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7 LONG TITLE
8 General Description:
9 This bill enacts and amends provisions related to electronic cigarette products.
10 Highlighted Provisions:
11 This bill:
12 ▸ requires a person to obtain a license in order to sell or distribute an electronic
13 cigarette product;
14 ▸ provides criminal penalties for a person that sells an electronic cigarette without a
15 license; and
16 ▸ gives the Department of Health the authority to determine product quality, nicotine
17 content, packaging, and labeling standards for an electronic cigarette substance.
18 Money Appropriated in this Bill:
19 None
20 Other Special Clauses:
21 This bill provides a special effective date.
22 This bill provides a coordination clause.
23 Utah Code Sections Affected:
24 AMENDS:
25 26-42-102, as enacted by Laws of Utah 1998, Chapter 319
26 26-42-103, as last amended by Laws of Utah 2011, Chapter 96
27 26-42-107, as enacted by Laws of Utah 1998, Chapter 319
28 76-10-101, as last amended by Laws of Utah 2010, Chapter 114
29 76-10-105.1, as last amended by Laws of Utah 2010, Chapter 114
30 ENACTS:
31 26-57-101, Utah Code Annotated 1953
32 26-57-102, Utah Code Annotated 1953
33 26-57-103, Utah Code Annotated 1953
34 59-14-801, Utah Code Annotated 1953
35 59-14-802, Utah Code Annotated 1953
36 59-14-803, Utah Code Annotated 1953
37 Utah Code Sections Affected by Coordination Clause:
38 76-10-101, as last amended by Laws of Utah 2010, Chapter 114
39
40 Be it enacted by the Legislature of the state of Utah:
41 Section 1. Section 26-42-102 is amended to read:
42 26-42-102. Definitions.
43 As used in this chapter:
44 (1) "Commission" means the Utah State Tax Commission.
45 (2) "Employee" means an employee of a licensee.
46 (3) "Enforcing agency" means the state Department of Health, or any local health
47 department enforcing the provisions of this chapter.
48 (4) "Licensee" means a person licensed:
49 (a) under Section 59-14-201 to sell cigarettes at retail; [
50 (b) under Section 59-14-301 to sell tobacco products at retail[
51 (c) under Section 59-14-803 to sell an electronic cigarette product.
52 (5) "License to sell tobacco" or "license" means a license issued:
53 (a) under Section 59-14-201 to sell cigarettes at retail; [
54 (b) under Section 59-14-301 to sell tobacco products at retail[
55 (c) under Section 59-14-803 to sell an electronic cigarette product.
56 (6) "Tobacco" means [
57 (a) a cigarette or a tobacco product, as defined in Section 59-14-102[
58 (b) an electronic cigarette product, as defined in Section 59-14-802.
59 Section 2. Section 26-42-103 is amended to read:
60 26-42-103. Violations and penalties -- Imposition by enforcing agency and tax
61 commission.
62 (1) If, following an investigation or issuance of a citation or information under Section
63 77-39-101, an enforcing agency determines under Section 26-42-104 that a licensee or any
64 employee has sold tobacco to a person younger than 19 years of age, as prohibited by Section
65 76-10-104, the enforcing agency may impose upon the licensee the following administrative
66 penalties:
67 (a) upon the first violation, a penalty of not more than $300;
68 (b) upon a second violation at the same retail location, and within 12 months of the
69 first violation, a penalty of not more than $750; and
70 (c) upon a third or subsequent violation at the same retail location and within 12
71 months of the first violation, a penalty of not more than $1,000.
72 (2) The enforcing agency shall notify the commission in writing of any order or order
73 of default finding a violation of Subsection (1) which is a third or fourth violation.
74 (3) The commission, upon receipt of the written notification under Subsection (2), shall
75 take action under Section 59-14-203.5 or 59-14-301.5 against the license to sell tobacco:
76 (a) by suspending the licensee's license to sell tobacco at that location for not more
77 than 30 days, upon receipt of notification of a third violation under Subsection (1)(c); and
78 (b) by revoking the license to sell tobacco at that location held by the licensee,
79 including any license under suspension, upon receipt of notification of a fourth violation under
80 Subsection (1)(c).
81 (4) When the commission revokes a license under Subsection (3)(b), the commission
82 may not issue to the licensee, or to the business entity using the license that is revoked, a
83 license under Section 59-14-202 [
84 for which the license was issued for one year after:
85 (a) the day on which the time for filing an appeal of the revocation ends; or
86 (b) if the revocation is appealed, the day on which the decision to uphold the
87 revocation becomes final.
