Maryland 2024 Regular Session

Maryland House Bill HB1173 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1
2	2
3	3	EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
4	4	[Brackets] indicate matter deleted from existing law.
5	5	hb1173
6	6
7	7	HOUSE BILL 1173
8	8	C2 4lr2404
9	9	CF SB 1018
10	10	By: Delegate Qi
11	11	Introduced and read first time: February 7, 2024
12	12	Assigned to: Health and Government Operations
13	13
14	14	A BILL ENTITLED
15	15
16	16	AN ACT concerning 1
17	17
18	18	Tobacco Product Manufacturers – Escrow Act – Alterations 2
19	19
20	20	FOR the purpose of requiring, beginning in a certain year, a certain tobacco product 3
21	21	manufacturer to pay a certain equity fee instead of depositing certain funds in a 4
22	22	certain escrow account; authorizing a certain tobacco product manufacturer to 5
23	23	contest the amount of the equity fee paid under certain circumstances; requiring a 6
24	24	certain tobacco product manufacturer to make a certain certification to the Attorney 7
25	25	General each year; authorizing the Attorney General to recover the attorney’s fees, 8
26	26	costs, and expenses of a certain action and to deposit certain funds into the Cigarette 9
27	27	Restitution Fund; altering the information that certain tobacco product 10
28	28	manufacturers must include in a certain certification to the Attorney General; and 11
29	29	generally relating to the tobacco product manufacturers and the Escrow Act. 12
30	30
31	31	BY repealing and reenacting, with amendments, 13
32	32	Article – Business Regulation 14
33	33	Section 16–401 and 16–403 to be under the amended subtitle “Subtitle 4. Tobacco 15
34	34	Product Manufacturers Equity Act”; and 16–501, 16–503, 16–504, and 16
35	35	16–506(e) to be under the amended subtitle “Subtitle 5. Equity Requirements 17
36	36	for Nonparticipating Tobacco Product Manufacturers” 18
37	37	Annotated Code of Maryland 19
38	38	(2015 Replacement Volume and 2023 Supplement) 20
39	39
40	40	BY adding to 21
41	41	Article – Business Regulation 22
42	42	Section 16–404 23
43	43	Annotated Code of Maryland 24
44	44	(2015 Replacement Volume and 2023 Supplement) 25
45	45
46	46	SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 26
47	47	That the Laws of Maryland read as follows: 27
48	48	2 HOUSE BILL 1173
49	49
50	50
51	51	Article – Business Regulation 1
52	52
53	53	Subtitle 4. Tobacco Product Manufacturers [Escrow] EQUITY Act. 2
54	54
55	55	16–401. 3
56	56
57	57	(a) Cigarette smoking presents serious public health concerns to the State and to 4
58	58	the citizens of the State. The United States Surgeon General has determined that smoking 5
59	59	causes lung cancer, heart disease, and other serious diseases, and that there are hundreds 6
60	60	of thousands of tobacco–related deaths in the United States each year. These diseases most 7
61	61	often do not appear until many years after the person in question begins smoking. 8
62	62
63	63	(b) Cigarette smoking also presents serious financial concerns for the State. 9
64	64	Under certain health care programs, the State may have a legal obligation to provide 10
65	65	medical assistance to eligible persons for health conditions associated with cigarette 11
66	66	smoking, and those persons may have a legal entitlement to receive the medical assistance. 12
67	67
68	68	(c) Under these programs, the State pays millions of dollars each year to provide 13
69	69	medical assistance for these persons for health conditions associated with cigarette 14
70	70	smoking. 15
71	71
72	72	(d) It is the policy of the State that financial burdens imposed on the State by 16
