Tennessee 2025-2026 Regular Session

Tennessee Senate Bill SB0763 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1
2		-	HOUSE BILL 968
3		-	By Hawk
	2	+	<BillNo> <Sponsor>
4	3
5	4		SENATE BILL 763
6	5		By Yager
7	6
8	7
9	8		SB0763
10	9		002878
11	10		- 1 -
12	11
13	12		AN ACT to amend Tennessee Code Annotated, Title 10,
14	13		Chapter 7, Part 5; Title 39, Chapter 17, Part 15;
15	14		Title 47, Chapter 25; Title 67, Chapter 4, Part 10
16	15		and Title 67, Chapter 4, Part 26, relative to
17	16		regulated consumable products.
18	17
19	18		BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
20	19		SECTION 1. Tennessee Code Annotated, Section 39-17-1504(d), is amended by
21	20		deleting the language "if an ordinary person would conclude on the basis of appearance that the
22	21		prospective purchaser or recipient may be under thirty (30) years of age".
23	22		SECTION 2. Tennessee Code Annotated, Section 67-4-1001(24)(A), is amended by
24	23		deleting the language "and snuff" and substituting instead the language "snuff, and vapor
25	24		products".
26	25		SECTION 3. Tennessee Code Annotated, Section 67-4-1001, is amended by adding
27	26		the following as new, appropriately designated subdivisions:
28	27		( ) "Closed-system vapor product" means:
29	28		(A) A disposable container or cartridge prefilled with consumable material
30	29		and sealed by the manufacturer, not easily refillable or intended or designed to
31	30		be refillable, and intended or used to dispense consumable material when
32	31		connected to a device that is designed to be reused; and
33	32		(B) Any single unit vapor product which is prefilled with consumable
34	33		material and sealed by the manufacturer, not intended to be refillable, and
35	34		intended to be disposed of once the consumable material has been depleted;
36	35		( ) "Consumable material" means any liquid nicotine solution intended for use in
37	36		a vapor product;
38	37
39	38
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41	40
42	41		( ) "Open-system vapor product" means:
43	42		(A) A vapor product that can be filled and refilled with consumable
44	43		material by a consumer; and
45	44		(B) Any consumable material that is intended to be used with the vapor
46	45		product described in subdivision ( )(A);
47	46		( ) "Vapor product":
48	47		(A) Means a noncombustible product containing nicotine, whether natural
49	48		or synthetic, that employs a mechanical heating element, battery, electronic
50	49		circuit, or other mechanism, regardless of shape or size, that can be used to
51	50		produce or emit a visible or non-visible vapor;
52	51		(B) Includes an electronic cigarette, electronic cigar, electronic cigarillo,
53	52		electronic pipe, or similar product, and any vapor cartridge containing
54	53		consumable material or other container of consumable material that is intended
55	54		to be used with or in an electronic cigarette, electronic cigar, electronic cigarillo,
56	55		electronic pipe, or similar product; and
57	56		(C) Does not include a product regulated under Chapter V of the Food,
58	57		Drug, and Cosmetic Act (21 U.S.C. § 351 et seq.);
59	58		SECTION 4. Tennessee Code Annotated, Section 67-4-1005, is amended by deleting
60	59		the section and substituting instead the following:
61	60		(a) The rate on all other tobacco products, including, but not limited to, cigars,
62	61		cheroots, stogies, beedies, bidis, manufactured tobacco, and snuff of all descriptions
63	62		made of tobacco or any substitute for tobacco, but not on vapor products, is six and six-
64	63		tenths percent (6.6%) of the wholesale cost price.
65	64
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69	68		(b) The rate on closed-system vapor products is seven cents ($0.07) per milliliter
70	69		of consumable material contained in the vapor product, and a like rate on all fractional
71	70		parts of a milliliter of consumable material.
72	71		(c) The rate on open-system vapor products is ten percent (10%) of the
73	72		wholesale cost price.
74	73		(d) This section does not apply to smokeless nicotine products.
75	74		SECTION 5. Tennessee Code Annotated, Section 67-4-1025(a), is amended by adding
76	75		the language ", other than vapor products," immediately after the language "All of the taxes on
77	76		tobacco products".
78	77		SECTION 6. Tennessee Code Annotated, Section 67-4-1025, is amended by adding
79	78		the following as a new subsection:
80	79		(f) All of the revenue from taxes on vapor products collected under this part must
81	80		be deposited in a special account in the state general fund to be used exclusively for
82	81		administration and enforcement of § 67-4-1034. Any unexpended funds do not revert to
83	82		the general fund and must be held in the account for use in accordance with this section.
84	83		SECTION 7. Tennessee Code Annotated, Title 67, Chapter 4, Part 10, is amended by
85	84		adding the following as a new section:
86	85		67-4-1034. Vapor product directory.