88 (5) This section does not prevent any bona fide purchaser of the business, who is not a
89 sole proprietor, director, corporate officer, or partner or other holder of significant interest in
90 the entity selling the business, from immediately applying for and obtaining a license to sell
91 tobacco.
92 Section 3. Section 26-42-107 is amended to read:
93 26-42-107. Allocation of civil penalties.
94 Civil monetary penalties collected under this chapter shall be allocated as follows:
95 (1) if a local health department conducts an adjudicative proceeding under Section
96 26-42-104, the penalty shall be paid to the treasurer of the county in which the violation was
97 committed, and transferred to:
98 (a) the local health department if it conducts a civil hearing under Section 26-42-104
99 alone; or
100 (b) in equal portions to the local health department and the other agencies that
101 participated in the hearing process;
102 (2) if the state Department of Health conducts a civil hearing under Section 26-42-104,
103 the penalty shall be deposited in the state's General Fund, and may be appropriated by the
104 Legislature to the state Department of Health for use in enforcement of this chapter; and
105 (3) if the civil penalty involves suspension or revocation of a license to sell tobacco
106 under Section 59-14-203.5 [
107 the commission, and the other half shall be allocated under Subsection (1) or (2), as
108 appropriate.
109 Section 4. Section 26-57-101 is enacted to read:
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111 26-57-101. Title.
112 This chapter is known as the "Electronic Cigarette Regulation Act."
113 Section 5. Section 26-57-102 is enacted to read:
114 26-57-102. Definitions.
115 As used in this chapter:
116 (1) "Cigarette" means the same as that term is defined in Section 59-14-102.
117 (2) "Electronic cigarette" means the same as that term is defined in Section 59-14-802.
118 (3) "Electronic cigarette product" means an electronic cigarette or an electronic
119 cigarette substance.
120 (4) "Electronic cigarette substance" means the same as that term is defined in Section
121 59-14-802.
122 (5) "Manufacture" includes:
123 (a) to cast, construct, or make electronic cigarettes; or
124 (b) to blend, make, process, or prepare an electronic cigarette substance.
125 (6) "Manufacturer sealed electronic cigarette substance" means an electronic cigarette
126 substance that is sold in a container that:
127 (a) is pre-filled by the electronic cigarette substance manufacturer; and
128 (b) the electronic cigarette manufacturer does not intend for a consumer to open.
129 Section 6. Section 26-57-103 is enacted to read:
130 26-57-103. Electronic cigarette products -- Labeling -- Manufacturing and quality
131 control standards -- Low-grade nicotine -- Advertising.
132 (1) The department shall, in consultation with a local health department, as defined in
133 Section 26A-1-102, and with input from members of the public, establish, no later than January
134 1, 2016, by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
135 Rulemaking Act, standards for electronic cigarette substance:
136 (a) labeling;
137 (b) nicotine content;
138 (c) packaging; and
139 (d) product quality.
140 (2) The standards established by the department under Subsection (1) do not apply to a
141 manufacturer sealed electronic cigarette substance.
142 (3) Beginning on July 1, 2016, a person may not sell an electronic cigarette substance
143 unless the electronic cigarette substance complies with the standards established by the
144 department under Subsection (1).
145 (4) (a) Beginning on July 1, 2016, a local health department may not enact a rule or
146 regulation regarding electronic cigarette substance labeling, nicotine content, packaging, or
147 product quality that is not identical to the standards established by the department under
148 Subsection (1).
149 (b) Except as provided in Subsection (4)(c), a local health department may enact a rule
150 or regulation regarding electronic cigarette substance manufacturing.
151 (c) A local health department may not enact a rule or regulation regarding a
152 manufacturer sealed electronic cigarette substance.
153 (5) Beginning on July 1, 2016, a person may not advertise an electronic cigarette
154 product:
155 (a) as a tobacco cessation device;
156 (b) if the person is not licensed to sell an electronic cigarette product under Section
157 59-14-803; or
158 (c) during a period of time when the person's license to sell an electronic cigarette
159 product under Section 59-14-803 has been suspended or revoked.
160 Section 7. Section 59-14-801 is enacted to read:
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162 59-14-801. Title.
163 This part is known as the "Electronic Cigarette Licensing Act."
164 Section 8. Section 59-14-802 is enacted to read:
165 59-14-802. Definitions.