73	73	cigarette smoking be borne by tobacco product manufacturers rather than by the State [to 17
74	74	the extent that such manufacturers either determine to enter into a settlement with the 18
75	75	State or are found culpable by the courts] AND, FOR THAT PURPOSE, TOBACCO 19
76	76	PRODUCT MANUFACTURER S THAT HAVE SETTLED WITH THE STATE PAY THE STATE 20
77	77	MILLIONS OF DOLLARS EACH YEAR , UNLIKE OTHER TOBACCO PRODUCT 21
78	78	MANUFACTURERS THAT DO NOT MAKE DIRECT P AYMENTS. 22
79	79
80	80	(e) On November 23, 1998, leading United States tobacco product manufacturers 23
81	81	entered into a settlement agreement, entitled the “Master Settlement Agreement”, with 24
82	82	the State. The Master Settlement Agreement obligates these manufacturers, in return for 25
83	83	a release of past, present, and certain future claims against them as described in the 26
84	84	Agreement, to pay substantial sums to the State (tied in part to their volume of sales); to 27
85	85	fund a national foundation devoted to the interests of public health; and to make 28
86	86	substantial changes in their advertising and marketing practices and corporate culture, 29
87	87	with the intention of reducing underage smoking. 30
88	88
89	89	(f) [(1) It would be contrary to the policy of the State if tobacco product 31
90	90	manufacturers who determine not to enter into such a settlement could use a resulting cost 32
91	91	advantage to derive large, short–term profits in the years before liability may arise without 33
92	92	ensuring that the State will have an eventual source of recovery from them if they are 34
93	93	proven to have acted culpably. 35
94	94
95	95	(2) It is thus in the interest of the State to require such tobacco product 36
96	96	manufacturers to establish a reserve fund to guarantee a source of compensation in order 37 HOUSE BILL 1173 3
97	97
98	98
99	99	to prevent them from deriving large, short–term profits and then becoming judgment–proof 1
100	100	before liability may arise] THE PUBLIC HEALTH OBL IGATIONS OF THE STATE ARE 2
101	101	OWED EQUALLY TO ALL INDIVIDUALS IN THE STATE WHO SMOKE , REGARDLESS OF 3
102	102	THE BRAND OF CIGARET TE SMOKED OR THE STA TUS OF THE TOBACCO P RODUCT 4
103	103	MANUFACTURER UNDER T HE MASTER SETTLEMENT AGREEMENT. 5
104	104
105	105	(G) IT IS CONSISTENT WITH THE POLICY OF THE STATE TO REQUIRE 6
106	106	TOBACCO PRODUCT MANU FACTURERS THAT DO NO T MAKE PAYMENTS DIRE CTLY TO 7
107	107	THE STATE THROUGH THE MASTER SETTLEMENT AGREEMENT TO PAY AN A MOUNT 8
108	108	THAT IS INTENDED TO : 9
109	109
110	110	(1) PREVENT MANUFACTU RERS FROM DERIVING L ARGE 10
111	111	SHORT–TERM PROFITS AND THE N BECOMING JUDGMENT –PROOF; 11
112	112
113	113	(2) REQUIRE TOBACCO PRODUCT MANUFACTURERS TO INT ERNALIZE 12
114	114	THE HEALTH CARE COSTS IMPOSED O N THE STATE BY CIGARETTE SMOKING ; 13
115	115
116	116	(3) INCREASE THE PRICE O F CIGARETTES TO REDUCE SMOKING 14
117	117	RATES, PARTICULARLY AMONG THE YOUTH OF THE STATE, CONSISTENT WITH 15
118	118	STATE POLICY TO DISCOURAGE UNDERAGE SMOKING ; AND 16
119	119
120	120	(4) SERVE AS PARTIAL COM PENSATION FOR THE FI NANCIAL 17
121	121	BURDENS IMPOSED ON T HE STATE BY CIGARETTE SM OKING. 18
122	122
123	123	16–403. 19
124	124
125	125	(a) Any tobacco product manufacturer that sells cigarettes to consumers within 20
126	126	the State, whether directly or through a distributor, retailer, or similar intermediary or 21
127	127	intermediaries, after June 1, 1999, shall either: 22
128	128
129	129	(1) become a participating manufacturer, as that term is defined in section 23
130	130	II(jj) of the Master Settlement Agreement, and generally perform its financial obligations 24
