Illinois General Assembly - Full Text of HB3877
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Full Text of HB3877  100th General Assembly

HB3877eng 100TH GENERAL ASSEMBLY

  
  
  

 


 
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1    AN ACT concerning regulation.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the Vapor
5Products Regulatory Act.
 
6    Section 5. Definitions. For purposes of this Act:
7    "Adult-only facility" means a facility or restricted area
8(whether open-air or enclosed) where the operator ensures or
9has a reasonable basis to believe (such as by checking
10identification as required under State law, or by checking the
11identification of any person appearing to be under the age of
1227) that no person under legal age is present. A facility or
13restricted area need not be permanently restricted to persons
14under legal age to constitute an adult-only facility, provided
15that the operator ensures or has a reasonable basis to believe
16that no person under legal age is present during the event or
17time period in question.
18    "Age restricted area" means a signed designated area in a
19retail establishment to which minors under 18 years of age are
20not permitted access unless accompanied by a parent or legal
21guardian.
22    "Department" means the Department of Revenue.
23    "E-liquid" means a substance that contains nicotine and

 

 

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1flavoring, substances, or other additives and is intended for
2use in a vapor product.
3    "Person" means any natural individual, firm, partnership,
4association, joint stock company, joint adventure, or public or
5private corporation, however formed, limited liability
6company, or a receiver, executor, administrator, trustee,
7conservator, or other representative appointed by order of any
8court.
9    "Records" means all data maintained by the retailer of
10vapor products, including data on paper, microfilm,
11microfiche, or any type of machine sensible data compilation.
12    "Retailer of vapor products" means any person in this State
13engaged in the business of selling e-liquids or vapor products
14to consumers in this State for use or consumption and not for
15resale in any form, for valuable consideration, regardless of
16amount, quantity, or number of sales. "Retailer of vapor
17products" does not include any person or business subject to
18the Cigarette Tax Act, the Tobacco Products Tax Act of 1995,
19the Prevention of Tobacco Use By Minors and Sale and
20Distribution of Tobacco Products Act, the Display of Tobacco
21Products Act, or the Compassionate Use of Medical Cannabis
22Pilot Program Act.
23    "Sale" means any transfer, exchange, or barter in any
24manner or by any means whatsoever for a consideration and
25includes all sales made by persons.
26    "Vapor pen" means a powered vaporizer, and any component

 

 

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1parts thereof intended to be used in the powered vaporizer,
2that converts e-liquid into vapor which is intended for
3inhalation.
4    "Vapor product" means an e-liquid or vapor pen as defined
5under this Act.
 
6    Section 10. Retailer's license; fee.
7    (a) On or after January 1, 2018, no person may engage in
8business as a retailer of vapor products in this State without
9first having obtained a vapor products retail license from the
10Department. Applications for a license shall be made to the
11Department, by electronic means, in a form prescribed by the
12Department. Each applicant for a license under this Section
13shall furnish to the Department, in an electronic format
14established by the Department, the following information:
15        (1) the name and address of the applicant;
16        (2) the address of the location at which the applicant
17    proposes to engage in business as a retailer of vapor
18    products in this State;
19        (3) whether the applicant will engage in the sale of
20    e-liquids, vapor pens, or both; and
21        (4) such other additional information as the
22    Department may lawfully require by its rules.
23    (b) The annual license fee payable to the Department for
24each retailer's license shall be $75. The fee shall be
25deposited into the Tax Compliance and Administration Fund and

 

 

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1shall be used for the cost of enforcement of this Act.
2    An applicant for a license shall pay such fee to the
3Department at the time of submitting its application for
4license to the Department. The Department shall require an
5applicant for a license under this Section to electronically
6file and pay the fee.
7    (c) The following are ineligible to receive a retailer's
8license under this Act:
9        (1) a person who has been convicted of a felony related
10    to the illegal transportation, sale, or distribution of any
11    age-restricted product or item, under any federal or State
12    law, if the Department, after investigation and a hearing
13    if requested by the applicant, determines that the person
14    has not been sufficiently rehabilitated to warrant the
15    public trust; or
16        (2) a corporation, if any officer, manager, or director
17    thereof, or any stockholder or stockholders owning in the
18    aggregate more than 5% of the stock of such corporation,
19    would not be eligible to receive a license under this Act
20    for any reason.
21    (d) The Department, upon receipt of an application and
22license fee, in proper form, from a person who is eligible to
23receive a retailer's license under this Act, shall issue to the
24applicant a license in form as prescribed by the Department,
25which license shall permit the applicant to which it is issued
26to engage in business as a retailer of vapor products under

 

 

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1this Act at the place shown in his application. All licenses
2issued by the Department under this Section shall be valid for
3a period not to exceed one year after issuance unless sooner
4revoked, canceled, or suspended as provided in this Act. No
5license issued under this Section is transferable or
6assignable. The license shall be conspicuously displayed in the
7place of business conducted by the licensee in Illinois under
8the license. A person who obtains a license as a retailer of
9vapor products who ceases to do business as specified in the
10license, or who never commenced business, or whose license is
11suspended or revoked, shall immediately surrender the license
12to the Department. The Department shall not issue a license to
13a retailer of vapor products unless the retailer of vapor
14products is also validly registered under the Retailers'
15Occupation Tax Act. A person who obtains a license as a
16retailer of vapor products who ceases to do business as
17specified in the license, or who never commenced business, or
18whose license is suspended or revoked, shall immediately
19surrender the license to the Department.
20    (e) Any person aggrieved by any decision of the Department
21under this Section may, within 30 days after notice of the
22decision, protest and request a hearing. Upon receiving a
23request for hearing, the Department shall give written notice
24to the person requesting the hearing of the time and place
25fixed for the hearing and shall hold a hearing in conformity
26with the provisions of this Act and then issue its final

 

 

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1administrative decision in the matter to that person. In
2absence of protest and request for a hearing within 30 days,
3the Department's decision shall become final without any
4further determination being made or notice given.
 
5    Section 20. Acting as a retailer of vapor products without
6a license; penalty. A person who knowingly acts as a retailer
7of vapor products in this State without first having obtained a
8license to do so in compliance with this Act is guilty of a
9Class A misdemeanor for the first offense and a Class 4 felony
10for a second or subsequent offense. Each day such person
11operates as a retailer of vapor products without a license
12constitutes a separate offense. The Department may, by
13application to any circuit court, obtain an injunction
14restraining any person who engages in business as a retailer of
15vapor products without a license (either because his or her
16license has been revoked, canceled, or suspended or because of
17a failure to obtain a license in the first instance) from
18engaging in that business until that person, as if that person
19were a new applicant for a license, complies with all of the
20conditions, restrictions, and requirements of this Act and
21qualifies for and obtains a license.
 
22    Section 25. Revocation, cancellation, or suspension of a
23retail license.
24    (a) The Department may, after notice and hearing, revoke,

 

 

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1cancel, or suspend the license of any retailer of vapor
2products for the violation of any provision of this Act, or for
3noncompliance with any provision herein contained, or for any
4noncompliance with any lawful rule adopted by the Department
5pursuant to this Act, or because the licensee is determined to
6be ineligible for a license for any one or more of the reasons
7provided in this Section.
8    (b) A person aggrieved by any decision of the Department
9under this Section may, within 30 days after notice of the
10decision, protest and request a hearing. Upon receiving a
11request for a hearing, the Department shall give notice to the
12person requesting the hearing of the time and place fixed for
13the hearing and shall hold a hearing in conformity with the
14provisions of this Act and then issue its final administrative
15decision in the matter to that person. In the absence of a
16protest and request for a hearing within 30 days, the
17Department's decision shall become final without any further
18determination being made or notice given. The final decisions
19of the Department shall be subject to judicial review according
20to the provisions of the Administrative Review Law.
21    (c) If the retailer of vapor products has a training
22program that facilitates compliance with minimum-age vapor
23products laws, the Department shall suspend for 3 days the
24license of that retailer of vapor products for a fourth or
25subsequent violation of subsection (a) or (b) of Section 50.
26For the purposes of this Section, any violation of Section 50

 

 

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1occurring at the licensed location for the retailer of vapor
2products during a 24-month period shall be counted as a
3violation against the retailer of vapor products.
4    If the retailer of vapor products does not have a training
5program that facilitates compliance with minimum-age vapor
6products laws, the Department shall suspend for 3 days the
7license of that retailer of vapor products for a second
8violation subsection (a) or (b) of Section 50.
9    If the retailer of vapor products does not have a training
10program that facilitates compliance with minimum-age vapor
11products laws, the Department shall suspend for 7 days the
12license of that retailer of vapor products for a third
13violation of subsection (a) or (b) of Section 50.
14    If the retailer of vapor products does not have a training
15program that facilitates compliance with minimum-age vapor
16products laws, the Department shall suspend for 30 days the
17license of a retailer of vapor products for a fourth or
18subsequent violation of subsection (a) or (b) of Section 50.
 
19    Section 30. Arrest; search and seizure without warrant.
20    (a) Any duly authorized employee of the Department may:
21        (1) arrest without warrant any person committing in his
22    or her presence a violation of any of the provisions of
23    this Act; and
24        (2) may seize any vapor products in accordance with the
25    provisions of this Act.

 

 

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1    The vapor products so seized are subject to confiscation
2and forfeiture.
3    (b) After seizing any vapor products or vending devices,
4the Department must hold a hearing and determine whether the
5retailer of vapor products was properly licensed to sell the
6vapor products at the time of their seizure by the Department.
7The Department shall give not less than 20 days' notice of the
8time and place of the hearing to the owner of the property, if
9the owner is known, and also to the person in whose possession
10the property was found, if that person is known and if the
11person in possession is not the owner of the property. If
12neither the owner nor the person in possession of the property
13is known, the Department must cause publication of the time and
14place of the hearing to be made at least once in each week for 3
15weeks successively in a newspaper of general circulation in the
16county where the hearing is to be held.
17    If, as the result of the hearing, the Department determines
18that the retailer of vapor products was not properly licensed
19at the time the vapor products were seized, the Department must
20enter an order declaring the vapor products or vending devices
21confiscated and forfeited to the State, to be held by the
22Department for disposal by it as provided in Section 40. The
23Department must give notice of the order to the owner of the
24property, if the owner is known, and also to the person in
25whose possession the property was found, if that person is
26known and if the person in possession is not the owner of the

 

 

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1property. If neither the owner nor the person in possession of
2the property is known, the Department must cause publication of
3the order to be made at least once in each week for 3 weeks
4successively in a newspaper of general circulation in the
5county where the hearing was held.
 
6    Section 35. Peace officer investigation.
7    (a) Whenever any peace officer of the State or any duly
8authorized officer or employee of the Department shall have
9reason to believe that any violation of this Act has occurred
10and that the person so violating the Act has in his, hers, or
11its possession any vapor product, or any vending device
12containing such vapor products, he may file or cause to be
13filed his complaint in writing, verified by affidavit, with any
14court within whose jurisdiction the premises to be searched are
15situated, stating the facts upon which such belief is founded,
16the premises to be searched, and the property to be seized, and
17procure a search warrant and execute the same.
18    (b) Upon the execution of such search warrant, the peace
19officer, or officer or employee of the Department, executing
20such search warrant shall make due return thereof to the court
21issuing the same, together with an inventory of the property
22taken thereunder. The court shall thereupon issue process
23against the owner of such property if he is known; otherwise,
24such process shall be issued against the person in whose
25possession the property so taken is found, if such person is

