§675-3  Requirements.  Any tobacco
product manufacturer selling cigarettes to consumers within the State (whether
directly or through a distributor, retailer or similar intermediary or
intermediaries) after the date of enactment of this Act shall do one of the
following:



(a) become a participating manufacturer (as that term
is defined in section II(jj) of the Master Settlement Agreement) and generally
perform its financial obligations under the Master Settlement Agreement; or



(b) (1)  place into a qualified escrow fund by
April 15 of the year following the year in question the following amounts (as
such amounts are adjusted for inflation)--



1999: 
$.0094241 per unit sold after the date of enactment of this Act;



2000: 
$.0104712 per unit sold;



for
each of 2001 and 2002:  $.0136125 per unit sold;



for
each of 2003 through 2006: $.0167539 per unit sold;



for
each of 2007 and each year thereafter: $.0188482 per unit sold.



(2)  a tobacco product manufacturer that
places funds into escrow pursuant to paragraph (1) shall receive the interest
or other appreciation on such funds as earned.  Such funds themselves shall be
released from escrow only under the following circumstances--



(A)  to pay a judgment or settlement on any
released claim brought against such tobacco product manufacturer by the State
or any releasing party located or residing in the State.  Funds shall be
released from escrow under this subparagraph (i) in the order in which they
were placed into escrow and (ii) only to the extent and at the time necessary
to make payments required under such judgment or settlement;



(B)  to the extent that a tobacco product
manufacturer establishes that the amount it was required to place into escrow
on account of units sold in the State in a particular year was greater than the
Master Settlement Agreement payments, as determined pursuant to section IX(i)
of that Agreement including after final determination of all adjustments, that
such manufacturer would have been required to make on account of such units
sold had it been a participating manufacturer, the excess shall be released
from escrow and revert back to such tobacco product manufacturer; or



(C)  to the extent not released from escrow
under subparagraphs (A) or (B), funds shall be released from escrow and revert
back to such tobacco product manufacturer twenty-five years after the date on
which they were placed into escrow.



(3)  Each tobacco product manufacturer that
elects to place funds into escrow pursuant to this subsection shall annually
certify to the Attorney General that it is in compliance with this subsection. 
The Attorney General may bring a civil action on behalf of the State against
any tobacco product manufacturer that fails to place into escrow the funds
required under this section.  Any tobacco product manufacturer that fails in
any year to place into escrow the funds required under this section shall--



(A)  be required within 15 days to place such
funds into escrow as shall bring it into compliance with this section.  The court,
upon a finding of a violation of this subsection, may impose a civil penalty to
be paid to the general fund of the State in an amount not to exceed 5 percent
of the amount improperly withheld from escrow per day of the violation and in a
total amount not to exceed 100 percent of the original amount improperly
withheld from escrow;



(B)  in the case of a knowing violation, be
required within 15 days to place such funds into escrow as shall bring it into
compliance with this section.  The court, upon a finding of a knowing violation
of this subsection, may impose a civil penalty to be paid to the general fund
of the State in an amount not to exceed 15 percent of the amount improperly
withheld from escrow per day of the violation and in a total amount not to
exceed 300 percent of the original amount improperly withheld from escrow; and



(C)  in the case of a second knowing violation,
be prohibited from selling cigarettes to consumers within the State (whether
directly or through a distributor, retailer or similar intermediary) for a
period not to exceed 2 years.



Each failure to make an annual deposit required
under this section shall constitute a separate violation.



The State shall be awarded its attorneys' fees
and expenses incurred in prosecuting violations of this chapter. [L 1999, c
188, pt of §1; am L 2003, c 177, §7]



 



Note



 



  Severability and conditional repeal and reenactment of
section because of 2003 amendment.  L 2003, c 177, §9.



  "The date of enactment of this Act", referred to in
the first paragraph, is July 2, 1999.