(B-5) manufactures cigarettes, whether in this SB3828 - 5 - LRB104 16359 HLH 29746 b State or outside of this State, and who is neither (i) a participating manufacturer as defined in subsection II(jj) of the "Master Settlement Agreement",Agreement" as defined in Sections 10 of the Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003 nor (ii) in full compliance with the Tobacco Products Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

nor (ii) in full compliance with Tobacco Product Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

(D) has been found by the Department, after notice and a hearing, to have imported or caused to be imported into the United States for sale or distribution, or manufactured for sale or distribution in the United States, any cigarette that does not 10400SB3828sam001 -6- LRB104 16359 HLH 35248 a fully comply with the Federal Cigarette Labeling and Advertising Act (15 U.S.C.

The Department, upon receipt of an application and , SB3828 - 6 - LRB104 16359 HLH 29746 b license fee, and bond in proper form from a person who is eligible to receive a cigarette machine operator license under this Act, shall issue to such applicant a license in a form as prescribed by the Department.

That license shall permit the applicant to whom it is issued to engage in business as a cigarette machine operator at the place shown in the his or her application.

10400SB3828sam001 -7- LRB104 16359 HLH 35248 a Every prior continuous compliance taxpayer shall be exempt from all requirements under this Section concerning the furnishing of bond as a condition precedent to his being authorized to engage in the business licensed under this Act.

This exemption shall continue for each prior continuous compliance taxpayer until such time as he may be determined by the Department to be delinquent in the filing of any returns, SB3828 - 7 - LRB104 16359 HLH 29746 b or is determined by the Department (either through the Department's issuance of a final assessment which has become final under the Act, or by the taxpayer's filing of a return which admits tax to be due that is not paid) to be delinquent or deficient in the paying of any tax under this Act, at which time that taxpayer shall become subject to the bond requirements of this Section and, as a condition of being allowed to continue to engage in the business licensed under this Act, shall be required to furnish bond to the Department in such form as provided in this Section.

10400SB3828sam001 -8- LRB104 16359 HLH 35248 a The Department shall discharge any surety and shall release and return any bond or security deposited, assigned, pledged, or otherwise provided to it by a taxpayer under this Section within 30 days after:

or (2) that taxpayer has ceased to collect receipts on SB3828 - 8 - LRB104 16359 HLH 29746 b which the taxpayer he is required to remit tax to the Department, has filed a final tax return, and has paid to the Department an amount sufficient to discharge the his remaining tax liability as determined by the Department under this Act.

Upon receiving a written request for a hearing, the Department shall give notice to the person requesting the hearing of the time and place fixed for the hearing and shall hold a hearing in conformity with the provisions of this Act and then issue its final administrative decision in the matter to that 10400SB3828sam001 -9- LRB104 16359 HLH 35248 a person.

In the absence of a protest and request for a hearing within 30 20 days, the Department's decision shall become final without any further determination being made or notice given.

Revocation, cancellation, or suspension of SB3828 - 9 - LRB104 16359 HLH 29746 b license.

The 10400SB3828sam001 -10- LRB104 16359 HLH 35248 a Department shall hold the hearing in conformity with the provisions of this Act and then issue its final administrative decision in the matter to the cigarette machine operator.

In the absence of a written protest and request for a hearing within 30 20 days, the Department's decision shall become final without any further determination being made or notice given.

No license so revoked shall be reissued to any cigarette machine operator for a period of 6 months after the date of the SB3828 - 10 - LRB104 16359 HLH 29746 b final determination of such revocation.

the quantity of cigarettes made or fabricated 10400SB3828sam001 -11- LRB104 16359 HLH 35248 a during the period covered by the return;

the SB3828 - 11 - LRB104 16359 HLH 29746 b type and quantity of cigarette tubes used in a cigarette machine;

10400SB3828sam001 -12- LRB104 16359 HLH 35248 a To be eligible for such credit, the tobacco product must meet the requirements of subsection (a) of Section 1-25 of this Act.

(c) If any payment provided for in this Section exceeds the cigarette machine operator's liabilities under this Act, as shown on an original return, the cigarette machine operator may credit such excess payment against liability subsequently to be remitted to the Department under this Act, in accordance SB3828 - 12 - LRB104 16359 HLH 29746 b with reasonable rules adopted by the Department.

The Department is not required to hold such a hearing if a waiver and consent to forfeiture has been executed by (i) the owner of the property, if the owner is known, and (ii)by the person in whose possession the property so taken was found, if thethat person in whose possession the property was found is known and if that person is not the owner of the property.

The 10400SB3828sam001 -13- LRB104 16359 HLH 35248 a Department shall give not less than 7 days' notice of the time and place of such hearing to the owner of such property, if he is known, and also to the person in whose possession the property so taken was found, if such person is known and if such person in possession is not the owner of said property.

In case neither the owner nor the person in possession of such property is known, the Department shall cause publication of the time and place of such hearing to be made at least once in each week for 3 weeks SB3828 - 13 - LRB104 16359 HLH 29746 b successively in a newspaper of general circulation in the county where such hearing is to be held.

In case neither the owner nor the person in possession of such property is known, the Department shall cause publication of such order to be made at least once 10400SB3828sam001 -14- LRB104 16359 HLH 35248 a in each week for 3 weeks successively in a newspaper of general circulation in the county where such hearing was held.

When any cigarettes or any cigarette machine shall have been declared forfeited to the State by the Department, as provided hereunder, and when all proceedings for the judicial review of the Department's decision have terminated, the Department shall, to the extent that its decision is sustained on review, destroy or maintain and use such property in an SB3828 - 14 - LRB104 16359 HLH 29746 b undercover capacity.

Any person aggrieved by any decision of the Department under this Section may, within 2030 days after receiving notice of the decision, protest to the Department and request a hearing.

Upon receiving a written request for a hearing, the Department shall give notice ofto the timeperson andrequesting placethe fixedhearing forof the hearingtime toand theplace personfixed requestingfor the hearing and shall hold a hearing in conformity with the provisions of this Act.Act and then issue its final administrative decision in the matter to that person.

AfterIn the absence of a protest and request for a hearing haswithin concluded,30 days, the DepartmentDepartment's decision shall issuebecome its final administrativewithout decisionany infurther thedetermination matterbeing tomade theor person.notice given.

In the absence of a protest and request for a hearing within the 20-day period set forth in this paragraph, the Department's decision shall become final without any further determination being made or notice given.

6-14-12.) 10400SB3828sam001 -15- LRB104 16359 HLH 35248 a Section 10.

SB3828 - 15 - LRB104 16359 HLH 29746 b (a) No person may engage in business as a distributor of cigarettes in this State within the meaning of the first 2 definitions of distributor in Section 1 of this Act without first having obtained a license therefor from the Department.

and (C) such (c) Such other additional information as 10400SB3828sam001 -16- LRB104 16359 HLH 35248 a the Department may reasonably lawfully require by its rules and regulations.

The purpose of the initial and renewal such annual license fee is to defray the cost, to the Department, of serializing SB3828 - 16 - LRB104 16359 HLH 29746 b cigarette tax stamps.

The Department shall discharge any surety and shall release and return any bond provided to it by a taxpayer under this Section within 90 days after July 1, 2027.2027, provided that the taxpayer is not delinquent or deficient in the payment of tax liability.

A separate application for license shall be made and , a 10400SB3828sam001 -17- LRB104 16359 HLH 35248 a separate annual license fee paid, and a separate bond filed, for each place of business at which a person who is required to procure a distributor's license under this Section proposes to engage in business as a distributor in Illinois under this Section Act.

SB3828 - 17 - LRB104 16359 HLH 29746 b (1) a person who is not of good character and reputation in the community in which the person he resides;

the Department may consider whetherprior theconviction person has previously been convicted of a felonyfelony, when determining whether the person is of good character and reputation, past conviction of a felony but, except as provided in paragraph (2), the conviction shall not operate as an absolute bar to licensure;

(3) a corporation, if any officer, manager, or director thereof, or any stockholder or stockholders 10400SB3828sam001 -18- LRB104 16359 HLH 35248 a owning in the aggregate more than 5% of the stock of such corporation, would not be eligible to receive a license under this Act for any reason;

(4) a person who has delinquent reports under Section 25 of the Tobacco Products Manufacturers' Escrow SB3828 - 18 - LRB104 16359 HLH 29746 b Enforcement Act of 2003;

(C) (c) manufactures cigarettes, whether in this State or out of this State, and who is neither (i) a 10400SB3828sam001 -19- LRB104 16359 HLH 35248 a participating manufacturer as defined in subsection II(jj) of the "Master Settlement Agreement" as defined in Sections 10 of the Tobacco Product Products Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003 (30 ILCS 168/10 and 30 SB3828 - 19 - LRB104 16359 HLH 29746 b ILCS 167/10);

nor (ii) in full compliance with Tobacco Product Products Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003 (30 ILCS 168/ and 30 ILCS 167/);

or (F) (f) has been found by the Department, after notice and a hearing, to have made a materially material false statement in the application or has failed to produce records required to be maintained by 10400SB3828sam001 -20- LRB104 16359 HLH 35248 a this Act.

