HOUSE BILL NO. 308

AMENDMENT IN THE NATURE OF A SUBSTITUTE

(Proposed by the Senate Committee on Rehabilitation and Social Services

on ________________)

(Patron Prior to Substitute—Delegate Hope)

A BILL to amend and reenact §§ 4.1-103, 4.1-229, 18.2-371.2, 18.2-391, 58.1-1021.04:2, 58.1-1021.06, 58.1-1021.07, 59.1-293.10, 59.1-293.12, 59.1-293.13, 59.1-391.15 through 59.1-293.18, 59.1-293.20, and 59.1-293.21 of the Code of Virginia; to amend the Code of Virginia by adding in Chapter 2 of Title 4.1 an article numbered 4, consisting of sections numbered 4.1-241 through 4.1-246; and to repeal § 58.1-1021.04:1 of the Code of Virginia, relating to Virginia Alcoholic Beverage Control Authority; licensing of retail tobacco product retailers; purchase, possession, and sale of retail tobacco products; penalties; report.

Be it enacted by the General Assembly of Virginia:

1. That §§ 4.1-103, 4.1-229, 18.2-371.2, 18.2-391, 58.1-1021.04:2, 58.1-1021.06, 58.1-1021.07, 59.1-293.10, 59.1-293.12, 59.1-293.13, 59.1-391.15 through 59.1-293.18, 59.1-293.20, and 59.1-293.21 of the Code of Virginia are amended and reenacted and that the Code of Virginia is amended by adding in Chapter 2 of Title 4.1 an article numbered 4, consisting of sections numbered 4.1-241 through 4.1-246, as follows:

§ 4.1-103. General powers of Board.

The Board shall have the power to:

1. Sue and be sued, implead and be impleaded, and complain and defend in all courts;

2. Adopt, use, and alter at will a common seal;

3. Fix, alter, charge, and collect rates, rentals, fees, and other charges for the use of property of, the sale of products of, or services rendered by the Authority at rates to be determined by the Authority for the purpose of providing for the payment of the expenses of the Authority;

4. Make and enter into all contracts and agreements necessary or incidental to the performance of its duties, the furtherance of its purposes, and the execution of its powers under this subtitle, including agreements with any person or federal agency;

5. Employ, at its discretion, consultants, researchers, architects, engineers, accountants, financial experts, investment bankers, superintendents, managers, and such other employees and special agents as may be necessary and fix their compensation to be payable from funds made available to the Authority. Legal services for the Authority shall be provided by the Attorney General in accordance with Chapter 5 (§ 2.2-500 et seq.) of Title 2.2;

6. Receive and accept from any federal or private agency, foundation, corporation, association, or person grants or other aid to be expended in accomplishing the objectives of the Authority, and receive and accept from the Commonwealth or any state and any municipality, county, or other political subdivision thereof or from any other source aid or contributions of either money, property, or other things of value, to be held, used, and applied only for the purposes for which such grants and contributions may be made. All federal moneys accepted under this section shall be accepted and expended by the Authority upon such terms and conditions as are prescribed by the United States and as are consistent with state law, and all state moneys accepted under this section shall be expended by the Authority upon such terms and conditions as are prescribed by the Commonwealth;

7. Adopt, alter, and repeal bylaws, rules, and regulations governing the manner in which its business shall be transacted and the manner in which the powers of the Authority shall be exercised and its duties performed. The Board may delegate or assign any duty or task to be performed by the Authority to any officer or employee of the Authority. The Board shall remain responsible for the performance of any such duties or tasks. Any delegation pursuant to this subdivision shall, where appropriate, be accompanied by written guidelines for the exercise of the duties or tasks delegated. Where appropriate, the guidelines shall require that the Board receive summaries of actions taken. Such delegation or assignment shall not relieve the Board of the responsibility to ensure faithful performance of the duties and tasks;

8. Conduct or engage in any lawful business, activity, effort, or project consistent with the Authority's purposes or necessary or convenient to exercise its powers;

9. Develop policies and procedures generally applicable to the procurement of goods, services, and construction, based upon competitive principles;

10. Develop policies and procedures consistent with Article 4 (§ 2.2-4347 et seq.) of Chapter 43 of Title 2.2;

11. Buy, import, and sell alcoholic beverages other than beer and wine not produced by farm wineries, and to have alcoholic beverages other than beer and wine not produced by farm wineries in its possession for sale;

12. Buy and sell any mixers;

13. Buy and sell products licensed by the Virginia Tourism Corporation that are within international trademark classes 16 (paper goods and printer matters), 18 (leather goods), 21 (housewares and glass), and 25 (clothing);

14. Control the possession, sale, transportation, and delivery of alcoholic beverages;

15. Determine, subject to § 4.1-121, the localities within which government stores shall be established or operated and the location of such stores;

16. Maintain warehouses for alcoholic beverages and control the storage and delivery of alcoholic beverages to and from such warehouses;

17. Acquire, purchase, hold, use, lease, or otherwise dispose of any property, real, personal or mixed, tangible or intangible, or any interest therein necessary or desirable for carrying out the purposes of the Authority; lease as lessee any property, real, personal or mixed, tangible or intangible, or any interest therein, at such annual rental and on such terms and conditions as may be determined by the Board; lease as lessor to any person any property, real, personal or mixed, tangible or intangible, or any interest therein, at any time acquired by the Authority, whether wholly or partially completed, at such annual rental and on such terms and conditions as may be determined by the Board; sell, transfer, or convey any property, real, personal or mixed, tangible or intangible, or any interest therein, at any time acquired or held by the Authority on such terms and conditions as may be determined by the Board; and occupy and improve any land or building required for the purposes of this subtitle;

18. Purchase, lease, or acquire the use of, by any manner, any plant or equipment that may be considered necessary or useful in carrying into effect the purposes of this subtitle, including rectifying, blending, and processing plants. The Board may purchase, build, lease, and operate distilleries and manufacture alcoholic beverages;

19. Determine the nature, form, and capacity of all containers used for holding alcoholic beverages to be kept or sold under this subtitle, and prescribe the form and content of all labels and seals to be placed thereon; however, no container sold in or shipped into the Commonwealth shall include powdered or crystalline alcohol;

20. Appoint every agent and employee required for its operations; require any or all of them to give bonds payable to the Commonwealth in such penalty as shall be fixed by the Board; and engage the services of experts and professionals;

21. Hold and conduct hearings; issue subpoenas requiring the attendance of witnesses and the production of records, memoranda, papers, and other documents before the Board or any agent of the Board; and administer oaths and take testimony thereunder. The Board may authorize any Board member or agent of the Board to hold and conduct hearings, issue subpoenas, administer oaths and take testimony thereunder, and decide cases, subject to final decision by the Board, on application of any party aggrieved. The Board may enter into consent agreements and may request and accept from any applicant or licensee a consent agreement in lieu of proceedings on (i) objections to the issuance of a license or (ii) disciplinary action. Any such consent agreement shall include findings of fact and may include an admission or a finding of a violation. A consent agreement shall not be considered a case decision of the Board and shall not be subject to judicial review under the provisions of the Administrative Process Act (§ 2.2-4000 et seq.), but may be considered by the Board in future disciplinary proceedings;

