Public Act 094-0575
 
SB0417 Enrolled LRB094 06046 BDD 36106 b

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