That in form as prescribed by the Department, which license shall SB3828 - 20 - LRB104 16359 HLH 29746 b permit the applicant to which it is issued to engage in business as a distributor at the place shown in the his application.

Upon receiving a request for a hearing, the Department shall give notice to the person requesting the hearing of the time and place fixed for 10400SB3828sam001 -21- LRB104 16359 HLH 35248 a the hearing and shall hold a hearing in conformity with the provisions of this Act and then issue its final administrative decision in the matter to that person.

SB3828 - 21 - LRB104 16359 HLH 29746 b (Source:

7-12-10.) 10400SB3828sam001 -22- LRB104 16359 HLH 35248 a (35 ILCS 130/4b) (from Ch.

Distributor's permit;permit.

cigarettes(a) Cigarettes in original packages contained inside a sealed transparent wrapper.

(a)(1) The Department may, in its discretion, upon application, issue permits authorizing the payment of the tax herein imposed by out-of-State cigarette manufacturers who are SB3828 - 22 - LRB104 16359 HLH 29746 b not required to be licensed as distributors of cigarettes in this State, but who elect to qualify under this subsection Act as distributors of cigarettes in this State, and who, to the satisfaction of the Department, furnish adequate security to insure payment of the tax, provided that any such permit shall extend only to cigarettes which such permittee manufacturer places in original packages that are contained inside a sealed transparent wrapper.

ApplicationsApplication for permitsa permit shall be made to the Department, by electronic means, in a form prescribed by the Department.

(2) Each applicant for a permit under this Sectionsubsection shall furnish to the Department in a form signed and verified by the applicant under penalty of perjury, in an electronic format established by the Department, the following:

(1)(A) a statement that the applicant will fully 10400SB3828sam001 -23- LRB104 16359 HLH 35248 a comply with the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

and (2)(B) the following information:

(A)(i) the name and address of the applicant;

(B)(ii) the address of the location at which the applicant proposes to engage in business;

and (C)(iii) such other additional information as the Department may reasonably require by its rules.

(3) The following are ineligible to receive a distributor's SB3828 - 23 - LRB104 16359 HLH 29746 b permit under this subsection:

(1)(A)(1) a person who is not of good character and reputation in the community in which the person he resides;

the Department may consider whetherprior theconviction person has previously been convicted of a felonyfelony, when determining whether the person is of good character and reputation, past conviction of a felony but, except as provided in paragraph (2),(B), the conviction shall not operate as an absolute bar to receiving a permit;

(B) (2) a person who has been convicted of a felony under any federal Federal or State law, if the Department, after investigation,investigation and a hearing and consideration of any mitigating factors and evidence of rehabilitation contained in the applicant's record, including those in Section 4i of this Act, and after a hearing, if requested by the applicant, determines that such person has not been sufficiently rehabilitated to warrant the public trust and the conviction will impair the ability of the person to 10400SB3828sam001 -24- LRB104 16359 HLH 35248 a engage in the position for which a permit is sought;

(C) (3) a corporation, if any officer, manager or director thereof, or any stockholder or stockholders owning in the aggregate more than 5% of the stock of such corporation, would not be eligible to receive a permit under this Act for any reason.

(4)(D) a person who has delinquent reports under Section 25 of the Tobacco Products Manufacturers' Escrow SB3828 - 24 - LRB104 16359 HLH 29746 b Enforcement Act of 2003;

or (5)(E) a person, or any person who owns more than 15% of the ownership interests in a person or a related partyparty, who:

(A)(i) owes, at the time of application, any delinquent taxes that have been determined by law to be due and unpaid under this Act or any other tax Act administered by the Department, unless the license applicant has entered into an agreement approved by the Department to pay the amount due;

(B)(ii) had a license under this Act, the Cigarette Use Tax Act, the Tobacco Products Tax Act of 1995, or the Cigarette Machine Operator's Occupation Tax Act revoked within the past 2 years immediately preceding the application by the Department for misconduct relating to stolen or contraband cigarettes or has been convicted of a State or federal crime, punishable by imprisonment of one year or more, relating to 10400SB3828sam001 -25- LRB104 16359 HLH 35248 a stolen or contraband cigarettes;

(C)(iii) manufactures cigarettes, whether in this State or out of this State, and who is neither (i)(a) a participating manufacturer as defined in subsection II(jj) of the "Master Settlement Agreement" as defined in Sections 10 of the Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

nor (ii)(b) in full SB3828 - 25 - LRB104 16359 HLH 29746 b compliance with the Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

(D)(iv) has been found by the Department, after notice and a hearing, to have imported or caused to be imported into the United States for sale or distribution any cigarette in violation of 19 U.S.C.

(E)(v) has been found by the Department, after notice and a hearing, to have imported or caused to be imported into the United States for sale or distribution or manufactured for sale or distribution in the United States any cigarette that does not fully comply with the Federal Cigarette Labeling and Advertising Act (15 U.S.C.

or (F)(vi) has been found by the Department, after 10400SB3828sam001 -26- LRB104 16359 HLH 35248 a notice and a hearing, to have made a materially false statement in the application or has failed to produce records required to be maintained by this Act.

(4) There is no application fee for the initial and renewal permits.

A permittee shall notify the Department of any change in the information contained on the application form, including any change in ownership and shall do so within 30 days after any the change.

A permittee does not acquire any vested interest or compensable property right in a permit SB3828 - 26 - LRB104 16359 HLH 29746 b issued under this subsection.

(5) Any person aggrieved by any decision of the Department under this subsection may, within 30 days after notice of the decision, protest and request a hearing.

(6) With respect to cigarettes which come within the scope of such a permit and which any such permittee 10400SB3828sam001 -27- LRB104 16359 HLH 35248 a delivers or causes to be delivered in Illinois to licensed distributors, such permittee shall remit the tax imposed by this Act at the times provided for in Section 3 of this Act.

All returns and supporting schedules required to be filed under this subsection Section and all payments required to be made under this subsection Section shall be by electronic means in the form prescribed by the Department.

Each such SB3828 - 27 - LRB104 16359 HLH 29746 b return shall be accompanied by a copy of each invoice rendered by the permittee to any licensed distributor to whom the permittee delivered cigarettes of the type covered by the permit (or caused cigarettes of the type covered by the permit to be delivered) in Illinois during the period covered by such return.

(7) Such permit may be suspended, canceled, or revoked when, at any time, the Department considers that the security given is inadequate, or that such tax can more effectively be collected from distributors located in this State, or whenever the permittee violates any provision of this Act or any lawful rule or regulation issued by the 10400SB3828sam001 -28- LRB104 16359 HLH 35248 a Department pursuant to this Act or is determined to be ineligible for a distributor's permit under this Act as provided in this subsection Section, whenever the permittee shall notify the Department in writing of his desire to have the permit canceled.

(8) All permits issued by the Department under this subsection Act shall be valid for a period not to exceed one year after issuance unless sooner revoked, canceled, or suspended as provided in this Act provided.

(b) Out-of-stateUnstamped cigaretteoriginal manufacturerspackages who are not required to be licensed as distributors of cigarettes infor thisdistribution SB3828 - 28 - LRB104 16359 HLH 29746 b State and who do not elect to obtain approval under subsection 4b(a) to pay the taxpublic imposed by this Act, but who elect to qualify under this subsection Act as distributors of cigarettes in this State for promotional purposes ofwithout shippingconsideration. and delivering unstamped original packages of cigarettes into this State to licensed distributors, shall obtain a permit from the Department.

Application(1) forOut-of-state acigarette permitmanufacturers shallwho are not required to be madelicensed as distributors of cigarettes in this State and who do not elect to obtain approval under subsection 4b(a) to pay the Department,tax imposed by electronicthis means,Act, but who elect to qualify under this subsection Act as distributors of cigarettes in athis formState prescribedfor bypurposes of shipping and delivering unstamped original packages of cigarettes into this State to licensed distributors, shall obtain a permit from the Department.

Application for a permit shall be made to the Department, by electronic 10400SB3828sam001 -29- LRB104 16359 HLH 35248 a means, in a form prescribed by the Department.

