
11formed, or a receiver, executor, administrator, trustee,
12conservator, or other representative appointed by order of any
13court.
14    "Place of business" means and includes any place where
15tobacco products are sold or where tobacco products are
16manufactured, stored, or kept for the purpose of sale or
17consumption, including any vessel, vehicle, airplane, train,
18or vending machine.
19    "Retailer" means any person in this State engaged in the
20business of selling tobacco products to consumers in this
21State, regardless of quantity or number of sales.
22    "Sale" means any transfer, exchange, or barter in any
23manner or by any means whatsoever for a consideration and
24includes all sales made by persons.
25    "Stamp" or "stamps" mean the indicia required to be affixed
26on a package of little cigars that evidence payment of the tax

 

 

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1on packages of little cigars containing 20 or 25 little cigars
2under Section 10-10 of this Act. These stamps shall be the same
3stamps used for cigarettes under the Cigarette Tax Act.
4    "Stamping distributor" means a distributor licensed under
5this Act and also licensed as a distributor under the Cigarette
6Tax Act or Cigarette Use Tax Act.
7    "Tobacco products" means any cigars, including little
8cigars; cheroots; stogies; periques; granulated, plug cut,
9crimp cut, ready rubbed, and other smoking tobacco; snuff
10(including moist snuff) or snuff flour; cavendish; plug and
11twist tobacco; fine-cut and other chewing tobaccos; shorts;
12refuse scraps, clippings, cuttings, and sweeping of tobacco;
13and other kinds and forms of tobacco, prepared in such manner
14as to be suitable for chewing or smoking in a pipe or
15otherwise, or both for chewing and smoking; but does not
16include cigarettes as defined in Section 1 of the Cigarette Tax
17Act or tobacco purchased for the manufacture of cigarettes by
18cigarette distributors and manufacturers defined in the
19Cigarette Tax Act and persons who make, manufacture, or
20fabricate cigarettes as a part of a Correctional Industries
21program for sale to residents incarcerated in penal
22institutions or resident patients of a State operated mental
23health facility.
24    "Wholesale price" means the established list price for
25which a manufacturer sells tobacco products to a distributor,
26before the allowance of any discount, trade allowance, rebate,

 

 

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1or other reduction. In the absence of such an established list
2price, the manufacturer's invoice price at which the
3manufacturer sells the tobacco product to unaffiliated
4distributors, before any discounts, trade allowances, rebates,
5or other reductions, shall be presumed to be the wholesale
6price.
7    "Wholesaler" means any person, wherever resident or
8located, engaged in the business of selling tobacco products to
9others for the purpose of resale. "Wholesaler", when used in
10this Act, does not include a person licensed as a distributor
11under Section 10-20 of this Act unless expressly stated in this
12Act.
13(Source: P.A. 97-688, eff. 6-14-12; 98-273, eff. 8-9-13.)
 
14    (35 ILCS 143/10-20)
15    Sec. 10-20. Distributor's Licenses. It shall be unlawful
16for any person to engage in business as a distributor of
17tobacco products within the meaning of this Act without first
18having obtained a license to do so from the Department.
19Application for that license shall be made to the Department in
20a form prescribed and furnished by the Department. Each
21applicant for a license shall furnish to the Department on a
22form, signed and verified by the applicant, the following
23information:
24        (1) The name of the applicant.
25        (2) The address of the location at which the applicant

 

 

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1    proposes to engage in business as a distributor of tobacco
2    products.
3        (3) Other information the Department may reasonably
4    require.
5    Except as otherwise provided in this Section, every
6applicant who is required to procure a distributor's license
7shall file with his or her application a joint and several
8bond. The bond shall be executed to the Department of Revenue,
9with good and sufficient surety or sureties residing or
10licensed to do business within the State of Illinois,
11conditioned upon the true and faithful compliance by the
12licensee with all of the provisions of this Act. The Department
13shall fix the amount of the bond for each applicant, taking
14into consideration the amount of money expected to become due
15from the applicant under this Act. The amount of bond required
16by the Department shall be an amount that, in its opinion, will
17protect the State of Illinois against failure to pay the amount
18that may become due from the applicant under this Act, but the
19amount of the security required by the Department shall not
20exceed 3 times the amount of the applicant's average monthly
21tax liability, or $50,000, whichever amount is lower. The bond,
22a reissue, or a substitute shall be kept in full force and
23effect during the entire period covered by the license. A
24separate application for license shall be made, and bond filed,
25for each place of business at which a person who is required to
26procure a distributor's license proposes to engage in business