131	131	under the Master Settlement Agreement; or 25
132	132
133	133	(2) (I) [place] HAVE PLACED into a qualified escrow fund by April 15 26
134	134	of the year following the year in question the following amounts, as such amounts are 27
135	135	adjusted for inflation: 28
136	136
137	137	[(i)] 1. for 1999, $.0094241 per unit sold after June 1, 1999; 29
138	138
139	139	[(ii)] 2. for 2000, $.0104712 per unit sold; 30
140	140
141	141	[(iii)] 3. for each of 2001 and 2002, $.0136125 per unit sold; 31
142	142	4 HOUSE BILL 1173
143	143
144	144
145	145	[(iv)] 4. for each of 2003, 2004, 2005, and 2006, $.0167539 per unit 1
146	146	sold; and 2
147	147
148	148	[(v)] 5. for 2007 [and each year thereafter] THROUGH 2023, 3
149	149	$.0188482 per unit sold; AND 4
150	150
151	151	(II) BEGINNING IN 2024 AND EACH YEAR THEREA FTER, PAY TO 5
152	152	THE COMPTROLLER AN EQUITY FEE OF $.0188482 PER UNIT SOLD , AS ADJUSTED 6
153	153	FOR INFLATION . 7
154	154
155	155	(b) (1) A tobacco product manufacturer that [places] PLACED funds into 8
156	156	escrow in accordance with subsection [(a)(2)] (A)(2)(I) of this section shall receive the 9
157	157	interest or other appreciation on the funds as earned. 10
158	158
159	159	(2) The funds themselves shall be released from escrow only under the 11
160	160	following circumstances: 12
161	161
162	162	(i) to pay a judgment or settlement on any released claim brought 13
163	163	against such tobacco product manufacturer by the State or any releasing party located or 14
164	164	residing in the State. Funds shall be released from escrow under this subparagraph: 15
165	165
166	166	1. in the order in which they were placed into escrow; and 16
167	167
168	168	2. only to the extent and at the time necessary to make 17
169	169	payments required under such judgment or settlement; 18
170	170
171	171	(ii) to the extent that a tobacco product manufacturer establishes 19
172	172	that the amount it was required to place into escrow on account of units sold in the State 20
173	173	in a particular year was greater than the Master Settlement Agreement payments, as 21
174	174	determined pursuant to section IX(i) of that Agreement, including after final determination 22
175	175	of all adjustments, that such manufacturer would have been required to make on account 23
176	176	of such units sold had it been a participating manufacturer, the excess shall be released 24
177	177	from escrow and revert back to such tobacco manufacturer; or 25
178	178
179	179	(iii) to the extent funds are not released from escrow under item (i) 26
180	180	or (ii) of this paragraph, funds shall be released from escrow and revert to such tobacco 27
181	181	product manufacturer 25 years after the date on which they were placed into escrow. 28
182	182
183	183	(C) A TOBACCO PRODUCT MANU FACTURER THAT TIMELY PAYS THE EQUITY 29
184	184	FEE UNDER SUBSECTION (A)(2)(II) OF THIS SECTION MAY CONTEST THE AMOUNT O F 30
185	185	THE EQUITY FEE REQUIRED WITHIN 1 YEAR AFTER THE DATE OF PAYMENT . 31
186	186
187	187	(D) THE COMPTROLLER SHALL DIS TRIBUTE THE EQUITY F EES PAID UNDER 32
188	188	SUBSECTION (A)(2)(II) OF THIS SECTION TO T HE CIGARETTE RESTITUTION FUND 33 HOUSE BILL 1173 5
189	189
190	190
191	191	ESTABLISHED UNDER § 7–317 OF THE STATE FINANCE AND PROCUREMENT 1
192	192	ARTICLE. 2
193	193
194	194	[(c)] (E) (1) [Each] ON OR BEFORE APRIL 30 EACH YEAR, EACH tobacco 3
195	195	product manufacturer [that elects to place funds into escrow pursuant to subsection (a)(2) 4
196	196	of this section] shall [annually]: 5
197	197
198	198	(I) certify to the Attorney General that it is in compliance with 6
199	199	subsections (a)(2) and (b) of this section; AND 7
