Amended in Assembly April 21, 2014

California Legislature—2013–14 Regular Session

Assembly Bill No. 1500

Introduced by Assembly Member Dickinson

January 13, 2014

An act to begin delete repeal and end delete add Section begin delete 22963 of end delete begin insert 22963.5 to end insert the Business and Professions Code, begin delete to add Section 119406 to the Health and Safety Code, and to repeal Section 30101.7 of the Revenue and Taxation Code, end delete relating to begin delete public health end delete begin insert electronic cigarettes end insert .

LEGISLATIVE COUNSEL’S DIGEST

AB 1500, as amended, Dickinson. begin delete Cigarettes, tobacco products, and electronic end delete begin insert Electronic end insert cigarettes.

Existing law, the Stop Tobacco Access to Kids Enforcement (STAKE) Act, among other things, prohibits any person from distributing or selling tobacco products via the United States Postal Service, or any other public or private postal or package delivery service, to any purchaser who is a minor. The STAKE Act also requires a specified distributor or seller, among other things, to verify that a purchaser of tobacco products is 18 years of age or older, and to telephone the purchaser after 5 p.m. to confirm the order prior to shipping the tobacco products.

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This bill would repeal those provisions

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Existing law makes it unlawful for a person to sell or otherwise furnish an electronic cigarette, as defined, to a person under 18 years of age and makes a violation punishable as an infraction, as specified.

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This bill would, with certain exceptions, prohibit shipping or transporting cigarettes, tobacco products, or electronic cigarettes to persons in California. The bill would establish civil penalties for a violation of that prohibition and would authorize the State Board of Equalization or a law enforcement agency to seize and take possession of the cigarettes, tobacco products, or electronic cigarettes. The bill would require any cigarettes, tobacco products, or electronic cigarettes seized by, or delivered to, the board to be deemed forfeited to the state and would require the board to comply with specified procedures in handling the forfeited products.

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Existing law, the Cigarette and Tobacco Products Tax Law, prohibits, except under specified circumstances, the retail sale of cigarettes in California unless the sale is a vendor-assisted, face-to-face sale, as defined.

end delete begin delete

This bill would repeal those provisions.

end delete begin insert

This bill would prohibit a delivery seller, as defined, from selling, delivering, or causing to be delivered an electronic cigarette to a person under 18 years of age. The bill would require the delivery seller to use a method of mailing or shipping that has specified requirements, including the requirement that the person delivering the electronic cigarette not deliver the electronic cigarette without first obtaining the full name, birth date, and residential address of the person signing for the delivery of the electronic cigarette and verifying that information, as specified. The bill would make a violation of these provisions an infraction, punishable as specified. By creating a new crime, the bill would impose a state-mandated local program.

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The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

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This bill would provide that no reimbursement is required by this act for a specified reason.

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Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program:  begin delete no end delete begin insert yes end insert .

The people of the State of California do enact as follows:

SECTION 1.  

The Legislature finds and declares all of the
following:

(a) The transfer and shipment of begin delete cigarettes, tobacco products,
and end delete electronic begin delete cigarette products end delete begin insert cigarettes end insert (e-cigarettes) sold via
the Internet or by telephone or by mail order, or by any other means
in which the seller is not in the physical presence of the buyer, to
residents of this state poses a serious threat to public health, safety,
welfare, and economy of the state.

(b) When begin delete cigarettes, tobacco products, and end delete e-cigarettes are
shipped directly to a consumer, adequate proof that the consumer
is of legal age to purchase the products cannot be obtained by the
vendor, thereby enabling sellers of begin delete cigarettes, tobacco products,
and end delete e-cigarettes to evade provisions of law designed to prevent
sales to minors.

(c) By preventing shipment of begin delete cigarettes, tobacco products, and end delete
e-cigarettes directly to begin delete consumers, end delete begin insert minors end insert the state will be better
able to measure and monitor begin delete cigarette and tobacco products end delete
begin insert e-cigarette end insert consumption, determine the public health and fiscal
consequences of smoking, and keep these products out of the hands
of children.

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(d) Existing penalties for cigarette and tobacco products
bootlegging have been an inadequate deterrent.

end delete

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Section 22963.5 is added to the end insert begin insert Business and
Professions Code end insert begin insert , to read: end insert

begin insert

begin insert 22963.5. end insert   

(a) For purposes of this section, the following
definitions apply:

(1) “Consumer” means a person who purchases an electronic
cigarette. “Consumer” does not include any person lawfully
operating as a manufacturer, distributor, wholesaler, or retailer
of electronic cigarettes.