 

 

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1known. In case of inability to serve such process upon the
2owner or the person in possession of the property at the time
3of its seizure, as hereinbefore provided, notice of the
4proceedings before the court shall be given as required by the
5statutes of the State governing cases of Attachment. Upon the
6return of the process duly served or upon the posting or
7publishing of notice made, as hereinabove provided, the court
8or jury, if a jury shall be demanded, shall proceed to
9determine whether or not such property so seized was held or
10possessed in violation of this Act, or whether, if a vending
11device has been so seized, it contained at the time of its
12seizure any vapor products held or possessed in violation of
13this Act.
 
14    Section 40. Destruction or use of forfeited property. When
15any vapor product or any vending device shall have been
16declared forfeited to the State and all proceedings for the
17judicial review of the Department's decision have terminated,
18the Department shall, to the extent that its decision is
19sustained on review, destroy or maintain and use such property
20in an undercover capacity.
 
21    Section 45. Retailers; records.
22    (a) A retailer of vapor products who is required to procure
23a license under this Act shall keep within Illinois complete
24and accurate records of vapor products purchased, sold, or

 

 

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1otherwise disposed of and shall preserve and keep all invoices,
2bills of lading, sales records, and copies of bills of sale,
3returns, and other pertinent papers and documents relating to
4the purchase, sale, or disposition of vapor products. The
5records need not be maintained on the licensed premises, but
6must be maintained in the State of Illinois; however, if access
7is available electronically, the records may be maintained
8out-of-State. However, all original invoices or copies thereof
9covering purchases of vapor products must be retained on the
10licensed premises for a period of 90 days after such purchase,
11unless the Department has granted a waiver in response to a
12written request in cases where records are kept at a central
13business location within the State of Illinois or in cases
14where records that are available electronically are maintained
15out of State. The Department shall adopt rules regarding the
16eligibility for a waiver, revocation of a waiver, and
17requirements and standards for maintenance and accessibility
18of records located at a central location out-of-State pursuant
19to a waiver provided under this Section.
20    (b) Records shall be preserved for a period of at least 3
21years after the later of the date of the records or the date of
22the entries appearing in the records, unless the Department, in
23writing, authorizes their destruction or disposal at an earlier
24date. At all times during the usual business hours of the day,
25any duly authorized agent or employee of the Department may
26enter any place of business of the retailer of vapor products

 

 

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1without a search warrant and may inspect the premises to
2determine whether any of the provisions of this Act are being
3violated. If such agent or employee is denied free access or is
4hindered or interfered with in making such examination as
5herein provided, the license of the retailer of vapor products
6shall be subject to suspension or revocation by the Department.
 
7    Section 50. Distribution of vapor products to, and
8possession by, persons under 18 years of age prohibited.
9    (a) A person, either directly or indirectly by an agent or
10employee, or by a vending machine owned by the person or
11located in the person's establishment, may not sell, offer for
12sale, give, or furnish any vapor product to a person under 18
13years of age.
14    (b) Before selling, offering for sale, giving, or
15furnishing a vapor product to another person, the person
16selling, offering for sale, giving, or furnishing the vapor
17product shall verify that the person is at least 18 years of
18age by:
19        (1) examining from any person that appears to be under
20    27 years of age a government-issued photographic
21    identification that establishes the person is at least 18
22    years of age; or
23        (2) for sales made though the Internet or other remote
24    sales methods, performing an age verification through an
25    independent, third-party age verification service that

 

 

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1    compares information available from public records to the
2    personal information entered by the person during the
3    ordering process that establishes the person is 18 years of
4    age or older.
5    (c) A person under 18 years of age shall not possess a
6vapor product.
 