200	200
201	201	(II) 1. HAVE PLACED FUNDS INTO ES CROW UNDER 8
202	202	SUBSECTION (A)(2)(I) OF THIS SECTION; OR 9
203	203
204	204	2. HAVE PAID THE EQUITY FEE UNDER SUBSECTION 10
205	205	(A)(2)(II) OF THIS SECTION . 11
206	206
207	207	(2) (I) The Attorney General may bring a civil action on behalf of the 12
208	208	State against any tobacco product manufacturer that fails to place into escrow the funds 13
209	209	OR PAY THE EQUITY FE E required under this section. 14
210	210
211	211	(II) THE ATTORNEY GENERAL IS ENTITLED T O RECOVER THE 15
212	212	ATTORNEY’S FEES, COSTS, AND EXPENSES OF THE ACTION FOR THE USE O F THE 16
213	213	STATE. 17
214	214
215	215	(III) THE ATTORNEY GENERAL SHALL DEPOSIT ANY FUNDS 18
216	216	RECEIVED UNDER SUBPA RAGRAPH (II) OF THIS PARAGRAPH IN TO THE CIGARETTE 19
217	217	RESTITUTION FUND ESTABLISHED UNDE R § 7–317 OF THE STATE FINANCE AND 20
218	218	PROCUREMENT ARTICLE. 21
219	219
220	220	(3) (i) Any tobacco product manufacturer that fails in any year to place 22
221	221	into escrow the funds OR PAY THE EQUITY FE E required under this section shall be 23
222	222	required within 15 days to place such funds into escrow OR PAY THE EQUITY FEE as will 24
223	223	bring the manufacturer into compliance with this section. 25
224	224
225	225	(ii) The court, upon a finding of a violation of subsection (a)(2) or (b) 26
226	226	of this section, may impose a civil penalty, to be paid to the General Fund of the State: 27
227	227
228	228	1. in an amount not to exceed 5 percent of the amount 28
229	229	improperly withheld [from escrow] per day of the violation; and 29
230	230
231	231	2. in a total amount not to exceed 100 percent of the original 30
232	232	amount improperly withheld [from escrow]. 31
233	233
234	234	(4) (i) If a tobacco product manufacturer has knowingly violated 32
235	235	subsection (a)(2) or (b) of this section, the manufacturer shall be required within 15 days to 33 6 HOUSE BILL 1173
236	236
237	237
238	238	place such funds into escrow OR PAY THE EQUITY FEE as will bring it into compliance with 1
239	239	this section. 2
240	240
241	241	(ii) Upon a finding of a knowing violation of subsection (a)(2) or (b) 3
242	242	of this section, the court may impose a civil penalty, to be paid to the General Fund of the 4
243	243	State: 5
244	244
245	245	1. in an amount not to exceed 15 percent of the amount 6
246	246	improperly withheld [from escrow] per day of the violation; and 7
247	247
248	248	2. in a total amount not to exceed 300 percent of the original 8
249	249	amount improperly withheld [from escrow]. 9
250	250
251	251	(5) In the case of a second knowing violation of subsection (a)(2) or (b) of 10
252	252	this section, the tobacco product manufacturer shall be prohibited from selling cigarettes 11
253	253	to consumers within the State, whether directly or through a distributor, retailer, or similar 12
254	254	intermediary or intermediaries, for a period not to exceed 2 years. 13
255	255
256	256	(6) Each failure to make the annual deposit OR PAY THE EQUITY FEE 14
257	257	required under this section shall constitute a separate violation. 15
258	258
259	259	16–404. 16
260	260
261	261	THE ATTORNEY GENERAL MAY ADOPT REG ULATIONS TO CARRY OU T THE 17
262	262	PROVISIONS OF THIS S UBTITLE. 18
263	263
264	264	Subtitle 5. [Escrow] EQUITY Requirements for Nonparticipating Tobacco Product 19
265	265	Manufacturers. 20
266	266
267	267	16–501. 21
268	268
269	269	(a) In this subtitle the following words have the meanings indicated. 22
270	270
271	271	(b) (1) “Brand family” means all styles of cigarettes sold under the same 23
