| 47 | | - | SECTION 1. The legislature finds that the introduction of flavored e-cigarettes, electronic smoking devices, and other electronic nicotine delivery systems into the marketplace has had a negative impact on Hawaii's youth. According to the Hawaii Youth Risk Behavior Survey, Hawaii suffers from the highest rate of usage of e‑cigarettes among middle school students and the second highest rate of usage among high school students in the nation. The United States Surgeon General, United States Department of Health and Human Services, and Centers for Disease Control and Prevention caution against the use of electronic nicotine delivery systems due to the highly addictive nature of nicotine and its potential detriment to developing adolescents. There has been recent federal action to better regulate electronic nicotine delivery systems, with the implementation of the premarket tobacco product applications--the equivalent of a federal Food and Drug Administration scientific certification. All manufacturers of existing tobacco products and new tobacco products were required to submit premarket tobacco product application to the Food and Drug Administration by September 9, 2020, to continue legal sales of those products. In January 2021, the Food and Drug Administration began issuing warning letters to manufacturers that failed to submit premarket tobacco product applications for products being marketed for sale. The legislature further finds that at the end of December 2020, Congress passed and the President signed the Consolidated Appropriations Act, 2021 (P.L. 116-260). Title VI of division FF of the Consolidated Appropriations Act, 2021, named the "Preventing Online Sales of E-Cigarettes to Children Act", extended the restrictions on interstate shipping and sales of cigarettes and smokeless tobacco, and extended the prohibition on the mailing of cigarettes through the United States Postal Service to include electronic nicotine delivery systems. This has the effect of ensuring only private package delivery companies, such as the United Parcel Service and FedEx, can deliver electronic nicotine delivery systems. This federal legislation helps to close the loopholes in underage illegal purchasing of electronic nicotine delivery systems, as all deliveries of electronic nicotine delivery systems will now require verification that a person is at least twenty-one years of age with a government-issued identification. The legislature further finds that the intent of this Act is to not compromise existing Master Settlement Agreement mandated enforcement activities, but rather to assist the department of the attorney general in efficiently protecting public health from the damages caused by the use of nicotine-related products. The purpose of this Act is to: (1) Make unlawful the sale of flavored tobacco products, mislabeling of e-liquid products containing nicotine, and sale of tobacco products other than through retail sales via in-person exchange; (2) Include e-liquid and electronic smoking devices within the definition of "tobacco products" as used in the cigarette tax and tobacco tax law, thereby: (A) Subjecting e-liquid and electronic smoking devices to the excise tax on tobacco products; (B) Requiring retailers of tobacco products to obtain a retail tobacco permit to sell, possess, keep, acquire, distribute, or transport tobacco products; (C) Prohibiting persons from engaging in the business of a wholesaler or dealer of tobacco products without first obtaining a license from the department of taxation; and (D) Applying other requirements of the cigarette tax and tobacco tax law pursuant to chapter 245, Hawaii Revised Statutes; and (3) Abolish the electronic smoking device retailer registration unit. SECTION 2. Chapter 712, Hawaii Revised Statutes, is amended by adding a new section to part IV to be appropriately designated and to read as follows: "§712- Sale of tobacco products; flavored; nicotine‑free; remote retail sales. (1) Beginning July 1, 2021, it shall be unlawful for any retailer or any agents or employees of the retailer to: (a) Sell, offer for sale, or possess with the intent to sell or offer for sale, a flavored tobacco product or e-liquid; (b) Mislabel as nicotine-free, or sell or market for sale as nicotine-free, any e-liquid product that contains nicotine; and (c) Have tobacco products, including electronic smoking devices, e-liquid, and electronic smoking device accessories delivered or sold to end consumers other than through retail sales through a direct, face-to-face, or over-the-counter exchange between a licensed retailer and a consumer at a tobacco retail location. This restriction includes a prohibition on sales performed through mail, curbside pickup, or delivery anywhere outside a licensed retail location. (2) A statement or claim, including but not limited to text, color, or images on the tobacco product's labeling or packaging, that is used to explicitly or implicitly communicate that the tobacco product