87	86		(a) For purposes of this section, "timely filed premarket tobacco product
88	87		application" means an application pursuant to 21 U.S.C. § 387j for a vapor product
89	88		containing nicotine derived from tobacco, marketed in the United States as of August 8,
90	89		2016, that was submitted to the United States food and drug administration on or before
91	90		September 9, 2020, and accepted for filing.
92	91		(b) By August 1, 2025, and annually thereafter, each manufacturer of a vapor
93	92		product that is sold for retail sale in this state, whether directly or through an importer,
94	93
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98	97		wholesaler, distributor, retailer, or similar intermediary or intermediaries, shall execute
99	98		and deliver to the department a certification, under penalty of perjury on a form and in a
100	99		manner prescribed by the department, that the manufacturer is compliant with this
101	100		section and that, for each vapor product sold for retail sale in this state:
102	101		(1) The manufacturer has received a marketing granted order for the
103	102		vapor product from the United States food and drug administration (FDA)
104	103		pursuant to 21 U.S.C. § 387j;
105	104		(2) The manufacturer submitted a timely filed premarket tobacco product
106	105		application for the vapor product to the FDA pursuant to 21 U.S.C. § 387j, and
107	106		the application either:
108	107		(A) Remains under review by the FDA; or
109	108		(B) Has received a denial order that has been and remains:
110	109		(i) Stayed by the FDA or court order;
111	110		(ii) Rescinded by the FDA; or
112	111		(iii) Vacated by a court; or
113	112		(3) The manufacturer is not required to submit an additional marketing
114	113		granted order or premarket tobacco product application for the vapor product
115	114		because the vapor product merely reflects changes to the name, brand style, or
116	115		packaging of a vapor product that is covered under subdivision (b)(1) or (b)(2).
117	116		(c) The following must be indicated on the certification for each vapor product
118	117		that is sold in this state:
119	118		(1) Brand name;
120	119		(2) Category, such as consumable material, power unit, device, vapor
121	120		cartridge, pod, or disposable;
122	121		(3) Product name; and
123	122
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127	126		(4) Flavor.
128	127		(d) Each annual certification form must be accompanied by:
129	128		(1) A copy of:
130	129		(A) The marketing granted order issued by the FDA pursuant to
131	130		21 U.S.C. Section 387j;
132	131		(B) The acceptance letter issued by the FDA pursuant to 21
133	132		U.S.C. § 387j for a timely filed premarket tobacco product application; or
134	133		(C) A document issued by the FDA or by a court confirming that
135	134		the premarket tobacco product application has received a denial order
136	135		that has been and remains stayed by FDA or court order, rescinded by
137	136		the FDA, or vacated by a court; and
138	137		(2) Payment of a fee of twenty-five dollars ($25.00) for each vapor
139	138		product each time a manufacturer submits an annual certification form for that
140	139		vapor product.
141	140		(e) The information submitted by the manufacturer pursuant to subdivision (d)(1)
142	141		is confidential and not subject to the open records law compiled in title 10, chapter 7.
143	142		The manufacturer may redact proprietary information provided under subdivision (d)(1).
144	143		The department shall not disclose such information, except as required or authorized by
145	144		law. As used in this subsection (e), "proprietary information" means commercial or
146	145		financial information that is used either directly or indirectly in the business of any person
147	146		or company and that gives such person an advantage or an opportunity to obtain an
148	147		advantage over competitors who do not know or use such information.
149	148		(f) A manufacturer that is required to submit a certification form pursuant to this
150	149		section shall notify the department within thirty (30) calendar days of any material
151	150		change to the certification form, including the issuance or denial of a marketing
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156	155		authorization or other order by the FDA pursuant to 21 U.S.C. § 387j, or any other order
157	156		or action by the FDA or any court that affects the ability of the vapor product to be
158	157		introduced or delivered into interstate commerce for commercial distribution in the United
159	158		States.
160	159		(g) Starting January 1, 2026, the department shall maintain and make publicly
161	160		available on the department's website a directory that lists all vapor product
162	161		manufacturers, brand names, categories, product names, and flavors for which
163	162		certification forms have been submitted and approved by the department. The
164	163		department shall update the directory at least monthly to ensure accuracy. The
165	164		department shall establish a process to provide retailers and licensed distributors and
166	165		wholesalers notice of the initial publication of the directory and changes made to the
167	166		directory from the prior month.
168	167		(h) A manufacturer or the manufacturer's vapor products must not be included or
169	168		retained in the directory if the department determines that any of the following apply:
170	169		(1) The manufacturer failed to provide a complete and accurate
171	170		certification as required by subsection (b);
172	171		(2) The manufacturer submitted a certification that does not comply with
173	172		the requirements of subsection (c) and (d);
174	173		(3) The manufacturer failed to include with its certification the payment
175	174		required by subdivision (d)(2);
176	175		(4) The manufacturer sold products in this state that are required to be
177	176		certified under this section during a period when either the manufacturer or the
178	177		product had not been certified and listed on the directory; or
179	178
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183	182		(5) The information provided by the manufacturer in its certification is
184	183		determined by the department to contain false information or contains material
185	184		misrepresentations or omissions.