7    Section 55. Penalties for distribution of vapor products
8to, and possession by, persons under 18 years of age.
9    (a) Any person who violates subsection (a) or (b) of
10Section 50 is guilty of a petty offense. For the first offense
11in a 24-month period, the person shall be fined $200 if his or
12her employer has a training program that facilitates compliance
13with minimum-age vapor product laws. For the second offense in
14a 24-month period, the person shall be fined $400 if his or her
15employer has a training program that facilitates compliance
16with minimum-age vapor products laws. For the third offense in
17a 24-month period, the person shall be fined $600 dollars if
18his or her employer has a training program that facilitates
19compliance with minimum-age vapor product laws. For the fourth
20or subsequent offense in a 24-month period, the person shall be
21fined $800 if his or her employer has a training program that
22facilitates compliance with minimum-age vapor products laws.
23For the purposes of this subsection, the 24-month period shall
24begin with the person's first violation of the Act. The
25penalties in this subsection are in addition to any other

 

 

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1penalties provided by law.
2    (a-5) Any retailer of vapor products who violates
3subsection (a) or (b) of Section 50 is guilty of a petty
4offense. For the first offense in a 24-month period, the
5retailer of vapor products shall be fined $200 it does not have
6a training program that facilitates compliance with
7minimum-age vapor product laws. For the second offense in a
824-month period, the retailer of vapor products shall be fined
9$400 if it does not have a training program that facilitates
10compliance with minimum-age vapor products laws. For the third
11offense in a 24-month period, the retailer of vapor products
12shall be fined $600 dollars if it does not have a training
13program that facilitates compliance with minimum-age vapor
14product laws. For the fourth or subsequent offense in a
1524-month period, the retailer of vapor products shall be fined
16$800 if it does not have a training program that facilitates
17compliance with minimum-wage vapor products laws. For the
18purposes of this subsection, the 24-month period shall begin
19with the person's first violation of the Act. The penalties in
20this subsection are in addition to any other penalties provided
21by law.
22    (a-10) A training program that facilitates compliance with
23minimum-age vapor products laws must include at least the
24following elements: (i) it must explain that only individuals
25displaying valid identification demonstrating that they are 18
26years of age or older shall be eligible to purchase vapor

 

 

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1products; and (ii) it must explain where a clerk can check
2identification for a date of birth. The training may be
3conducted electronically. Each retailer of vapor products that
4has a training program shall require each employee who
5completes the training program to sign a form attesting that
6the employee has received and completed the vapor products
7training. The form shall be kept in the employee's file and may
8be used to provide proof of training.
9    (b) If a minor violates subsection (c) of Section 50, he or
10she is guilty of a petty offense and the court may impose a
11sentence of 25 hours of community service and a fine of $50 for
12a first violation.
13    (c) A second violation by a minor of subsection (c) of
14Section 50 that occurs within 12 months after the first
15violation is punishable by a fine of $75 and 50 hours of
16community service.
17    (d) A third or subsequent violation by a minor of
18subsection (c) of Section 50 that occurs within 12 months after
19the first violation is punishable by a $200 fine and 50 hours
20of community service.
21    (e) Any second or subsequent violation not within the
2212-month time period after the first violation is punishable as
23provided for a first violation.
24    (f) If a minor is convicted of or placed on supervision for
25a violation of subsection (c) of Section 50, the court may, in
26its discretion, and upon recommendation by the State's Attorney

 

 

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1order that minor and his or her parents or legal guardian to
2attend a youth diversion program if that program is available
3in the jurisdiction where the offender resides. Attendance at a
4youth diversion program shall be time-credited against any
5community service time imposed for any first violation of
6subsection (c) of Section 50. In addition to any other penalty
7that the court may impose for a violation of subsection (c) of
8Section 50, the court, upon request by the State's Attorney,
9may in its discretion require the offender to remit a fee for
10his or her attendance at a youth diversion program.
11    For the purposes of this Section, a "youth diversion
12program" includes, but is not limited to, a seminar designed to
13educate a person on the physical and psychological effects of
14using nicotine products and the health consequences of using
15nicotine products that can be conducted with a locality's youth
16diversion program.
17    (g) All moneys collected as fines for violations of Section
18(a), (b), or (c) of Section 50 of this Act shall be distributed
19in the following manner:
20        (1) one-half of each fine shall be distributed to the
21    unit of local government or other entity that successfully
22    prosecuted the offender; and
23        (2) one-half shall be remitted to the State to be used
24    for enforcement of this Act.
25    Any violation of subsection (a) or (b) of Section 50 shall
26be reported to the Department of Revenue within 7 business

 

 

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1days.
 
