Tennessee 2025-2026 Regular Session

Tennessee House Bill HB0968 Compare Versions

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

Old	New	Differences
1	1
2	2	SENATE BILL 763
3	3	By Yager
4	4
5	5	HOUSE BILL 968
6	6	By Hawk
7	7
8	8
9	9	HB0968
10	10	002878
11	11	- 1 -
12	12
13	13	AN ACT to amend Tennessee Code Annotated, Title 10,
14	14	Chapter 7, Part 5; Title 39, Chapter 17, Part 15;
15	15	Title 47, Chapter 25; Title 67, Chapter 4, Part 10
16	16	and Title 67, Chapter 4, Part 26, relative to
17	17	regulated consumable products.
18	18
19	19	BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
20	20	SECTION 1. Tennessee Code Annotated, Section 39-17-1504(d), is amended by
21	21	deleting the language "if an ordinary person would conclude on the basis of appearance that the
22	22	prospective purchaser or recipient may be under thirty (30) years of age".
23	23	SECTION 2. Tennessee Code Annotated, Section 67-4-1001(24)(A), is amended by
24	24	deleting the language "and snuff" and substituting instead the language "snuff, and vapor
25	25	products".
26	26	SECTION 3. Tennessee Code Annotated, Section 67-4-1001, is amended by adding
27	27	the following as new, appropriately designated subdivisions:
28	28	( ) "Closed-system vapor product" means:
29	29	(A) A disposable container or cartridge prefilled with consumable material
30	30	and sealed by the manufacturer, not easily refillable or intended or designed to
31	31	be refillable, and intended or used to dispense consumable material when
32	32	connected to a device that is designed to be reused; and
33	33	(B) Any single unit vapor product which is prefilled with consumable
34	34	material and sealed by the manufacturer, not intended to be refillable, and
35	35	intended to be disposed of once the consumable material has been depleted;
36	36	( ) "Consumable material" means any liquid nicotine solution intended for use in
37	37	a vapor product;
38	38
39	39
40	40	- 2 - 002878
41	41
42	42	( ) "Open-system vapor product" means:
43	43	(A) A vapor product that can be filled and refilled with consumable
44	44	material by a consumer; and
45	45	(B) Any consumable material that is intended to be used with the vapor
46	46	product described in subdivision ( )(A);
47	47	( ) "Vapor product":
48	48	(A) Means a noncombustible product containing nicotine, whether natural
49	49	or synthetic, that employs a mechanical heating element, battery, electronic
50	50	circuit, or other mechanism, regardless of shape or size, that can be used to
51	51	produce or emit a visible or non-visible vapor;
52	52	(B) Includes an electronic cigarette, electronic cigar, electronic cigarillo,
53	53	electronic pipe, or similar product, and any vapor cartridge containing
54	54	consumable material or other container of consumable material that is intended
55	55	to be used with or in an electronic cigarette, electronic cigar, electronic cigarillo,
56	56	electronic pipe, or similar product; and
57	57	(C) Does not include a product regulated under Chapter V of the Food,
58	58	Drug, and Cosmetic Act (21 U.S.C. § 351 et seq.);
59	59	SECTION 4. Tennessee Code Annotated, Section 67-4-1005, is amended by deleting
60	60	the section and substituting instead the following:
61	61	(a) The rate on all other tobacco products, including, but not limited to, cigars,
62	62	cheroots, stogies, beedies, bidis, manufactured tobacco, and snuff of all descriptions
63	63	made of tobacco or any substitute for tobacco, but not on vapor products, is six and six-
64	64	tenths percent (6.6%) of the wholesale cost price.
65	65
66	66
67	67	- 3 - 002878
68	68
69	69	(b) The rate on closed-system vapor products is seven cents ($0.07) per milliliter
70	70	of consumable material contained in the vapor product, and a like rate on all fractional
71	71	parts of a milliliter of consumable material.
72	72	(c) The rate on open-system vapor products is ten percent (10%) of the
73	73	wholesale cost price.