186	185		(i)
187	186		(1) The department shall provide manufacturers with a written notice of
188	187		deficiencies and an opportunity to cure those deficiencies before taking action to
189	188		remove manufacturers or products from the directory.
190	189		(2) The department shall not remove the manufacturer or its products
191	190		from the directory until at least thirty (30) business days after the manufacturer
192	191		has been given notice of an intended action setting forth the reasons for the
193	192		removal. Notice is deemed sufficient and immediately received by a
194	193		manufacturer if the notice is sent either electronically or by facsimile to an
195	194		electronic mail address or facsimile number, as the case may be, that was
196	195		provided by the manufacturer in its most recently filed certification.
197	196		(3) A vapor product manufacturer has fifteen (15) business days from the
198	197		date of service of the notice of the department's intended action to cure the noted
199	198		deficiencies or otherwise establish that the vapor product manufacturer or its
200	199		products should be included in the directory.
201	200		(4) Retailers have a thirty-day period following the removal of a
202	201		manufacturer or its products from the directory in which the retailer is authorized
203	202		to sell such products that were in the retailer's inventory as of the date of
204	203		removal. A retailer is not authorized to sell the identified products after the
205	204		expiration of the thirty-day period.
206	205		(5) After thirty (30) calendar days following removal from the directory,
207	206		the vapor products of a manufacturer identified in the notice of removal and
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212	211		intended for sale in this state are subject to seizure, forfeiture, and destruction,
213	212		and may not be purchased or sold for retail sale in this state. The cost of the
214	213		seizure, forfeiture, and destruction must be borne by the business or person from
215	214		whom the products are confiscated, except that no products may be seized from
216	215		a consumer who has made a bona fide purchase of such product. The
217	216		department may store and dispose of the seized products as appropriate, in
218	217		accordance with federal, state, and local laws pertaining to storage and disposal
219	218		of such products.
220	219		(j)
221	220		(1) Except as provided in subdivisions (j)(2) and (3), beginning January
222	221		1, 2026, or on the date that the department first makes the directory available for
223	222		public inspection on its website, whichever is later, vapor products not included in
224	223		the directory shall not be sold for retail sale in this state, either directly or through
225	224		an importer, distributor, wholesaler, retailer, or similar intermediary or
226	225		intermediaries.
227	226		(2) A retailer has sixty (60) calendar days from the date that the
228	227		department first makes the directory available for inspection on its website to sell
229	228		products that were in its inventory and not included in the directory or remove
230	229		those products from inventory.
231	230		(3) A distributor or wholesaler has sixty (60) calendar days from the date
232	231		that the department first makes the directory available for inspection on its
233	232		website to remove those products intended for sale in this state that were not
234	233		included in the directory from its inventory.
235	234		(4) After sixty (60) calendar days following publication of the directory,
236	235		vapor products not listed in the directory and intended for sale in this state are
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241	240		subject to seizure, forfeiture, and destruction, and shall not be purchased or sold
242	241		for retail sale except as provided in subsection (i). The cost of the seizure,
243	242		forfeiture, and destruction must be borne by the business or person from whom
244	243		the products are confiscated, except that no products may be seized from a
245	244		consumer who has made a bona fide purchase of such product.
246	245		(5) Retailers are authorized to purchase vapor products only from
247	246		licensed distributors or wholesalers of tobacco products.
248	247		(k)
249	248		(1) The following penalties apply to violations of this section:
250	249		(A)
251	250		(i) A retailer, distributor, wholesaler, or importer who sells
252	251		or offers for sale a vapor product for retail sale in this state that is
253	252		not included in the directory is subject to a civil penalty of up to
254	253		five hundred dollars ($500) for each individual vapor product
255	254		offered for sale in violation of this section;
256	255		(ii) The civil penalty for a second violation under this
257	256		subdivision (k)(1) within a twelve-month period is at least seven
258	257		hundred fifty dollars ($750) but not more than one thousand
259	258		dollars ($1,000) per product, and the suspension of the license of
260	259		the retailer, distributor, wholesaler, or importer for thirty (30)
261	260		calendar days; and
262	261		(iii) The civil penalty for a third violation under this
263	262		subdivision (k)(1) within a twelve-month period is at least one
264	263		thousand dollars ($1,000) but not more than one thousand five
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269	268		hundred dollars ($1,500) per product, and the revocation of the
270	269		license of the retailer, distributor, wholesaler, or importer; and
271	270		(B) A manufacturer whose vapor products are not listed in the
272	271		directory and who causes the products that are not listed to be sold for
273	272		retail sale in this state, whether directly or through an importer, distributor,
274	273		wholesaler, retailer, or similar intermediary or intermediaries, is subject to
275	274		a civil penalty of ten thousand dollars ($10,000) for each individual vapor
276	275		product offered for sale in violation of this section. In addition, a
277	276		manufacturer that knowingly and falsely represents any information
278	277		required by a certification form commits a Class A misdemeanor. Each
279	278		false representation is a separate offense.