166 As used in this part:
167 (1) "Cigarette" means the same as that term is defined in Section 59-14-102.
168 (2) (a) "Electronic cigarette" means:
169 (i) an electronic device used to deliver or capable of delivering vapor containing
170 nicotine to an individual's respiratory system;
171 (ii) a component of the device described in Subsection (2)(a)(i); or
172 (iii) an accessory sold in the same package as the device described in Subsection
173 (2)(a)(i).
174 (b) "Electronic cigarette" includes an e-cigarette as defined in Section 26-38-2.
175 (3) "Electronic cigarette product" means an electronic cigarette or an electronic
176 cigarette substance.
177 (4) "Electronic cigarette substance" means any substance, including liquid containing
178 nicotine, used or intended for use in an electronic cigarette.
179 (5) "Enforcing agency" means the Department of Health, a county health department,
180 or a local health department, when enforcing:
181 (i) Title 26, Chapter 42, Civil Penalties for Tobacco Sales to Underage Persons; or
182 (ii) Title 26, Chapter 57, Electronic Cigarette Regulation Act.
183 (6) "License to sell an electronic cigarette product" means a license issued by the
184 commission under Subsection 59-14-803(3).
185 (7) "Licensee" means a person that holds a valid license to sell electronic cigarette
186 products.
187 Section 9. Section 59-14-803 is enacted to read:
188 59-14-803. Electronic cigarette licenses -- Sale.
189 (1) Except as provided in Subsection (2), a person may not sell, offer to sell, or
190 distribute an electronic cigarette product in Utah without first obtaining a license to sell an
191 electronic cigarette product from the commission under this section.
192 (2) A person that holds a valid license to sell cigarettes under Section 59-14-202, or a
193 person that holds a valid license to sell tobacco products under Section 59-14-301, may,
194 without obtaining a separate license to sell an electronic cigarette product under this part, sell,
195 offer to sell, or distribute an electronic cigarette product in Utah in accordance with this part.
196 (3) Except as provided in Subsection (6), the commission shall issue a license to sell an
197 electronic cigarette product to a person that:
198 (a) submits an application, on a form created by the commission, that includes:
199 (i) the person's name;
200 (ii) the address of the facility where the person will sell an electronic cigarette product;
201 and
202 (iii) any other information the commission requires to implement this chapter; and
203 (b) pays a fee:
204 (i) in the amount of $30; or
205 (ii) if renewing the person's license, in the amount of $20.
206 (4) A license described in Subsection (3) is:
207 (a) valid only at one fixed business address;
208 (b) valid for three years;
209 (c) valid only for a physical location; and
210 (d) renewable if a licensee meets the criteria for licensing described in Subsection (3).
211 (5) The commission shall, after notifying a licensee, revoke a license described in
212 Subsection (3) if an enforcing agency determines the licensee has violated a provision of:
213 (a) Title 26, Chapter 42, Civil Penalties for Tobacco Sales to Underage Persons; or
214 (b) Title 26, Chapter 57, Electronic Cigarette Regulation Act.
215 (6) If the commission revokes a person's license to sell an electronic cigarette product
216 under Subsection (5), the commission may not issue a license to sell an electronic cigarette
217 product, a license to sell cigarettes under Section 59-14-201, or a license to sell tobacco under
218 Section 59-14-301 to the person until one year after:
219 (a) the day on which the time for filing an appeal of the revocation ends, as determined
220 by the enforcing agency; or
221 (b) if the person appeals the enforcing agency's decision to revoke the license to sell an
222 electronic cigarette product, the day on which the enforcing agency's decision to uphold the
223 revocation is final.
224 (8) If the commission revokes a person's license under Subsection (5), the commission
225 shall also revoke the person's license to sell cigarettes under Section 59-14-201, if any, and the
226 person's license to sell tobacco under Section 59-14-301, if any.
227 (9) The commission may make rules in accordance with Title 63G, Chapter 3, Utah
228 Administrative Rulemaking Act, to establish the additional information described in
229 Subsection (3)(a)(iii) that a person must provide in the application described in Subsection
230 (3)(a).
231 (10) It is a class B misdemeanor for a person to violate Subsection (1).
232 Section 10. Section 76-10-101 is amended to read:
233 76-10-101. Definitions.