 

 

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1as a distributor under this Act.
2    The Department, upon receipt of an application and bond in
3proper form, shall issue to the applicant a license, in a form
4prescribed by the Department, which shall permit the applicant
5to whom it is issued to engage in business as a distributor at
6the place shown on his or her application. The license shall be
7issued by the Department without charge or cost to the
8applicant. No license issued under this Act is transferable or
9assignable. The license shall be conspicuously displayed in the
10place of business conducted by the licensee under the license.
11    The bonding requirement in this Section does not apply to
12an applicant for a distributor's license who is already bonded
13under the Cigarette Tax Act or the Cigarette Use Tax Act.
14Licenses issued by the Department under this Act shall be valid
15for a period not to exceed one year after issuance unless
16sooner revoked, canceled, or suspended as provided in this Act.
17    No license shall be issued to any person who is in default
18to the State of Illinois for moneys due under this Act or any
19other tax Act administered by the Department.
20    The Department may, in its discretion, upon application,
21authorize the payment of the tax imposed under Section 10-10 by
22any distributor or manufacturer not otherwise subject to the
23tax imposed under this Act who, to the satisfaction of the
24Department, furnishes adequate security to ensure payment of
25the tax. The distributor or manufacturer shall be issued,
26without charge, a license to remit the tax. When so authorized,

 

 

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1it shall be the duty of the distributor or manufacturer to
2remit the tax imposed upon the wholesale price of tobacco
3products sold or otherwise disposed of to retailers or
4consumers located in this State, in the same manner and subject
5to the same requirements as any other distributor or
6manufacturer licensed under this Act.
7    The Department may revoke, suspend, or cancel the license
8of a distributor of roll-your-own tobacco (as that term is used
9in Section 10 of the Tobacco Product Manufacturers' Escrow Act)
10under this Act if the tobacco product manufacturer, as defined
11in Section 10 of the Tobacco Product Manufacturers' Escrow Act,
12that made or sold the roll-your-own tobacco has failed to
13become a participating manufacturer, as defined in subdivision
14(a)(1) of Section 15 of the Tobacco Product Manufacturers'
15Escrow Act, or has failed to create a qualified escrow fund for
16any roll-your-own tobacco manufactured by the tobacco product
17manufacturer and sold in this State or otherwise failed to
18bring itself into compliance with subdivision (a)(2) of Section
1915 of the Tobacco Product Manufacturers' Escrow Act.
20    Any person aggrieved by any decision of the Department
21under this Section may, within 20 days after notice of that
22decision, protest and request a hearing, whereupon the
23Department must give notice to that person of the time and
24place fixed for the hearing and must hold a hearing in
25conformity with the provisions of this Act and then issue its
26final administrative decision in the matter to that person. In

 

 

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1the absence of such a protest within 20 days, the Department's
2decision becomes final without any further determination being
3made or notice given.
4(Source: P.A. 92-231, eff. 8-2-01; 92-737, eff. 7-25-02.)
 
5    (35 ILCS 143/10-21 new)
6    Sec. 10-21. Retailer's license. Beginning on January 1,
72016, no person may engage in business as a retailer of tobacco
8products in this State without first having obtained a license
9from the Department. Application for license shall be made to
10the Department, by electronic means, in a form prescribed by
11the Department. Each applicant for a license under this Section
12shall furnish to the Department, in an electronic format
13established by the Department, the following information:
14        (1) the name and address of the applicant;
15        (2) the address of the location at which the applicant
16    proposes to engage in business as a retailer of tobacco
17    products in this State;
18        (3) such other additional information as the
19    Department may lawfully require by its rules and
20    regulations.
21    The annual license fee payable to the Department for each
22retailer's license shall be $75. The fee will be deposited into
23the Tax Compliance and Administration Fund and shall be used
24for the cost of tobacco retail inspection and contraband
25tobacco and tobacco smuggling with at least two-thirds of the