22. Make a reasonable charge for preparing and furnishing statistical information and compilations to persons other than (i) officials, including court and police officials, of the Commonwealth and of its subdivisions if the information requested is for official use and (ii) persons who have a personal or legal interest in obtaining the information requested if such information is not to be used for commercial or trade purposes;

23. Promulgate regulations in accordance with the Administrative Process Act (§ 2.2-4000 et seq.) and § 4.1-111;

24. Grant, suspend, and revoke licenses for the manufacture, bottling, distribution, importation, and sale of alcoholic beverages;

25. Grant, suspend, and revoke retail tobacco licenses for the sale of retail tobacco products;

26. Assess and collect civil penalties and civil charges for violations of this subtitle and Board regulations;

26. 27. Maintain actions to enjoin common nuisances as defined in § 4.1-317;

27. 28. Establish minimum food sale requirements for all retail licensees;

28. 29. Review and approve any proposed legislative or regulatory changes suggested by the Chief Executive Officer as the Board deems appropriate;

29. 30. Report quarterly to the Secretary of Public Safety and Homeland Security on the law-enforcement activities undertaken to enforce the provisions of this subtitle;

30. 31. Establish and collect fees for all permits set forth in this subtitle, including fees associated with applications for such permits;

31. 32. Impose a requirement that a mixed beverage casino licensee pursuant to subdivision A 14 of § 4.1-206.3 pay for any cost incurred by the Board to enforce such license in excess of the applicable state license fee; and

32. 33. Do all acts necessary or advisable to carry out the purposes of this subtitle.

§ 4.1-229. Suspension or revocation of permits or licenses; grounds; notice and hearing; exception.

A. The Board may suspend or revoke any permit. The suspension or revocation of any permit shall be in accordance with §§ 4.1-225 and 4.1-227.

B. This section shall not apply to (i) temporary permits granted under § 4.1-212, which may be revoked summarily in the same manner as a temporary license may be revoked under § 4.1-211, or (ii) retail tobacco licenses, which may be suspended or revoked in accordance with Article 4 (§ 4.1-241 et seq.).

Article 4.

Retail Tobacco Licenses.

§ 4.1-241. Definitions.

As used in this article, unless the context requires a different meaning:

"Board" means the Board of Directors of the Virginia Alcoholic Beverage Control Authority.

"Electronic smoking device" means the same as that term is defined in § 18.2-371.2.

"Licensed location" means the individual location or place of business licensed as a retail tobacco establishment by a licensee.

"Licensee" means any tobacco retailer to whom a retail tobacco license has been issued by the Board.

"Liquid nicotine" means the same as that term is defined in § 58.1-1021.01.

"Liquid nicotine container" means the same as that term is defined in § 59.1-293.10.

"Nicotine vapor product" means the same as that term is defined in § 58.1-1021.01 and includes liquid nicotine containers.

"Retail dealer" means the same as that term is defined in § 58.1-1021.01.

"Retail tobacco establishment" means the place of business owned by a licensee to sell retail tobacco products to the general public, including any grocery store, retail tobacco product shop, kiosk, convenience store, gasoline service station, bar, or restaurant where retail tobacco products are available for sale to the general public. "Retail tobacco establishment" includes any facility from which cigarette delivery sales, as that term is defined in § 18.2-246.6, are made. "Retail tobacco establishment" does not include an establishment that does not sell retail tobacco products other than cigars and pipe tobacco as those terms are defined in § 58.1-1021.01.

"Retail tobacco license" means a license issued by the Board to a tobacco retailer that authorizes such retailer to sell retail tobacco products at a retail tobacco establishment owned by such licensee.

"Retail tobacco product" means (i) any product containing, made of, or derived from tobacco or that contains nicotine that is intended for human consumption or is likely to be consumed, whether smoked, heated, chewed, dissolved, inhaled, absorbed, or ingested by other means, including a cigarette, heated tobacco product, chewing tobacco, snuff, or snus; (ii) any electronic smoking device and any substances that may be aerosolized or vaporized by such device, whether or not the substance contains nicotine; and (iii) any component, part, or accessory of a product described in clause (i) or (ii), whether or not such component, part, or accessory contains tobacco or nicotine, including filters, rolling papers, blunt or hemp wraps, and glass pipes. "Retail tobacco product" includes any liquid nicotine or nicotine vapor product, or drugs or devices, as such terms are defined in 21 U.S.C. § 321, or combination products, as such term is used in 21 U.S.C. § 353, if such drugs, devices, or combination products are authorized for sale by the U.S. Food and Drug Administration. "Retail tobacco product" does not include any cigar or pipe tobacco as defined in § 58.1-1021.01.

"Tobacco product" means the same as that term is defined in § 58.1-1021.01.

"Tobacco retailer" means the same as that term is defined in § 59.1-293.10.

§ 4.1-242. Retail tobacco license; application; fee.

A. No person shall engage in the business of selling or dealing in retail tobacco products as a tobacco retailer in the Commonwealth without first having received a separate license from the Board for each individual licensable location where such retail sales will occur. Each application for a retail tobacco license shall be accompanied by a fee of $750 and shall be made on a form prescribed by the Board. Such application shall include the following information:

1. The name and address of the applicant. If the applicant is a firm, partnership, or association, the name and address of each of its members shall be provided. If the applicant is a corporation, the name and address of each of its principal officers shall be provided;

2. The address of the applicant's principal place of business;

3. The place or places where the business to be licensed is to be conducted; and

4. Such other information as the Board may require for the purpose of the administration of this article.

B. The application or renewal fee of $750 shall be retained by the Board to be applied to the administrative and other costs of processing retail tobacco license applications, conducting background investigations, and issuing retail tobacco licenses. Any amount collected pursuant to this section in excess of such costs as of June 30 in even-numbered years shall be divided as follows: (i) 75 percent to the Board for underage enforcement of the provisions of this article and (ii) 25 percent to the Office of the Attorney General for purposes of enforcement of the provisions of §§ 59.1-293.15 through 59.1-293.21.

C. A person outside the Commonwealth who ships or transports retail tobacco products to tobacco retailers in the Commonwealth, to be sold by such retailers, may make application for a retail tobacco license as a distributor, be granted such a license by the Board, and thereafter be subject to all the provisions of this article. Once a license is granted pursuant to this section, such person shall be entitled to act as a licensed distributor and, unless such person maintains a registered agent pursuant to Chapter 9 (§ 13.1-601 et seq.), 10 (§ 13.1-801 et seq.), 12 (§ 13.1-1000 et seq.), or 14 (§ 13.1-1200 et seq.) of Title 13.1 or Chapter 2.1 (§ 50-73.1 et seq.) or 2.2 (§ 50-73.79 et seq.) of Title 50, shall be deemed to have appointed the Clerk of the State Corporation Commission as the person's agent for the purpose of service of process relating to any matter or issue involving the person and arising under the provisions of this article.