234 As used in this part:
235 (1) "Cigar" means a product that contains nicotine, is intended to be burned under
236 ordinary conditions of use, and consists of any roll of tobacco wrapped in leaf tobacco, or in
237 any substance containing tobacco, other than any roll of tobacco that is a cigarette as described
238 in Subsection (2).
239 (2) "Cigarette" means a product that contains nicotine, is intended to be burned under
240 ordinary conditions of use, and consists of:
241 (a) any roll of tobacco wrapped in paper or in any substance not containing tobacco; or
242 (b) any roll of tobacco wrapped in any substance containing tobacco which, because of
243 its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to
244 be offered to, or purchased by, consumers as a cigarette described in Subsection (2)(a).
245 (3) "Electronic cigarette" means [
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247 product, as defined in Section 59-14-802.
248 (4) "Place of business" includes:
249 (a) a shop;
250 (b) a store;
251 (c) a factory;
252 (d) a public garage;
253 (e) an office;
254 (f) a theater;
255 (g) a recreation hall;
256 (h) a dance hall;
257 (i) a poolroom;
258 (j) a café;
259 (k) a cafeteria;
260 (l) a cabaret;
261 (m) a restaurant;
262 (n) a hotel;
263 (o) a lodging house;
264 (p) a streetcar;
265 (q) a bus;
266 (r) an interurban or railway passenger coach;
267 (s) a waiting room; and
268 (t) any other place of business.
269 (5) "Smoking" means the possession of any lighted cigar, cigarette, pipe, or other
270 lighted smoking equipment.
271 Section 11. Section 76-10-105.1 is amended to read:
272 76-10-105.1. Requirement of direct, face-to-face sale of tobacco products and
273 electronic cigarettes -- Supremacy clause -- Penalties.
274 (1) As used in this section:
275 (a) "Cigarette tobacco" means a product that consists of loose tobacco that contains or
276 delivers nicotine and is intended for use by a consumer in a cigarette.
277 (b) "Pipe tobacco" means a product that consists of loose tobacco that contains or
278 delivers nicotine and is intended to be smoked by a consumer in a pipe.
279 (c) "Retailer" means a person who sells cigarettes, electronic cigarettes, cigars,
280 cigarette tobacco, pipe tobacco, or smokeless tobacco to individuals for personal consumption
281 or who operates a facility where a vending machine or a self-service display is permitted under
282 Subsection (3)(b).
283 (d) "Self-service display" means a display of cigarettes, electronic cigarettes, cigars,
284 cigarette tobacco, pipe tobacco, or smokeless tobacco products to which the public has access
285 without the intervention of a retail employee.
286 (e) "Smokeless tobacco" means a product that consists of cut, ground, powdered, or
287 leaf tobacco that contains nicotine and that is intended to be placed in the oral cavity.
288 (2) (a) Except as provided in Subsection (3), a retailer may sell cigarettes, [
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290 tobacco only in a direct, face-to-face exchange between:
291 (i) an employee of the retailer; and
292 (ii) the purchaser.
293 (b) Examples of methods that are not permitted include vending machines and
294 self-service displays.
295 (c) Subsections (2)(a) and (b) do not prohibit the use or display of locked cabinets
296 containing cigarettes, [
297 pipe tobacco, or smokeless tobacco if the locked cabinets are accessible only to the retailer or
298 the retailer's employees.
299 (3) The following sales are permitted as exceptions to Subsection (2):
300 (a) mail-order sales, if the provisions of Section 59-14-509 are met;
301 (b) sales from vending machines, including vending machines that sell packaged,
302 single cigarettes or cigars, and self-service displays that are located in a separate and defined
303 area within a facility where the retailer ensures that no person younger than 19 years of age is
304 present, or permitted to enter, at any time, unless accompanied by a parent or legal guardian;
305 and
306 (c) sales by a retailer from a retail store which derives at least 80% of its revenue from
307 tobacco and tobacco related products and where the retailer ensures that no person younger
308 than 19 years of age is present, or permitted to enter at any time, unless accompanied by a
309 parent or legal guardian.
310 (4) Any ordinance, regulation, or rule adopted by the governing body of a political
311 subdivision of the state or by a state agency that affects the sale, placement, or display of
312 cigarettes, electronic cigarettes, cigars, cigarette tobacco, pipe tobacco, or smokeless tobacco
313 that is not essentially identical to the provisions of this section and Section 76-10-102 is
314 superseded.