(2) Each applicant for a permit under this Sectionsubsection shall furnish to the Department in a form signed and verified by the applicant under penalty of perjury, in an electronic format established by the Department, the following:

(3) The following are ineligible to receive a distributor's permit under this subsection:

SB3828(A) - 29 - LRB104 16359 HLH 29746 b (1) a person who is not of good character and reputation in the community in which the person he or she resides;

the Department may consider whetherprior theconviction person has previously been convicted of a felonyfelony, when determining whether the person is of good character and reputation, past conviction of a felony but, except as provided in paragraph (2),(B), the conviction shall not operate as an absolute bar to 10400SB3828sam001 -30- LRB104 16359 HLH 35248 a receiving a permit;

(B) (2) a person who has been convicted of a felony under any federal or State law, if the Department, after investigation and a hearing and consideration of any mitigating factors and evidence of rehabilitation contained in the applicant's record, including those set forth in Section 4i of this Act, and a hearing, if requested by the applicant, determines that the person has not been sufficiently rehabilitated to warrant the public trust and the conviction will impair the ability of the person to engage in the position for which a permit is sought;

and (C) (3) a corporation, if any officer, manager, or director thereof, or any stockholder or stockholders owning in the aggregate more than 5% of the stock of the corporation, would not be eligible to receive a permit under this Act for any reason.reason;.

With(D) respecta toperson originalwho packageshas ofdelinquent cigarettesreports thatunder suchSection permittee25 deliversof or causes to be delivered in Illinois and distributes to the publicTobacco forProducts promotionalManufacturers' purposesEscrow withoutEnforcement SB3828 - 30 - LRB104 16359 HLH 29746 b consideration, the permittee shall pay the tax imposed by this Act by remitting the amount thereof to the Department by the 5th day of each2003; month covering cigarettes shipped or otherwise delivered in Illinois for those purposes during the preceding calendar month.

The permittee, before delivering those cigarettes or causing(E) thosea cigarettesperson, to be delivered in this State, shall evidence his or herany obligationperson towho remitowns themore taxesthan due15% withof respect to those cigarettes by imprinting language to be prescribed by the Departmentownership oninterests each original package of cigarettes, in sucha placeperson thereonor anda inrelated suchparty mannerwho: also to be prescribed by the Department.

The(i) imprintedowes, languageat shallthe acknowledgetime theof permittee'sapplication, paymentany ofdelinquent taxes that have been determined by law to be due and unpaid under this Act or liabilityany forother the10400SB3828sam001 -31- LRB104 16359 HLH 35248 a tax imposedAct administered by thisthe ActDepartment, withunless respectthe toapplicant has entered into an agreement approved by the distributionDepartment ofto thosepay cigarettes.the amount due;

With(ii) respecthad toa cigaretteslicense thatunder thethis permitteeAct, deliversthe orCigarette causesUse toTax beAct, deliveredthe inTobacco IllinoisProducts toTax IllinoisAct licensedof distributors1995, or distributed to the publicCigarette forMachine promotionalOperator's purposes,Occupation theTax permitteeAct shall,revoked bywithin the 5thpast day2 ofyears eachby month, file with the Department,Department afor reportmisconduct coveringrelating cigarettesto shippedstolen or otherwisecontraband deliveredcigarettes in Illinois to licensed distributors or distributedhas tobeen theconvicted publicof for promotional purposes during the preceding calendar month on a formState toor befederal prescribedcrime, andpunishable furnished by theimprisonment Departmentof andone shallyear discloseor suchmore, otherrelating informationto asstolen theor Departmentcontraband maycigarettes; lawfully require.

Information(iii) thatmanufactures thecigarettes, Departmentwhether mayin lawfullythis requireState includesor informationout relatedof tothis State, and who is neither (a) a participating manufacturer as defined in subsection II(jj) of the uniform"Master regulationSettlement andAgreement" taxationas defined in Sections 10 of SB3828the -Tobacco 31Product -Manufacturers' LRB104Escrow 16359Act HLHand 29746the bTobacco cigarettes.Products Manufacturers' Escrow Enforcement Act of 2003;

Allnor reports(b) andin supportingfull schedulescompliance requiredwith toTobacco beProduct filedManufacturers' underEscrow thisAct Sectionand shallthe beTobacco filedProducts electronicallyManufacturers' inEscrow theEnforcement formAct prescribedof by2003; the Department.

(iv) has been found by the Department, after notice and a hearing, to have imported or caused to be imported into the United States for sale or 10400SB3828sam001 -32- LRB104 16359 HLH 35248 a distribution any cigarette in violation of 19 U.S.C.

1681a;

(v) has been found by the Department, after notice and a hearing, to have imported or caused to be imported into the United States for sale or distribution or manufactured for sale or distribution in the United States any cigarette that does not fully comply with the Federal Cigarette Labeling and Advertising Act (15 U.S.C.

1331, et seq.);

or (vi) has been found by the Department, after notice and a hearing, to have made a materially false statement in the application or has failed to produce records required to be maintained by this Act.

(4) There is no application fee for the initial and renewal permits.

A permittee shall notify the Department of any change in the information contained on the application form, including any change in ownership and shall do so within 30 days after any such change.

Such permit shall not be transferable or assignable.

A permittee does not acquire any vested interest or compensable property right in a permit issued under this subsection.

(5) Any person aggrieved by any decision of the Department under this subsection may, within 30 days after 10400SB3828sam001 -33- LRB104 16359 HLH 35248 a notice of the decision, protest and request a hearing.

Upon receiving a request for a hearing, the Department shall give notice to the person requesting the hearing of the time and place fixed for the hearing and shall hold a hearing in conformity with the provisions of this Act and then issue its final administrative decision in the matter to that person.

In the absence of a protest and request for a hearing within 30 days, the Department's decision shall become final without any further determination being made or notice given.

(6) With respect to original packages of cigarettes that such permittee delivers or causes to be delivered in Illinois and distributes to the public for promotional purposes without consideration, the permittee shall pay the tax imposed by this Act by remitting the amount thereof to the Department by the 5th day of each month covering cigarettes shipped or otherwise delivered in Illinois for those purposes during the preceding calendar month.

The permittee, before delivering those cigarettes or causing those cigarettes to be delivered in this State, shall evidence the permittee's his or her obligation to remit the taxes due with respect to those cigarettes by imprinting language to be prescribed by the Department on each original package of cigarettes, in such place thereon and in such manner also to be prescribed by the Department.

The imprinted language shall acknowledge the 10400SB3828sam001 -34- LRB104 16359 HLH 35248 a permittee's payment of or liability for the tax imposed by this Act with respect to the distribution of those cigarettes.

(7) With respect to cigarettes that the permittee delivers or causes to be delivered in Illinois to Illinois licensed distributors or distributed to the public for promotional purposes, the permittee shall, by the 5th day of each month, file with the Department, a report covering cigarettes shipped or otherwise delivered in Illinois to licensed distributors or distributed to the public for promotional purposes during the preceding calendar month in on a form to be prescribed and furnished by the Department and shall disclose such other information as the Department may lawfully require.

Information that the Department may lawfully require includes information related to the uniform regulation and taxation of cigarettes.

All reports and supporting schedules required to be filed under this subsection Section shall be filed electronically in the form prescribed by the Department.

(8) Such permit may be suspended, canceled, or revoked 10400SB3828sam001 -35- LRB104 16359 HLH 35248 a whenever the permittee violates any provision of this Act or any lawful rule or regulation issued by the Department pursuant to this Act, is determined to be ineligible for a distributor's permit under this Act as provided in this subsection Section, or notifies the Department in writing of his or her desire to have the permit canceled.

(9) All permits issued by the Department under this subsection Act shall be valid for a period not to exceed one year after issuance unless sooner revoked, canceled, or suspended as provided in this Act.

1-1-26.) (35 ILCS 130/4c) SB3828 - 32 - LRB104 16359 HLH 29746 b Sec.

Each applicant for a license under this Section shall furnish the following information to the Department in 10400SB3828sam001 -36- LRB104 16359 HLH 35248 a on a form signed and verified by the applicant under penalty of perjury, in an electronic format established by the Department, the following:

SB3828 - 33 - LRB104 16359 HLH 29746 b A separate application for license shall be made and separate annual license fee paid for each place of business at which a person who is required to procure a secondary distributor's license under this Section proposes to engage in business as a secondary distributor in Illinois under this Act.

10400SB3828sam001 -37- LRB104 16359 HLH 35248 a (1) a person who is not of good character and reputation in the community in which the person he resides;

the Department may consider prior past conviction of a felony but, except as provided in itemparagraph (2), the conviction shall not operate as an absolute bar to licensure receiving a license;

(2) a person who has been convicted of a felony under any federal or State law, if the Department, after investigation,investigation and a hearing and consideration of any the mitigating factors and evidence of rehabilitation contained in the applicant's record, including those provided in subsection (b) of Section 4i of this Act, and hearing, if requested by the applicant, determines that such person has not been sufficiently rehabilitated to warrant the public trust and the conviction will impair the ability of the person to engage in the position for which a license is sought;

(3) a corporation, if any officer, manager, or SB3828 - 34 - LRB104 16359 HLH 29746 b director thereof, or any stockholder or stockholders owning in the aggregate more than 5% of the stock of such corporation, would not be eligible to receive a license under this Act for any reason;

(4) a person who manufactures cigarettes, whether in this State or out of this StateState, and who is neither (i) a participating manufacturer as defined in subsection II(jj) of the "Master Settlement Agreement" as defined in 10400SB3828sam001 -38- LRB104 16359 HLH 35248 a Sections 10 of the Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

nor (ii) in full compliance with Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

(B) had a license under this Act, the Cigarette SB3828 - 35 - LRB104 16359 HLH 29746 b Use Tax Act, the Tobacco Products Tax Act of 1995, or the Cigarette Machine Operator's Occupation Tax Act revoked within the past 2 two years by the Department for misconduct relating to stolen or contraband cigarettes or has been convicted of a State or federal crime, punishable by imprisonment of one year or more, relating to stolen or contraband cigarettes;

(C) has been found by the Department, after notice 10400SB3828sam001 -39- LRB104 16359 HLH 35248 a and a hearing, to have imported or caused to be imported into the United States for sale or distribution any cigarette in violation of 19 U.S.C.