D. No person inside or outside the Commonwealth shall make a remote retail sale of cigars or pipe tobacco to consumers in the Commonwealth without (i) completing an application for and being granted a license as a remote retail seller; (ii) determining whether economic nexus activity thresholds have been met to register for a dealer's certificate under § 58.1-613; (iii) if economic nexus thresholds are met, collecting and remitting the excise tax pursuant to subsection A of § 58.1-1021.02; (iv) providing for age verification through an independent, third-party age verification service that compares information available from a commercially available database, or aggregate of databases, that is regularly used by government agencies and businesses for the purpose of age and identity verification to the personal information entered by the individual during the ordering process that establishes that the individual is of age; and (v) if economic nexus thresholds are met and excise tax is being remitted using the actual cost list method to calculate the excise tax, providing the remote retail seller's certified actual cost list to the Department of Taxation for each SKU to be offered for remote retail sale in the subsequent calendar year. The actual cost list shall be updated quarterly as new SKUs are added to a remote retail seller's inventory. New SKUs will be added using the actual cost first paid for the SKU.

E. Upon receipt of an application in proper form and payment of the required license fee, the Board shall, unless otherwise provided by this article, issue to the applicant a license, which shall permit the licensee to engage in business as a distributor at the location or place of business shown on the license. Each license, or a copy thereof, shall be prominently displayed on the premises covered by the license. No license shall be transferable to any other person.

F. Retail tobacco licenses issued pursuant to this section shall be valid for a period of three years from the date of issue unless revoked by the Board in the manner provided in this article.

G. The Board may at any time revoke the license issued for any licensee at a licensable location that is found guilty of violating or noncompliance with any of the provisions of this article. The Board shall suspend or revoke the retail tobacco license issued to any licensee who is found guilty of a second or subsequent violation of subsection B or C of § 18.2-371.2.

H. The Board shall compile and maintain a current list of all licensees. The list shall be updated on a monthly basis and published on the Board's website, available to any interested party.

§ 4.1-243. Background investigation required; penalties.

A. The Board shall conduct a background investigation, to include a Virginia criminal history records search, and fingerprints of each applicant for a retail tobacco license, or the responsible principals, managers, and other persons engaged in handling retail tobacco products at the licensable location, that shall be submitted to the Federal Bureau of Investigation if the Board deems a national criminal records search necessary. The Board may refuse to issue a retail tobacco license or may suspend, revoke, or refuse to renew a retail tobacco license issued to any person, partnership, corporation, limited liability company, or business trust if it determines that the principals, managers, and other persons engaged in handling retail tobacco products at the licensable location of the applicant have been (i) found guilty of any fraud or misrepresentation in any connection; (ii) convicted of robbery, extortion, burglary, larceny, embezzlement, fraudulent conversion, gambling, perjury, bribery, treason, or racketeering; or (iii) convicted of a felony.

B. Any person that knowingly and willfully falsifies, conceals, or misrepresents a material fact or knowingly and willfully makes a false, fictitious, or fraudulent statement or representation in any application for a retail tobacco license to the Board, is guilty of a Class 1 misdemeanor.

§ 4.1-244. Liquid nicotine or nicotine vapor products; penalties.

A. In addition to the requirements of Chapter 23.2 (§ 59.1-293.10 et seq.) of Title 59.1, no person shall engage in the business of selling or dealing liquid nicotine or nicotine vapor products or shipping or transporting liquid nicotine or nicotine vapor products to retailers in the Commonwealth, to be sold by those retailers, as a manufacturer, distributor, or retail dealer in the Commonwealth without first having received a separate retail tobacco license pursuant to this article from the Board for each location or place of business. Any person who violates such prohibition shall be subject to a penalty of $400 in addition to any other applicable taxes or fees.

B. Notwithstanding the provisions of subsection F of § 4.1-242, licenses, other than temporary licenses, issued to a retailer engaged in the business of selling or dealing liquid nicotine or nicotine vapor products or shipping or transporting liquid nicotine or nicotine vapor products to retailers in the Commonwealth, to be sold by those retailers, as a manufacturer, distributor, or retail dealer in the Commonwealth shall be valid for two years from the date of issue unless revoked by the Board. The Board may at any time suspend or revoke the approved retail tobacco license issued in accordance with this section to any person who is found guilty of violating or noncompliance with any of the provisions of this article or any of the rules of the Board adopted and promulgated under authority of this article. Any person licensed to sell liquid nicotine or nicotine vapor products pursuant to this article shall, as a condition of renewing or extending an approved retail tobacco license be required to submit to the Board an accurate record of any taxes paid on liquid nicotine pursuant to § 58.1-1021.02.

C. No person shall make a sale of liquid nicotine or nicotine vapor products (i) to any person who has not attained the legal age for purchasing liquid nicotine or nicotine vapor products and (ii) without a valid retail tobacco license issued pursuant to this article.

D. 1. For each retail dealer, the Board shall conduct an unannounced investigation of licensed locations at least once every 24 months to verify that no person at such licensed location is selling liquid nicotine or nicotine vapor products to persons younger than 21 years of age. If the Board determines that the retail dealer for a licensed location has violated any provision of this article, or any other state or local law related to the sale of retail tobacco products, it shall conduct an unannounced investigation of the licensed location within six months of such violation.

2. Any person who is found guilty of violating or noncompliance with this section shall be subject to the following penalties for the licensed location:

a. For the first violation in a 36-month period, a penalty of no less than $1,000;

b. For a second violation in a 36-month period, a penalty of no less than $5,000 and a 30-day suspension of the retail tobacco license. If the person is found to be in violation of clause (i) of subsection C, such person shall be required to verify that any consumer who appears to be younger than 30 years of age is of legal age by verifying such consumer's government-issued photographic identification using fraud detection software, technology, or a scanner that confirms the authenticity of such identification; and

c. For a third violation in a 36-month period, a penalty of no less than $10,000, revocation of the retail tobacco license, and ineligibility to possess a retail tobacco license for liquid nicotine and nicotine vapor products for a period of three years from the date of the most recent violation.

§ 4.1-245. Liquid nicotine or nicotine vapor products; age verification required.

A. No person inside or outside the Commonwealth shall make a retail sale of liquid nicotine and nicotine vapor products without verifying that the consumer is of legal age by examining from any person who appears to be younger than 30 years of age a government-issued photographic identification that establishes that the person is of legal age or providing for age verification through an independent age verification service that compares information available from a commercially available database, or aggregate of databases, that is regularly used by government agencies and businesses for the purpose of age and identity verification to the personal information entered by the individual during the ordering process that establishes that the individual is of age.

§ 4.1-246. Liquid nicotine or nicotine vapor products; certain records required.

