34 Tex. Admin. Code § 3.1207 - E-cigarette Retailer Permits
(a)
Definitions. The following words and terms, when used in this section, have the
following meanings, unless the context clearly indicates otherwise.
(1) Commercial business location--The entire
premises occupied by a permit applicant or a person required to hold a permit
under Health and Safety Code, §
147.0051
(E-cigarette Retailer Permit Required).
(2) E-cigarette--An electronic cigarette or
any other device that simulates smoking by using a mechanical heating element,
battery, or electronic circuit to deliver nicotine or other substances to the
individual inhaling from the device; or a consumable liquid solution or other
material aerosolized or vaporized during the use of an electronic cigarette or
other device described by this paragraph.
(A)
The term "e-cigarette" includes:
(i) a device
described by this paragraph regardless of whether the device is manufactured,
distributed, or sold as an e-cigarette, e-cigar, or e-pipe or under another
product name or description; and
(ii) a component, part, or accessory for the
device, regardless of whether the component, part, or accessory is sold
separately from the device.
(B) The term "e-cigarette" does not include a
prescription medical device unrelated to the cessation of smoking.
(3) E-cigarette retailer--A person
who engages in the business of selling e-cigarettes to consumers, including a
person who sells e-cigarettes to consumers through a marketplace.
(4) Marketplace--A physical or electronic
medium through which persons other than the owner or operator of the medium
make sales of taxable items. The term includes a store, Internet website,
software application, or catalog.
(5) Marketplace provider--A person who owns
or operates a marketplace and directly or indirectly processes sales or
payments for marketplace sellers.
(6) Marketplace seller--A seller, other than
the marketplace provider, who makes a sale of a taxable item through a
marketplace.
(7) Permit holder--A
person who obtains a permit under Health and Safety Code, §
147.0052
(Issuance of Permit).
(8) Place of
business--
(A) a commercial business location
where e-cigarettes are sold;
(B) a
commercial business location where e-cigarettes are kept for sale or
consumption or otherwise stored; or
(C) a vehicle from which e-cigarettes are
sold.
(b)
Inapplicability. This section does not apply to a product that is:
(1) approved by the United States Food and
Drug Administration for use in the treatment of nicotine or smoking addiction;
and
(2) labeled with a "Drug Facts"
panel in accordance with regulations of the United States Food and Drug
Administration.
(c)
E-cigarette retailer permits.
(1)
Requirements.
(A) Beginning January 1, 2022,
a person may not engage in business as an e-cigarette retailer in Texas without
a permit issued by the comptroller.
(B) An e-cigarette retailer shall obtain a
permit for each place of business owned or operated by the e-cigarette
retailer.
(C) The comptroller may
not issue a permit for a place of business that is a residence or a unit in a
public storage facility.
(D) A
marketplace seller shall obtain a permit for each marketplace where the seller
makes sales of e-cigarettes.
(E) A
marketplace provider shall obtain a permit when selling e-cigarettes on behalf
of marketplace sellers.
(2) Application.
(A) The applicant shall complete Form AP-242,
Texas Application for E-Cigarette Retailer Permit, or any successor to that
form promulgated by the comptroller.
(B) The applicant shall accurately complete
all information required by the application and provide the comptroller with
any additional information the comptroller considers necessary.
(C) Each applicant that applies for a permit
to sell e-cigarettes from a vehicle shall provide the make, model, vehicle
identification number, registration number, and any other information
concerning the vehicle the comptroller requires.
(D) All financial information provided under
this section is confidential and not subject to Government Code, Chapter 552
(Public Information).
(d) Permit period; fees.
(1) An initial application and a renewal of
an existing permit shall be accompanied by the permit fee.
(A) A permit issued under this section
expires on the last day of May of each even-numbered year.
(B) The permit fee for the full two years is
$180. A new applicant permit fee is prorated according to the number of months
remaining during the period that the permit is to be in effect.
(C) A person who holds an active cigarette or
tobacco product permit under Tax Code, §§
154.101
(Permits), 154.102 (Combination Permit) or
155.041 (Permits), for the same business location at the time of an application
or renewal of an application, pays a reduced amount of one-half the retailer
permit fee.
(2) A person
who does not renew an e-cigarette retailer permit by the expiration of a
current permit shall pay a late fee of $50 in addition to the application fee
for the permit.
(3) If a permit
expires within three months from the date of issuance, the comptroller may
collect the prorated permit fee amount for the remaining months of the current
period and, with the consent of the permit holder, may collect the permit fee
amount for the next permit period and issue permits for both periods.
(4) A person issued a permit for a place of
business that permanently closes before the permit expiration date is not
entitled to a refund of the permit fee.
(e) Payment for e-cigarette retailer permit.
(1) An applicant for a permit shall remit the
required fee with the application.
(2) The payment shall be made in cash or by
money order, check, or credit card.
(3) The comptroller may not issue a permit in
exchange for a check until after the comptroller receives full payment on the
check.
(f) Issuance of
an e-cigarette retailer permit.
(1) The
comptroller will issue a permit to an applicant if the comptroller:
(A) has received an application and
fee;
(B) does not reject the
application and deny the permit under subsection (h) of this section;
and
(C) determines that issuing the
permit will not jeopardize the administration and enforcement of Health and
Safety Code, Chapter 147 (E-cigarette Retailer Permits).