272	272	trademark, regardless of whether the cigarettes are differentiated from one another by 24
273	273	means of additional modifiers or descriptors such as “menthol”, “lights”, “kings”, “100s”, or 25
274	274	other differentiation. 26
275	275
276	276	(2) “Brand family” includes any use of a brand name (alone or in 27
277	277	conjunction with any other word) trademark, logo, symbol, motto, selling message, 28
278	278	recognizable pattern of colors, or any other indicia of product identification identical or 29
279	279	similar to, or identifiable with, a previously known brand of cigarettes. 30
280	280
281	281	(c) “Cigarette” has the meaning stated in § 16–402(e) of this title (the [Escrow] 31
282	282	EQUITY Act). 32
283	283	HOUSE BILL 1173 7
284	284
285	285
286	286	(d) “Comptroller” means the Comptroller of the State or any authorized agent of 1
287	287	the Comptroller who is responsible for collection of the excise tax on cigarettes. 2
288	288
289	289	(e) [“Escrow] “EQUITY Act” means Subtitle 4 of this title. 3
290	290
291	291	(f) “Executive Director” includes an agent or employee of the Alcohol and Tobacco 4
292	292	Commission responsible for the enforcement of State tobacco laws and regulations. 5
293	293
294	294	(g) “Licensed wholesaler” means a wholesaler who is licensed under Subtitle 2 of 6
295	295	this title to act as a wholesaler and any person who is an authorized agent of the licensed 7
296	296	wholesaler for the stamping and distribution of cigarettes. 8
297	297
298	298	(h) “Master Settlement Agreement” has the meaning stated in § 16–402(f) of this 9
299	299	title (the [Escrow] EQUITY Act). 10
300	300
301	301	(i) “Nonparticipating manufacturer” means any tobacco product manufacturer 11
302	302	that is not a participating manufacturer. 12
303	303
304	304	(j) “Participating manufacturer” has the meaning stated in section II(jj) of the 13
305	305	Master Settlement Agreement and all amendments to the Agreement. 14
306	306
307	307	(k) “Qualified escrow fund” has the meaning stated in § 16–402(g) of this title (the 15
308	308	[Escrow] EQUITY Act). 16
309	309
310	310	(l) “Tobacco product manufacturer” has the meaning stated in § 16–402(j) of this 17
311	311	title (the [Escrow] EQUITY Act). 18
312	312
313	313	(m) “Units sold” has the meaning stated in § 16–402(k) of this title (the [Escrow] 19
314	314	EQUITY Act). 20
315	315
316	316	16–503. 21
317	317
318	318	(a) A tobacco product manufacturer whose cigarettes are sold in this State, 22
319	319	whether directly or through a distributor, retailer or similar intermediary, shall execute 23
320	320	and deliver, on a form prescribed by the Attorney General, a certification to the Attorney 24
321	321	General no later than the 30th day of April each year, certifying under penalty of perjury 25
322	322	that, as of the date of the certification, the tobacco product manufacturer either: 26
323	323
324	324	(1) is a participating manufacturer; or 27
325	325
326	326	(2) is in full compliance with the [Escrow] EQUITY Act. 28
327	327
328	328	(b) (1) A participating manufacturer shall include in its certification a list of 29
329	329	its brand families. 30
330	330	8 HOUSE BILL 1173
331	331
332	332
333	333	(2) The participating manufacturer shall update the list at least 30 1
334	334	calendar days prior to any addition or modification to its brand families by executing and 2
335	335	delivering a supplemental certification to the Attorney General. 3
336	336
337	337	(c) (1) A nonparticipating manufacturer shall include in its certification a 4
338	338	complete list of all of its brand families. 5
339	339
340	340	(2) The certification shall: 6
341	341
