HB577: HB577 Georgia Nicotine Vapor Products Directory Act; enact

25 LC 50 1211S House Bill 577 (COMMITTEE SUBSTITUTE) By: Representatives Gaines of the 120th, Ridley of the 6th, Dempsey of the 13th, Stephens of the 164th, Williams of the 168th, and others A BILL TO BE ENTITLED AN ACT To amend Title 48 of the Official Code of Georgia Annotated, re lating to revenue and1 taxation, so as to enact the "Georgia Nicotine Vapor Products Directory Act"; to provide for2 definitions; to require the establishment and maintenance of a directory of nicotine vapor3 products authorized for sale in this state; to prohibit the sale of any vapor product containing4 nicotine that is not listed in the directory; to provide for compliance checks and enforcement;5 to provide for seizure and destruction of contraband; to provid e for civil penalties and6 enforcement; to provide procedures for the revocation and suspe nsion of licenses for7 violations; to provide for statutory construction; to provide f or rules and regulations; to8 require an annual report to the General Assembly; to provide for related matters; to provide9 for contingent effectiveness upon appropriation of funds; to repeal conflicting laws; and for10 other purposes.11 BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:12 SECTION 1.13 Title 48 of the Official Code of Georgia Annotated, relating to revenue and taxation, is14 amended by designating Code Sections 48-11-1 through 48-11-30 as Article 1 of Chapter 1115 and enacting a new article to read as follows:16 H. B. 577 (SUB) - 1 - 25 LC 50 1211S "ARTICLE 217 48-11-40.18 This article shall be known and may be cited as the 'Georgia Ni cotine Vapor Products19 Directory Act.'20 48-11-41.21 As used in this article, the term:22 (1) 'Directory' means the directory of nicotine vapor products the commissioner is23 required to develop and maintain as provided in this article.24 (2) 'FDA' means the United States Food and Drug Administration.25 (3) 'Foreign business entity' means an entity formed under a l aw other than the law of26 this state.27 (4) 'Licensee' means any vapor product dealer, vapor product distributor, vapor product28 importer, or vapor product manufacturer licensed under Article 1 of this chapter.29 (5) 'Nicotine vapor product' means any consumable vapor produc t that contains any30 amount of nicotine and any vapor device developed or intended t o deliver any31 consumable vapor product that contains nicotine. Such term sha ll not include a32 consumable vapor product contained within an open system or any vapor device that33 utilizes or is designed to utilize an open system.34 (6) 'Timely filed premarket tobacco product application' means an application pursuant35 to 21 U.S.C. Section 387j for a nicotine vapor product marketed in the United States as36 of August 8, 2016, that was submitted to the FDA on or before September 9, 2020, and37 accepted for filing.38 H. B. 577 (SUB) - 2 - 25 LC 50 1211S 48-11-42.39 (a)(1) The commissioner shall develop a process by which vapor product manufacturers40 can submit the certification required under subsection (b) of t his Code section and any41 other information required under this article to be used to cre ate the directory listing42 required under Code Section 48-11-43 and for such other purpose s as provided in this43 article. Such process may include a portal or software application accessible through an44 internet website. The commissioner may allow a vapor product m anufacturer to file a45 single certification for all of its nicotine vapor products or require a separate certification46 for each nicotine vapor product.47 (2) Notwithstanding any law to the contrary, the commissioner shall be authorized to48 disclose the certifications and any other information received pursuant to this chapter,49 Chapters 13 and 13A of Title 10, and Title 16 with federal, sta te, or local courts or50 agencies for purposes of enforcing the provisions of this chapter, Chapters 13 and 13A51 of Title 10, and Title 16, or the corresponding laws of other states.52 (b) Within 12 months of the effective date of this article, an d annually thereafter, every53 vapor product manufacturer that sells nicotine vapor products in this state or sells nicotine54 vapor products to a licensee shall execute and deliver a certification to the commissioner55 in a format prescribed by the commissioner through rules and re gulations. In such56 certification, the vapor product manufacturer shall attest, und er penalty of perjury, as to57 each nicotine vapor product:58 (1) The vapor product manufacturer in offering such nicotine vapor product for sale in59 this state or in selling such nicotine vapor product to a licensee for the purpose of selling60 in it in this state is compliant with federal law and this chapter;61 (2) The nicotine vapor product does not contain any substance or exceed the quantity of62 any substance that is illegal to be sold in this state pursuant to federal law or the laws of63 this state; and64 H. B. 577 (SUB) - 3 - 25 LC 50 1211S (3)(A) The vapor product manufacturer has submitted a timely filed premarket tobacco65 product