280	279		(2) In an action to enforce this section, the state is entitled to recover
281	280		costs, including the costs of investigation, expert witness fees, and reasonable
282	281		attorney fees.
283	282		(3) Notwithstanding this section to the contrary, a repeated violation of
284	283		this section constitutes a deceptive trade practice under § 47-18-104.
285	284		(l)
286	285		(1) A manufacturer not registered to do business in the state shall, as a
287	286		condition precedent to having the manufacturer's name or products listed and
288	287		retained in the directory, appoint, and continually engage without interruption, a
289	288		registered agent in this state for service of process on whom all process and any
290	289		action or proceeding arising out of the enforcement of this section may be
291	290		served. The manufacturer shall provide to the department the name, address,
292	291		and telephone number of its agent for service of process and provide any other
293	292		information relating to its agent as may be requested by the department.
294	293
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298	297		(2) A manufacturer located outside of the United States shall, as an
299	298		additional condition precedent to having the manufacturer's products listed or
300	299		retained in the directory, cause each of the importers of any of the manufacturer's
301	300		products to be sold in this state to appoint, and continually engage without
302	301		interruption, the services of an agent in this state in accordance with this section.
303	302		All obligations of a manufacturer imposed by this section with respect to
304	303		appointment of its agent also apply to the importers with respect to appointment
305	304		of their agents.
306	305		(3) A manufacturer shall provide written notice to the department not later
307	306		than thirty (30) calendar days prior to the termination of the authority of an agent
308	307		appointed pursuant to subdivision (l)(1) or (l)(2). Not less than five (5) calendar
309	308		days prior to the termination of an existing agent appointment, a manufacturer
310	309		shall provide to the department the name, address, and telephone number of the
311	310		manufacturers newly appointed agent for service of process and provide any
312	311		other information relating to the new appointment as may be requested by the
313	312		department. In the event an agent terminates an agency appointment, the
314	313		manufacturer shall notify the department of the termination within five (5)
315	314		calendar days and include proof to the satisfaction of the department of the
316	315		appointment of a new agent.
317	316		(m) A retailer, distributor, or wholesaler that sells or distributes vapor products in
318	317		this state is subject to at least two (2) unannounced compliance checks by the
319	318		department or its designee, including any state or local law enforcement official, annually
320	319		for purposes of enforcing this section. Such compliance checks must take place during
321	320		business hours. Unannounced follow-up compliance checks of all noncompliant
322	321		retailers, distributors, and wholesalers must be conducted within thirty (30) calendar
323	322
324	323
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327	326		days after any violation of this section. The department shall publish the results of all
328	327		compliance checks at least annually and make the results available to the public on
329	328		request.
330	329		(n) If the department elects not to include a vapor product or vapor product
331	330		manufacturer on the directory, or if the department removes a vapor product or vapor
332	331		product manufacturer from the directory, then that action is subject to review in the
333	332		manner provided by § 67-1-105 and in accordance with the Uniform Administrative
334	333		Procedures Act, compiled in title 4, chapter 5. In the event of a conflict between § 67-1-
335	334		105 and the Uniform Administrative Procedures Act, the Uniform Administrative
336	335		Procedures Act governs.
337	336		(o) The department may promulgate rules necessary to effectuate this section.
338	337		Rules must be promulgated in accordance with the Uniform Administrative Procedures
339	338		Act, compiled in title 4, chapter 5.
340	339		(p) All fees and penalties collected by the department pursuant to this section
341	340		must be used for the administration and enforcement of this section. Funds collected
342	341		pursuant to this section must be placed in a special account within the general fund and
343	342		do not revert to the general fund at the end of a fiscal year.
344	343		(q) The department shall submit a report to the chief clerks of the senate and the
345	344		house of representatives, the office of legislative budget analysis, and the legislative
346	345		librarian regarding the status of the directory, manufacturers, and products included in
347	346		the directory, revenue and expenditures related to administration of this section, and
348	347		enforcement activities undertaken pursuant to this section. The initial report must be
349	348		submitted by July 1, 2026, and subsequent annual reports must be submitted by each
350	349		July 1 thereafter.
351	350		SECTION 8. This act takes effect July 1, 2025, the public welfare requiring it.