342	342	(i) separately list each brand family of cigarettes and the number of 7
343	343	units sold for each brand family that was sold in the State during the preceding calendar 8
344	344	year; 9
345	345
346	346	(ii) list each of its brand families that have been sold in the State at 10
347	347	any time during the current calendar year; 11
348	348
349	349	(iii) indicate by an asterisk any brand family sold in the State during 12
350	350	the preceding calendar year that is no longer being sold in the State as of the date of such 13
351	351	certification; and 14
352	352
353	353	(iv) identify by name and address any other manufacturer of such 15
354	354	brand families in the preceding or current calendar year. 16
355	355
356	356	(3) The nonparticipating manufacturer shall update the list at least 30 17
357	357	calendar days prior to any addition or modification of its brand families by executing and 18
358	358	delivering a supplemental certification to the Attorney General. 19
359	359
360	360	(d) (1) In the case of a nonparticipating manufacturer, the certification shall 20
361	361	further certify that the nonparticipating manufacturer: 21
362	362
363	363	(i) is registered to do business in the State or has appointed a 22
364	364	resident agent for service of process and provided notice of the appointment as required by 23
365	365	§ 16–505 of this subtitle; 24
366	366
367	367	(ii) 1. REGARDING SALES MADE ON OR BEFORE DECEMBER 25
368	368	31, 2023, has established and continues to maintain a qualified escrow fund, and has 26
369	369	executed a qualified escrow agreement that has been reviewed and approved by the 27
370	370	Attorney General and that governs the qualified escrow fund; [and] OR 28
371	371
372	372	2. HAS PAID THE EQUITY FEE REQUIRED UNDER § 29
373	373	16–403(A)(2)(II) OF THIS TITLE; AND 30
374	374
375	375	(iii) is in full compliance with the [Escrow] EQUITY Act and this 31
376	376	subtitle and any regulations adopted in accordance with the [Escrow] EQUITY Act and this 32
377	377	subtitle. 33
378	378	HOUSE BILL 1173 9
379	379
380	380
381	381	(2) The certification shall include: 1
382	382
383	383	(i) FOR NONPARTICIPATING MAN UFACTURERS THAT 2
384	384	ESTABLISHED AN ESCRO W FUND: 3
385	385
386	386	1. the name, address and telephone number of the financial 4
387	387	institution in which the nonparticipating manufacturer has established a qualified escrow 5
388	388	fund required under [§ 16–403(a)(2)] § 16–403(A)(2)(I) of this title (the [Escrow] EQUITY 6
389	389	Act) and all regulations adopted under it; 7
390	390
391	391	[(ii)] 2. the account number of the qualified escrow fund and 8
392	392	subaccount number for the State of Maryland; 9
393	393
394	394	[(iii)] 3. the amount the nonparticipating manufacturer HAS 10
395	395	placed in the fund for cigarettes sold in the State during the preceding calendar year, the 11
396	396	date and amount of each deposit, and any additional information the Attorney General 12
397	397	considers necessary to confirm the information required by this subparagraph; and 13
398	398
399	399	[(iv)] 4. the amount of and date of any withdrawal or transfer of 14
400	400	funds the nonparticipating manufacturer made at any time from the fund or from any other 15
401	401	qualified escrow fund into which the nonparticipating manufacturer made escrow 16
402	402	payments under [§ 16–403(a)(2)] § 16–403(A)(2)(I) of this title (the [Escrow] EQUITY Act) 17
403	403	and all regulations adopted under that section; OR 18
404	404
405	405	(II) FOR A NONPARTICIPATI NG MANUFACTURER THAT PAID THE 19
406	406	EQUITY FEE, THE AMOUNT OF THE PA YMENT THE NONPARTICI PATING 20