74	74	(d) This section does not apply to smokeless nicotine products.
75	75	SECTION 5. Tennessee Code Annotated, Section 67-4-1025(a), is amended by adding
76	76	the language ", other than vapor products," immediately after the language "All of the taxes on
77	77	tobacco products".
78	78	SECTION 6. Tennessee Code Annotated, Section 67-4-1025, is amended by adding
79	79	the following as a new subsection:
80	80	(f) All of the revenue from taxes on vapor products collected under this part must
81	81	be deposited in a special account in the state general fund to be used exclusively for
82	82	administration and enforcement of § 67-4-1034. Any unexpended funds do not revert to
83	83	the general fund and must be held in the account for use in accordance with this section.
84	84	SECTION 7. Tennessee Code Annotated, Title 67, Chapter 4, Part 10, is amended by
85	85	adding the following as a new section:
86	86	67-4-1034. Vapor product directory.
87	87	(a) For purposes of this section, "timely filed premarket tobacco product
88	88	application" means an application pursuant to 21 U.S.C. § 387j for a vapor product
89	89	containing nicotine derived from tobacco, marketed in the United States as of August 8,
90	90	2016, that was submitted to the United States food and drug administration on or before
91	91	September 9, 2020, and accepted for filing.
92	92	(b) By August 1, 2025, and annually thereafter, each manufacturer of a vapor
93	93	product that is sold for retail sale in this state, whether directly or through an importer,
94	94
95	95
96	96	- 4 - 002878
97	97
98	98	wholesaler, distributor, retailer, or similar intermediary or intermediaries, shall execute
99	99	and deliver to the department a certification, under penalty of perjury on a form and in a
100	100	manner prescribed by the department, that the manufacturer is compliant with this
101	101	section and that, for each vapor product sold for retail sale in this state:
102	102	(1) The manufacturer has received a marketing granted order for the
103	103	vapor product from the United States food and drug administration (FDA)
104	104	pursuant to 21 U.S.C. § 387j;
105	105	(2) The manufacturer submitted a timely filed premarket tobacco product
106	106	application for the vapor product to the FDA pursuant to 21 U.S.C. § 387j, and
107	107	the application either:
108	108	(A) Remains under review by the FDA; or
109	109	(B) Has received a denial order that has been and remains:
110	110	(i) Stayed by the FDA or court order;
111	111	(ii) Rescinded by the FDA; or
112	112	(iii) Vacated by a court; or
113	113	(3) The manufacturer is not required to submit an additional marketing
114	114	granted order or premarket tobacco product application for the vapor product
115	115	because the vapor product merely reflects changes to the name, brand style, or
116	116	packaging of a vapor product that is covered under subdivision (b)(1) or (b)(2).
117	117	(c) The following must be indicated on the certification for each vapor product
118	118	that is sold in this state:
119	119	(1) Brand name;
120	120	(2) Category, such as consumable material, power unit, device, vapor
121	121	cartridge, pod, or disposable;
122	122	(3) Product name; and
123	123
124	124
125	125	- 5 - 002878
126	126
127	127	(4) Flavor.
128	128	(d) Each annual certification form must be accompanied by:
129	129	(1) A copy of:
130	130	(A) The marketing granted order issued by the FDA pursuant to
131	131	21 U.S.C. Section 387j;
132	132	(B) The acceptance letter issued by the FDA pursuant to 21
133	133	U.S.C. § 387j for a timely filed premarket tobacco product application; or
134	134	(C) A document issued by the FDA or by a court confirming that
135	135	the premarket tobacco product application has received a denial order
136	136	that has been and remains stayed by FDA or court order, rescinded by
137	137	the FDA, or vacated by a court; and
138	138	(2) Payment of a fee of twenty-five dollars ($25.00) for each vapor
139	139	product each time a manufacturer submits an annual certification form for that
140	140	vapor product.
