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§ 5702.313. Surety bond requirements

Purdon's Pennsylvania Statutes and Consolidated StatutesTitle 35 P.S. Health and SafetyEffective: March 6, 2024

Purdon's Pennsylvania Statutes and Consolidated Statutes
Title 35 P.S. Health and Safety (Refs & Annos)
Chapter 27F. Tobacco Product Manufacturer Directory Act
Chapter 3. Tobacco Product Manufacturers Directory
Effective: March 6, 2024
35 P.S. § 5702.313
§ 5702.313. Surety bond requirements
Currentness
(a) Requirements.--All nonparticipating manufacturers shall post a bond for the benefit of the Commonwealth, which shall be:
(1) Subject to execution under subsection (c).
(2) Conditioned on the nonparticipating manufacturer's compliance with the requirements of this act and the Tobacco Settlement Agreement Act.1
(3) Posted by a surety bond company located within this Commonwealth.
(4) Posted or adjusted at least 21 days prior to every calendar quarter.
(5) Provided to the Attorney General at least 21 days in advance of each calendar quarter as a precondition for the nonparticipating manufacturer and its brand families being included on the directory for that quarter. If the amount required to be posted under subsection (b) is equal to or lower than the amount already posted, the nonparticipating manufacturer shall not be required to post a new bond and may comply with this section by providing evidence that the bond already posted will remain in effect for the next calendar year or quarter, whichever is applicable.
(b) Amount.--The amount of the bond required by subsection (a) shall be the greater of:
(1) $25,000;
(2) for a nonparticipating manufacturer that deposits escrow annually, the highest collective amount of escrow owed in this Commonwealth by the nonparticipating manufacturer or its predecessor for any four consecutive calendar quarters out of the past 12 calendar quarters;
(3) for a nonparticipating manufacturer that deposits escrow quarterly, the highest amount of escrow owed in this Commonwealth by the nonparticipating manufacturer or its predecessor for any of the past 12 calendar quarters; or
(4) for a nonparticipating manufacturer that, at the time of its application, is not included on the directory and is applying for initial inclusion or reinclusion on the directory, an amount determined by the Attorney General to adequately protect the Commonwealth's interest in enforcing the Tobacco Settlement Agreement Act and this act, considering:
(i) the nonparticipating manufacturer's prior sales history selling within this Commonwealth or in other states, territories or countries;
(ii) the nonparticipating manufacturer's history of compliance with Federal or State tobacco regulations;
(iii) the financial state of the nonparticipating manufacturer; and
(iv) any other factors that the Attorney General deems pertinent to the determination.
(c) Execution upon bond.--If a nonparticipating manufacturer that posted a bond has failed to make, or have made on its behalf by its importer with joint and several liability, escrow deposits equal to the full amount due for the certification within 15 days following the due date for the certification under section 4 of the Tobacco Settlement Agreement Act,2 the Attorney General may execute upon the bond, first to recover delinquent escrow, then to recover civil penalties and costs authorized by section 4 of the Tobacco Settlement Agreement Act, all of which, including escrow, shall be deposited into the General Fund. Escrow obligations, civil penalties, costs, fees and disgorgement of profits determined to be due under this act or the Tobacco Settlement Agreement Act that are above the amount collected on the bond shall remain due from the nonparticipating manufacturer and from any importer that sold cigarettes during the period of default. Any delinquent escrow recovered under this subsection shall reduce the amount of escrow due from the nonparticipating manufacturer by the dollar amount collected.

Credits

2003, Dec. 30, P.L. 441, No. 64, § 313, added 2023, Oct. 11, P.L. 51, No. 11, § 7, effective 60 days after published notice of consent at 54 Pa.B. 72 [March 6, 2024].

Footnotes

1
35 P.S. § 5671 et seq.
2
35 P.S. § 5674.
35 P.S. § 5702.313, PA ST 35 P.S. § 5702.313
Current through Act 10 of the 2024 Regular Session. Some statute sections may be more current, see credits for details.
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