The Department, upon receipt of an application and license fee from a person who is eligible to receive a secondary distributor's license under this Section Act, shall issue to SB3828 - 36 - LRB104 16359 HLH 29746 b such applicant a license in such form as prescribed by the Department.

No license issued under this Section Act is transferable 10400SB3828sam001 -40- LRB104 16359 HLH 35248 a or assignable.

In the absence of a protest and request for a hearing within 30 20 days, the SB3828 - 37 - LRB104 16359 HLH 29746 b Department's decision shall become final without any further determination being made or notice given.

(a) No manufacturer may market cigarettes produced by the manufacturer directly to retailers in this State issued a 10400SB3828sam001 -41- LRB104 16359 HLH 35248 a license under Section 4g of this Act without first having obtained authorization from the Department.

SB3828 - 38 - LRB104 16359 HLH 29746 b (C) (3) the number of manufacturer representatives the applicant requests to maintain in this State;

and (D) (4) such (4) any other additional information as the Department may reasonably require by its rule.

(1) a manufacturer who owes, at the time of 10400SB3828sam001 -42- LRB104 16359 HLH 35248 a application, any delinquent cigarette taxes that have been determined by law to be due and unpaid under this Act or any other tax Act administered by the Department, unless the applicant has entered into an agreement approved by the Department to pay the amount due;

(3) a manufacturer who manufactures cigarettes, whether in this State or out of this State, and who is neither (i) a participating manufacturer as defined in subsection II(jj) of the "Master Settlement Agreement" as defined in Sections 10 of the Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

nor (ii) in full compliance with Tobacco ProductsProduct Manufacturers' SB3828 - 39 - LRB104 16359 HLH 29746 b Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

(4) a manufacturer who has been found, after notice and a hearing, to have imported or caused to be imported 10400SB3828sam001 -43- LRB104 16359 HLH 35248 a into the United States for sale or distribution or manufactured for sale or distribution in the United States any cigarette that does not fully comply with the Federal Cigarette Labeling and Advertising Act (15 U.S.C.

The Department, upon receipt of an application from a SB3828 - 40 - LRB104 16359 HLH 29746 b manufacturer who is eligible to maintain manufacturer representatives in this State, shall notify the applicant in writing, not more than 60 days after an application has been received, that the applicant may or may not maintain the requested number of manufacturer representatives in this State.

A copy of the notice authorizing a manufacturer to maintain manufacturer representatives in this State shall be available for inspection by the Department at each place of 10400SB3828sam001 -44- LRB104 16359 HLH 35248 a business identified in the application and in the motor vehicle operated by marketing representatives in the course of performing their his or her duties in this State on behalf of the manufacturer.

The manufacturer shall provide to the Department the names and addresses of the manufacturer representatives operating in this State and the make, model, and license plate number of each motor vehicle operated by a manufacturer representative in the course of performing their his or her duties in this State on behalf of the manufacturer.

(1) an individual who is not of good character and reputation in the community in which the individual SB3828 - 41 - LRB104 16359 HLH 29746 b resides;

(1.5) an individual who owes any delinquent cigarette taxes that have been determined by law to be due and unpaid under this Act or any other tax Act administered by the Department, unless the individual has entered into an 10400SB3828sam001 -45- LRB104 16359 HLH 35248 a agreement approved by the Department to pay the amount due;

(2) an individual who has had a license under this Act, the Cigarette Use Tax Act, the Tobacco Products Tax Act of 1995, or the Cigarette Machine Operator's Occupation Tax Act revoked within the past 2 years for misconduct relating to stolen or contraband cigarettes or has been convicted of a state or federal crime, punishable by imprisonment of one year or more, relating to stolen or contraband cigarettes;

(c) Manufacturer representatives may sell to retailers in this State who are licensed under Section 4g of this Act only original packages of cigarettes made, manufactured, or SB3828 - 42 - LRB104 16359 HLH 29746 b fabricated by the manufacturer and purchased or obtained from a distributor licensed under this Act, or the Cigarette Tax Use Tax Act, and on which tax stamps have been affixed.

A manufacturer representative may not possess more than 500 10400SB3828sam001 -46- LRB104 16359 HLH 35248 a stamped original packages of cigarettes made, manufactured, or fabricated by the manufacturer and purchased or obtained from a distributor licensed under this Act or the Cigarette Use Tax Act.

The manufacturer representative shall provide the distributor with a signed receipt for the cigarettes obtained from the SB3828 - 43 - LRB104 16359 HLH 29746 b distributor.

Distributors shall 10400SB3828sam001 -47- LRB104 16359 HLH 35248 a provide manufacturer representatives with invoices for stamped original packages of cigarettes sold to manufacturer representatives.

Upon receiving a request for a hearing, the Department shall give notice to the person requesting the hearing of the time and place fixed for SB3828 - 44 - LRB104 16359 HLH 29746 b the hearing and shall hold a hearing in conformity with the provisions of this Act and then issue its final administrative decision in the matter to that person.

1-1-16.) 10400SB3828sam001 -48- LRB104 16359 HLH 35248 a (35 ILCS 130/4g) Sec.

SB3828 - 45 - LRB104 16359 HLH 29746 b The annual license fee payable to the Department for each retailer's license shall be $75.

10400SB3828sam001 -49- LRB104 16359 HLH 35248 a Each applicant for a license shall pay the fee to the Department at the time of submitting its application for a license to the Department.

(1) a person who has been convicted of a felony related to the illegal transportation, sale, or distribution of cigarettes, or a tobacco-related felony, under any federal or State law, if the Department, after investigation and consideration of any mitigating factors and evidence of rehabilitation contained in the applicant's record, including those provided in Section 4i of the Act, and a hearinghearing, if requested by the applicant, SB3828 - 46 - LRB104 16359 HLH 29746 b determines that the person has not been sufficiently rehabilitated to warrant the public trust;

a limited liability 10400SB3828sam001 -50- LRB104 16359 HLH 35248 a company, if any member or managing member would not be eligible to receive a license under this Act for any reason;

The Department shall not issue a retailer's license to a retailer unless the retailer is also registered under the Retailers' Occupation Tax Act.

A person who obtains a license as a retailer who ceases to do business as specified in the license, or who never commenced business, or whose license is suspended or revoked, shall immediately surrender the license to the Department.

SB382810400SB3828sam001 --51- 47 - LRB104 16359 HLH 2974635248 ba A licensed retailer shall notify the Department of any change in the information contained on the application form, including any change in ownership and shall do so within 30 days after the change.

1-1-16.) (35 ILCS 130/4i) SB382810400SB3828sam001 --52- 48 - LRB104 16359 HLH 2974635248 ba Sec.

(b) The Department, upon a finding that an applicant for a license or permit was previously convicted of a felony under any federal or State law, shall consider any mitigating factors and evidence of rehabilitation contained in the applicant's record, including any of the following factors and evidence, to determine if the applicant has been sufficiently rehabilitated and whether a prior conviction will impair the ability of the applicant to engage in the position for which a SB382810400SB3828sam001 --53- 49 - LRB104 16359 HLH 2974635248 ba license or permit is sought:

(7) evidence of rehabilitation or rehabilitative effort during or after incarceration, or during or after a term of supervision, including, but not limited to, a certificate of good conduct under Section 5-5.5-25 of the SB382810400SB3828sam001 --54- 50 - LRB104 16359 HLH 2974635248 ba Unified Code of Corrections or a certificate of relief from disabilities under Section 5-5.5-10 of the Unified Code of Corrections;

Each SB382810400SB3828sam001 --55- 51 - LRB104 16359 HLH 2974635248 ba report shall show, at a minimum:

Revocation, cancellation, or suspension of SB382810400SB3828sam001 --56- 52 - LRB104 16359 HLH 2974635248 ba license.

However, no such license shall be revoked, cancelled or suspended, except after a hearing by the Department with notice to the distributor, secondary distributor, or retailer, as aforesaid, and affording such distributor, secondary distributor, or retailer a reasonable opportunity to appear and defend, and any distributor, secondary distributor, or SB382810400SB3828sam001 --57- 53 - LRB104 16359 HLH 2974635248 ba retailer aggrieved by any decision of the Department with respect thereto may have the determination of the Department judicially reviewed, as herein provided.