For any transaction between a distributor and a retail dealer involving liquid nicotine or nicotine vapor products, both the distributor and the retail dealer shall maintain and retain records of any invoice or sales receipt involved that shall include itemized lists of the types of products included in such transaction, the tax due on each product pursuant to subsection B of § 58.1-1021.02, and the total amount of taxes paid. Such records shall be produced and provided to the Board as necessary for auditing, compliance, and enforcement purposes.

§ 18.2-371.2. Prohibiting purchase or possession of retail tobacco products and hemp products intended for smoking by a person under 21 years of age or sale of retail tobacco products and hemp products intended for smoking to persons under 21 years of age; civil penalties.

A. As used in this section,

"Authority" means the Virginia Alcoholic Beverage Control Authority.

"Electronic smoking device" means any device that may be used to deliver any aerosolized or vaporized substance to the person inhaling from the device, including an e-cigarette, e-cigar, e-pipe, vape pen, or e-hookah. "Electronic smoking device" includes any component, part, or accessory of the device, whether or not sold separately, and also includes any substance intended to be aerosolized or vaporized during the use of the device, whether or not the substance contains nicotine. "Electronic smoking device" does not include any (i) battery or battery charger when sold separately or (ii) device used for heated tobacco products. "Electronic smoking device" does not include drugs or devices, as such terms are defined in 21 U.S.C. § 321, or combination products, as such term is used in 21 U.S.C. § 353, if such drugs, devices, or combination products are authorized for sale by the U.S. Food and Drug Administration.

"Hemp product" and "hemp product intended for smoking" mean the same as those terms are defined in § 3.2-4112.

"Retail tobacco product" means (i) any product containing, made of, or derived from tobacco or that contains nicotine that is intended for human consumption or is likely to be consumed, whether smoked, heated, chewed, dissolved, inhaled, absorbed, or ingested by other means, including a cigarette, a heated tobacco product, a cigar, pipe tobacco, chewing tobacco, snuff, or snus; (ii) any electronic smoking device and any substances that may be aerosolized or vaporized by such device, whether or not the substance contains nicotine; and (iii) any component, part, or accessory of a product described in clause (i) or (ii), whether or not such component, part, or accessory contains tobacco or nicotine, including filters, rolling papers, blunt or hemp wraps, and pipes. "Retail tobacco product" includes any nicotine vapor product as that term is defined in § 58.1-1021.01. "Retail tobacco product" does not include drugs or devices, as such terms are defined in 21 U.S.C. § 321, or combination products, as such term is used in 21 U.S.C. § 353, if such drugs, devices, or combination products are authorized for sale by the U.S. Food and Drug Administration.

"Wrappings" includes materials made or sold for covering or rolling tobacco or other materials for smoking in a manner similar to a cigarette or cigar.

B. No person shall sell to, distribute to, purchase for, or knowingly permit the purchase by any person younger than 21 years of age, knowing or having reason to believe that such person is younger than 21 years of age, any retail tobacco product or hemp product intended for smoking.

No person shall sell retail tobacco products or hemp products intended for smoking from a vending machine.

B. C. No person shall sell a retail tobacco product or hemp product intended for smoking to any individual who does not demonstrate, by producing a driver's license or similar photo identification issued by a government agency, that the individual is at least 21 years of age.

Before a retail dealer may sell retail tobacco products, other than cigar and pipe tobacco products as defined in § 58.1-1021.01, to any consumer, the person selling, offering for sale, giving, or furnishing the retail tobacco products shall verify that the consumer is of legal age by examining from any person who appears to be under 30 years of age a government-issued photographic identification that establishes that the person is of legal age or, if required pursuant to subdivision C 4 b of § 58.1-1021.04:1 § 4.1-242 or 4.1-244 or subdivision B 2 b of § 59.1-293.12, verifying the identification presented using identification fraud detection software, technology, or a scanner that confirms the authenticity of such identification.

This subsection shall not apply to mail order or Internet internet sales, provided that the person offering the retail tobacco product or hemp product intended for smoking for sale through mail order or the Internet internet (i) prior to the sale of the retail tobacco product or hemp product intended for smoking verifies that the purchaser is at least 21 years of age through a commercially available database that is regularly used by businesses or governmental entities for the purpose of age and identity verification and (ii) uses a method of mailing, shipping, or delivery that requires the signature of a person at least 21 years of age before the retail tobacco product or hemp product intended for smoking will be released to the purchaser.

C. D. A violation of subsection A B or B C by an individual or by a separate retail establishment is punishable by a civil penalty in the amount of $500 for a first violation and a civil penalty in the amount of $2,500 for a second or subsequent violation within a three-year period. If applicable, upon a second or subsequent violation within a three-year period, the Department of Taxation Authority may suspend or revoke any approved license, permit, or registration issued pursuant to subsection C of § 58.1-1021.04:1 § 4.1-242.

For any violation of this section by an employee of a retail establishment, (i) such penalty shall be assessed against the establishment and (ii) an additional penalty of $100 shall be assessed against the employee.

Any attorney for the Commonwealth of the county or city locality in which an alleged violation occurred may bring an action to recover the civil penalty, which shall be paid into the state treasury. Any law-enforcement officer may issue a summons for a violation of subsection A B or B C.

D. E. 1. Cigarettes and hemp products intended for smoking shall be sold only in sealed packages provided by the manufacturer, with the required health warning. The proprietor of every retail establishment that offers for sale any retail tobacco product or hemp product intended for smoking shall post in a conspicuous manner and place a sign or signs indicating that the sale of retail tobacco products or hemp products intended for smoking to any person under 21 years of age is prohibited by law. Any attorney for the county, city, or town locality in which an alleged violation of this subsection occurred may enforce this subsection by civil action to recover a civil penalty not to exceed $500. The civil penalty shall be paid into the local treasury. No filing fee or other fee or cost shall be charged to the county, city, or town locality which instituted the action.

2. For the purpose of compliance with regulations of the Substance Abuse and Mental Health Services Administration published at 61 Federal Register 1492, the Department of Agriculture and Consumer Services may promulgate regulations which allow the Department to undertake the activities necessary to comply with such regulations.

3. Any attorney for the county, city, or town locality in which an alleged violation of this subsection occurred may enforce this subsection by civil action to recover a civil penalty not to exceed $500. The civil penalty shall be paid into the local treasury. No filing fee or other fee or cost shall be charged to the county, city, or town which locality that instituted the action.

E. F. Nothing in this section shall be construed to create a private cause of action.

F. G. Agents of the Virginia Alcoholic Beverage Control Authority designated pursuant to § 4.1-105 may issue a summons for any violation of this section. Additionally, any retailer selling retail tobacco products shall be subject to the enforcement and compliance provisions of Article 4 (§ 4.1-241 et seq.) of Chapter 2 of Title 4.1 and Chapter 23.2 (§ 59.1-293.10 et seq.) of Title 59.1.