315 (5) (a) A parent or legal guardian who accompanies a person younger than 19 years of
316 age into an area described in Subsection (3)(b) or into a retail store as described in Subsection
317 (3)(c) and permits the person younger than 19 years of age to purchase or otherwise take a
318 cigar, cigarette, [
319 providing tobacco as provided for in Section 76-10-104 and the penalties provided for in that
320 section.
321 (b) Nothing in this section may be construed as permitting a person to provide tobacco
322 to a minor in violation of Section 76-10-104.
323 (6) Violation of Subsection (2) or (3) is a:
324 (a) class C misdemeanor on the first offense;
325 (b) class B misdemeanor on the second offense; and
326 (c) class A misdemeanor on the third and all subsequent offenses.
327 Section 12. Effective date.
328 This bill takes effect on July 1, 2015.
329 Section 13. Coordinating H.B. 415 with H.B. 131 -- Substantive amendments.
330 If this H.B. 415 and H.B. 131, Tobacco Shop Amendments, both pass and become law,
331 it is the intent of the Legislature that, when the Office of Legislative Research and General
332 Counsel prepares the Utah Code database for publication:
333 (1) the amendments to Section 76-10-101 in this bill supersede the amendments to
334 Section 76-10-101 in H.B. 131; and
335 (2) Section 76-10-105.1 shall be amended to read:
336 "76-10-105.1 Requirement of direct, face-to-face sale of cigarettes, tobacco, and
337 electronic cigarettes -- Minors not allowed in tobacco specialty shop -- Penalties.
338 (1) As used in this section:
339 [
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341 [
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343 (a) "Cigarette" means the same as that term is defined in Section 59-14-102.
344 (b) (i) "Face-to-face exchange" means a transaction made in person between an
345 individual and a retailer or retailer's employee.
346 (ii) "Face-to-face exchange" does not include a sale through a:
347 (A) vending machine; or
348 (B) self-service display.
349 (c) "Retailer" means a person who [
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352 (i) sells a cigarette, tobacco, or an electronic cigarette to an individual for personal
353 consumption; or
354 (ii) operates a facility [
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356 cigarette.
357 (d) "Self-service display" means a display of [
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359 electronic cigarette to which the public has access without the intervention of a [
360 or retailer's employee.
361 [
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363 (e) "Tobacco" means any product, except a cigarette, made of or containing tobacco.
364 (f) "Tobacco specialty shop" means a retailer with a physical location that derives at
365 least 80% of its total sales from the sale of cigarettes, tobacco, or electronic cigarettes.
366 (2) [
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400 (3) The face-to-face sale requirement in Subsection (2) does not apply to:
401 (a) a mail-order, telephone, or Internet sale made in compliance with Section
402 59-14-509;
403 (b) a sale from a vending machine or self-service display that is located in an area of a
404 retailer's facility:
405 (i) that is distinct and separate from the rest of the facility; and
406 (ii) where the retailer only allows an individual who complies with Subsection (4) to be
407 present; or
408 (c) a sale at a tobacco specialty shop.
409 (4) An individual who is less than 19 years old may not enter or be present at a tobacco
410 specialty shop unless the individual is:
411 (a) accompanied by a parent or legal guardian;
412 (b) present at the tobacco shop for a bona fide commercial purpose other than to
413 purchase a cigarette, tobacco, or an electronic cigarette; or
414 (c) 18 years old or older and an active duty member of the United States Armed Forces,
415 as demonstrated by a valid, government-issued military identification card.
416 (5) A parent or legal guardian who accompanies, under Subsection (4)(a), an individual
417 into an area described in Subsection (3)(b), or into a tobacco specialty shop, may not allow the
418 individual to purchase a cigarette, tobacco, or an electronic cigarette.
419 (6) [
420 (a) class C misdemeanor on the first offense;
421 (b) class B misdemeanor on the second offense; and
422 (c) class A misdemeanor on the third and all subsequent offenses.
423 (7) An individual who violates Subsection (5) is guilty of providing tobacco to a minor
424 under Section 76-10-104.
425 (8) (a) Any ordinance, regulation, or rule adopted by the governing body of a political
426 subdivision of the state or by a state agency that affects the sale, placement, or display of
427 cigarettes, tobacco, or electronic cigarettes that is not essentially identical to the provisions of
428 this section and Section 76-10-102 is superseded.
429 (b) Subsection (8)(a) does not apply to the adoption or enforcement of a land use
430 ordinance by a municipal or county government.".