 

 

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1money being used for contraband tobacco and tobacco smuggling
2operations and enforcement.
3    Each applicant for license shall pay such fee to the
4Department at the time of submitting its application for
5license to the Department. The Department shall require an
6applicant for a license under this Section to electronically
7file and pay the fee.
8    A separate annual license fee shall be paid for each place
9of business at which a person who is required to procure a
10retailer's license under this Section proposes to engage in
11business as a retailer in Illinois under this Act.
12    The following are ineligible to receive a retailer's
13license under this Act:
14        (1) a person who has been convicted of a felony under
15    any federal or State law for smuggling cigarettes or
16    tobacco products or tobacco tax evasion, if the Department,
17    after investigation and a hearing if requested by the
18    applicant, determines that such person has not been
19    sufficiently rehabilitated to warrant the public trust;
20    and
21        (2) a corporation, if any officer, manager or director
22    thereof, or any stockholder or stockholders owning in the
23    aggregate more than 5% of the stock of such corporation,
24    would not be eligible to receive a license under this Act
25    for any reason.
26    The Department, upon receipt of an application and license

 

 

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1fee, in proper form, from a person who is eligible to receive a
2retailer's license under this Act, shall issue to such
3applicant a license in form as prescribed by the Department,
4which license shall permit the applicant to which it is issued
5to engage in business as a retailer under this Act at the place
6shown in his application. All licenses issued by the Department
7under this Section shall be valid for a period not to exceed
8one year after issuance unless sooner revoked, canceled or
9suspended as provided in this Act. No license issued under this
10Section is transferable or assignable. Such license shall be
11conspicuously displayed in the place of business conducted by
12the licensee in Illinois under such license. A person who
13obtains a license as a retailer who ceases to do business as
14specified in the license, or who never commenced business, or
15who obtains a distributor's license, or whose license is
16suspended or revoked, shall immediately surrender the license
17to the Department. The Department shall not issue a license to
18a retailer unless the retailer is also validly registered under
19the Retailers Occupation Tax Act.
20    A retailer as defined under this Act need not obtain an
21additional license under this Act, but shall be deemed to be
22sufficiently licensed by virtue of his being properly licensed
23as a retailer under Section 4g of the Cigarette Tax Act.
24    Any person aggrieved by any decision of the Department
25under this subsection may, within 30 days after notice of the
26decision, protest and request a hearing. Upon receiving a

 

 

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1request for a hearing, the Department shall give notice to the
2person requesting the hearing of the time and place fixed for
3the hearing and shall hold a hearing in conformity with the
4provisions of this Act and then issue its final administrative
5decision in the matter to that person. In the absence of a
6protest and request for a hearing within 30 days, the
7Department's decision shall become final without any further
8determination being made or notice given.
 
9    (35 ILCS 143/10-22 new)
10    Sec. 10-22. Purchases of tobacco products by licensed
11retailers. A person who possesses a retailer's license under
12Section 10-21 of this Act shall obtain tobacco products for
13sale only from a licensed distributor or licensed secondary
14distributor.
 
15    (35 ILCS 143/10-25)
16    Sec. 10-25. License actions.
17    (a) The Department may, after notice and a hearing, revoke,
18cancel, or suspend the license of any distributor or retailer
19who violates any of the provisions of this Act. The notice
20shall specify the alleged violation or violations upon which
21the revocation, cancellation, or suspension proceeding is
22based.
23    (b) The Department may revoke, cancel, or suspend the
24license of any distributor for a violation of the Tobacco

 

 