G. As used in this section:

"Electronic smoking device" means any device that may be used to deliver any aerosolized or vaporized substance to the person inhaling from the device, including an e-cigarette, e-cigar, e-pipe, vape pen, or e-hookah. "Electronic smoking device" includes any component, part, or accessory of the device, whether or not sold separately, and also includes any substance intended to be aerosolized or vaporized during the use of the device, whether or not the substance contains nicotine. "Electronic smoking device" does not include any (i) battery or battery charger when sold separately or (ii) device used for heated tobacco products. "Electronic smoking device" does not include drugs or devices, as such terms are defined in 21 U.S.C. § 321, or combination products, as such term is used in 21 U.S.C. § 353, if such drugs, devices, or combination products are authorized for sale by the U.S. Food and Drug Administration.

"Hemp product" and "hemp product intended for smoking" mean the same as those terms are defined in § 3.2-4112.

"Retail tobacco product" means (i) any product containing, made of, or derived from tobacco or that contains nicotine that is intended for human consumption or is likely to be consumed, whether smoked, heated, chewed, dissolved, inhaled, absorbed, or ingested by other means, including a cigarette, a heated tobacco product, a cigar, pipe tobacco, chewing tobacco, snuff, or snus; (ii) any electronic smoking device and any substances that may be aerosolized or vaporized by such device, whether or not the substance contains nicotine; and (iii) any component, part, or accessory of a product described in clause (i) or (ii), whether or not such component, part, or accessory contains tobacco or nicotine, including filters, rolling papers, blunt or hemp wraps, and pipes. "Retail tobacco product" includes any nicotine vapor product as that term is defined in § 58.1-1021.01. "Retail tobacco product" does not include drugs or devices, as such terms are defined in 21 U.S.C. § 321, or combination products, as such term is used in 21 U.S.C. § 353, if such drugs, devices, or combination products are authorized for sale by the U.S. Food and Drug Administration.

"Wrappings" includes materials made or sold for covering or rolling tobacco or other materials for smoking in a manner similar to a cigarette or cigar.

§ 18.2-391. Unlawful acts; penalties.

A. It shall be is unlawful for any person to sell, rent, or loan to a juvenile, knowing or having reason to know that such person is a juvenile, or to knowingly display for commercial purpose in a manner whereby juveniles may examine and peruse:

1. Any picture, photography, drawing, sculpture, motion picture in any format or medium, video or computer game, electronic file or message containing an image, or similar visual representation or image of a person or portion of the human body which that depicts sexually explicit nudity, sexual conduct, or sadomasochistic abuse and which that is harmful to juveniles, or

2. Any book, pamphlet, magazine, printed matter however reproduced, electronic file or message containing words, or sound recording which that contains any matter enumerated in subdivision 1 of this subsection, or explicit and detailed verbal descriptions or narrative accounts of sexual excitement, sexual conduct, or sadomasochistic abuse and which that, taken as a whole, is harmful to juveniles.

However, if a person uses services of an Internet internet service provider or an electronic mail service provider in committing acts prohibited under this subsection, such Internet internet service provider or electronic mail service provider shall not be held responsible for violating this subsection.

B. It shall be is unlawful for any person knowingly to sell to a juvenile an admission ticket or pass, or knowingly to admit a juvenile to premises whereon there is exhibited a motion picture, show, or other presentation which that, in whole or in part, depicts sexually explicit nudity, sexual conduct, or sadomasochistic abuse and which that is harmful to juveniles or to exhibit any such motion picture at any such premises which that are not designed to prevent viewing from any public way of such motion picture by juveniles not admitted to any such premises.

C. It shall be is unlawful for any juvenile falsely to represent to any person mentioned in subsection A or subsection B hereof, or to his agent, that such juvenile is 18 years of age or older, with the intent to procure any material set forth in subsection A, or with the intent to procure such juvenile's admission to any motion picture, show, or other presentation, as set forth in subsection B.

D. It shall be is unlawful for any person knowingly to make a false representation to any person mentioned in subsection A or subsection B hereof or to his agent, that he is the parent or guardian of any juvenile, or that any juvenile is 18 years of age, with the intent to procure any material set forth in subsection A, or with the intent to procure such juvenile's admission to any motion picture, show, or other presentation, as set forth in subsection B.

E. No person shall sell, rent, or loan any item described in subdivision A 1 or A 2 to any individual who does not demonstrate his age in accordance with the provisions of subsection B C of § 18.2-371.2.

F. A violation of subsection A, B, C, or D is a Class 1 misdemeanor. A person or separate retail establishment who violates subsection E shall be liable for a civil penalty not to exceed $100 for a first violation, a civil penalty not to exceed $200 for a second violation, and a civil penalty not to exceed $500 for a third or subsequent violation.

§ 58.1-623.2. Cigarette exemption certificate.

A. 1. Notwithstanding any other provision of law, all sales of cigarettes, as defined in § 58.1-1031, bearing Virginia revenue stamps in the Commonwealth shall be subject to the tax until the contrary is established. The burden of proving that a sale is not taxable is upon the dealer unless he takes from the taxpayer a cigarette exemption certificate issued by the Department to the taxpayer to the effect that the cigarettes are exempt under this chapter for the purposes of resale in the Commonwealth.

2. The cigarette exemption certificate mentioned in this section shall relieve the person who takes such certificate from any liability for the payment or collection of the tax on the sale of cigarettes, except upon notice from the Tax Commissioner or the taxpayer that such certificate is no longer acceptable.

3. If a taxpayer who gives a cigarette exemption certificate under this section makes any use of the property other than an exempt use or retention, demonstration, or display while holding the property for resale or distribution in the regular course of business, such use shall be deemed a taxable sale by the taxpayer as of the time the property or service is first used by him, and the cost of the property to him shall be deemed the sales price of such retail sale.

B. 1. Prior to issuing a cigarette exemption certificate under this section, the Department shall conduct a background investigation on the taxpayer for the certificate. The Department shall not issue a cigarette exemption certificate until at least 30 days have passed from the receipt of the application, unless the taxpayer qualifies for the expedited process set forth in subdivision 3, or any other expedited process set forth in guidelines issued pursuant to subsection L. If the taxpayer does not qualify for the expedited process, the Department shall inspect each location listed in the application and verify that any location that resells cigarettes meets the requirements prescribed in subsection E.

2. A taxpayer shall be required to pay an application fee, not to exceed $50, to the Department for a cigarette exemption certificate.

3. A taxpayer shall be eligible for an expedited process to receive a cigarette exemption certificate if the taxpayer possesses, at the time of filing an application for a cigarette exemption certificate, (i) an active license, in good standing, issued by the Department of Alcoholic Beverage Control pursuant to Title 4.1, as verified by electronic or other means by the Department, or (ii) an active retail tobacco products tax distributor's license, in good standing, issued by the Department pursuant to § 58.1-1021.04:1 Article 4 (§ 4.1-241 et seq.) of Chapter 2 of Title 4.1. The Department may identify other categories of taxpayers who qualify for an expedited process through guidelines issued pursuant to subsection L. Taxpayers that qualify for an expedited process shall not be subject to the background check or the waiting period set forth in subdivision 1, nor shall such taxpayers be required to pay the application fee set forth in subdivision 2.