141	141	(e) The information submitted by the manufacturer pursuant to subdivision (d)(1)
142	142	is confidential and not subject to the open records law compiled in title 10, chapter 7.
143	143	The manufacturer may redact proprietary information provided under subdivision (d)(1).
144	144	The department shall not disclose such information, except as required or authorized by
145	145	law. As used in this subsection (e), "proprietary information" means commercial or
146	146	financial information that is used either directly or indirectly in the business of any person
147	147	or company and that gives such person an advantage or an opportunity to obtain an
148	148	advantage over competitors who do not know or use such information.
149	149	(f) A manufacturer that is required to submit a certification form pursuant to this
150	150	section shall notify the department within thirty (30) calendar days of any material
151	151	change to the certification form, including the issuance or denial of a marketing
152	152
153	153
154	154	- 6 - 002878
155	155
156	156	authorization or other order by the FDA pursuant to 21 U.S.C. § 387j, or any other order
157	157	or action by the FDA or any court that affects the ability of the vapor product to be
158	158	introduced or delivered into interstate commerce for commercial distribution in the United
159	159	States.
160	160	(g) Starting January 1, 2026, the department shall maintain and make publicly
161	161	available on the department's website a directory that lists all vapor product
162	162	manufacturers, brand names, categories, product names, and flavors for which
163	163	certification forms have been submitted and approved by the department. The
164	164	department shall update the directory at least monthly to ensure accuracy. The
165	165	department shall establish a process to provide retailers and licensed distributors and
166	166	wholesalers notice of the initial publication of the directory and changes made to the
167	167	directory from the prior month.
168	168	(h) A manufacturer or the manufacturer's vapor products must not be included or
169	169	retained in the directory if the department determines that any of the following apply:
170	170	(1) The manufacturer failed to provide a complete and accurate
171	171	certification as required by subsection (b);
172	172	(2) The manufacturer submitted a certification that does not comply with
173	173	the requirements of subsection (c) and (d);
174	174	(3) The manufacturer failed to include with its certification the payment
175	175	required by subdivision (d)(2);
176	176	(4) The manufacturer sold products in this state that are required to be
177	177	certified under this section during a period when either the manufacturer or the
178	178	product had not been certified and listed on the directory; or
179	179
180	180
181	181	- 7 - 002878
182	182
183	183	(5) The information provided by the manufacturer in its certification is
184	184	determined by the department to contain false information or contains material
185	185	misrepresentations or omissions.
186	186	(i)
187	187	(1) The department shall provide manufacturers with a written notice of
188	188	deficiencies and an opportunity to cure those deficiencies before taking action to
189	189	remove manufacturers or products from the directory.
190	190	(2) The department shall not remove the manufacturer or its products
191	191	from the directory until at least thirty (30) business days after the manufacturer
192	192	has been given notice of an intended action setting forth the reasons for the
193	193	removal. Notice is deemed sufficient and immediately received by a
194	194	manufacturer if the notice is sent either electronically or by facsimile to an
195	195	electronic mail address or facsimile number, as the case may be, that was
196	196	provided by the manufacturer in its most recently filed certification.
197	197	(3) A vapor product manufacturer has fifteen (15) business days from the
198	198	date of service of the notice of the department's intended action to cure the noted
199	199	deficiencies or otherwise establish that the vapor product manufacturer or its
200	200	products should be included in the directory.
201	201	(4) Retailers have a thirty-day period following the removal of a
202	202	manufacturer or its products from the directory in which the retailer is authorized
203	203	to sell such products that were in the retailer's inventory as of the date of
204	204	removal. A retailer is not authorized to sell the identified products after the
205	205	expiration of the thirty-day period.