(d) If the retailer does not have a training program that facilitates compliance with minimum-age tobacco laws, the Department shall suspend for 3 days the license of that retailer for a second violation of the Prevention of Tobacco SB382810400SB3828sam001 --58- 54 - LRB104 16359 HLH 2974635248 ba Use by Persons under 21 Years of Age and Sale and Distribution of Tobacco Products Act, as provided in subsection (a-5) of Section 2 of that Act.

Each retailer that has a training program shall require each employee who completes the training SB382810400SB3828sam001 --59- 55 - LRB104 16359 HLH 2974635248 ba program to sign a form attesting that the employee has received and completed tobacco training.

No such license shall be reissued at all so long as the person who would receive the license is ineligible to receive a distributor's license under SB382810400SB3828sam001 --60- 56 - LRB104 16359 HLH 2974635248 ba this Act for any one or more of the reasons provided for in Section 4 of this Act, is ineligible to receive a secondary distributor's license under this Act for any one or more of the reasons provided for in Section 4c of this Act, or is determined to be ineligible for a retailer's license under the Act for any one or more of the reasons provided for in Section 4g of this Act.

(b) The Department may, prior to any destruction of cigarettes, permit the true holder of the trademark rights in SB382810400SB3828sam001 --61- 57 - LRB104 16359 HLH 2974635248 ba the cigarette brand to inspect such contraband cigarettes in order to assist the Department in any investigation regarding such cigarettes.

(d) Any person aggrieved by any decision of the Department under this Section may, within 2030 days after receiving notice of the decision, protest and request a hearing.

In the absence of a protest and request for a hearing within 2030 days, the Department's decision shall become final without any further determination being made or notice given.

If a hearing has already been set pursuant to Section 18a or Section 6 of this Act, all issues related to the cost of destruction shall be heard simultaneouslysimultaneously. (Source:

(Source:

SB382810400SB3828sam001 --62- 58 - LRB104 16359 HLH 2974635248 ba Section 20.

In completing such application, the applicant shall furnish such information as the Department may reasonably require (1) a statement that the applicant will fully comply SB382810400SB3828sam001 --63- 59 - LRB104 16359 HLH 2974635248 ba with the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

The annual license fee payable to the Department for eachthe initial and each renewal distributor's license shall be $250.

Beginning July 1, 2027, applicants are no longer required to SB382810400SB3828sam001 --64- 60 - LRB104 16359 HLH 2974635248 ba file a bond with their application.

The Department shall discharge any surety and shall release and return any bond provided to it by a taxpayer under this Section within 90 days after July 1, 2027.2027, provided that the taxpayer is not delinquent or deficient in the payment of tax liability.

the Department may consider prior conviction of a felonyfelony, but, except as provided in itemparagraph (2), the conviction shall not operate as an absolute bar to licensure;

(2) a person who has been convicted of a felony under any federal Federal or State law, if the Department, after investigation and consideration of any mitigating factors and evidence of rehabilitation contained in the applicant's record, including those provided in Section 4i of the Cigarette Tax Act, and a hearing, if requested by 10400SB3828sam001 -65- LRB104 16359 HLH 35248 a the applicant, determines that such person has not been sufficiently rehabilitated to warrant the public trust and SB3828 - 61 - LRB104 16359 HLH 29746 b the conviction will impair the ability of the person to engage in the position for which a license is sought;

(B) (b) had a license under this Act, the Cigarette Tax Act, the Tobacco Products Tax Act of 1995, or the Cigarette Machine Operator's Occupation Tax Act revoked within the past 2 years by the Department for misconduct relating to stolen or 10400SB3828sam001 -66- LRB104 16359 HLH 35248 a contraband cigarettes or has been convicted of a State or federal crime, punishable by imprisonment of one year or more, SB3828 - 62 - LRB104 16359 HLH 29746 b relating to stolen or contraband cigarettes;

(C) (c) manufactures cigarettes, whether in this State or out of this State, and who is neither (i) a participating manufacturer as defined in subsection II(jj) of the "Master Settlement Agreement" as defined in Sections 10 of the Tobacco Product Products Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003 (30 ILCS 168/10 and 30 ILCS 167/10);

nor (ii) in full compliance with Tobacco Product Products Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003 (30 ILCS 168/ and 30 ILCS 167/);

(E) (e) has been found by the Department, after notice and a hearing, to have imported or caused to be imported into the United States for sale or distribution or manufactured for sale or distribution in the United States any cigarette that does not fully 10400SB3828sam001 -67- LRB104 16359 HLH 35248 a comply with the Federal Cigarette Labeling and Advertising Act (15 U.S.C.

or (F) (f) has been found by the Department, after notice and a hearing, to have made a materially SB3828 - 63 - LRB104 16359 HLH 29746 b material false statement in the application or has failed to produce records required to be maintained by this Act.

A licensed distributor shall notify the Department of any change in the information contained on the application form, including any change in ownership, and shall do so within 30 10400SB3828sam001 -68- LRB104 16359 HLH 35248 a days after any such change.

Upon receiving a SB3828 - 64 - LRB104 16359 HLH 29746 b request for a hearing, the Department shall give notice to the person requesting the hearing of the time and place fixed for the hearing and shall hold a hearing in conformity with the provisions of this Act and then issue its final administrative decision in the matter to that person.

Every secondary distributor maintaining a place of 10400SB3828sam001 -69- LRB104 16359 HLH 35248 a business in this State, if not required to procure a license under the Cigarette Tax Act, shall make application for a license, by electronic means, in on a form as furnished and prescribed by the Department.

Such applicant shall furnish the SB3828 - 65 - LRB104 16359 HLH 29746 b following information to the Department in on a form signed and verified by the applicant under penalty of perjury, in an electronic format established by the Department, the following:

The annual license fee payable to the Department for the initial and each renewal secondary distributor's license shall be $250.

A separate application for license shall be made and a separate annual license fee paid, for each place of business at or from which the applicant proposes to act as a secondary 10400SB3828sam001 -70- LRB104 16359 HLH 35248 a distributor under this Section Act and for which the applicant is not required to procure a license as a secondary distributor under the Cigarette Tax Act.

(b) The following are ineligible to receive a secondary SB3828 - 66 - LRB104 16359 HLH 29746 b distributor's license under this Section Act:

the Department may consider prior conviction of a felony, butbut, except as provided in itemparagraph (2), the conviction shall not operate as an absolute bar to licensure;

(2) a person who has been convicted of a felony under any federal Federal or State law, if the Department, after investigation and consideration of any mitigating factors and evidence of rehabilitation contained in the applicant's record, including those in Section 4i of the Cigarette Tax Act, and a hearing, if requested by the applicant, determines that such person has not been sufficiently rehabilitated to warrant the public trust and the conviction will impair the ability of the person to engage in the position for which a license is sought;

10400SB3828sam001 -71- LRB104 16359 HLH 35248 a (4) a person who manufactures cigarettes, whether in this State or out of this State, and who is neither (i) a participating manufacturer as defined in subsection II(jj) of the "Master Settlement Agreement" as defined in Sections 10 of the Tobacco ProductsProduct Manufacturers' Escrow SB3828 - 67 - LRB104 16359 HLH 29746 b Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

nor (ii) in full compliance with Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

(B) had a license under this Act, or the Cigarette Tax Act, the Tobacco Products Tax Act of 1995, or the Cigarette Machine Operator's Occupation Tax Act revoked within the past 2 years by the Department for misconduct relating to stolen or contraband cigarettes 10400SB3828sam001 -72- LRB104 16359 HLH 35248 a or has been convicted of a State or federal crime, punishable by imprisonment of one year or more, relating to stolen or contraband cigarettes;

(C) has been found by the Department, after notice and a hearing, to have imported or caused to be SB3828 - 68 - LRB104 16359 HLH 29746 b imported into the United States for sale or distribution any cigarette in violation of 19 U.S.C.

All licenses 10400SB3828sam001 -73- LRB104 16359 HLH 35248 a issued by the Department under this Section Act shall be valid for a period not to exceed one year after issuance unless sooner revoked, canceled or suspended as provided in this Act provided.

Such license shall be SB3828 - 69 - LRB104 16359 HLH 29746 b conspicuously displayed at the place of business for which it is issued.

7-12-10.) 10400SB3828sam001 -74- LRB104 16359 HLH 35248 a (35 ILCS 135/6) (from Ch.

(a) The Department may, after notice and hearing as SB3828 - 70 - LRB104 16359 HLH 29746 b provided for by this Act, revoke, cancel or suspend the license of any distributor or secondary distributor for the violation of any provision of this Act, or for non-compliance with any provision herein contained, or for any non-compliance with any lawful rule or regulation promulgated by the Department under Section 21 of this Act, or because the licensee is determined to be ineligible for a distributor's license for any one or more of the reasons provided for in Section 4 of this Act, or because the licensee is determined to be ineligible for a secondary distributor's license for any one or more of the reasons provided for in Section 4b or Section 7a of this Act.