4. If a taxpayer has been denied a cigarette exemption certificate, or has been issued a cigarette exemption certificate that has subsequently been suspended or revoked, the Department shall not consider an application from the taxpayer for a new cigarette exemption certificate for six months from the date of the denial, suspension, or revocation.

C. The Department shall deny an application for a cigarette exemption certificate, or suspend or revoke a cigarette exemption certificate previously issued to a taxpayer, if the Department determines that:

1. The taxpayer is a person who is not 18 years of age or older;

2. The taxpayer is a person who is physically unable to carry on the business for which the application for a cigarette exemption certificate is filed, or has been adjudicated incapacitated;

3. The taxpayer has not resided in the Commonwealth for at least one year immediately preceding the application, unless in the opinion of the Department, good cause exists for the taxpayer to have not resided in the Commonwealth for the immediately preceding year;

4. The taxpayer has not established a physical place of business in the Commonwealth, as described in subsection E;

5. A court or administrative body having jurisdiction has found that the physical place of business occupied by the taxpayer, as described in subsection E, does not conform to the sanitation, health, construction, or equipment requirements of the governing body of the county, city, or town in which such physical place is located, or to similar requirements established pursuant to the laws of the Commonwealth;

6. The physical place of business occupied by the taxpayer, as described in subsection E, is not constructed, arranged, or illuminated so as to allow access to and reasonable observation of, any room or area in which cigarettes are to be sold;

7. The taxpayer is not an authorized representative of the business;

8. The taxpayer made a material misstatement or material omission in the application;

9. The taxpayer has defrauded, or attempted to defraud, the Department, or any federal, state, or local government or governmental agency or authority, by making or filing any report, document, or tax return required by statute or regulation that is fraudulent or contains a false representation of material fact, or the taxpayer has willfully deceived or attempted to deceive the Department, or any federal, state, or local government or governmental agency or authority, by making or maintaining business records required by statute or regulation that are false or fraudulent;

10. The Tax Commissioner has determined that the taxpayer has misused the certificate;

11. The taxpayer has knowingly and willfully allowed any individual, other than an authorized representative, to use the certificate;

12. The taxpayer has failed to comply with or has been convicted under any of the provisions of this chapter or Chapter 10 (§ 58.1-1000 et seq.) or any of the rules of the Department adopted or promulgated under the authority of this chapter or Chapter 10; however, no certificate shall be denied, suspended, or revoked on the basis of a failure to file a retail sales and use tax return or remit retail sales and use tax unless the taxpayer is more than 30 days delinquent in any filing or payment and has not entered into an installment agreement pursuant to § 58.1-1817; or

13. The taxpayer has been convicted under the laws of any state or of the United States of (i) any robbery, extortion, burglary, larceny, embezzlement, gambling, perjury, bribery, treason, racketeering, money laundering, other crime involving fraud under Chapter 6 (§ 18.2-168 et seq.) of Title 18.2, or crime that has the same elements of the offenses set forth in § 58.1-1017 or 58.1-1017.1, or (ii) a felony.

D. The provisions of § 58.1-623.1 shall apply to the suspension and revocation of exemption certificates issued pursuant to this section, mutatis mutandis.

E. A cigarette exemption certificate shall only be issued to a taxpayer who:

1. Has a physical place of business in the Commonwealth, owned or leased by him, where a substantial portion of the sales activity of the retail cigarette sales activity of the business is routinely conducted and that (i) satisfies all local zoning regulations; (ii) has sales and office space of at least 250 square feet in a permanent, enclosed building not used as a house, apartment, storage unit, garage, or other building other than a building zoned for retail business; (iii) houses all records required to be maintained pursuant to § 58.1-1007; (iv) is equipped with office equipment, including but not limited to, a desk, a chair, a Point of Sale System, filing space, a working telephone listed in the name of the taxpayer or his business, working utilities, including electricity and provisions for space heating, and an Internet connection and email address; (v) displays a sign and business hours and is open to the public during the listed business hours; and (vi) does not occupy the same physical place of business of any other taxpayer who has been issued a cigarette exemption certificate;

2. Possesses a copy of the (i) corporate charter and articles of incorporation in the case of a corporation, (ii) partnership agreement in the case of a partnership, or (iii) organizational registration from the Virginia State Corporation Commission in the case of an LLC; and

3. Possesses a local business license, if such local business license is required by the locality where the taxpayer's physical place of business is located.

F. A taxpayer with more than one physical place of business shall be required to complete only one application for a cigarette exemption certificate but shall list on the application every physical place of business in the Commonwealth where cigarettes are purchased, stored, or resold by the taxpayer or his affiliate. Upon approval of the application, the Department shall issue a cigarette exemption certificate to the taxpayer. The taxpayer shall be authorized to resell cigarettes only at the locations listed on the application. No cigarette exemption certificate shall be transferrable. For purposes of this subsection, a taxpayer shall be considered to have more than one physical place of business if the taxpayer owns or leases two or more physical locations in the Commonwealth where cigarettes are purchased, stored, or resold.

G. A cigarette exemption certificate issued to a taxpayer shall bear the address of the physical place of business occupied or to be occupied by the taxpayer in conducting the business of purchasing cigarettes in the Commonwealth. In the event that a taxpayer intends to move the physical place of business listed on a certificate to a new location, he shall provide written notice to the Department at least 30 days in advance of the move. A successful inspection of the new physical place of business shall be required by the Department prior to the issuance of a new cigarette exemption certificate bearing the updated address. If the taxpayer intends to change any of the required information relating to the physical places of business contained in the application for the cigarette exemption certificate submitted pursuant to subsection F, the taxpayer shall file an amendment to the application at least 30 days in advance of such change. The certificate with the original address shall become invalid upon the issuance of the new certificate, or 30 days after notice of the move is provided to the Department, whichever occurs sooner. A taxpayer shall not be required to pay a fee to the Department for the issuance of a new cigarette exemption certificate pursuant to this subsection.

H. The privilege of a taxpayer issued a cigarette exemption certificate to purchase cigarettes shall extend to any authorized representative of such taxpayer. The taxpayer issued a cigarette exemption certificate may be held liable for any violation of this chapter, Chapter 10 (§ 58.1-1000 et seq.), Chapter 10.1 (§ 58.1-1031 et seq.), or any related Department guidelines by such authorized representative.

I. A taxpayer issued a cigarette exemption certificate shall comply with the recordkeeping requirements prescribed in § 58.1-1007 and shall make such records available for audit and inspection as provided therein. A taxpayer issued a cigarette exemption certificate who fails to comply with such requirements shall be subject to the penalties provided in § 58.1-1007.