application for the nicotine vapor product pursuant to 21 U.S.C. Section 387j66 to the FDA, and the application either remains under review by the FDA or has67 received a marketing denial order that has been and remains stayed by the FDA or court68 order, rescinded by the FDA, or vacated by a court; or69 (B) The vapor product manufacturer has received a marketing gr anted order under70 21 U.S.C. Section 387j for the nicotine vapor product from the FDA.71 (c) The certification under subsection (b) of this Code sectio n shall require each vapor72 product manufacturer to set forth:73 (1) The name under which the vapor product manufacturer transa cts or intends to74 transact business;75 (2) The license identification information for any license iss ued to the vapor product76 manufacturer by the commissioner under Article 1 of this chapter;77 (3) The address of the location of the vapor product manufactu rer's principal place of78 business;79 (4) The vapor product manufacturer's email address;80 (5) The brand name, category or type, product name, flavor, and description of each of81 such vapor product manufacturer's nicotine vapor product that it seeks to have made part82 of the directory; and83 (6) Such other information as may be required by the commissioner pursuant to rules and84 regulations.85 (d) In addition to the certification required under subsection (b) of this Code section, each86 vapor product manufacturer shall submit to the commissioner for each nicotine vapor87 product a copy of:88 (1)(A) The cover page of the marketing granted order issued pu rsuant to 21 U.S.C.89 Section 387j;90 H. B. 577 (SUB) - 4 - 25 LC 50 1211S (B) A copy of the acceptance letter issued by the FDA pursuant to 21 U.S.C.91 Section 387j for a timely filed premarket tobacco product application; or92 (C) A document issued by the FDA or by a court confirming that the premarket93 tobacco product application has received a denial order that is not yet in effect; and94 (2) A payment of $1,000.00 for each nicotine vapor product the first time the vapor95 product manufacturer submits a certification for that nicotine vapor product and a96 payment of $250.00 annually thereafter for each such nicotine vapor product.97 (e) The information submitted by the vapor product manufacture r pursuant to98 paragraph (1) of subsection (d) of this Code section shall be c onsidered confidential99 commercial or financial information for purposes of Article 4 o f Chapter 18 of Title 50. 100 The vapor product manufacturer may redact certain confidential commercial or financial101 information provided under paragraph (1) of subsection (d) of this Code section, subject102 to approval by the commissioner. The commissioner shall not disclose such information103 except as required or authorized by law.104 (f) Any vapor product manufacturer that submits a certification pursuant to subsection (b)105 of this Code section shall notify the commissioner within 30 days after any material change106 to such certification as to any nicotine vapor product, including, but not limited to:107 (1) Issuance or denial of a marketing authorization or other order by the FDA pursuant108 to 21 U.S.C. Section 387j;109 (2) Any other order by the FDA or a court or any action required by the FDA concerning110 the content or quality of the nicotine used in a nicotine vapor product requiring a vapor111 product manufacturer to remove such nicotine vapor product from the market either112 temporarily or permanently;113 (3) Any notice of action taken by the FDA affecting the abilit y of the nicotine vapor114 product to be introduced or delivered into interstate commerce for commercial115 distribution in the United States; or116 H. B. 577 (SUB) - 5 - 25 LC 50 1211S (4) Any other change deemed material by the commissioner pursu ant to the rules and117 regulations.118 (g) The commissioner may by rules and regulations establish a procedure to allow vapor119 product manufacturers to renew certifications w ithout having to resubmit all the120 information required by this Code section, if there has not bee n any change as to such121 information.122 48-11-43.123 (a) The commissioner shall develop and maintain a directory listing all the nicotine vapor124 products for which a certification has been submitted that complies with this article. Such125 directory listing shall include information as to the vapor pro duct manufacturer that126 submitted the certification and may include the status of any m arketing authorization,127 order, or other action of the FDA or any court provided under s ubsection (b) of Code128 Section 48-11-42. The commissioner shall make the directory av ailable on the129 department's public website within 14 months of the effective d ate of this article. The130 commissioner on at least a monthly basis shall update the direc tory to correct mistakes,131 ensure accuracy, and add or remove nicotine vapor products as m ay be necessary. The132 commissioner shall establish by rules and regulations a process to provide any vapor133 product manufacturer that submits a certification pursuant to Code Section 48-11-42 and134 all licensees