(2) “Delivery sale” means sale of electronic cigarettes into and
in this state in either of the following cases:

(A) The consumer submits the order for the sale by means of a
telephone or other method of voice transmission, the mail, or the
Internet or other online service, or the seller is otherwise not in
the physical presence of the consumer when the request for
purchase or order is made.

(B) The electronic cigarette is delivered to the consumer by
common carrier, private delivery service, or other method of
remote delivery, or the seller is not in the physical presence of the
consumer when the consumer obtains possession of the electronic
cigarette.

(3) “Delivery seller” means a person who makes a delivery
sale.

(4) “Electronic cigarette” has the same meaning as defined in
Section 119405 of the Health and Safety Code.

(b) A delivery seller shall not sell, deliver, or cause to be
delivered an electronic cigarette to a person under 18 years of
age.

(c) (1) The delivery seller shall use a method of mailing or
shipping that requires all of the following:

(A) The consumer placing the delivery sale order, or an adult
who is at least 18 years of age at the place of delivery, shall sign
to accept delivery of the electronic cigarette at the delivery address.

(B) The person who signs to accept delivery of the electronic
cigarette shall provide proof, in the form of a valid,
government-issued identification bearing a photograph of the
person, that the person is 18 years of age or older.

(C) The person delivering the electronic cigarette shall not
deliver the electronic cigarette without first obtaining the full
name, birth date, and residential address of that person and
verifying that information through the use of a commercially
available database or aggregate of databases, consisting primarily
of data from government sources, that are regularly used by
government and businesses for the purpose of age and identity
verification and authentication, to ensure that the purchaser is at
least the minimum age required for the legal sale or purchase of
electronic cigarettes.

(2) A database being used for age and identity verification
pursuant to paragraph (1) shall not be in the possession or under
the control of the delivery seller, or be subject to any changes or
supplementation by the delivery seller.

(d) A violation of this section shall be an infraction punishable
by a fine not exceeding two hundred dollars ($200) for the first
violation, by a fine not exceeding five hundred dollars ($500) for
the second violation, or by a fine not exceeding one thousand
dollars ($1,000) for a third or subsequent violation.

(e) This section or any other law shall not invalidate an existing
ordinance of, or prohibit the adoption of an ordinance by, a city
or county that regulates the distribution of electronic cigarettes
in a manner that is more restrictive than this section, to the extent
that the ordinance is not otherwise prohibited by federal law.

end insert

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begin insert SEC. 3. end insert   

end insert begin insert

No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of
the Government Code, or changes the definition of a crime within
the meaning of Section 6 of Article XIII B of the California
Constitution.

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begin delete

SEC. 2.  

Section 22963 of the Business and Professions Code
is repealed.

SEC. 3.  

Section 22963 is added to the Business and Professions
Code, to read:

22963.  

(a) It is unlawful for any person engaged in the business
of selling or distributing cigarettes or tobacco products to ship or
cause to be shipped any cigarettes or tobacco products to any
person in this state who is not any of the following:

(1) A retailer licensed pursuant to Division 8.6 (commencing
with Section 22970).

(2) An export warehouse proprietor as defined in Section 5702
of Title 26 of the United States Code.

(3) An operator of a customs bonded warehouse as described
in Section 1311 or 1555 of Title 19 of the United States Code.

(4) A person who is an officer, employee, or agent of the federal
government, or of this state or of a department, agency,
instrumentality, or political subdivision of the federal government
or this state, when the person is acting in accordance with his or
her official duties.

(b) It is unlawful for any common or contract carrier to
knowingly transport cigarettes or tobacco products to any person
in this state reasonably believed by the carrier to be other than a
person described in subdivision (a). It is unlawful for any other
person to knowingly, or with reason to know, transport cigarettes
or tobacco products to any person in this state, other than a person
described in subdivision (a).

(c) Notwithstanding any other provision of this division, upon
discovery by the State Board of Equalization or a law enforcement
agency of any cigarettes or tobacco products that have been, or
are being, shipped or transported in violation of this section, the
State Board of Equalization or the law enforcement agency may
seize and take possession of the cigarettes or tobacco products.
Any cigarettes or tobacco products seized by a law enforcement
agency shall be delivered to the State Board of Equalization, or
its designee, within seven days, unless the cigarettes or tobacco
products are otherwise required to be used as evidence in an
administrative, criminal, or civil proceeding, or as part of an
ongoing law enforcement operation. Any cigarettes or tobacco
products seized by the State Board of Equalization or delivered to
the State Board of Equalization by a law enforcement agency shall
be deemed forfeited to the state and the State Board of Equalization
shall comply with procedures set forth in Chapter 7.5 (commencing
with Section 30435) of Part 13 of Division 2 of the Revenue and
Taxation Code.