J. A cigarette exemption certificate granted by the Department shall be valid for five years from the date of issuance. At the end of the five-year period, the cigarette exemption certificate of a taxpayer who qualifies for the expedited application process set forth in subdivision B 3 shall be automatically renewed and no fee shall be required. If a taxpayer does not qualify for the expedited application process, then such taxpayer shall apply to the Department to renew the new cigarette exemption certificate as set forth in subdivision B 1 and shall pay an application fee not to exceed $50 as set forth in subdivision B 2; however, the 30-day waiting period set forth in subdivision B 1 shall not apply.

K. No taxpayer issued a cigarette exemption certificate shall display the certificate, or a copy thereof, in the physical place of business where a substantial portion of the retail cigarette sales activity of the business is routinely conducted.

L. The Tax Commissioner shall develop guidelines implementing the provisions of this section, including but not limited to (i) defining categories of taxpayers who qualify for the expedited process, (ii) prescribing the form of the application for the cigarette exemption certificate, (iii) prescribing the form of the application for the expedited cigarette exemption certificate, (iv) establishing procedures for suspending and revoking the cigarette exemption certificate, and (v) establishing procedures for renewing the cigarette exemption certificate. Such guidelines shall be exempt from the provisions of the Administrative Process Act (§ 2.2-4000 et seq.).

M. For the purposes of this section:

"Authorized representative" means an individual who has an ownership interest in or is a current employee of the taxpayer who possesses a valid cigarette exemption certificate pursuant to this section.

§ 58.1-1021.04:2. Certain records required of distributor; access to premises.

A. Each distributor or remote retail seller shall keep in each licensed place of business complete and accurate records for that place of business, including itemized invoices of: (i) tobacco products held, purchased, manufactured, brought in or caused to be brought in from outside the Commonwealth, or shipped or transported to retailers in the Commonwealth; (ii) all sales of tobacco products made; (iii) all tobacco products, including cigars and pipe tobacco, transferred to other retail outlets owned or controlled by that licensed distributor or remote retail seller; and (iv) any records required by the Department.

All books, records and other papers and documents required by this subsection to be kept shall be preserved, in a form prescribed by the Department, for a period of at least three years after the date of the documents or the date of the entries thereof appearing in the records, unless the Department authorizes, in writing, their destruction or disposal at an earlier date.

B. At any time during usual business hours, duly authorized agents or employees of the Department may enter any place of business of a distributor and inspect the premises, the records required to be kept under this article and the tobacco products contained therein, to determine whether all the provisions of this article are being complied with fully. Refusal to permit such inspection by a duly authorized agent or employee of the Department shall be grounds for revocation of the license.

C. Each person who sells tobacco products to persons other than an ultimate consumer shall render with each sale itemized invoices showing the seller's name and address, the purchaser's name and address, the date of sale and all prices. Such person shall preserve legible copies of all such invoices for three years after the date of sale.

D. Each distributor or remote retail seller shall procure itemized invoices of all tobacco products purchased. The invoices shall show the name and address of the seller and the date of purchase. The distributor or remote retail seller shall preserve a legible copy of each invoice for three years after the date of purchase. Invoices shall be available for inspection by authorized agents or employees of the Department at the distributor's place of business or remote retail seller's place of business. If the remote retail seller cannot produce the required invoice information and the excise tax is being remitted using the actual cost list method to calculate the excise tax, the remote retail seller shall provide the remote retail seller's certified actual cost list to the Department for each SKU to be offered for remote retail sale in the subsequent calendar year. The actual cost list shall be updated quarterly as new SKUs are added to a remote retail seller's inventory. New SKUs will be added using the actual cost first paid for the SKU. This method shall not be used unless the actual cost list has been filed with the Department for the previous calendar year.

E. Any violation of Article 4 (§ 4.1-241 et seq.) of Chapter 2 of Title 4.1 or § 58.1-1021.04:1, 58.1-1021.04:2, 58.1-1021.04:3, or 58.1-1021.04:4 of this article shall be grounds for revocation of the license.

§ 58.1-1021.06. Delivery sales of liquid nicotine and nicotine vapor products.

A. A retail dealer shall not make a delivery sale of liquid nicotine or nicotine vapor products without a license issued pursuant to § 58.1-1021.04:1 Article 4 (§ 4.1-241 et seq.) of Chapter 2 of Title 4.1. Such delivery sales and any shipment shall be made only to a legal consumer.

B. A retail dealer may not ship for delivery sale any liquid nicotine or nicotine vapor products without first making a good faith effort to verify the age of the purchaser of the liquid nicotine or nicotine vapor products through an independent age verification software, service, or technology that compares information available from public records to the personal information entered by the purchaser during the ordering process that establishes the purchaser is of legal age or older.

C. Prior to shipment of liquid nicotine or nicotine vapor products for a delivery sale, a retail dealer shall be fully paid for the purchase and shall accept payment from the consumer by a check drawn on an account in the consumer's name, by a credit card issued in the consumer's name, or by a debit card issued in the consumer's name. A retail dealer taking a delivery sale may request the electronic mail address of the consumer as a condition of completing such delivery sale.

§ 58.1-1021.07. Retail sales of liquid nicotine and nicotine vapor products; identification and use by minors.

Before a retail dealer may sell liquid nicotine or nicotine vapor products to any consumer, the person selling, offering for sale, giving, or furnishing the liquid nicotine or nicotine vapor product shall verify that the consumer is of legal age by:

1. For any retail sale by a retail dealer, examining from any person who appears to be under 30 years of age a government-issued photographic identification that establishes the person is of legal age or, if required pursuant to subdivision C 4 b of § 58.1-1021.04:1 § 4.1-245 or subdivision B 2 b of § 59.1-293.12, verifying the identification presented using identification fraud detection software, technology, or scanner that confirms the authenticity of such identification; or

2. For any delivery sale by a retail dealer to a consumer in the Commonwealth, performing an age verification through an independent, age verification software, service, or technology that compares information available from public records to the personal information entered by the purchaser during the ordering process that establishes that the purchaser is of legal age or older.

§ 59.1-293.10. Definitions.

As used in this chapter, unless the context requires another a different meaning:

"Board" means the Board of Directors of the Virginia Alcoholic Beverage Control Authority.

"Child-resistant packaging" means packaging that is designed or constructed to meet the child-resistant effectiveness standards set forth in 16 C.F.R. § 1700.15(b)(1) when tested in accordance with the protocols described in 16 C.F.R. § 1700.20 as in effect on July 1, 2015.

"Department" means the Department of Taxation.

"Licensed location" means the same as that term is defined in § 4.1-241.

"Licensee" means the same as that term is defined in § 4.1-241.

"Liquid nicotine" means the same as that term is defined in § 58.1-1021.01.

"Liquid nicotine container" means a bottle or other container holding liquid nicotine in any concentration but does not include a cartridge containing liquid nicotine if such cartridge is prefilled and sealed by the manufacturer of such cartridge and is not intended to be opened by the consumer.