notice of the initial publication of the director y and changes made to the135 directory in the prior month.136 (b)(1) The commissioner shall provide a vapor product manufacturer with notice of any137 deficiencies in the submitted certification and an opportunity to cure such deficiencies138 before removing a nicotine vapor product of such vapor product manufacturer from the139 directory.140 (2) The commissioner shall not remove from the directory a nicotine vapor product of141 such vapor product manufacturer until at least 15 days after th e vapor product142 H. B. 577 (SUB) - 6 - 25 LC 50 1211S manufacturer has been given notice of such intended action. Notice shall be sufficient143 and deemed immediately received by a vapor product manufacturer if the notice is sent144 either electronically or by facsimile to an email address or facsimile number provided by145 the vapor product manufacturer in its most recent certification form for such nicotine146 vapor product.147 (3) The vapor product manufacturer shall have 15 days from the date of service of the148 notice of the commissioner's intended action provided pursuant to paragraph (2) of this149 subsection to cure any deficiencies or otherwise establish to t he satisfaction of the150 commissioner that such nicotine vapor product of such vapor pro duct manufacturer151 should be included in the directory.152 (4) A determination by the commissioner not to include in or t o remove from the153 directory a nicotine vapor product shall be subject to judicial review in the same manner154 as is provided by law for judicial review of contested cases under Chapter 13 of Title 50,155 the 'Georgia Administrative Procedure Act.'156 48-11-44.157 (a) Beginning on the date that the commissioner first makes the directory available on the158 department's public website, nicotine vapor products not included in the directory shall not159 be sold or purchased in this state except as provided in this Code section.160 (b)(1) Each vapor product dealer shall have six months from th e date that the161 commissioner first makes the directory available on the department's public website to162 sell nicotine vapor products that were in its inventory and not included in the directory163 or to remove those nicotine vapor products from its inventory and return those nicotine164 vapor products to the vapor product manufacturer or vapor produ ct distributor from165 whom it was acquired for a full refund.166 (2) Each vapor product distributor shall have six months from the date that the167 commissioner first makes the directory available on the department's public website to168 H. B. 577 (SUB) - 7 - 25 LC 50 1211S remove those nicotine vapor products intended for sale or purchase in this state from its169 inventory and return those nicotine vapor products to the vapor product manufacturer170 from whom it was acquired for a full refund.171 (3) After six months following publication of the directory, nicotine vapor products not172 listed in the directory and intended for sale or purchase in th is state shall be subject to173 seizure, forfeiture, storage, and destruction consistent with t he provisions of Code174 Section 48-11-48 and shall not be sold or purchased in this sta te except as otherwise175 provided in this article.176 (c)(1) If a nicotine vapor product is removed from the directo ry, each vapor product177 dealer and vapor product distributor shall have 30 days from the date notice is received178 that such nicotine vapor product has been removed from the dire ctory to sell such179 nicotine vapor product or remove such nicotine vapor product fr om its inventory and180 return such nicotine vapor product to the vapor product manufacturer from whom it was181 acquired for a full refund. Each such nicotine vapor product manufacturer shall provide182 to the commissioner information regarding the return of such ni cotine vapor product183 within 21 days after receipt.184 (2) After 30 days following removal of a nicotine vapor produc t from the directory, it185 shall be unlawful to purchase or sell such nicotine vapor product identified in the notice186 of removal in this state and such nicotine vapor product shall be subject to seizure187 consistent with the provisions of Code Section 48-11-48. Such prohibition on the188 purchase and sale of such nicotine vapor products shall not pro hibit the vapor product189 manufacturer or vapor product distributor from providing a refund pursuant to this Code190 section.191 48-11-45.192 Each vapor product dealer and vapor product distributor that se lls or distributes vapor193 products in this state shall be subject to compliance checks by the department for purposes194 H. B. 577 (SUB) - 8 - 25 LC 50 1211S of enforcing this article. Unannounced follow-up compliance checks conducted on behalf195 of the department of all noncompliant vapor product dealers and vapor product distributors196 shall be conducted within 30 days after any violation of this C ode section. The197 commissioner on an annual basis shall make available on the department's public website198 the results of all compliance checks.199 