has a flavor other than tobacco, made by a manufacturer or an agent or employee of the manufacturer in the course of the person's agency or employment, and directed to consumers or the public that a tobacco product is flavored, shall be prima facie evidence that the tobacco product is a flavored tobacco product. (3) Any flavored tobacco product found in a retailer's possession that is in violation of this section shall be considered contraband, promptly seized, and subject to immediate forfeiture and destruction or disposal as hazardous waste following the conclusion of an administrative or judicial proceeding finding that a violation of subsection (1) has been committed, and shall not be subject to the procedures set forth in chapter 712A. (4) Any retailer who violates this section shall be fined as follows: (a) For the first offense, a fine of $1,000; (b) For the second offense committed within years of a first offense, a fine of $2,000; and (c) For a third and subsequent offense committed within years of a first offense, a fine of $5,000. All fines shall be paid to and deposited into the Hawaii tobacco prevention and control trust fund established pursuant to section 328L-5. Retailers shall be responsible for all costs associated with disposing of their confiscated product found to be in violation of this section. (5) Notwithstanding any other law to the contrary, any county may adopt a rule or ordinance that places greater restrictions on the access to tobacco or electronic smoking device products than provided for in this section. In the case of a conflict between the restrictions in this section and any county rule or ordinance, the more stringent restrictions shall prevail. (6) For the purposes of this section: "Distinguishable" means perceivable by either the sense of smell or taste. "Electronic smoking device" has the same meaning as defined in section 712-1258(7). "E-liquid" means any liquid or like substance, which may or may not contain nicotine, that is capable of being used in an electronic smoking device, whether or not packaged in a cartridge or other container. "Flavored tobacco product" means any tobacco product that contains a taste or smell, other than the taste or smell of tobacco, that is distinguishable by an ordinary consumer either prior to, or during the consumption of, a tobacco product, including but not limited to any taste or smell relating to fruit, mint, wintergreen, chocolate, cocoa, vanilla, honey, molasses, or any candy, dessert, alcoholic beverage, herb, or spice. "Flavored tobacco product" does not include tobacco products that contain a taste or smell of menthol. "Labeling" means written, printed, pictorial, or graphic matter upon a tobacco product or any of its packaging. "Packaging" means a pack, box, carton, or container of any kind, or if no other container, wrapping, including cellophane, in which a tobacco product is sold or offered for sale to a consumer. "Retailer" means an entity that sells, offers for sale, or exchanges or offers to exchange for any form of consideration tobacco products or e-liquids to consumers. "Retailer" includes the owner of a tobacco retail location. "Tobacco product" means any: (a) Product containing, made of, or derived from tobacco or nicotine that is intended for human consumption or is likely to be consumed, whether inhaled, absorbed, or ingested by any other means, including but not limited to a cigarette, cigar, pipe tobacco, chewing tobacco, snuff, or snus; (b) Electronic smoking device and any substances that may be aerosolized or vaporized by such device, whether or not the substance contains nicotine; or (c) Component, part, or accessory of paragraph (a) or (b), whether or not any of these contains tobacco or nicotine, including but not limited to filters, rolling papers, blunt or hemp wraps, hookahs, and pipes. "Tobacco product" does not include drugs, devices, or combination products authorized for sale by the United States Food and Drug Administration and subject to the Federal Food, Drug, and Cosmetic Act, title 21 United States Code chapter 9; medical cannabis; or manufactured cannabis products under chapter 329D. "Tobacco retail location" means any premises where tobacco products are sold or distributed to a consumer, including but not limited to any store, bar, lounge, cafe, vending machine, or structure." SECTION 3. Section 245-1, Hawaii Revised Statutes, is amended as follows: 1. By adding three new definitions to be appropriately inserted and to read: ""E-liquid" means any liquid or like substance, which may or may not contain nicotine, that is capable of being used in an electronic smoking device, whether or not packaged in a cartridge or other container. "E-liquid" does not include prescription drugs, devices, or a combination of products approved for sale by the United States Food and Drug Administration and subject to the Federal Food, Drug, and Cosmetic Act, title 21 United States Code chapter 9; medical cannabis; or manufactured