H.B. 354

1

CIGARETTE MARKETING AGREEMENT
2 PROHIBITIONS
3 2002 GENERAL SESSION
4 STATE OF UTAH
5 Sponsor: David L. Hogue
6 This act modifies the Utah Antitrust Act. The act prohibits certain marketing practices
7 between tobacco product manufacturers and cigarette retailers. The act imposes the
8 penalties of the Utah Antitrust Act on manufacturers and retailers who violate the marketing
9 prohibitions and provides private right of action and damages against retailers and
10 manufacturers who enter into prohibited marketing practices.
11 This act affects sections of Utah Code Annotated 1953 as follows:
12 ENACTS:
13 76-10-914.5, Utah Code Annotated 1953
14 Be it enacted by the Legislature of the state of Utah:
15 Section 1. Section 76-10-914.5 is enacted to read:
16 76-10-914.5. Cigarette marketing practices.
17 (1) As used in this section:
18 (a) "Cigarette category space" means a portion of space in a store or on the store premises
19 reserved, made available, or identified by a retailer for the display of products, signs, advertising,
20 promotion, or other communications relating to cigarettes.
21 (b) "Cigarette retailer" means any person or entity that offers cigarettes for retail sales.
22 (c) Manufacturer" means a cigarette manufacturer or importer who, directly or indirectly
23 through an agent, representative, broker, or any other person or entity, offers to supply, sell, or
24 deliver cigarettes or cigarette advertising, merchandising, or promotions to a cigarette retailer.
25 (d) "Promotion" means a program or means by which:
26 (i) the effective price paid by a purchaser of cigarettes is reduced from the regular price
27 charged by the retailer when a manufacturer's promotion is not in effect or applicable; or

28 (ii) additional cigarettes or other items are offered to the consumer in connection with the
29 purchase of cigarettes.
30 (2) A contract or agreement between a manufacturer and a cigarette retailer may not
31 contain a provision or agreement which:
32 (a) requires the cigarette retailer to allocate:
33 (i) a percentage or fraction of any part of the cigarette retailer's:
34 (A) space available for product display, signage, or advertising; or
35 (B) cigarette category space to a manufacturer for any purpose; or
36 (ii) a determined amount of space to a manufacturer, including footage, product facings,
37 or other forms of stated measurement, in order to receive, participate in, or receive payment under
38 a manufacturer's promotions; or
39 (b) restricts or limits a cigarette retailer's:
40 (i) cigarette category space; or
41 (ii) conduct of or participation in any program or activity concerning the sale, display,
42 merchandising, promotion, pricing, or advertising of any manufacturer's products.
43 (3) A cigarette retailer or manufacturer who engages in conduct prohibited under
44 Subsection (2) is in violation of this act and is subject to Sections 76-10-916 through 76-10-926 .
45 (4) This act does not prohibit a cigarette retailer and manufacturer from entering into
46 agreements which permit the cigarette retailer to:
47 (a) obtain, participate in, and receive payments from the manufacturer pursuant to the
48 manufacturer's cigarette merchandising, advertising, display, or promotion programs, whether
49 permanent or temporary;
50 (b) be compensated by the manufacturer for providing space for the merchandising,
51 advertising, display, or promotion of the manufacturer's products; or
52 (c) purchase cigarettes.




Legislative Review Note
as of 3-1-02 2:56 PM

A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel