88R17146 TYPED
 
  By: Smith H.B. No. 4481
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to a directory of e-cigarettes and alternative nicotine
  products sold in this state, and regulation of the sale and
  distribution of e-cigarettes and alternative nicotine products;
  imposing fees; creating criminal offenses; imposing a civil
  penalty; imposing administrative penalties.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 161.081, Health and Safety Code, is
  amended by amending Subdivisions (1), (1-a), (3), and (4) and
  adding Subdivision (1-a-1) to read as follows:
               (1)  "Alternative Nicotine Product" means any
  noncombustible product containing nicotine that is intended for
  human consumption, whether chewed, absorbed, dissolved, ingested,
  inhaled, or consumed by any other means, and does not include any
  cigarette, e-cigarette, tobacco product, or any product regulated
  as a drug or device by the United States Food and Drug
  Administration under Subchapter V of the Federal Food, Drug, and
  Cosmetic Act (21 U.S.C. Chapter 9, Subchapter V).
               (1-a)  "Cigarette" has the meaning assigned by Section
  154.001, Tax Code.
               (1-a-1) [(1-a)] (A)  "E-cigarette" means:
                           (i)  an electronic cigarette or any other
  device that simulates smoking by using a mechanical heating
  element, battery, or electronic circuit to deliver nicotine or
  other substances to the individual inhaling from the device; or
                           (ii)  a consumable liquid solution or other
  material aerosolized or vaporized during the use of an electronic
  cigarette or other device described by this subdivision.
                     (B)  The term "e-cigarette" does not include a
  prescription medical device unrelated to the cessation of smoking.
                     (C)  The term "e-cigarette" includes:
                           (i)  a device described by this subdivision
  regardless of whether the device is manufactured, distributed, or
  sold as an e-cigarette, e-cigar, or e-pipe or under another product
  name or description; and
                           (ii)  a component, part, or accessory for
  the device, regardless of whether the component, part, or accessory
  is sold separately from the device.
               (3)  "Retail sale" means a transfer of possession from
  a retailer to a consumer in connection with a purchase, sale, or
  exchange for value of cigarettes, e-cigarettes, alternative
  nicotine products, or tobacco products.
               (4)  "Retailer" means a person who engages in the
  practice of selling cigarettes, e-cigarettes, alternative nicotine
  products, or tobacco products to consumers and includes the owner
  of a coin-operated cigarette, e-cigarette, alternative nicotine
  product, or tobacco product vending machine.  The term includes a
  retailer as defined by Section 154.001 or 155.001, Tax Code, and an
  e-cigarette retailer as defined by Section 147.0001 of this code,
  as applicable.
         SECTION 2.  Section 161.082, Health and Safety Code, is
  amended to read as follows:
         Sec. 161.082.  SALE OF CIGARETTES, E-CIGARETTES,
  ALTERNATIVE NICOTINE PRODUCTS, OR TOBACCO PRODUCTS TO PERSONS
  YOUNGER THAN 21 YEARS OF AGE PROHIBITED; PROOF OF AGE REQUIRED.  (a)  
  A person commits an offense if the person, with criminal
  negligence:
               (1)  sells, gives, or causes to be sold or given a
  cigarette, e-cigarette, alternative nicotine product, or tobacco
  product to someone who is younger than 21 years of age; or
               (2)  sells, gives, or causes to be sold or given a
  cigarette, e-cigarette, alternative nicotine product, or tobacco
  product to another person who intends to deliver it to someone who
  is younger than 21 years of age.
         (b)  If an offense under this section occurs in connection
  with a sale by an employee of the owner of a store in which
  cigarettes, e-cigarettes, alternative nicotine product, or tobacco
  products are sold at retail, the employee is criminally responsible
  for the offense and is subject to prosecution.
         (c)  An offense under this section is a Class C misdemeanor.
         (d)  It is a defense to prosecution under Subsection (a)(1)
  that the person to whom the cigarette, e-cigarette, alternative
  nicotine product, or tobacco product was sold or given presented to
  the defendant apparently valid proof of identification.
         (e)  A proof of identification satisfies the requirements of
  Subsection (d) if it contains a physical description and photograph
  consistent with the person's appearance, purports to establish that
  the person is 21 years of age or older, and was issued by a
  governmental agency. The proof of identification may include a
  driver's license issued by this state or another state, a passport,
  or an identification card issued by a state or the federal
  government.
         (f)  It is an exception to the application of Subsection
  (a)(1) that the person to whom the cigarette, e-cigarette,
  alternative nicotine product, or tobacco product was sold:
               (1)  is at least 18 years of age; and
               (2)  presented at the time of purchase a valid military
  identification card of the United States military forces or the
  state military forces.
         SECTION 3.  Section 161.083, Health and Safety Code, is
  amended by amending Subsection (a) to read as follows:
         (a)  A person may not sell, give, or cause to be sold or given
  a cigarette, e-cigarette, alternative nicotine product, or tobacco
  product to someone who is younger than 30 years of age unless the
  person to whom the cigarette, e-cigarette, or tobacco product was
  sold or given presents an apparently valid proof of identification.
         SECTION 4.  Section 161.084, Health and Safety Code, is
  amended by amending Subsections (a), (b) and (d) to read as follows:
         (a)  Each person who sells cigarettes, e-cigarettes,
  alternative nicotine products, or tobacco products at retail or by
  vending machine shall post a sign in a location that is conspicuous
  to all employees and customers and that is close to the place at
  which the cigarettes, e-cigarettes, alternative nicotine products,  
  or tobacco products may be purchased.
         (b)  The sign must include the statement:
         PURCHASING OR ATTEMPTING TO PURCHASE CIGARETTES,
  E-CIGARETTES, OR TOBACCO PRODUCTS BY A PERSON UNDER 21 YEARS OF AGE
  IS PROHIBITED BY LAW.  SALE OR PROVISION OF CIGARETTES,
  E-CIGARETTES, ALTERNATIVE NICOTINE PRODUCTS, OR TOBACCO PRODUCTS
  TO A PERSON UNDER 21 YEARS OF AGE IS PROHIBITED BY LAW.  UPON
  CONVICTION, A CLASS C MISDEMEANOR, INCLUDING A FINE OF UP TO $500,
  MAY BE IMPOSED.  VIOLATIONS MAY BE REPORTED TO THE TEXAS
  COMPTROLLER'S OFFICE BY CALLING (insert toll-free telephone
  number).  PREGNANT WOMEN SHOULD NOT SMOKE.  SMOKERS ARE MORE LIKELY
  TO HAVE BABIES WHO ARE BORN PREMATURE OR WITH LOW BIRTH WEIGHT.  THE
  PROHIBITIONS ON THE PURCHASE OR ATTEMPT TO PURCHASE DESCRIBED ABOVE
  DO NOT APPLY TO A PERSON WHO IS IN THE UNITED STATES MILITARY FORCES
  OR STATE MILITARY FORCES.
         (d)  The comptroller on request shall provide the sign
  without charge to any person who sells cigarettes, e-cigarettes, or
  tobacco products. The comptroller may provide the sign without
  charge to distributors of cigarettes, e-cigarettes, alternative
  nicotine products, or tobacco products or wholesale dealers of
  cigarettes, e-cigarettes, alternative nicotine products, or
  tobacco products in this state for distribution to persons who sell
  cigarettes, e-cigarettes, alternative nicotine products, or
  tobacco products. A distributor or wholesale dealer may not charge
  for distributing a sign under this subsection.
         SECTION 5.  Section 161.085, Health and Safety Code, is
  amended by amending Subsections (a) and (b) to read as follows:
         (a)  Each retailer shall notify each individual employed by
  that retailer who is to be engaged in retail sales of cigarettes,
  e-cigarettes, alternative nicotine products, or tobacco products
  that state law:
               (1)  prohibits the sale or distribution of cigarettes,
  e-cigarettes, alternative nicotine products, or tobacco products
  to any person who is younger than 21 years of age as provided by
  Section 161.082 and that a violation of that section is a Class C
  misdemeanor; [and]
               (2)  requires each person who sells cigarettes,
  e-cigarettes, alternative nicotine products, or tobacco products
  at retail or by vending machine to post a warning notice as provided
  by Section 161.084, requires each employee to ensure that the
  appropriate sign is always properly displayed while that employee
  is exercising the employee's duties, and provides that a violation
  of Section 161.084 is a Class C misdemeanor; and
               (3)  prohibits the sale or offer for sale of
  e-cigarettes or alternative nicotine products that are not included
  in the e-cigarette and alternative nicotine products directory
  described by Section 161.0904.
         (b)  The notice required by this section must be provided
  within 72 hours of the date an individual begins to engage in retail
  sales of cigarettes, e-cigarettes, alternative nicotine products,
  or tobacco products.  The individual shall signify that the
  individual has received the notice required by this section by
  signing a form stating that the law has been fully explained, that
  the individual understands the law, and that the individual, as a
  condition of employment, agrees to comply with the law.
         SECTION 6.  Section 161.086, Health and Safety Code, is
  amended to read as follows:
         Sec. 161.086.  VENDOR ASSISTED SALES REQUIRED; VENDING
  MACHINES.  (a)  Except as provided by Subsection (b), a retailer or
  other person may not:
               (1)  offer cigarettes, e-cigarettes, alternative
  nicotine products, or tobacco products for sale in a manner that
  permits a customer direct access to the cigarettes, e-cigarettes,
  or tobacco products; or
               (2)  install or maintain a vending machine containing
  cigarettes, e-cigarettes, alternative nicotine products, or
  tobacco products.
         (b)  Subsection (a) does not apply to:
               (1)  a facility or business that is not open to persons
  younger than 21 years of age at any time;
               (2)  that part of a facility or business that is a
  humidor or other enclosure designed to store cigars in a
  climate-controlled environment and that is not open to persons
  younger than 21 years of age at any time; or
               (3)  a premises for which a person holds a package store
  permit issued under the Alcoholic Beverage Code and that is not open
  to persons younger than 21 years of age at any time.
         (c)  The comptroller or a peace officer may, with or without
  a warrant, seize, seal, or disable a vending machine installed or
  maintained in violation of this section. Property seized under this
  subsection must be seized in accordance with, and is subject to
  forfeiture to the state in accordance with, Subchapter H, Chapter
  154, Tax Code, and Subchapter E, Chapter 155, Tax Code.
         (d)  A person commits an offense if the person violates
  Subsection (a).  An offense under this subsection is a Class C
  misdemeanor.
         SECTION 7.  Section 161.087, Health and Safety Code, is
  amended to read as follows:
         Sec. 161.087.  DISTRIBUTION OF CIGARETTES, E-CIGARETTES,
  ALTERNATIVE NICOTINE PRODUCTS, OR TOBACCO PRODUCTS. (a)  A person
  may not distribute:
               (1)  a free sample of a cigarette, e-cigarette,
  alternative nicotine product, or tobacco product; or
               (2)  a coupon or other item that the recipient may use
  to receive a free cigarette, e-cigarette, alternative nicotine
  product, or tobacco product or a sample cigarette, e-cigarette, or
  tobacco product.
         (a-1)  A person may not distribute to persons younger than 21
  years of age a coupon or other item that the recipient may use to
  receive a discounted cigarette, e-cigarette, alternative nicotine
  product, or tobacco product.
         (b)  Except as provided by Subsection (c), a person,
  including a permit holder, may not accept or redeem, offer to accept
  or redeem, or hire a person to accept or redeem:
               (1)  a coupon or other item that the recipient may use
  to receive a free cigarette, e-cigarette, alternative nicotine
  product, or tobacco product or a sample cigarette, e-cigarette,
  alternative nicotine product, or tobacco product; or
               (2)  a coupon or other item that the recipient may use
  to receive a discounted cigarette, e-cigarette, alternative
  nicotine products, or tobacco product if the recipient is younger
  than 21 years of age.
         (b-1)  A coupon or other item that a recipient described by
  Subsection (b) may use to receive a discounted cigarette,
  e-cigarette, alternative nicotine product, or tobacco product may
  not be redeemable through mail or courier delivery.
         (c)  Subsections (a)(2), (a-1), (b), and (b-1) do not apply
  to a transaction between permit holders unless the transaction is a
  retail sale.
         (d)  A person commits an offense if the person violates this
  section.  An offense under this subsection is a Class C misdemeanor.
         SECTION 8.  Section 161.088, Health and Safety Code, is
  amended by amending Subsections (b) and (c) to read as follows:
         (b)  The comptroller may make block grants to counties and
  municipalities to be used by local law enforcement agencies to
  enforce this subchapter and Subchapter R in a manner that can
  reasonably be expected to reduce the extent to which cigarettes,
  e-cigarettes, alternative nicotine products, and tobacco products
  are sold or distributed, including by delivery sale, to persons who
  are younger than 21 years of age.  At least annually, random
  unannounced inspections shall be conducted at various locations
  where cigarettes, e-cigarettes, and tobacco products are sold or
  distributed, including by delivery sale, to ensure compliance with
  this subchapter and Subchapter R.  The comptroller shall rely, to
  the fullest extent possible, on local law enforcement agencies to
  enforce this subchapter and Subchapter R.
         (c)  To facilitate the effective administration and
  enforcement of this subchapter, the comptroller shall make the
  e-cigarette and alternative nicotine products directory described
  by Sec. 161.0904 available to the public and may enter into
  interagency contracts with other state agencies, and those agencies
  may assist the comptroller in the administration and enforcement of
  this subchapter.
         SECTION 9.  The heading to Section 161.0901, Health and
  Safety Code, is amended to read as follows:
         Sec. 161.0901.  DISCIPLINARY ACTION AGAINST CIGARETTE,
  E-CIGARETTE, ALTERNATIVE NICOTINE PRODUCT, AND TOBACCO PRODUCT
  RETAILERS.
         SECTION 10.  Subchapter H, Chapter 161, Health and Safety
  Code, is amended by adding Section 161.0904 to read as follows:
         Sec. 161.0904.  E-CIGARETTE AND ALTERNATIVE NICOTINE
  PRODUCTS DIRECTORY.  (a)  A manufacturer of e-cigarettes or
  alternative nicotine products that are sold in this state, whether
  directly or through a wholesaler, retailer, or similar intermediary
  or intermediaries, shall annually certify under penalty of perjury
  on a form prescribed by the comptroller, that the manufacturer
  agrees to comply with this subchapter and that:
               (1)  the manufacturer has received a marketing
  authorization or similar order for the e-cigarette or alternative
  nicotine product from the United States Food and Drug
  Administration pursuant to 21 U.S.C. Section 387j; or
               (2)  the e-cigarette or alternative nicotine product
  was marketed in the United States as of August 8, 2016, the
  manufacturer submitted a premarket tobacco product application for
  the e-cigarette or alternative nicotine product to the United
  States Food and Drug Administration pursuant to 21 U.S.C. Section
  387j on or before September 9, 2020, and the application either
  remains under review by the United States Food and Drug
  Administration or a final decision on the application has not
  otherwise taken effect.
         (b)  A manufacturer shall submit a separate certification
  form for each e-cigarette or alternative nicotine product that is
  sold in this state.
         (c)  Each annual certification form required by Subsection
  (a) shall be accompanied by:
               (1)  a copy of the marketing authorization or other
  order for the e-cigarette or alternative nicotine product issued by
  the United States Food and Drug Administration pursuant to 21
  U.S.C. Section 387j, or evidence that the premarket tobacco product
  application for the e-cigarette or alternative nicotine product was
  submitted to the United States Food and Drug Administration and a
  final authorization or order has not yet taken effect; and
               (2)  payment of $1,000 for each form submitted under
  this section.
         (d)  A manufacturer required to submit a certification form
  pursuant to Subsection (a) shall notify the comptroller within 30
  days of any material change to the certification form, including
  the issuance or denial of a marketing authorization or other order
  by the United States Food and Drug Administration pursuant to 21
  U.S.C. Section 387j, or any other order or action by the United
  States Food and Drug Administration that affects the ability of the
  e-cigarette or alternative nicotine product to be introduced or
  delivered into interstate commerce for commercial distribution in
  the United States.
         (e)  The comptroller shall maintain a directory that lists
  all e-cigarette and alternative nicotine product manufacturers and
  e-cigarettes and alternative nicotine products for which
  certification forms have been submitted and shall update the
  directory as necessary to ensure accuracy.
         (f)  A person may not sell or offer for sale an e-cigarette or
  alternative nicotine product in this state that is not included in
  the directory described by Subsection (e), and an e-cigarette or
  alternative nicotine product manufacturer may not sell, either
  directly or through a wholesaler, retailer, or similar intermediary
  or intermediaries, an e-cigarette or alternative nicotine product
  in this state that is not included in the directory described by
  Subsection (e).
         (g)  The comptroller shall provide manufacturers notice and
  an opportunity to cure deficiencies before removing manufacturers
  or products from the directory.
               (1)  The comptroller may not remove the manufacturer or
  its products from the directory until at least 15 days after the
  manufacturer has been given notice of an intended action. Notice
  shall be sufficient and be deemed immediately received by a
  manufacturer if the notice is sent either electronically or by
  facsimile to an electronic mail address or facsimile number, as the
  case may be, provided by the manufacturer in its most recent
  certification filed under Subsection (a) of this section.
               (2)  The e-cigarette or alternative nicotine product
  manufacturer shall have 15 business days from the date of service of
  the notice of the comptroller's intended action to establish that
  the e-cigarette or alternative nicotine product manufacturer or its
  products should be included in the directory.
               (3)  A determination by the comptroller to not include
  or to remove from the directory a manufacturer or a manufacturer's
  product shall be subject to review by the filing of a civil action
  for prospective declaratory or injunctive relief.
         (h)  If a product is removed from the directory, each
  retailer and wholesaler shall have twenty-one days from the day
  such product is removed from the directory to remove the product
  from its inventory and return the product to the manufacturer for
  disposal.
         (i)  A retailer who sells or offers for sale an e-cigarette
  or alternative nicotine product in this state that is not included
  in the directory shall be subject to disciplinary action as
  described by Section 161.0901.
         (j)  An e-cigarette or alternative nicotine product
  manufacturer whose e-cigarettes or alternative nicotine products
  are not listed in the directory and are sold in this state, whether
  directly or through a wholesaler, retailer, or similar intermediary
  or intermediaries, is subject to a civil penalty of $1,000. Each
  sale of an e-cigarette or alternative nicotine product that is not
  listed in the directory shall constitute a separate violation.
         (k)  The comptroller or a person assisting the comptroller
  with enforcement under Section 161.088 may seize and destroy
  e-cigarettes and alternative nicotine products that are not listed
  on the directory described by this section.
         (1)  Funds collected under this section or pursuant to
  enforcement action under this section or a disciplinary action
  under Section 161.0901 shall be used to administer this section or
  for block grants as described by Section 161.088(b).
         SECTION 11.  This Act takes effect September 1, 2023.