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1Product Manufacturers' Escrow Enforcement Act as provided in
2Section 20 of that Act.
3    (c) If the retailer has a training program that facilitates
4compliance with minimum-age tobacco laws, the Department shall
5suspend for 3 days the license of that retailer for a fourth or
6subsequent violation of the Prevention of Tobacco Use by Minors
7and Sale and Distribution of Tobacco Products Act, as provided
8in subsection (a) of Section 2 of that Act. For the purposes of
9this Section, any violation of subsection (a) of Section 2 of
10the Prevention of Tobacco Use by Minors and Sale and
11Distribution of Tobacco Products Act occurring at the
12retailer's licensed location, during a 24-month period, shall
13be counted as a violation against the retailer.
14    If the retailer does not have a training program that
15facilitates compliance with minimum-age tobacco laws, the
16Department shall suspend for 3 days the license of that
17retailer for a second violation of the Prevention of Tobacco
18Use by Minors and Sale and Distribution of Tobacco Products
19Act, as provided in subsection (a-5) of Section 2 of that Act.
20    If the retailer does not have a training program that
21facilitates compliance with minimum-age tobacco laws, the
22Department shall suspend for 7 days the license of that
23retailer for a third violation of the Prevention of Tobacco Use
24by Minors and Sale and Distribution of Tobacco Products Act, as
25provided in subsection (a-5) of Section 2 of that Act.
26    If the retailer does not have a training program that

 

 

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1facilitates compliance with minimum-age tobacco laws, the
2Department shall suspend for 30 days the license of a retailer
3for a fourth or subsequent violation of the Prevention of
4Tobacco Use by Minors and Sale and Distribution of Tobacco
5Products Act, as provided in subsection (a-5) of Section 2 of
6that Act.
7    A training program that facilitates compliance with
8minimum-age tobacco laws must include at least the following
9elements: (i) it must explain that only individuals displaying
10valid identification demonstrating that they are 18 years of
11age or older shall be eligible to purchase cigarettes or
12tobacco products; (ii) it must explain where a clerk can check
13identification for a date of birth; and (iii) it must explain
14the penalties that a clerk and retailer are subject to for
15violations of the Prevention of Tobacco Use by Minors and Sale
16and Distribution of Tobacco Products Act.
17    (d) The Department may, by application to any circuit
18court, obtain an injunction restraining any person who engages
19in business as a distributor of tobacco products without a
20license (either because his or her license has been revoked,
21canceled, or suspended or because of a failure to obtain a
22license in the first instance) from engaging in that business
23until that person, as if that person were a new applicant for a
24license, complies with all of the conditions, restrictions, and
25requirements of Section 10-20 of this Act and qualifies for and
26obtains a license. Refusal or neglect to obey the order of the

 

 

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1court may result in punishment for contempt.
2(Source: P.A. 92-737, eff. 7-25-02.)
 
3    (35 ILCS 143/10-35)
4    Sec. 10-35. Record keeping.
5    (a) Every distributor, as defined in Section 10-5, shall
6keep complete and accurate records of tobacco products held,
7purchased, manufactured, brought in or caused to be brought in
8from without the State, and tobacco products sold, or otherwise
9disposed of, and shall preserve and keep all invoices, bills of
10lading, sales records, and copies of bills of sale, the
11wholesale price for tobacco products sold or otherwise disposed
12of, an inventory of tobacco products prepared as of December 31
13of each year or as of the last day of the distributor's fiscal
14year if he or she files federal income tax returns on the basis
15of a fiscal year, and other pertinent papers and documents
16relating to the manufacture, purchase, sale, or disposition of
17tobacco products. Every sales invoice issued by a licensed
18distributor to a retailer in this State shall contain the
19distributor's Tobacco Products License number.
20    (b) Every retailer, as defined in Section 10-5, shall keep
21complete and accurate records of tobacco products held,
22purchased, sold, or otherwise disposed of, and shall preserve
23and keep all invoices, bills of lading, sales records, and
24copies of bills of sale, returns and other pertinent papers and
25documents relating to the purchase, sale, or disposition of

 

 

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1tobacco products. Such records need not be maintained on the
2licensed premises, but must be maintained in the State of
3Illinois; however, if access is available electronically, the
4records may be maintained out of state. However, all original
5invoices or copies thereof covering purchases of tobacco
6products must be retained on the licensed premises for a period
7of 90 days after such purchase, unless the Department has
8granted a waiver in response to a written request in cases
9where records are kept at a central business location within
10the State of Illinois or in cases where records that are
11available electronically are maintained out of state.
12    (c) Books, records, papers, and documents that are required
13by this Act to be kept shall, at all times during the usual
14business hours of the day, be subject to inspection by the
15Department or its duly authorized agents and employees. The
16books, records, papers, and documents for any period with
17respect to which the Department is authorized to issue a notice
18of tax liability shall be preserved until the expiration of
19that period.
20(Source: P.A. 89-21, eff. 6-6-95.)
 