206	206	(5) After thirty (30) calendar days following removal from the directory,
207	207	the vapor products of a manufacturer identified in the notice of removal and
208	208
209	209
210	210	- 8 - 002878
211	211
212	212	intended for sale in this state are subject to seizure, forfeiture, and destruction,
213	213	and may not be purchased or sold for retail sale in this state. The cost of the
214	214	seizure, forfeiture, and destruction must be borne by the business or person from
215	215	whom the products are confiscated, except that no products may be seized from
216	216	a consumer who has made a bona fide purchase of such product. The
217	217	department may store and dispose of the seized products as appropriate, in
218	218	accordance with federal, state, and local laws pertaining to storage and disposal
219	219	of such products.
220	220	(j)
221	221	(1) Except as provided in subdivisions (j)(2) and (3), beginning January
222	222	1, 2026, or on the date that the department first makes the directory available for
223	223	public inspection on its website, whichever is later, vapor products not included in
224	224	the directory shall not be sold for retail sale in this state, either directly or through
225	225	an importer, distributor, wholesaler, retailer, or similar intermediary or
226	226	intermediaries.
227	227	(2) A retailer has sixty (60) calendar days from the date that the
228	228	department first makes the directory available for inspection on its website to sell
229	229	products that were in its inventory and not included in the directory or remove
230	230	those products from inventory.
231	231	(3) A distributor or wholesaler has sixty (60) calendar days from the date
232	232	that the department first makes the directory available for inspection on its
233	233	website to remove those products intended for sale in this state that were not
234	234	included in the directory from its inventory.
235	235	(4) After sixty (60) calendar days following publication of the directory,
236	236	vapor products not listed in the directory and intended for sale in this state are
237	237
238	238
239	239	- 9 - 002878
240	240
241	241	subject to seizure, forfeiture, and destruction, and shall not be purchased or sold
242	242	for retail sale except as provided in subsection (i). The cost of the seizure,
243	243	forfeiture, and destruction must be borne by the business or person from whom
244	244	the products are confiscated, except that no products may be seized from a
245	245	consumer who has made a bona fide purchase of such product.
246	246	(5) Retailers are authorized to purchase vapor products only from
247	247	licensed distributors or wholesalers of tobacco products.
248	248	(k)
249	249	(1) The following penalties apply to violations of this section:
250	250	(A)
251	251	(i) A retailer, distributor, wholesaler, or importer who sells
252	252	or offers for sale a vapor product for retail sale in this state that is
253	253	not included in the directory is subject to a civil penalty of up to
254	254	five hundred dollars ($500) for each individual vapor product
255	255	offered for sale in violation of this section;
256	256	(ii) The civil penalty for a second violation under this
257	257	subdivision (k)(1) within a twelve-month period is at least seven
258	258	hundred fifty dollars ($750) but not more than one thousand
259	259	dollars ($1,000) per product, and the suspension of the license of
260	260	the retailer, distributor, wholesaler, or importer for thirty (30)
261	261	calendar days; and
262	262	(iii) The civil penalty for a third violation under this
263	263	subdivision (k)(1) within a twelve-month period is at least one
264	264	thousand dollars ($1,000) but not more than one thousand five
265	265
266	266
267	267	- 10 - 002878
268	268
269	269	hundred dollars ($1,500) per product, and the revocation of the
270	270	license of the retailer, distributor, wholesaler, or importer; and
271	271	(B) A manufacturer whose vapor products are not listed in the
272	272	directory and who causes the products that are not listed to be sold for
273	273	retail sale in this state, whether directly or through an importer, distributor,
274	274	wholesaler, retailer, or similar intermediary or intermediaries, is subject to
275	275	a civil penalty of ten thousand dollars ($10,000) for each individual vapor
276	276	product offered for sale in violation of this section. In addition, a
277	277	manufacturer that knowingly and falsely represents any information
278	278	required by a certification form commits a Class A misdemeanor. Each
279	279	false representation is a separate offense.
280	280	(2) In an action to enforce this section, the state is entitled to recover
281	281	costs, including the costs of investigation, expert witness fees, and reasonable
282	282	attorney fees.
283	283	(3) Notwithstanding this section to the contrary, a repeated violation of
284	284	this section constitutes a deceptive trade practice under § 47-18-104.