48-11-46.200 (a) In addition to any other provision of law, a vapor product dealer or a vapor product201 distributor that has a nicotine vapor product that is not inclu ded in the directory and is202 available for sale or is offered for sale in this state in viol ation of this article shall be203 subject to a civil penalty as follows:204 (1) A violation of a total quantity of 20 nicotine vapor produ ct units or less shall be205 punishable:206 (A) For a first violation, no penalty if the nicotine vapor pr oducts are removed as207 provided in this chapter;208 (B) For a second violation within a 12 month period, by a fine of ten times the retail209 value of the units of nicotine vapor products involved;210 (C) For a third violation within an 18 month period, by a fine of 25 times the retail211 value of the units of nicotine vapor products involved; and212 (D) For a fourth violation within a 24 month period, by a fine of 25 times the retail213 value of the units of nicotine vapor products involved and revocation of the license of214 the vapor product dealer or the vapor product distributor, as a pplicable, by the215 department pursuant to Code Section 48-11-6;216 (2) A violation of a total quantity of more than 20 nicotine vapor product units shall be217 punishable:218 (A) For a first violation, no pe nalty if the nicotine vapor pr oducts are removed as219 provided in this chapter;220 H. B. 577 (SUB) - 9 - 25 LC 50 1211S (B) For a second violation within a 12 month period, by a fine of $10,000.00 or 50221 times the retail value for each unit of nicotine vapor product involved, whichever is222 greater;223 (C) For a third violation within an 18 month period, by a fine of $20,000.00 or 50 times224 the retail value for each unit of nicotine vapor product involved, whichever is greater,225 and a 60 day suspension of the license of the vapor product dealer or the vapor product226 distributor, as applicable, by the department pursuant to Code Section 48-11-6; and227 (D) For a fourth violation within a 24 month period, by a fine of $30,000.00 or 50228 times the retail value for each unit of nicotine vapor product involved, whichever is229 greater, and revocation of the license of the vapor product dealer or the vapor product230 distributor, as applicable, by the department pursuant to Code Section 48-11-6; and231 (3) Notwithstanding paragraphs (1) and (2) of this subsection, a fourth violation of any232 quantity of units of nicotine vapor products shall result in a revocation of the license of233 the vapor product dealer or the vapor product distributor, as applicable, by the department234 pursuant to Code Section 48-11-6.235 For purposes of this subsection, each unit of a nicotine vapor product that may be sold236 individually shall be counted separately to determine the quant ity of nicotine vapor237 products.238 (b) A vapor product manufacturer whose nicotine vapor products are not listed in the239 directory and that causes the nicotine vapor products that are not listed to be sold in this240 state, whether directly or through a vapor product importer, va por product distributor,241 vapor product dealer, or any other person, shall be subject to a civil penalty of $10,000.00242 per day for each individual nicotine vapor product offered for sale in violation of this243 chapter until the offending nicotine vapor product is either re moved from the market or244 properly listed on the directory. In addition, any vapor product manufacturer that falsely245 represents any information on the certification or that is required under this chapter to be246 H. B. 577 (SUB) - 10 - 25 LC 50 1211S provided to the commissioner or the department shall be guilty of a misdemeanor for each247 false representation.248 (c) A repeated violation of this Code section shall constitute a deceptive trade practice249 under Part 1 of Article 15 of Chapter 1 of Title 10, the 'Uniform Deceptive Trade Practices250 Act.'251 48-11-47.252 In an action for any violation brought under this chapter, the commissioner may recover253 reasonable expenses incurred in investigating and preparing the case and attorneys' fees if254 successful in the initial action, unless such action is successfully appealed and reversed.255 48-11-48.256 (a) Any nicotine vapor products offered for sale or sold in vi olation of this article are257 declared to be contraband goods and shall be seized by the comm issioner, the258 commissioner's agents or employees, or any law enforcement officer of this state if directed259 by the commissioner to do so.260 (b) Upon seizure, the person from whom the contraband property was seized, if known,261 shall be provided with a receipt identifying the contraband property seized and indicating262 from whom the contraband property was seized and the place of seizure. Such contraband263 shall be stored pending a hearing and appeal provided for in subsections (d) and (e) of this264 Code section and thereafter destroyed, if authorized.265 (c) A copy of the receipt shall be:266 (1) Filed with the department and shall be a public record open to public inspection; and267 (2) Posted at the courthouse of the