21    (35 ILCS 143/10-37 new)
22    Sec. 10-37. Proof of payment of tax imposed by this Act.
23Every licensed distributor of tobacco products in this State is
24required to show proof of the tax having been paid as required
25by this Act by displaying its Tobacco Products License number

 

 

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1on every sales invoice issued to a retailer in this State. No
2retailer shall possess tobacco products without either a proper
3invoice indicating that the tobacco products tax was paid by a
4distributor for the tobacco products in the retailer's
5possession or other proof that the tax was paid by the retailer
6if it has purchased tobacco products on which tax has not been
7paid as required by this Act. Failure to comply with the
8provisions of this paragraph may be grounds for revocation of a
9distributor's or retailer's license in accordance with Section
1010-25 of this Act or Section 6 of the Cigarette Tax Act. In
11addition, the Department may impose a civil penalty not to
12exceed $1,000 for each violation, which shall be deposited into
13the Tax Compliance and Administration Fund.
 
14    (35 ILCS 143/10-50)
15    Sec. 10-50. Violations and penalties. When the amount due
16is under $300, any distributor who fails to file a return,
17willfully wilfully fails or refuses to make any payment to the
18Department of the tax imposed by this Act, or files a
19fraudulent return, or any officer or agent of a corporation
20engaged in the business of distributing tobacco products to
21retailers and consumers located in this State who signs a
22fraudulent return filed on behalf of the corporation, or any
23accountant or other agent who knowingly enters false
24information on the return of any taxpayer under this Act is
25guilty of a Class 4 felony.

 

 

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1    Any person who violates any provision of Sections Section
210-20, 10-21, or 10-22 of this Act, fails to keep books and
3records as required under this Act, or willfully wilfully
4violates a rule or regulation of the Department for the
5administration and enforcement of this Act is guilty of a Class
64 felony. A person commits a separate offense on each day that
7he or she engages in business in violation of Sections Section
810-20, 10-21, or 10-22 of this Act.
9    When the amount due is under $300, any person who accepts
10money that is due to the Department under this Act from a
11taxpayer for the purpose of acting as the taxpayer's agent to
12make the payment to the Department, but who fails to remit the
13payment to the Department when due, is guilty of a Class 4
14felony.
15    Any person who violates any provision of Sections 10-20,
1610-21 and 10-22 of this Act, fails to keep books and records as
17required under this Act, or willfully violates a rule or
18regulation of the Department for the administration and
19enforcement of this Act is guilty of a business offense and may
20be fined up to $5,000. A person commits a separate offense on
21each day that he or she engages in business in violation of
22Sections 10-20, 10-21 and 10-22 of this Act.
23    When the amount due is $300 or more, any distributor who
24files, or causes to be filed, a fraudulent return, or any
25officer or agent of a corporation engaged in the business of
26distributing tobacco products to retailers and consumers

 

 

09800HB2494sam002- 76 -LRB098 08122 HLH 59891 a

1located in this State who files or causes to be filed or signs
2or causes to be signed a fraudulent return filed on behalf of
3the corporation, or any accountant or other agent who knowingly
4enters false information on the return of any taxpayer under
5this Act is guilty of a Class 3 felony.
6    When the amount due is $300 or more, any person engaged in
7the business of distributing tobacco products to retailers and
8consumers located in this State who fails to file a return,
9willfully wilfully fails or refuses to make any payment to the
10Department of the tax imposed by this Act, or accepts money
11that is due to the Department under this Act from a taxpayer
12for the purpose of acting as the taxpayer's agent to make
13payment to the Department but fails to remit such payment to
14the Department when due is guilty of a Class 3 felony.
15    When the amount due is under $300, any retailer who fails
16to file a return, willfully fails or refuses to make any
17payment to the Department of the tax imposed by this Act, or
18files a fraudulent return, or any officer or agent of a
19corporation engaged in the retail business of selling tobacco
20products to purchasers of tobacco products for use and
21consumption located in this State who signs a fraudulent return
22filed on behalf of the corporation, or any accountant or other
23agent who knowingly enters false information on the return of
24any taxpayer under this Act is guilty of a Class A misdemeanor
25for a first offense and a Class 4 felony for each subsequent
26offense.

 

 

09800HB2494sam002- 77 -LRB098 08122 HLH 59891 a

1    When the amount due is $300 or more, any retailer who fails
2to file a return, willfully fails or refuses to make any
3payment to the Department of the tax imposed by this Act, or
4files a fraudulent return, or any officer or agent of a
5corporation engaged in the retail business of selling tobacco
6products to purchasers of tobacco products for use and
7consumption located in this State who signs a fraudulent return
8filed on behalf of the corporation, or any accountant or other
9agent who knowingly enters false information on the return of
10any taxpayer under this Act is guilty of a Class 4 felony.
11    Any person whose principal place of business is in this
12State and who is charged with a violation under this Section
13shall be tried in the county where his or her principal place
14of business is located unless he or she asserts a right to be
15tried in another venue. If the taxpayer does not have his or
16her principal place of business in this State, however, the
17hearing must be held in Sangamon County unless the taxpayer
18asserts a right to be tried in another venue.
19    Any taxpayer or agent of a taxpayer who with the intent to
20defraud purports to make a payment due to the Department by
21issuing or delivering a check or other order upon a real or
22fictitious depository for the payment of money, knowing that it
23will not be paid by the depository, is guilty of a deceptive
24practice in violation of Section 17-1 of the Criminal Code of
252012.
26    A prosecution for a violation described in this Section may

 

 

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1be commenced within 3 years after the commission of the act
2constituting the violation.
3(Source: P.A. 97-1150, eff. 1-25-13.)
 
4    (35 ILCS 143/10-53 new)
5    Sec. 10-53. Acting as a retailer of tobacco products
6without a license. Any person who knowingly acts as a retailer
7of tobacco products in this State without first having obtained
8a license to do so in compliance with Section 10-21 of this Act
9or a license in compliance with Section 4g of the Cigarette Tax
10Act shall be guilty of a Class A misdemeanor for the first
11offense and a Class 4 felony for a second or subsequent
12offense. Each day such person operates as a retailer without a
13license constitutes a separate offense.
 
14    Section 25. The Prevention of Tobacco Use by Minors and
15Sale and Distribution of Tobacco Products Act is amended by
16changing Sections 1 and 2 as follows:
 
17    (720 ILCS 675/1)  (from Ch. 23, par. 2357)
18    Sec. 1. Prohibition on sale to and possession of tobacco by
19minors; prohibition on the distribution of tobacco samples to
20any person; use of identification cards; vending machines;
21lunch wagons; out-of-package sales.
22    (a) No minor under 18 years of age shall buy any tobacco
23product. No person shall sell, buy for, distribute samples of

 

 

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1or furnish any tobacco product to any minor under 18 years of
2age.
3    (a-5) No minor under 16 years of age may sell any tobacco
4product at a retail establishment selling tobacco products.
5This subsection does not apply to a sales clerk in a
6family-owned business which can prove that the sales clerk is
7in fact a son or daughter of the owner.
8    (a-6) No minor under 18 years of age in the furtherance or
9facilitation of obtaining any tobacco product shall display or
10use a false or forged identification card or transfer, alter,
11or deface an identification card.
12     (a-7) No minor under 18 years of age shall possess any
13cigar, cigarette, smokeless tobacco, or tobacco in any of its
14forms.
15    (a-8) A person shall not distribute without charge samples
16of any tobacco product to any other person, regardless of age:
17        (1) within a retail establishment selling tobacco
18    products, unless the retailer has verified the purchaser's
19    age with a government issued identification;
20        (2) from a lunch wagon; or
21        (3) on a public way as a promotion or advertisement of
22    a tobacco manufacturer or tobacco product.
23    This subsection (a-8) does not apply to the distribution of
24a tobacco product sample in any adult-only facility.
25    (a-9) For the purpose of this Section:
26        "Adult-only facility means a facility or restricted

 

 