407	407	MANUFACTURER HAS PAI D FOR CIGARETTES SOL D IN THE STATE DURING THE 21
408	408	PRECEDING CALENDAR Y EAR, THE DATE AND AMOUNT OF THE PAYMENT , AND ANY 22
409	409	ADDITIONAL INFORMATI ON THE ATTORNEY GENERAL CONSIDERS NEC ESSARY TO 23
410	410	CONFIRM THE INFORMATIO N REQUIRED BY THIS I TEM. 24
411	411
412	412	(e) (1) A tobacco product manufacturer may not include a brand family in its 25
413	413	certification unless: 26
414	414
415	415	(i) in the case of a participating manufacturer, the participating 27
416	416	manufacturer affirms that the brand family is deemed to be its cigarettes for purposes of 28
417	417	calculating its payments under the Master Settlement Agreement for the relevant year, in 29
418	418	the volume and shares determined in accordance with the Master Settlement Agreement; 30
419	419	and 31
420	420
421	421	(ii) in the case of a n onparticipating manufacturer, the 32
422	422	nonparticipating manufacturer affirms that the brand family is deemed to be its cigarettes 33
423	423	for purposes of the [Escrow] EQUITY Act. 34
424	424
425	425	(2) Nothing in this section may be construed as limiting or otherwise 35
426	426	affecting the State’s right to maintain that a brand family constitutes cigarettes of a 36 10 HOUSE BILL 1173
427	427
428	428
429	429	different tobacco product manufacturer for purposes of calculating payments under the 1
430	430	Master Settlement Agreement or for purposes of the [Escrow] EQUITY Act. 2
431	431
432	432	(3) The tobacco product manufacturer shall maintain all invoices and 3
433	433	documentation of sales and any other information relied upon for its certification for a 4
434	434	period of 5 years, unless otherwise required by law to maintain them for a greater period 5
435	435	of time. 6
436	436
437	437	16–504. 7
438	438
439	439	(a) Except as provided in subsection (b) of this section, the Attorney General shall 8
440	440	develop and make available for public inspection a directory listing all tobacco product 9
441	441	manufacturers that THE ATTORNEY GENERAL DETERMINES have provided current and 10
442	442	accurate certifications conforming to the requirements of § 16–503 of this subtitle AND 11
443	443	WITH ALL APPLICABLE FEDERAL, STATE, AND LOCAL LAWS and all COMPLIANT brand 12
444	444	families that are listed in such certifications. 13
445	445
446	446	(b) (1) The Attorney General may not include or retain in the directory the 14
447	447	name or brand families of any nonparticipating manufacturer that fails to provide the 15
448	448	required certification or whose certification the Attorney General determines is not in 16
449	449	compliance with § 16–503(c)(3) and (d) of this subtitle, unless the Attorney General has 17
450	450	determined that the violation has been cured to the satisfaction of the Attorney General. 18
451	451
452	452	(2) Neither a tobacco product manufacturer nor a brand family may be 19
453	453	included or retained in the directory if the Attorney General concludes, in the case of a 20
454	454	nonparticipating manufacturer, that: 21
455	455
456	456	(i) 1. any escrow payment required under [§ 16–403(a)(2)] § 22
457	457	16–403(A)(2)(I) of this title (the [Escrow] EQUITY Act) for any period for any brand 23
458	458	family, whether or not listed by such nonparticipating manufacturer, has not been fully 24
459	459	paid into a qualified escrow fund governed by a qualified escrow agreement that has been 25
460	460	approved by the Attorney General; or 26
461	461
462	462	2. ANY EQUITY FEE REQUI RED UNDER § 16–403(A)(2)(II) 27
463	463	OF THIS TITLE FOR AN Y PERIOD FOR ANY BRAND FAMILY, WHETHER OR NOT LISTE D 28