(b) The Department may revoke, cancel, or suspend the 10400SB3828sam001 -75- LRB104 16359 HLH 35248 a license of any distributor for a violation of the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003 as provided in Section 30 of that Act.

The Department may revoke, cancel, or suspend the license of any secondary distributor for a violation of subsection (e) of Section 15 of the Tobacco SB3828 - 71 - LRB104 16359 HLH 29746 b Products Manufacturers' Escrow Enforcement Act of 2003.

No such license shall be reissued at all so long as the person who would receive the license is ineligible to 10400SB3828sam001 -76- LRB104 16359 HLH 35248 a receive a distributor's license under this Act for any one or more of the reasons provided for in Section 4 of this Act or is ineligible to receive a secondary distributor's license under this Act for any one or more of the reasons provided for in Section 4b and Section 7a of this Act.

SB3828 - 72 - LRB104 16359 HLH 29746 b The Department upon complaint filed in the circuit court may by injunction restrain any person who fails, or refuses, to comply with this Act from acting as a distributor or secondary distributor of cigarettes in this State.

(1) The Department may, in its discretion, upon application, issue permits authorizing the collection of the tax herein imposed by those out-of-State cigarette manufacturers who are not required to be licensed as distributors of cigarettes in this State, but who elect to qualify under this subsection Act as distributors of cigarettes in this State, and who, to the satisfaction of the Department, furnish adequate security to insure collection and payment of the tax, provided that any such permit shall extend only to cigarettes which such permittee manufacturer places in original packages that 10400SB3828sam001 -77- LRB104 16359 HLH 35248 a are contained inside a sealed transparent wrapper, and provided that no such permit shall be issued under this subsection Act to such a manufacturer who has obtained the permit provided for in Section 4b(a) of the Cigarette Tax Act.

Application for a permit shall be made to the SB3828 - 73 - LRB104 16359 HLH 29746 b Department, by electronic means, in a form prescribed by the Department.

When so authorized, it shall be the duty of such distributor to collect the tax upon all cigarettes which the distributor he delivers (or causes to be delivered) within 10400SB3828sam001 -78- LRB104 16359 HLH 35248 a this State to licensed distributors, in the same manner and subject to the same requirements as a distributor maintaining a place of business within this State.

SB3828 - 74 - LRB104 16359 HLH 29746 b (2) The following are ineligible to receive a distributor's permit under this subsection Act:

the Department may consider prior conviction of a felony, but, except as provided in itemparagraph (B), the conviction shall not operate as an absolute bar to licensure;

(C) (3) a corporation, if any officer, manager or director thereof, or any stockholder or stockholders 10400SB3828sam001 -79- LRB104 16359 HLH 35248 a owning in the aggregate more than 5% of the stock of such corporation, would not be eligible to receive a permit under this Act for any reason;

(D) a person who has delinquent reports under Section 25 of the Tobacco Products Manufacturers' SB3828 - 75 - LRB104 16359 HLH 29746 b Escrow Enforcement Act of 2003;

(i) owes, at the time of application, any delinquent taxes that have been determined by law to be due and unpaid under this Act or any other tax Act administered by the Department, unless the license applicant has entered into an agreement approved by the Department to pay the amount due;

(ii) had a license under this Act, the Cigarette Use Tax Act, the Tobacco Products Tax Act of 1995, or the Cigarette Machine Operator's Occupation Tax Act revoked within the past 2 years by the Department for misconduct relating to stolen or contraband cigarettes or has been convicted of a State or federal crime, punishable by imprisonment of one year or more, relating to stolen or contraband cigarettes;

(iii) manufactures cigarettes, whether in this State or out of this State, and who is neither (i)(a) 10400SB3828sam001 -80- LRB104 16359 HLH 35248 a a participating manufacturer as defined in subsection II(jj) of the "Master Settlement Agreement" as defined in Sections 10 of the Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement SB3828 - 76 - LRB104 16359 HLH 29746 b Act of 2003;

nor (ii)(b) in full compliance with Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

or (vi) has been found by the Department, after notice and a hearing, to have made a materially false statement in the application or has failed to produce records required to be maintained by 10400SB3828sam001 -81- LRB104 16359 HLH 35248 a this Act.

A permittee shall notify the Department of any change in the information contained on the application form, including any change in ownership, and SB3828 - 77 - LRB104 16359 HLH 29746 b shall do so within 30 days after any such change.

All returns and supporting schedules required to be filed under this subsection and all payments required to be made under this subsection shall be by electronic means in the form prescribed by the Department The Department may promulgate rules to require that the 10400SB3828sam001 -82- LRB104 16359 HLH 35248 a permittee's return be accompanied by appropriate computer-generated magnetic media supporting schedule data in the format prescribed by the Department, unless, as provided by rule, the Department grants an exception upon petition of the permittee.

Each such return shall be accompanied by a copy SB3828 - 78 - LRB104 16359 HLH 29746 b of each invoice rendered by the permittee to any licensed distributor to whom the permittee delivered cigarettes of the type covered by the permit (or caused cigarettes of the type covered by the permit to be delivered) in Illinois during the period covered by such return.

All permits issued by the Department under this subsection 10400SB3828sam001 -83- LRB104 16359 HLH 35248 a Act shall be valid for not to exceed one year after issuance unless sooner revoked, canceled or suspended as in this Act provided.

(b)Any Unstampedperson originalaggrieved packagesby ofany cigarettesdecision forof distributionthe toDepartment theunder publicthis forsubsection promotionalmay, purposeswithin without30 SB3828days -after 79notice -of LRB104the 16359decision, HLHprotest 29746and brequest consideration.a hearing.

(1)Upon Out-of-statereceiving cigarettea manufacturersrequest whofor area nothearing, requiredthe toDepartment beshall licensedgive asnotice distributors of cigarettes in this State and who do not elect to obtainthe approvalperson underrequesting subsection (a) to pay the taxhearing imposed by this Act, but who elect to qualify under this Act as distributors of cigarettesthe intime thisand Stateplace fixed for purposesthe ofhearing shipping and delivering unstamped original packages of cigarettes into this State to licensed distributors, shall obtainhold a permithearing fromin theconformity Department,with providedthe thatprovisions noof such permit shall be issued under this subsectionAct toand athen manufacturerissue whoits hasfinal obtainedadministrative thedecision permit provided for in Section 4b(b) of the Cigarettematter Taxto Act.that person.

In the absence of a protest and request for a hearing within 30 days, the Department's decision shall become final without any further determination being made or notice given.

(b) Unstamped original packages of cigarettes for distribution to the public for promotional purposes without consideration.

(1) Out-of-state cigarette manufacturers who are not required to be licensed as distributors of cigarettes in this State and who do not elect to obtain approval under subsection (a) to pay the tax imposed by this Act, but who elect to qualify under this subsection Act as distributors of cigarettes in this State for purposes of shipping and delivering unstamped original packages of cigarettes into this State to licensed distributors, shall obtain a permit from the Department, provided that no such permit shall be 10400SB3828sam001 -84- LRB104 16359 HLH 35248 a issued under this subsection to a manufacturer who has obtained the permit provided for in Section 4b(b) of the Cigarette Tax Act.

SB3828 - 80 - LRB104 16359 HLH 29746 b (i) the name and address of the applicant;

(A) (1) a person who is not of good character and reputation in the community in which the person he or she resides;

(B)the (2)Department amay personconsider whoprior has10400SB3828sam001 been-85- convictedLRB104 of16359 aHLH felony35248 undera anyconviction federalof or State law, if the Department, after investigation and a hearing,felony, ifbut, requestedexcept byas theprovided applicant,in determinesparagraph that(B), the personconviction hasshall not beenoperate sufficientlyas rehabilitatedan toabsolute warrantbar theto publiclicensure; trust;

(B) (2) a person who has been convicted of a felony under any federal or State law, if the Department, after investigation and consideration of any mitigating factors and evidence of rehabilitation contained in the applicant's record, including those provided in Section 4i of the Cigarette Tax Act, and a hearing, if requested by the applicant, determines that the person has not been sufficiently rehabilitated to warrant the public trust and the conviction will impair the ability of the person to engage in the position for which a permit is sought;

or (E) a person, or any person who owns more than 15% of the ownership interests in a person or a related SB3828 - 81 - LRB104 16359 HLH 29746 b party who:

10400SB3828sam001 -86- LRB104 16359 HLH 35248 a (i) owes, at the time of application, any delinquent taxes that have been determined by law to be due and unpaid under this Act or any other tax Act administered by the Department, unless the license applicant has entered into an agreement approved by the Department to pay the amount due;

(ii) had a license under this Act, the Cigarette Tax Act, the Tobacco Products Tax Act of 1995, or the Cigarette Machine Operator's Occupation Tax Act revoked within the past 2 years by the Department for misconduct relating to stolen or contraband cigarettes or has been convicted of a State or federal crime, punishable by imprisonment of one year or more, relating to stolen or contraband cigarettes;

(iii) manufactures cigarettes, whether in this State or out of this State, and who is neither (i)(a) a participating manufacturer as defined in subsection II(jj) of the "Master Settlement Agreement" as defined in Sections 10 of the Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

nor (ii)(b) in full compliance with Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement SB3828 - 82 - LRB104 16359 HLH 29746 b Act of 2003;

10400SB3828sam001 -87- LRB104 16359 HLH 35248 a (iv) has been found by the Department, after notice and a hearing, to have imported or caused to be imported into the United States for sale or distribution any cigarette in violation of 19 U.S.C.

A permittee does not acquire any vested interest or SB3828 - 83 - LRB104 16359 HLH 29746 b compensable property right in a permit issued under this 10400SB3828sam001 -88- LRB104 16359 HLH 35248 a subsection.

With respect to cigarettes such permittee delivers or causes to be delivered in Illinois to Illinois licensed distributors or distributed to the public for promotional purposes, the permittee shall, by the 5th day of each month, file with the Department, a report covering cigarettes shipped or otherwise delivered in Illinois to licensed distributors or distributed to the public for promotional purposes during the SB3828 - 84 - LRB104 16359 HLH 29746 b preceding calendar month on a form to be prescribed and 10400SB3828sam001 -89- LRB104 16359 HLH 35248 a furnished by the Department and shall disclose such other information as the Department may lawfully require.

The Department SB3828 - 85 - LRB104 16359 HLH 29746 b shall have the power, in its discretion, to issue a new permit 10400SB3828sam001 -90- LRB104 16359 HLH 35248 a after such suspension, cancellation, or revocation, except when the person who would receive the permit is ineligible to receive a distributor's permit under this Act.

(a) The Department may, in its discretion, upon application, issue a secondary distributor's license to persons who are not required to be licensed as secondary SB3828 - 86 - LRB104 16359 HLH 29746 b distributors of cigarettes in this State, but who elect to 10400SB3828sam001 -91- LRB104 16359 HLH 35248 a qualify under this Section Act as discretionary secondary distributors of cigarettes.

A separate application for license shall be made for each place of business at or from which the applicant proposes to act as a discretionary secondary distributor under this Section Act and for which the applicant is not required to procure a license as a secondary distributor under the SB3828 - 87 - LRB104 16359 HLH 29746 b Cigarette Tax Act or Cigarette Use Tax Act.

10400SB3828sam001 -92- LRB104 16359 HLH 35248 a (b) The following are ineligible to receive a discretionary secondary distributor's license under this Section Act:

the Department may consider prior conviction of a felony, but, except as provided in itemparagraph (2), the conviction shall not operate as an absolute bar to licensure;

(4) a person who manufactures cigarettes, whether in SB3828 - 88 - LRB104 16359 HLH 29746 b this State or out of this StateState, and who is neither (i) a 10400SB3828sam001 -93- LRB104 16359 HLH 35248 a participating manufacturer as defined in subsection II(jj) of the "Master Settlement Agreement" as defined in Sections 10 of the Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

nor (ii) in full compliance with Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

(B) had a license under this Act, or the Cigarette Tax Act, the Tobacco Products Tax Act of 1995, or the Cigarette Machine Operator's Occupation Tax Act revoked within the past 2 years by the Department for misconduct relating to stolen or contraband cigarettes or has been convicted of a State or federal crime, SB3828 - 89 - LRB104 16359 HLH 29746 b punishable by imprisonment of one year or more, 10400SB3828sam001 -94- LRB104 16359 HLH 35248 a relating to stolen or contraband cigarettes;

All SB3828 - 90 - LRB104 16359 HLH 29746 b licenses issued by the Department under this Section Act shall 10400SB3828sam001 -95- LRB104 16359 HLH 35248 a be valid for a period not to exceed one year after issuance unless sooner revoked, canceled, or suspended as provided in this Act provided.

SB3828 - 91 - LRB104 16359 HLH 29746 b Such authority and license may be suspended, canceled, or 10400SB3828sam001 -96- LRB104 16359 HLH 35248 a revoked whenever the licensee violates any provision of this Act or any lawful rule or regulation issued by the Department pursuant to this Act or is determined to be ineligible for a discretionary secondary distributor's permit under this Act as provided in this Section, or whenever the licensee shall notify the Department in writing of his desire to have the license canceled.

(b) The Department may, prior to any destruction of cigarettes, permit the true holder of the trademark rights in SB3828 - 92 - LRB104 16359 HLH 29746 b the cigarette brand to inspect such contraband cigarettes, in 10400SB3828sam001 -97- LRB104 16359 HLH 35248 a order to assist the Department in any investigation regarding such cigarettes.

(d) Any person aggrieved by any decision of the Department under this Section may, within 2030 days after receiving notice of the decision, protest and request a hearing.

In the absence of a protest and request for a hearing within 2030 days, the Department's decision shall become final without any further determination being made or notice given.

The Tobacco Products Tax Act of 1995 is amended by changing Sections 10-20, 10-21, 10-25, 10-55, 10-56, and 10-58 as follows:

SB382810400SB3828sam001 --98- 93 - LRB104 16359 HLH 2974635248 ba (35 ILCS 143/10-20) Sec.

Each applicant for a license shall furnish to the Department in on a form, signed and verified by the applicant under penalty of perjury, in an electronic format established by the Department,,Department, the following information:

Each distributor, except for a distributor who is applying for a distributor's license under this Act for the first time or a distributor who, in the preceding year, had less than SB3828 - 94 - LRB104 16359 HLH 29746 b $50,000 of tax liability, shall also file with the Department 10400SB3828sam001 -99- LRB104 16359 HLH 35248 a a bond in an amount not to exceed (i) 3 times the amount of the distributor's average monthly tax liability or (ii) $50,000, whichever amount is lower, on a form to be approved by the Department.

the Department may consider prior conviction of a felony but, except as provided in itemparagraph (2), the conviction shall not operate as an absolute bar to licensure;

(2) a person who has been convicted of a felony under SB3828 - 95 - LRB104 16359 HLH 29746 b any federal or State law, if the Department, after 10400SB3828sam001 -100- LRB104 16359 HLH 35248 a investigation and consideration of any mitigating factors and evidence of rehabilitation contained in the applicant's record, including those in Section 4i of the Cigarette Tax Act, and hearing, if requested by the applicant, determines that such person has not been sufficiently rehabilitated to warrant the public trust and the conviction will impair the ability of the person to engage in the position for which a license is sought;

SB3828 - 96 - LRB104 16359 HLH 29746 b (B) had a license under this Act, the Cigarette 10400SB3828sam001 -101- LRB104 16359 HLH 35248 a Tax Act, the Cigarette Use Tax Act, or the Cigarette Machine Operator's Occupation Tax Act revoked within the past 2 years by the Department for misconduct relating to stolen or contraband cigarettes or has been convicted of a State or federal crime, punishable by imprisonment of one year or more, relating to stolen or contraband cigarettes;

(C) manufactures cigarettes, whether in this State or out of this State, and who is neither (i) a participating manufacturer as defined in subsection II(jj) of the "Master Settlement Agreement" as defined in Sections 10 of the Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

nor (ii) in full compliance with Tobacco ProductsProduct Manufacturers' Escrow Act and the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003;

(E) has been found by the Department, after notice and a hearing, to have imported or caused to be imported into the United States for sale or SB3828 - 97 - LRB104 16359 HLH 29746 b distribution or manufactured for sale or distribution 10400SB3828sam001 -102- LRB104 16359 HLH 35248 a in the United States any cigarette that does not fully comply with the Federal Cigarette Labeling and Advertising Act (15 U.S.C.

(c) The Department, upon receipt of an application and bond, if required, in proper form, from a person who is eligible to receive a distributor's license shall issue to the the applicant a license, in a form prescribed by the Department.

SB3828 - 98 - LRB104 16359 HLH 29746 b A licensed distributor shall notify the Department of any 10400SB3828sam001 -103- LRB104 16359 HLH 35248 a change in the information contained on the application form, including any change in ownership and shall do so within 30 days after any such change No license shall be issued to any person who is in default to the State of Illinois for moneys due under this Act or any other tax Act administered by the Department.

If the Department will be unable to make such a final determination within 45 days after receiving the taxpayer's final tax return, then the Department shall notify the taxpayer within that 45-day period stating the reasons why it is unable to make SB3828 - 99 - LRB104 16359 HLH 29746 b the final determination within that 45-day period.