2    Section 60. Display of vapor products.
3    (a) Vapor product displays. All vapor products must be sold
4from behind the counter or in an age restricted area or in a
5sealed display case.
6    (b) The restrictions in this Section do not apply to an
7adult-only facility.
8    (c) The restrictions in this Section do not apply to a
9retail store that (i) derives at least 90% of its revenue from
10tobacco, tobacco related products, or vapor products; (ii) does
11not permit persons under the age of 18 to enter the premises
12unless accompanied by a parent or legal guardian; (iii) posts a
13sign on the main entrance way stating that persons under the
14age of 18 are prohibited from entering unless accompanied by a
15parent or legal guardian; or (iv) is subject to the Cigarette
16Tax Act, the Tobacco Products Tax Act of 1995, the Prevention
17of Tobacco Use By Minors and Sale and Distribution of Tobacco
18Products Act, or the Display of Tobacco Products Act.
19    (d) A violation of this Section is a petty offense for
20which the court shall impose a fine of not less than $100 nor
21more than $1,000.
 
22    Section 65. The Prevention of Tobacco Use by Minors and
23Sale and Distribution of Tobacco Products Act is amended by
24changing Section 1.5 as follows:
 

 

 

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1    (720 ILCS 675/1.5)
2    Sec. 1.5. Distribution of alternative nicotine products to
3persons under 18 years of age prohibited.
4    (a) For the purposes of this Section, "alternative nicotine
5product" means a product or device not consisting of or
6containing tobacco that provides for the ingestion into the
7body of nicotine, whether by chewing, smoking, absorbing,
8dissolving, inhaling, snorting, sniffing, or by any other
9means. "Alternative nicotine product" excludes cigarettes,
10smokeless tobacco, or other tobacco products as these terms are
11defined in Section 1 of this Act, vapor products as defined
12under Section 5 of the Vapor Products Regulatory Act, and any
13product approved by the United States Food and Drug
14Administration as a non-tobacco product for sale as a tobacco
15cessation product, as a tobacco dependence product, or for
16other medical purposes, and is being marketed and sold solely
17for that approved purpose.
18    (b) A person, either directly or indirectly by an agent or
19employee, or by a vending machine owned by the person or
20located in the person's establishment, may not sell, offer for
21sale, give, or furnish any alternative nicotine product, or any
22cartridge or component of an alternative nicotine product, to a
23person under 18 years of age.
24    (c) Before selling, offering for sale, giving, or
25furnishing an alternative nicotine product, or any cartridge or

 

 

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1component of an alternative nicotine product, to another
2person, the person selling, offering for sale, giving, or
3furnishing the alternative nicotine product shall verify that
4the person is at least 18 years of age by:
5        (1) examining from any person that appears to be under
6    27 years of age a government-issued photographic
7    identification that establishes the person is at least 18
8    years of age or
9        (2) for sales made through though the Internet or other
10    remote sales methods, performing an age verification
11    through an independent, third-party age verification
12    service that compares information available from public
13    records to the personal information entered by the person
14    during the ordering process that establishes the person is
15    18 years of age or older.
16    (d) A person under 18 years of age shall not possess an
17alternative nicotine product.
18(Source: P.A. 98-350, eff. 1-1-14; 99-496, eff. 6-1-16; revised
1910-25-16.)
 
20    Section 99. Effective date. This Act takes effect January
211, 2018.