cannabis products under chapter 329D, including devices uses to aerosolize, inhale, or ingest manufactured cannabis products manufactured or distributed in accordance with section 329D-10. "Electronic smoking device" means any electronic product, or part thereof, whether for one-time use or reusable that can be used to deliver nicotine or another substance to a person inhaling from the device including but not limited to electronic cigarettes, electronic cigars, electronic cigarillos, electronic pipes, vaping pens, hookah pens, and other similar devices that rely on vaporization or aerosolization, and any cartridge or component part of the device or product. "Electronic smoking device" includes any liquid or gel capable of use in such electronic device that can be used by a person to simulate smoking in the delivery of nicotine or any other substance, intended for human consumption, through inhalation of vapor or aerosol from the product. "Electronic smoking device" does not include: (1) Cigarettes; (2) A product that has been approved by the United States Food and Drug Administration for the sale of or use as a tobacco cessation product or for other medical purposes and is marketed and sold or prescribed exclusively for that approved purpose; (3) Prescription drugs; (4) Medical cannabis or manufactured cannabis products under chapter 329D; and (5) Medical devices used to aerosolize, inhale, or ingest prescription drugs, including manufactured cannabis products manufactured or distributed in accordance with section 329D-10. "Smoke" or "smoking" means inhaling, exhaling, burning, carrying, or possessing any activated, lighted, or heated tobacco product, plant product, or any similar substance intended for human consumption or inhalation, including the use of an electronic smoking device." 2. By amending the definition of "tobacco products" to read: ""Tobacco products" means [tobacco]: (1) Tobacco in any form, other than cigarettes or little cigars[, that is prepared or intended for consumption or for personal use by humans, including large cigars and any substitutes thereof other than cigarettes that bear the semblance thereof, snuff, chewing or smokeless tobacco, and smoking or pipe tobacco.]; or (2) Electronic smoking devices. "Tobacco products" includes but is not limited to large cigars and any substitutes thereof other than cigarettes that bear the semblance thereof, pipe tobacco, chewing or smokeless tobacco, snuff, snus, e-liquid, electronic smoking devices containing e-liquid, and components or parts containing e-liquid." SECTION 4. Chapter 28, part XII, Hawaii Revised Statutes, is repealed. SECTION 5. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2021-2022 and the same sum or so much thereof as may be necessary for fiscal year 2022-2023 to establish and hire full-time equivalent ( .0 FTE) permanent positions and related equipment within the department of the attorney general for the purposes of this Act. The sums appropriated shall be expended by the department of the attorney general for the purposes of this Act. SECTION 6. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date. SECTION 7. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored. SECTION 8. This Act shall take effect on July 1, 2060. |
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| 47 | + | SECTION 1. The legislature finds that the introduction of flavored e-cigarettes, electronic smoking devices, and other electronic nicotine delivery systems into the marketplace has had a negative impact on Hawaii's youth. According to the Hawaii Youth Risk Behavior Survey, Hawaii suffers from the highest rate of usage of e‑cigarettes among middle school students and the second highest rate of usage among high school students in the nation. The United States Surgeon General, United States Department of Health and Human Services, and Centers for Disease Control and Prevention caution against the use of electronic nicotine delivery systems due to the highly addictive nature of nicotine and its potential detriment to developing adolescents. There has been recent federal action to better regulate electronic nicotine delivery systems, with the implementation of the premarket tobacco product applications--the equivalent of a federal Food and Drug Administration scientific certification. All manufacturers of existing tobacco products and new tobacco products were required to submit premarket tobacco product application to the Food and Drug Administration by September 9, 2020, to continue legal sales of those products. In January 2021, the Food and Drug Administration began issuing warning letters to manufacturers that failed to submit premarket tobacco product applications for products being marketed for sale. The legislature further finds that at the end of December 2020, Congress passed and the President signed the Consolidated Appropriations Act, 2021 (P.L. 116-260). Title VI of division FF of the Consolidated Appropriations Act, 2021, named the "Preventing Online