10400SB3828sam001 -104- LRB104 16359 HLH 35248 a The Department may, in its discretion, upon application, authorize the payment of the tax imposed under Section 10-10 by any distributor or manufacturer not otherwise subject to the tax imposed under this Act who, to the satisfaction of the Department, furnishes adequate security to ensure payment of the tax.

The Department may revoke, suspend, or cancel the license of a distributor of roll-your-own tobacco,( as that term is used in Section 10 of the Tobacco Product Manufacturers' Escrow Act,) under this Act if the tobacco product manufacturer, as defined in Section 10 of the Tobacco Product Manufacturers' Escrow Act, that made or sold the roll-your-own tobacco has failed to become a participating manufacturer, as defined in subdivision (a)(1) of Section 15 of the Tobacco Product Manufacturers' Escrow Act, or has failed to create a qualified escrow fund for any roll-your-own tobacco manufactured by the tobacco product manufacturer and sold in this State or otherwise failed to bring itself into compliance SB3828 - 100 - LRB104 16359 HLH 29746 b with subdivision (a)(2) of Section 15 of the Tobacco Product 10400SB3828sam001 -105- LRB104 16359 HLH 35248 a Manufacturers' Escrow Act.

Application for license shall be made to SB3828 - 101 - LRB104 16359 HLH 29746 b the Department, by electronic means, in a form prescribed by 10400SB3828sam001 -106- LRB104 16359 HLH 35248 a the Department.

A separate application for license shall be made and a SB3828 - 102 - LRB104 16359 HLH 29746 b separate annual license fee shall be paid for each place of 10400SB3828sam001 -107- LRB104 16359 HLH 35248 a business at which a person who is required to procure a retailer's license under this Section proposes to engage in business as a retailer in Illinois under this Section Act.

The Department, upon receipt of an application and license fee, in proper form, from a person who is eligible to receive a retailer's license under this Act, shall issue to such SB3828 - 103 - LRB104 16359 HLH 29746 b applicant a license in form as prescribed by the Department, 10400SB3828sam001 -108- LRB104 16359 HLH 35248 a which license shall permit the applicant to which it is issued to engage in business as a retailer under this Act at the place shown in the his application.

The Department shall not issue a license to a retailer unless the retailer is also validly registered under the Retailers' Retailers Occupation Tax Act.

A retailer as defined under this Act need not obtain an additional license under this Act, but shall be deemed to be SB3828 - 104 - LRB104 16359 HLH 29746 b sufficiently licensed by virtue of his being properly licensed 10400SB3828sam001 -109- LRB104 16359 HLH 35248 a as a retailer under Section 4g of the Cigarette Tax Act.

The notice shall specify the alleged violation or violations upon which the revocation, SB3828 - 105 - LRB104 16359 HLH 29746 b cancellation, or suspension proceeding is based.

10400SB3828sam001 -110- LRB104 16359 HLH 35248 a (b) The Department may, after notice and hearing as provided for by this Act, revoke, cancel, or suspend the license of any distributor or retailer for the violation of any provision of this Act, or for noncompliance with the provisions of this Act, or for any noncompliance with any lawful rule promulgated by the Department under this Act, or because the licensee is determined to be ineligible for a distributor's license for any one or more of the reasons provided for in Section 10-20 of this Act, or because the licensee is determined to be ineligible for a retailer's license for any one or more of the reasons provided for in Section 10-21 of this Act.

For the purposes of this Section, any violation of subsection (a) of Section 2 of the Prevention of Tobacco Use by Persons under 21 Years of Age SB3828 - 106 - LRB104 16359 HLH 29746 b and Sale and Distribution of Tobacco Products Act occurring at 10400SB3828sam001 -111- LRB104 16359 HLH 35248 a the retailer's licensed location, during a 24-month period, shall be counted as a violation against the retailer.

A training program that facilitates compliance with minimum-age tobacco laws must include at least the following SB3828 - 107 - LRB104 16359 HLH 29746 b elements:

(i) it must explain that only individuals displaying 10400SB3828sam001 -112- LRB104 16359 HLH 35248 a valid identification demonstrating that they are 21 years of age or older shall be eligible to purchase cigarettes or tobacco products and (ii) it must explain where a clerk can check identification for a date of birth.

(c-10) No license so revoked shall be reissued to any SB3828 - 108 - LRB104 16359 HLH 29746 b distributor or retailer for a period of 6 months after the date 10400SB3828sam001 -113- LRB104 16359 HLH 35248 a of the final determination of such revocation.

6-16-25.) SB3828(35 -ILCS 109143/10-55) -10400SB3828sam001 -114- LRB104 16359 HLH 2974635248 ba (35 ILCS 143/10-58) Sec.

10-55.

Arrest;

search and seizure without warrant.

Any duly authorized employee of the Department (i) may arrest without warrant any person committing in his or her presence a violation of any of the provisions of this Act, (ii) may without a search warrant inspect all tobacco products located in any place of business, (iii) may seize any tobacco products possessed in violation in accordance with the provisions of this Act, and (iv) may seize any vending device in which those tobacco products that violate this Act are found;

and (v) may seize any tobacco products on which the tax imposed under this Act has not been paid.

The tobacco products and vending devices so seized are subject to confiscation and forfeiture as provided in Sections 10-56 through 10-58.

(Source:

P.A.

92-743, eff.

7-25-02.) (35 ILCS 143/10-56) Sec.

10-56.

Seizure and forfeiture.

After seizing any tobacco products or vending devices, as provided in Section 10-55, the Department must hold a hearing and determine whether (i) the distributor or retailer was properly licensed to sell the tobacco products at the time of their seizure by the Department;

(ii) the possession of the tobacco products was in violation of this Act;

or (iii) the tax imposed by this Act had been paid on the tobacco products.

The Department is not required to hold such a hearing if a waiver and consent to forfeiture has been executed by the owner of the property, if 10400SB3828sam001 -115- LRB104 16359 HLH 35248 a the owner is known, and by the person in whose possession the property so taken was found, if that person is known and if that person is not the owner of the property.

The Department shall give not less than 20 days' notice of the time and place of the hearing to the owner of the property, if the owner is known, and also to the person in whose possession the property was found, if that person is known and if the person in possession is not the owner of the property.

If neither the owner nor the person in possession of the property is known, the Department must cause publication of the time and place of the hearing to be made at least once in each week for 3 weeks successively in a newspaper of general circulation in the county where the hearing is to be held.

If, as the result of the hearing, the Department makes any of the findings listed in (i) through (iii) above determines that the distributor or retailer was not properly licensed at the time the tobacco products were seized, or upon receipt of a properly executed waiver and consent to forfeiture as provided in this Section, the Department must enter an order declaring the tobacco products or vending devices confiscated and forfeited to the State, to be held by the Department for disposal by it as provided in Section 10-58.

The Department must give notice of the order to the owner of the property, if the owner is known, and also to the person in whose possession the property was found, if that person is known and if the person in possession is not the owner of the property.

If 10400SB3828sam001 -116- LRB104 16359 HLH 35248 a neither the owner nor the person in possession of the property is known, the Department must cause publication of the order to be made at least once in each week for 3 weeks successively in a newspaper of general circulation in the county where the hearing was held.

(Source:

P.A.

103-1001, eff.

8-9-24.) (35 ILCS 143/10-58) Sec.

(b) If no complaint for review, as provided in Section 12 of the Retailers' Occupation Tax Act, has been filed within the time required by Law, and if no stay order has been entered 10400SB3828sam001 -117- LRB104 16359 HLH 35248 a under that Law, the Department shall proceed to destroy, maintain and use in an undercover capacity, or sell the property for the best price obtainable and shall forthwith pay over the proceeds of the sale to the State Treasurer.

If the value of the property to be sold at any one time is $500 or more, however, the property shall be sold only to the highest and best bidder on terms and conditions, and on open SB3828 - 110 - LRB104 16359 HLH 29746 b competitive bidding after public advertisement, in a manner and for terms as the Department, by rule, may prescribe.

(f) Any person aggrieved by any decision of the Department under this Section may, within 2030 days after receiving notice of the decision, protest and request a hearing.

Upon receiving a written request for a hearing, the Department shall give notice to the person requesting the hearing of the time and 10400SB3828sam001 -118- LRB104 16359 HLH 35248 a place fixed for the hearing and shall hold a hearing in conformity with the provisions of this Act and then issue its final administrative decision in the matter to that person.

In the absence of a protest and request for a hearing within 2030 days, the Department's decision shall become final without any further determination being made or notice given.

If a hearing has already been set pursuant to Section 10-25 or Section SB3828 - 111 - LRB104 16359 HLH 29746 b 10-56 of this Act, all issues related to the cost of destruction shall be heard simultaneously.

Where this Act makes changes in a statute that is represented in this Act by text that is not yet or no longer in effect (for example, a Section represented by multiple versions), the use of that text does not accelerate or delay the taking effect of (i) the changes made by this Act or (ii) provisions derived from any other Public Act.Act.".