285	285	(l)
286	286	(1) A manufacturer not registered to do business in the state shall, as a
287	287	condition precedent to having the manufacturer's name or products listed and
288	288	retained in the directory, appoint, and continually engage without interruption, a
289	289	registered agent in this state for service of process on whom all process and any
290	290	action or proceeding arising out of the enforcement of this section may be
291	291	served. The manufacturer shall provide to the department the name, address,
292	292	and telephone number of its agent for service of process and provide any other
293	293	information relating to its agent as may be requested by the department.
294	294
295	295
296	296	- 11 - 002878
297	297
298	298	(2) A manufacturer located outside of the United States shall, as an
299	299	additional condition precedent to having the manufacturer's products listed or
300	300	retained in the directory, cause each of the importers of any of the manufacturer's
301	301	products to be sold in this state to appoint, and continually engage without
302	302	interruption, the services of an agent in this state in accordance with this section.
303	303	All obligations of a manufacturer imposed by this section with respect to
304	304	appointment of its agent also apply to the importers with respect to appointment
305	305	of their agents.
306	306	(3) A manufacturer shall provide written notice to the department not later
307	307	than thirty (30) calendar days prior to the termination of the authority of an agent
308	308	appointed pursuant to subdivision (l)(1) or (l)(2). Not less than five (5) calendar
309	309	days prior to the termination of an existing agent appointment, a manufacturer
310	310	shall provide to the department the name, address, and telephone number of the
311	311	manufacturers newly appointed agent for service of process and provide any
312	312	other information relating to the new appointment as may be requested by the
313	313	department. In the event an agent terminates an agency appointment, the
314	314	manufacturer shall notify the department of the termination within five (5)
315	315	calendar days and include proof to the satisfaction of the department of the
316	316	appointment of a new agent.
317	317	(m) A retailer, distributor, or wholesaler that sells or distributes vapor products in
318	318	this state is subject to at least two (2) unannounced compliance checks by the
319	319	department or its designee, including any state or local law enforcement official, annually
320	320	for purposes of enforcing this section. Such compliance checks must take place during
321	321	business hours. Unannounced follow-up compliance checks of all noncompliant
322	322	retailers, distributors, and wholesalers must be conducted within thirty (30) calendar
323	323
324	324
325	325	- 12 - 002878
326	326
327	327	days after any violation of this section. The department shall publish the results of all
328	328	compliance checks at least annually and make the results available to the public on
329	329	request.
330	330	(n) If the department elects not to include a vapor product or vapor product
331	331	manufacturer on the directory, or if the department removes a vapor product or vapor
332	332	product manufacturer from the directory, then that action is subject to review in the
333	333	manner provided by § 67-1-105 and in accordance with the Uniform Administrative
334	334	Procedures Act, compiled in title 4, chapter 5. In the event of a conflict between § 67-1-
335	335	105 and the Uniform Administrative Procedures Act, the Uniform Administrative
336	336	Procedures Act governs.
337	337	(o) The department may promulgate rules necessary to effectuate this section.
338	338	Rules must be promulgated in accordance with the Uniform Administrative Procedures
339	339	Act, compiled in title 4, chapter 5.
340	340	(p) All fees and penalties collected by the department pursuant to this section
341	341	must be used for the administration and enforcement of this section. Funds collected
342	342	pursuant to this section must be placed in a special account within the general fund and
343	343	do not revert to the general fund at the end of a fiscal year.
344	344	(q) The department shall submit a report to the chief clerks of the senate and the
345	345	house of representatives, the office of legislative budget analysis, and the legislative
346	346	librarian regarding the status of the directory, manufacturers, and products included in
347	347	the directory, revenue and expenditures related to administration of this section, and
348	348	enforcement activities undertaken pursuant to this section. The initial report must be
349	349	submitted by July 1, 2026, and subsequent annual reports must be submitted by each
350	350	July 1 thereafter.
351	351	SECTION 8. This act takes effect July 1, 2025, the public welfare requiring it.