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1    area (whether open-air or enclosed) where the operator
2    ensures or has a reasonable basis to believe (such as by
3    checking identification as required under State law, or by
4    checking the identification of any person appearing to be
5    under the age of 27) that no person under legal age is
6    present. A facility or restricted area need not be
7    permanently restricted to persons under legal age to
8    constitute an adult-only facility, provided that the
9    operator ensures or has a reasonable basis to believe that
10    no person under legal age is present during the event or
11    time period in question.
12        "Lunch wagon" means a mobile vehicle designed and
13    constructed to transport food and from which food is sold
14    to the general public.
15        "Smokeless tobacco" means any tobacco products that
16    are suitable for dipping or chewing.
17        "Tobacco product" means any cigar, cigarette,
18    smokeless tobacco, or tobacco in any of its forms.
19    (b) Tobacco products listed in this Section may be sold
20through a vending machine only if such tobacco products are not
21placed together with any non-tobacco product, other than
22matches, in the vending machine and the vending machine is in
23any of the following locations:
24        (1) (Blank).
25        (2) Places to which minors under 18 years of age are
26    not permitted access.

 

 

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1        (3) Places where alcoholic beverages are sold and
2    consumed on the premises and vending machine operation is
3    under the direct supervision of the owner or manager.
4        (4) (Blank).
5        (5) Places where the vending machine can only be
6    operated by the owner or an employee over age 18 either
7    directly or through a remote control device if the device
8    is inaccessible to all customers.
9    (c) (Blank).
10    (d) The sale or distribution by any person of a tobacco
11product in this Section, including but not limited to a single
12or loose cigarette, that is not contained within a sealed
13container, pack, or package as provided by the manufacturer,
14which container, pack, or package bears the health warning
15required by federal law, is prohibited.
16    (e) It is not a violation of this Act for a person under 18
17years of age to purchase or possess a cigar, cigarette,
18smokeless tobacco or tobacco in any of its forms if the person
19under the age of 18 purchases or is given the cigar, cigarette,
20smokeless tobacco or tobacco in any of its forms from a retail
21seller of tobacco products or an employee of the retail seller
22pursuant to a plan or action to investigate, patrol, or
23otherwise conduct a "sting operation" or enforcement action
24against a retail seller of tobacco products or a person
25employed by the retail seller of tobacco products or on any
26premises authorized to sell tobacco products to determine if

 

 

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1tobacco products are being sold or given to persons under 18
2years of age if the "sting operation" or enforcement action is
3approved by, conducted by, or conducted on behalf of the
4Department of State Police, the county sheriff, a municipal
5police department, the Department of Revenue, the Department of
6Public Health, or a local health department. The results of any
7sting operation or enforcement action, including the name of
8the clerk, shall be provided to the retail seller within 7
9business days.
10(Source: P.A. 95-905, eff. 1-1-09; 96-179, eff. 8-10-09;
1196-446, eff. 1-1-10; 96-1000, eff. 7-2-10.)
 
12    (720 ILCS 675/2)  (from Ch. 23, par. 2358)
13    Sec. 2. Penalties.
14    (a) Any person who violates subsection (a) or (a-5) of
15Section 1 or Section 1.5 of this Act is guilty of a petty
16offense. For the first offense in a 24-month period, the person
17shall be fined $200 if his or her employer has a training
18program that facilitates compliance with minimum-age tobacco
19laws. For the second offense in a 24-month period, the person
20shall be fined $400 if his or her employer has a training
21program that facilitates compliance with minimum-age tobacco
22laws. For the third offense in a 24-month period, the person
23shall be fined $600 if his or her employer has a training
24program that facilitates compliance with minimum-age tobacco
25laws. For the fourth or subsequent offense in a 24-month

 

 