county in which the contraband was seized.268 (d) Any person desiring to make claim to the contraband property shall file a claim with269 the commissioner within ten days from the day of seizure. The commissioner, within 30270 days of receipt of any such claim, shall afford the claimant a hearing in which to show271 H. B. 577 (SUB) - 11 - 25 LC 50 1211S entitlement to the seized items. The burden of proof at such h earing shall be upon the272 claimant to establish a claim as to the items seized and to sho w compliance with or273 justification for noncompliance with this article. The commissioner shall enter a written274 order granting or denying the claim within 30 days from the date of the hearing.275 (e) An appeal from the commissioner's order may be taken to the Superior Court of Fulton276 County by filing with the commissioner, within 15 days from the date of the decision, a277 copy of the petition for review filed in the Superior Court of Fulton County. The278 proceedings on the petition for review shall be governed by Chapter 3 of Title 5 except as279 provided otherwise in this Code section. The appeal shall be based upon the record made280 before the commissioner. The commissioner shall transmit the r ecord and appropriate281 documents to the superior court within 30 days after the date t he petition for review is282 received. The superior court shall review the record for error s of law, violation of283 constitutional or statutory provisions, violation of the statut ory authority of the agency,284 lawfulness of the procedure, lack of any evidence to support the commissioner's decision,285 and arbitrariness and abuse of discretion. However, the court shall not substitute its286 judgment as to the weight of evidence on questions of fact.287 (f) The cost of such seizure, forfeiture, storage, and destruc tion shall be borne by the288 person from whom the nicotine vapor products determined to be c ontraband are289 confiscated.290 48-11-49.291 (a) Any nonresident vapor product manufacturer that has not registered to do business in292 this state as a foreign business entity shall, as a condition p recedent to being included in293 the directory, appoint and continually engage without interruption the services of an agent294 in this state to act as agent for the service of process on whom all process, and any action295 or proceeding against it concerning or arising out of the enfor cement of this article, may296 be served in any manner authorized by law. Such service shall constitute legal and valid297 H. B. 577 (SUB) - 12 - 25 LC 50 1211S service of process on the vapor product manufacturer. The vapo r product manufacturer298 shall provide the name, address, telephone number, and proof of the appointment and299 availability of such agent to the commissioner.300 (b) The vapor product manufacturer shall provide notice to the commissioner 30 days prior301 to termination of the authority of an agent and shall further provide proof to the satisfaction302 of the commissioner of the appointment of a new agent no less than five days prior to the303 termination of an existing agent appointment. In the event an agent terminates an agency304 appointment, the vapor product manufacturer shall notify the co mmissioner of the305 termination within five days and shall include proof to the satisfaction of the commissioner306 of the appointment of a new agent.307 (c) Any vapor product manufacturer whose nicotine vapor products are offered for sale or308 sold in this state that has not appointed and engaged the services of an agent as required by309 this Code section shall be deemed to have appointed the Secretary of State as its agent for310 service of process. The appointment of the Secretary of State as agent shall not satisfy the311 condition precedent required in subsection (a) of this Code sec tion to be included or312 retained in the directory.313 48-11-50.314 Nothing in this article shall be construed as limiting the commissioner in the exercise of315 his or her authority, as provided under Article 1 of this chapt er, to suspend or refuse to316 renew a license for violations of Chapters 13 and 13A of Title 10, Title 16, Title 48, or any317 other provisions of law and any rules or regulations promulgated thereunder.318 48-11-51.319 Starting on January 31 of the first year after the year in whic h this article becomes320 effective, and annually thereafter, the commissioner shall provide a report to the General321 Assembly regarding the status of the directory, the nicotine vapor products included in the322 H. B. 577 (SUB) - 13 - 25 LC 50 1211S directory, revenue, and expenditures related to administration of this article, and323 enforcement activities undertaken pursuant to this article."324 SECTION 2.325 This Act shall become effective only if funds are specifically appropriated for the purposes326 of this Act in an appropriations Act making specific reference to this Act and shall become327 effective when funds so appropriated become available for expenditure.328 SECTION 3.329 All laws and parts of laws in conflict with this Act are repealed.330 H. B. 577 (SUB) - 14 -