464	464	BY SUCH NONPARTICIPA TING MANUFACTURER , HAS NOT BEEN FULLY P AID TO THE 29
465	465	COMPTROLLER ; OR 30
466	466
467	467	(ii) any outstanding final judgment, including interest on the 31
468	468	judgment, for a violation of the Escrow Act has not been fully satisfied for the brand family 32
469	469	or the manufacturer. 33
470	470
471	471	(3) The Attorney General shall update the directory as necessary in order 34
472	472	to correct mistakes and to add or remove a tobacco product manufacturer or brand family 35
473	473	to keep the directory in conformity with the requirements of this subtitle. 36
474	474	HOUSE BILL 1173 11
475	475
476	476
477	477	(4) Each licensed wholesaler shall provide and update as necessary an 1
478	478	electronic mail address to the Attorney General for the purpose of receiving any 2
479	479	notifications that may be required by this subtitle. 3
480	480
481	481	(c) A person may not: 4
482	482
483	483	(1) affix a stamp to a package or other container of cigarettes of a tobacco 5
484	484	product manufacturer or brand family not included in the directory; or 6
485	485
486	486	(2) sell, offer or possess for sale in this State, or import for personal 7
487	487	consumption in this State, cigarettes of a tobacco product manufacturer or brand family 8
488	488	not included in the directory. 9
489	489
490	490	16–506. 10
491	491
492	492	(e) (1) To promote compliance with this subtitle, the Attorney General may 11
493	493	adopt regulations requiring a tobacco product manufacturer subject to the requirements of 12
494	494	§ 16–503(a) of this subtitle to make the escrow deposits OR PAY THE EQUITY FE E required 13
495	495	in quarterly installments during the year in which the sales covered by the deposits OR 14
496	496	PAYMENTS are made. 15
497	497
498	498	(2) The Attorney General may require production of information sufficient 16
499	499	to enable the Attorney General to determine the adequacy of the amount of the installment 17
500	500	deposit OR PAYMENT . 18
501	501
502	502	SECTION 2. AND BE IT FURTHER ENACTED, That notwithstanding the 19
503	503	provisions of § 1–210 of the General Provisions Article, the provisions of this Act are not 20
504	504	severable, and if any provision of this Act or the application thereof to any person or 21
505	505	circumstance is held invalid for any reason in a court of competent jurisdiction no other 22
506	506	provision or application of this Act may be given effect. 23
507	507
508	508	SECTION 3. AND BE IT FURTHER ENACTED, That : 24
509	509
510	510	(a) In this section, “Master Settlement Agreement” means the settlement 25
511	511	agreement and related documents entered into on November 23, 1998, by the State and 26
512	512	leading United States tobacco product manufacturers. 27
513	513
514	514	(b) Notwithstanding the provisions of § 1–210 of the General Provisions Article, 28
515	515	the provisions of this Act are not severable, and if all or any portion of the equity fee 29
516	516	established under § 16–403 of the Business Regulation Article, as enacted under Section 1 30
517	517	of this Act, results in a determination by the Firm, as that term is defined by the Master 31
518	518	Settlement Agreement, that Title 16, Subtitle 4 (the Equity Act) of the Business Regulation 32
519	519	Article no longer constitutes a qualifying statute, as that term is defined in § IX(d)(1)(C) of 33
520	520	the Master Settlement Agreement, no other provision or application of this Act may be 34
521	521	given effect. 35
522	522	12 HOUSE BILL 1173
523	523
524	524
525	525	SECTION 4. AND BE IT FURTHER ENACTED, That this Act shall take effect 1
526	526	October 1, 2024. 2