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1period, the person shall be fined $800 if his or her employer
2has a training program that facilitates compliance with
3minimum-age tobacco laws. For the purposes of this subsection,
4the 24-month period shall begin with the person's first
5violation of the Act. The penalties in this subsection are in
6addition to any other penalties prescribed under the Cigarette
7Tax Act and the Tobacco Products Tax Act of 1995.
8    (a-5) Any person who violates subsection (a) or (a-5) of
9Section 1 or Section 1.5 of this Act is guilty of a petty
10offense. For the first offense, the retailer shall be fined
11$200 if it does not have a training program that facilitates
12compliance with minimum-age tobacco laws. For the second
13offense, the retailer shall be fined $400 if it does not have a
14training program that facilitates compliance with minimum-age
15tobacco laws. For the third offense, the retailer shall be
16fined $600 if it does not have a training program that
17facilitates compliance with minimum-age tobacco laws. For the
18fourth or subsequent offense in a 24-month period, the retailer
19shall be fined $800 if it does not have a training program that
20facilitates compliance with minimum-age tobacco laws. For the
21purposes of this subsection, the 24-month period shall begin
22with the person's first violation of the Act. The penalties in
23this subsection are in addition to any other penalties
24prescribed under the Cigarette Tax Act and the Tobacco Products
25Tax Act of 1995.
26    (a-6) For the purpose of this Act, a training program that

 

 

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1facilitates compliance with minimum-age tobacco laws must
2include at least the following elements: (i) it must explain
3that only individuals displaying valid identification
4demonstrating that they are 18 years of age or older shall be
5eligible to purchase cigarettes or tobacco products; (ii) it
6must explain where a clerk can check identification for a date
7of birth; and (iii) it must explain the penalties that a clerk
8and retailer are subject to for violations of the Prevention of
9Tobacco Use by Minors and Sale and Distribution of Tobacco
10Products Act.
11Any person who violates subsection (a), (a-5), or (a-6) of
12Section 1 or Section 1.5 of this Act is guilty of a petty
13offense and for the first offense shall be fined $200, $400 for
14the second offense in a 12-month period, and $600 for the third
15or any subsequent offense in a 12-month period.
16    (b) If a minor violates subsection (a-7) of Section 1 he or
17she is guilty of a petty offense and the court may impose a
18sentence of 25 15 hours of community service and or a fine of
19$50 $25 for a first violation. If a minor violates subsection
20(a-6) of Section 1 he or she is guilty of a Class A
21misdemeanor.
22    (c) A second violation by a minor of subsection (a-7) of
23Section 1 that occurs within 12 months after the first
24violation is punishable by a fine of $75 $50 and 50 25 hours of
25community service.
26    (d) A third or subsequent violation by a minor of

 

 

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1subsection (a-7) of Section 1 that occurs within 12 months
2after the first violation is punishable by a $200 $100 fine and
350 30 hours of community service.
4    (e) Any second or subsequent violation not within the
512-month time period after the first violation is punishable as
6provided for a first violation.
7    (f) If a minor is convicted of or placed on supervision for
8a violation of subsection (a-6) or (a-7) of Section 1, the
9court may, in its discretion, and upon recommendation by the
10State's Attorney, order that minor and his or her parents or
11legal guardian to attend a smoker's education or youth
12diversion program if that program is available in the
13jurisdiction where the offender resides. Attendance at a
14smoker's education or youth diversion program shall be
15time-credited against any community service time imposed for
16any first violation of subsection (a-7) of Section 1. In
17addition to any other penalty that the court may impose for a
18violation of subsection (a-7) of Section 1, the court, upon
19request by the State's Attorney, may in its discretion require
20the offender to remit a fee for his or her attendance at a
21smoker's education or youth diversion program.
22    (g) For purposes of this Section, "smoker's education
23program" or "youth diversion program" includes, but is not
24limited to, a seminar designed to educate a person on the
25physical and psychological effects of smoking tobacco products
26and the health consequences of smoking tobacco products that

 

 

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1can be conducted with a locality's youth diversion program.
2    (h) All moneys collected as fines for violations of
3subsection (a), (a-5), (a-6), or (a-7) of Section 1 shall be
4distributed in the following manner:
5        (1) one-half of each fine shall be distributed to the
6    unit of local government or other entity that successfully
7    prosecuted the offender; and
8        (2) one-half shall be remitted to the State to be used
9    for enforcing this Act.
10    Any violation of subsection (a) or (a-5) of Section 1 or
11Section 1.5 shall be reported to the Department of Revenue
12within 7 business days.
13(Source: P.A. 98-350, eff. 1-1-14.)
 
14    Section 99. Effective date. This Act takes effect January
151, 2016.".