(2) The permit will be issued for a
designated place of business, except as provided by subsection (h) of this
section.
(3) Permits for engaging
in business as an e-cigarette retailer are non-assignable.
(g) Display of an e-cigarette retailer
permit.
(1) A permit holder shall keep the
permit on public display at the place of business for which the permit was
issued.
(2) A permit holder who has
a permit assigned to a vehicle shall post the permit in a conspicuous place on
the vehicle.
(h) Denial
of e-cigarette retailer permit. The comptroller may reject an application and
deny a permit if the comptroller finds, after notice and opportunity for
hearing:
(1) the premises where business will
be conducted are not adequate to protect the e-cigarettes; or
(2) the applicant or managing employee, or if
the applicant is a corporation, an officer, director, manager, or any
stockholder who holds directly or through family or partner relationship 10% or
more of the corporation's stock, or, if the applicant is a partnership, a
partner or manager:
(A) has failed to
disclose any of the information required by subsection (c)(2) of this section;
or
(B) has previously violated
provisions of Health and Safety Code, Chapter 147.
(i) Summary suspension of permit.
(1) The comptroller may suspend a permit
holder's permit without notice or a hearing for the permit holder's failure to
comply with this section if the permit holder's continued operation constitutes
an immediate and substantial threat.
(2) If the comptroller summarily suspends a
permit holder's permit, proceedings for a preliminary hearing before the
comptroller or the comptroller's representative must be initiated
simultaneously with the summary suspension. The preliminary hearing shall be
set for a date not later than the 10th day after the date of the summary
suspension, unless the parties agree to a later date.
(3) To initiate a proceeding to summarily
suspend a permit holder's permit, the comptroller shall serve notice on the
permit holder informing the permit holder of the right to a preliminary hearing
before the comptroller or the comptroller's representative and of the time and
place of the preliminary hearing. The notice must be personally served on the
permit holder or an officer, employee, or agent of the permit holder or sent by
certified or registered mail, return receipt requested, to the permit holder's
mailing address as it appears in the comptroller's records. The notice must
state the alleged violations that constitute the grounds for summary
suspension. The suspension is effective at the time the notice is served. If
notice is served in person, the permit holder shall immediately surrender the
permit to the comptroller. If notice is served by mail, the permit holder shall
immediately return the permit to the comptroller upon receipt of the
notice.
(4) At the preliminary
hearing, the permit holder must show cause why the permit should not remain
suspended pending a final hearing on suspension or revocation.
(5) Government Code, Chapter 2001,
(Administrative Procedure), does not apply to a summary suspension under this
section.
(6) Subsection (j) of this
section governs the hearing for final suspension or revocation of a permit
under this section.
(j)
Final suspension or revocation of permit.
(1)
The comptroller may revoke or suspend a permit holder's permit if the
comptroller finds, after notice and the opportunity for a hearing, that the
permit holder violated a provision of this section.
(2) If the comptroller intends to suspend or
revoke a permit, the comptroller shall provide the permit holder with written
notice that includes a statement:
(A) of the
reason for the intended revocation or suspension; and
(B) that the permit holder is entitled to a
hearing by the comptroller on the proposed suspension or revocation.
(3) The comptroller shall deliver
the written notice by personal service or by mail to the permit holder's
mailing address as it appears in the comptroller's records. Service by mail is
complete when the notice is deposited with the United States Postal
Service.
(4) If the permit holder
requests a hearing, the comptroller will set a hearing date. The hearing on the
revocation or suspension of the permit holder's permit is treated in the same
manner as a hearing on the imposition of an administrative penalty for a
violation of Health and Safety Code, §
161.0901
(Disciplinary Action Against Cigarette, E-Cigarette, and Tobacco Product
Retailers) and is governed by §
1.21 of this title (relating to
Cigarette, E-cigarette, Cigar, and Tobacco Tax Hearings).
(5) A permit holder may appeal the
comptroller's decision to a district court in Travis County not later than the
30th day after the date the comptroller's decision becomes final.
(6) A person whose permit is suspended or
revoked may not sell, offer for sale, or distribute e-cigarettes from the place
of business to which the permit applied until a new permit is granted or the
suspension is removed.
(k) Penalties.
(1) A person violates the provisions in this
section if the person:
(A) engages in the
business of an e-cigarette retailer without a permit; or
(B) is a person who is subject to a provision
of this section and who violates the provision.
(2) A person who violates a provision of this
section shall pay to the state a penalty set by the comptroller of not more
than $2,000 for each violation.
(3)
Each day on which a violation occurs is a separate violation.
(4) The attorney general shall bring suit to
recover penalties under this subsection.
(5) A suit under this subsection may be
brought in Travis County or another county having jurisdiction.
(l) Failure to have a permit;
offense.
(1) A person commits an offense if
the person acts as an e-cigarette retailer; and:
(A) receives or possesses e-cigarettes
without having a permit;
(B)
receives or possesses e-cigarettes without having a permit posted where it can
be easily seen by the public; or
(C) sells e-cigarettes without a
permit.
(2) An offense
under this subsection is a Class A misdemeanor.
Notes
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