(d) (1) A district attorney, city attorney, or the Attorney General
may assess civil penalties against any person, firm, corporation,
or other entity that violates this section and may recover the
reasonable costs of investigating and prosecuting the action,
including expert fees, reasonable attorney’s fees, and court costs.
The civil penalties shall be assessed according to the following
schedule:

(A) Upon the first violation, a civil penalty of not more than
one thousand dollars ($1,000).

(B) Upon the second violation, a civil penalty of not more than
five thousand dollars ($5,000).

(C) Upon the third violation or subsequent violations, a civil
penalty of not more than twenty-five thousand dollars ($25,000).

(2) The civil penalties assessed pursuant to this section shall be
in addition to any other penalties that may be applicable, including,
but not limited to, civil penalties pursuant to Section 22958.

(e) For the purposes of this section, the following definitions
apply:

(1) “Cigarette” has the same meaning as in Section 104556 of
the Health and Safety Code.

(2) “Tobacco products” has the same meaning as in Section
22962.

SEC. 4.  

Section 119406 is added to the Health and Safety Code,
to read:

119406.  

(a) It is unlawful for any person engaged in the
business of selling or distributing electronic cigarettes (e-cigarettes)
to ship or cause to be shipped any e-cigarettes to any person in
this state who is not any of the following:

(1) A retailer licensed pursuant to Division 8.6 (commencing
with Section 22970) of the Business and Professions Code.

(2) An export warehouse proprietor as defined in Section 5702
of Title 26 of the United States Code.

(3) An operator of a customs bonded warehouse as described
in Section 1311 or 1555 of Title 19 of the United States Code.

(4) A person who is an officer, employee, or agent of the federal
government, or of this state or of a department, agency,
instrumentality, or political subdivision of the federal government
or this state, when the person is acting in accordance with his or
her official duties.

(b) It is unlawful for any common or contract carrier to
knowingly transport e-cigarettes to any person in this state
reasonably believed by the carrier to be other than a person
described in subdivision (a). It is unlawful for any other person to
knowingly, or with reason to know, transport e-cigarettes to any
person in this state, other than a person described in subdivision
(a).

(c) Notwithstanding any other provision of this division, upon
discovery by the State Board of Equalization or a law enforcement
agency of any e-cigarettes that have been, or are being, shipped
or transported in violation of this section, the State Board of
Equalization or the law enforcement agency may seize and take
possession of the e-cigarettes. Any e-cigarettes seized by a law
enforcement agency shall be delivered to the State Board of
Equalization, or its designee, within seven days, unless the
e-cigarettes are otherwise required to be used as evidence in an
administrative, criminal, or civil proceeding, or as part of an
ongoing law enforcement operation. Any e-cigarettes seized by
the State Board of Equalization or delivered to the State Board of
Equalization by a law enforcement agency shall be deemed
forfeited to the state and the State Board of Equalization shall
comply with procedures set forth in Chapter 7.5 (commencing
with Section 30435) of Part 13 of Division 2 of the Revenue and
Taxation Code.

(d) (1) A district attorney, city attorney, or the Attorney General
may assess civil penalties against any person, firm, corporation,
or other entity that violates this section and may recover the
reasonable costs of investigating and prosecuting the action,
including expert fees, reasonable attorney’s fees, and court costs.
The civil penalties shall be assessed according to the following
schedule:

(A) Upon the first violation, a civil penalty of not more than
one thousand dollars ($1,000).

(B) Upon the second violation, a civil penalty of not more than
five thousand dollars ($5,000).

(C) Upon the third violation or subsequent violations, a civil
penalty of not more than twenty-five thousand dollars ($25,000).

(2) The civil penalties assessed pursuant to this section shall be
in addition to any other penalties that may be applicable.

(e) For the purposes of this section, “electronic cigarette” or
“e-cigarette” means a device designed to look like a cigarette,
cigar, pipe, or other smoking device, or any other nicotine delivery
device that is used for the purpose of creating a vapor inhaled by
the user, including cartridges, accessories, or liquids used with the
device.

SEC. 5.  

Section 30101.7 of the Revenue and Taxation Code
is repealed.

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