Sales of E-Cigarettes to Children Act", extended the restrictions on interstate shipping and sales of cigarettes and smokeless tobacco, and extended the prohibition on the mailing of cigarettes through the United States Postal Service to include electronic nicotine delivery systems. This has the effect of ensuring only private package delivery companies, such as the United Parcel Service and FedEx, can deliver electronic nicotine delivery systems. This federal legislation helps to close the loopholes in underage illegal purchasing of electronic nicotine delivery systems, as all deliveries of electronic nicotine delivery systems will now require verification that a person is at least twenty-one years of age with a government-issued identification. The legislature further finds that the intent of this Act is to not compromise existing Master Settlement Agreement mandated enforcement activities, but rather to provide additional enforcement-related resources to the department of the attorney general to protect public health for all nicotine related products. The purpose of this Act is to: (1) Expand the purposes for which moneys in the tobacco enforcement special fund may be used, to include all functions of the department of the attorney general; (2) Expand the scope of the electronic smoking device retailer registration unit within the department of the attorney general to better regulate and ensure the removal of unsafe, noncertified electronic nicotine delivery systems from the marketplace; (3) Establish a special fund for the deposit of moneys collected for violations of electronic smoking device compliance; (4) Make unlawful the sale of flavored tobacco products, mislabeling of e-liquid products containing nicotine, and sale of tobacco products other than through retail sales via in-person exchange; and (5) Include e-liquid and electronic smoking devices within the definition of "tobacco products" as used in the cigarette tax and tobacco tax law, thereby: (A) Subjecting e-liquid and electronic smoking devices to the excise tax on tobacco products; (B) Requiring retailers of tobacco products to obtain a retail tobacco permit to sell, possess, keep, acquire, distribute, or transport tobacco products; (C) Prohibiting persons from engaging in the business of a wholesaler or dealer of tobacco products without first obtaining a license from the department of taxation; and (D) Applying other requirements of the cigarette tax and tobacco tax law pursuant to chapter 245, Hawaii Revised Statutes. SECTION 2. Section 28-15, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows: "(b) The tobacco enforcement special fund shall be administered by the department of the attorney general and shall be used for administering, operating, monitoring, and ensuring compliance with and enforcement of: (1) The Master Settlement Agreement as defined in chapter 675 and any other statutes or programs relating to that agreement; (2) Chapter 675; (3) Tobacco prevention programs; (4) The cigarette tax stamp as defined in chapter 245 and any other statutes or programs relating to that chapter; (5) Chapter 245; (6) Chapter 486P and any other statutes or programs relating to that chapter; [and] (7) Chapter 28; and [(7)] (8) Any other requirement deemed necessary to carry out the purposes of the fund." SECTION 3. Chapter 28, Hawaii Revised Statutes, is amended by amending the title of part XII to read as follows: "PART XII. ELECTRONIC SMOKING DEVICE RETAILER REGISTRATION AND ENFORCEMENT UNIT" SECTION 4. Section 28-161, Hawaii Revised Statutes, is amended to read as follows: "[[]§28-161[]] Policy. The registration of and enforcement of compliance by electronic smoking device retailers is reasonably necessary to protect the health, safety, or welfare of consumers of electronic smoking devices and for the enforcement of the laws that regulate the sale of electronic smoking devices." SECTION 5. Section 28-166, Hawaii Revised Statutes, is amended to read as follows: "[[]§28-166[]] Inspection[.] and enforcement; special fund. (a) The unit may examine all records of any entity engaged in the business of electronic smoking device retailing to verify the accuracy of the information provided for registration or to verify that an entity is selling electronic smoking devices without being registered. Every person in possession of any books, papers, and records, and the person's agents and employees, are directed and required to give the unit opportunities for examination of applicable records. (b) The unit may inspect the operations, premises, and storage areas of any entity engaged in the retail sale of electronic smoking devices as necessary. (c) The unit shall enforce compliance of any electronic smoking device with the Federal Food, Drug, and Cosmetic Act, P.L. 75-717, as amended by the Family Smoking Prevention and Tobacco Control Act, P.L. 111-31, and its regulations, and shall have all powers necessary for the enforcement of compliance, including but not limited to inspection warrants, search warrants, warning letters, seizure and disposal, injunction, and criminal prosecution and fines, in addition to any other administrative or judicial remedy provided by law. (d) There is established in the state treasury the electronic smoking device retailer registration and enforcement unit special fund to be administered by the department of the attorney general and into which shall be deposited all moneys collected for violations of electronic smoking device compliance pursuant to subsection (c). Moneys in the special fund shall be used to support a portion of the operating expenses of the unit." SECTION 6. Chapter 712, Hawaii Revised Statutes, is amended by adding a new section to part IV to be appropriately designated and to read as follows: "§712- Sale of tobacco products; flavored; nicotine-free; remote retail sales. (1) Beginning July 1, 2021, it shall be unlawful for any retailer or any agents or employees of the retailer to: (a) Sell, offer for sale, or possess with the intent to sell or offer for sale, a flavored tobacco product or e-liquid; (b) Mislabel as nicotine-free, or sell or market for sale as nicotine-free, any e-liquid product that contains nicotine; and (c) Have tobacco products, including electronic smoking devices, e-liquid, and electronic smoking device accessories delivered or sold to end consumers other than through retail sales through a direct, face-to-face, or over-the-counter exchange between a licensed retailer and a consumer at a tobacco retail location. This restriction includes a prohibition on sales performed through mail, curbside pickup, or delivery anywhere outside a licensed retail location. (2) A statement or claim, including but not limited to text, color, or images on the tobacco product's labeling or packaging, that is used to explicitly or implicitly communicate that the tobacco product has a flavor other than tobacco, made by a manufacturer or an agent or employee of the manufacturer in the course of the person's agency or employment, and directed to consumers or the public that a tobacco product is flavored, shall be prima facie evidence that the tobacco product is a flavored tobacco product. (3) Any flavored tobacco product found in a retailer's possession that is in violation of this section shall be considered contraband, promptly seized, and subject to immediate forfeiture and destruction or disposal as hazardous waste following the conclusion of an administrative or judicial proceeding finding that a violation of subsection (1) has been committed, and shall not be subject to the procedures set forth in chapter 712A. (4) Any retailer who violates this section shall be fined as follows: (a) For the first offense, a fine of $1,000; (b) For the second offense, a fine of $2,000; and (c) For a third and subsequent offense, a fine of $5,000. All fines shall be paid to and deposited into the Hawaii tobacco prevention and control trust fund established pursuant to section 328L-5. Retailers shall be responsible for all costs associated with disposing of their confiscated product found to be in violation of this section. (5) Notwithstanding any other law to the contrary, any county may adopt a rule or ordinance that places greater restrictions on the access to tobacco or electronic smoking device products than provided for in this section. In the case of a conflict between the restrictions in this section and any county rule or ordinance, the more stringent restrictions shall prevail. (6) For the purposes of this section: "Distinguishable" means perceivable by either the sense of smell or taste. "Electronic smoking device" has the same meaning as defined in section 712-1258(7). "E-liquid" means any liquid or like substance, which may or may not contain nicotine, that is capable of being used in an electronic smoking device, whether or not packaged in a cartridge or other container. "Flavored tobacco product" means any tobacco product that contains a taste or smell, other than the taste or smell of tobacco, that is distinguishable by an ordinary consumer either prior to, or during the consumption of, a tobacco product, including but not limited to any taste or smell relating to fruit, mint, wintergreen, chocolate, cocoa, vanilla, honey, molasses, or any candy, dessert, alcoholic beverage, herb, or spice. "Flavored tobacco product" does not include tobacco products that contain a taste or smell of menthol. "Labeling" means written, printed, pictorial, or graphic matter upon a tobacco product or any of its packaging. "Packaging" means a pack, box, carton, or container of any kind, or if no other container, wrapping, including cellophane, in which a tobacco product is sold or offered for sale to a consumer. "Retailer" means an entity that sells, offers for sale, or exchanges or offers to exchange for any form of consideration tobacco products or e-liquids to consumers. "Retailer" includes the owner of a tobacco retail location. "Tobacco product" means any: (a) Product containing, made of, or derived from tobacco or nicotine that is intended for human consumption or is likely to be consumed, whether inhaled, absorbed, or ingested by any other means, including but not limited to a cigarette, cigar, pipe tobacco, chewing tobacco, snuff, or snus; (b) Electronic smoking device and any substances that may be aerosolized or vaporized by such device, whether or not the substance contains nicotine; or (c) Component, part, or accessory of paragraph (a) or (b), whether or not any of these contains tobacco or nicotine, including but not limited to filters, rolling papers, blunt or hemp wraps, hookahs, and pipes. "Tobacco product" does not include drugs, devices, or combination products authorized for sale by the United States Food and Drug Administration, as those terms are defined in the Federal Food, Drug, and Cosmetic Act; medical cannabis; or manufactured cannabis products under chapter 329D. "Tobacco retail location" means any premises where tobacco products are sold or distributed to a consumer, including but not limited to any store, bar, lounge, cafe, vending machine, or structure." SECTION 7. Section 245-1, Hawaii Revised Statutes, is amended as follows: 1. By adding three new definitions to be appropriately inserted and to read: ""E-liquid" means any liquid or like substance, which may or may not contain nicotine, that is capable of being used in an electronic smoking device, whether or not packaged in a cartridge or other container. "E-liquid" does not include prescription drugs, devices, or a combination of products approved for sale by the United States Food and Drug Administration, as those terms are defined in the Federal Food, Drug, and Cosmetic Act; medical cannabis; or manufactured cannabis products under chapter 329D, including devices uses to aerosolize, inhale, or ingest manufactured cannabis products manufactured or distributed in accordance with section 329D-10(a). "Electronic smoking device" means any electronic product, or part thereof, whether for one-time use or reusable that can be used to deliver nicotine or another substance to a person inhaling from the device including but not limited to electronic cigarettes, electronic cigars, electronic cigarillos, electronic pipes, vaping pens, hookah pens, and other similar devices that rely on vaporization or aerosolization, and any cartridge or component part of the device or product. "Electronic smoking device" includes any liquid or gel capable of use in such electronic device that can be used by a person to simulate smoking in the delivery of nicotine or any other substance, intended for human consumption, through inhalation of vapor or aerosol from the product. "Electronic smoking device" does not include: (1) Cigarettes; (2) A product that has been approved by the United States Food and Drug Administration for the sale of or use as a tobacco cessation product or for other medical purposes and is marketed and sold or prescribed exclusively for that approved purpose; (3) Prescription drugs; (4) Medical cannabis or manufactured cannabis products under chapter 329D; and (5) Medical devices used to aerosolize, inhale, or ingest prescription drugs, including manufactured cannabis products manufactured or distributed in accordance with section 329D-10(a). "Smoke" or "smoking" means inhaling, exhaling, burning, carrying, or possessing any activated, lighted, or heated tobacco product, plant product, or any similar substance intended for human consumption or inhalation, including the use of an electronic smoking device." 2. By amending the definition of "tobacco products" to read: ""Tobacco products" means [tobacco]: (1) Tobacco in any form, other than cigarettes or little cigars[, that is prepared or intended for consumption or for personal use by humans, including large cigars and any substitutes thereof other than cigarettes that bear the semblance thereof, snuff, chewing or smokeless tobacco, and smoking or pipe tobacco.]; or (2) Electronic smoking devices. "Tobacco products" includes but is not limited to large cigars and any substitutes thereof other than cigarettes that bear the semblance thereof, pipe tobacco, chewing or smokeless tobacco, snuff, snus, e-liquid, electronic smoking devices containing e-liquid, and components or parts containing e-liquid." SECTION 8. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2021-2022 and the same sum or so much thereof as may be necessary for fiscal year 2022-2023 to establish and hire full-time equivalent ( .0 FTE) permanent positions and related equipment within the department of the attorney general for the purposes of this Act. The sums appropriated shall be expended by the department of the attorney general for the purposes of this Act. SECTION 9. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date. SECTION 10. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored. SECTION 11. This Act shall take effect on July 1, 2060. |
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