"Nicotine vapor product" means the same as that term is defined in § 58.1-1021.01 and includes liquid nicotine containers.

"Retail dealer" means the same as that term is defined in § 58.1-1021.01.

"Retail tobacco product" means (i) any product containing, made of, or derived from tobacco or that contains nicotine that is intended for human consumption or is likely to be consumed, whether smoked, heated, chewed, dissolved, inhaled, absorbed, or ingested by other means, including a cigarette, a heated tobacco product, chewing tobacco, snuff, or snus; (ii) any electronic smoking device and any substances that may be aerosolized or vaporized by such device, whether or not the substance contains nicotine; and (iii) any component, part, or accessory of a product described in clause (i) or (ii), whether or not such component, part, or accessory contains tobacco or nicotine, including filters, rolling papers, blunt or hemp wraps, and glass pipes. "Retail tobacco product" includes any nicotine vapor product. "Retail tobacco product" does not include drugs or devices, as such terms are defined in 21 U.S.C. § 321, or combination products, as such term is used in 21 U.S.C. § 353, if such drugs, devices, or combination products are authorized for sale by the U.S. Food and Drug Administration. "Retail tobacco product" does not include any cigar or pipe tobacco as defined in § 58.1-1021.01 the same as that term is defined in § 4.1-241.

"Tobacco retailer" means any person, partnership, joint venture, society, club, trustee, trust, association, organization, or corporation that owns, operates, or manages any tobacco retail establishment. "Tobacco retailer" does not include nonmanagement employees of a tobacco retail establishment.

"Tobacco retail establishment" means any place of business where retail tobacco products are available for sale to the general public, including any grocery store, retail tobacco product shop, kiosk, convenience store, gasoline service station, bar, or restaurant where retail tobacco products are available for sale to the general public.

§ 59.1-293.13. Required education for retail dealers and employees.

Any retail dealer shall be required to attest that it has conducted education and training for its employees related to:

1. The provisions of § §§ 4.1-244, 4.1-245, and 59.1-293.12;

2. The prohibitions on the sale of retail tobacco products to persons under age 21 and other restrictions prescribed by §§ 18.2-246.8, 18.2-246.10, and 18.2-371.2;

3. Forms of identification that are acceptable as proof of age; and

4. The legal penalties that may be incurred for violation of the provisions of law identified in subdivisions 1 and 2.

§ 59.1-293.15. Liquid nicotine and nicotine vapor product; directory.

The Attorney General shall establish and maintain a directory that lists all liquid nicotine or nicotine vapor product manufacturers and liquid nicotine and nicotine vapor products for which current and accurate certification forms have been submitted in accordance with the provisions of § 59.1-293.13 59.1-293.16. The Attorney General shall make the directory available for public inspection on its website. The Attorney General shall update the directory as necessary.

§ 59.1-293.16. Liquid nicotine and nicotine vapor product; certification; penalty.

A. By December 31, 2025, and annually thereafter, every manufacturer of liquid nicotine or nicotine vapor products that are sold for retail sale in the Commonwealth, whether directly or through a wholesaler, distributor, retailer, or similar intermediary, shall certify in a form and manner as prescribed by the Attorney General that the manufacturer agrees to comply with the provisions of this chapter and that:

1. The manufacturer has received a marketing authorization or similar order for the liquid nicotine or nicotine vapor product from the U.S. Food and Drug Administration pursuant to 21 U.S.C. § 387j; or

2. The liquid nicotine or nicotine vapor product was marketed in the United States as of August 8, 2016, or the manufacturer submitted a premarket tobacco product application for the liquid nicotine or nicotine vapor product to the U.S. Food and Drug Administration pursuant to 21 U.S.C. § 387j on or before September 9, 2020, and the application either remains under review by the U.S. Food and Drug Administration or a final decision on the application has not otherwise taken effect.

B. A manufacturer of liquid nicotine or nicotine vapor products shall submit a certification or recertification form for each liquid nicotine and nicotine vapor product that such manufacturer sells for retail sale in the Commonwealth.

C. Each certification or recertification form shall be accompanied by:

1. A a copy of the marketing authorization or other order for each liquid nicotine or nicotine vapor product issued by the U.S. Food and Drug Administration pursuant to 21 U.S.C. § 387j, or evidence that the premarket tobacco product application for the liquid nicotine or nicotine vapor product was submitted to the U.S. Food and Drug Administration and a final authorization or order has not yet taken effect; and:

2. A 1. An initial certification fee of $2,000 $5,000 for each liquid nicotine and nicotine vapor product, to be remitted with the manufacturer's first certification submission that identifies any such product and with any resubmission of a certification for any such product following any period of noncertified status; and or

3. A 2. An annual recertification fee of $500 to be submitted annually $2,500 for each liquid nicotine and nicotine vapor product to be remitted with the manufacturer's annual recertification submission identifying any liquid nicotine or nicotine vapor such product, where such recertification does not follow any period of noncertified status.

D. A manufacturer required to submit a certification pursuant to this section shall notify the Attorney General within 30 days of any material change to the certification form, including the issuance or denial of a marketing authorization or other order or action by the U.S. Food and Drug Administration pursuant to 21 U.S.C. § 387j, or any other order or action by the U.S. Food and Drug Administration that affects the ability of the liquid nicotine or nicotine vapor product to be introduced or delivered into interstate commerce for commercial distribution in the United States.

E. Any manufacturer that falsely represents any of the information required by this section is guilty of a Class 3 misdemeanor for each false representation. Notwithstanding the provisions of § 2.2-511, the Attorney General may institute or conduct a prosecution for a violation of this subsection. Venue for prosecution of a such violation of this subsection shall be proper in the Circuit Court for the City of Richmond.

§ 59.1-293.17. Removal or exclusion from directory.

A. The Attorney General shall, in accordance with the provisions of this section, remove or exclude from the directory any liquid nicotine or nicotine vapor product manufacturer or liquid nicotine or nicotine vapor product that the Attorney General determines is not in compliance with the provisions of this chapter.

B. If the Attorney General determines to remove or exclude from the directory a liquid nicotine or nicotine vapor product manufacturer or a liquid nicotine or nicotine vapor product in the directory, the Attorney General shall notify by electronic or other practicable means the manufacturer's registered agent in the Commonwealth of such determination. The liquid nicotine or nicotine vapor product manufacturer shall have 10 business days from receipt of such notice to establish that the liquid nicotine or nicotine vapor product manufacturer or liquid nicotine or nicotine vapor product meets the requirements to be included in the directory. If the liquid nicotine or nicotine vapor product manufacturer fails to establish compliance within the 10-business-day period, the Attorney General shall remove or exclude from the directory the liquid nicotine or nicotine vapor product manufacturer or liquid nicotine or nicotine vapor product.

C. Any determination by the Attorney General to remove or exclude from the directory a manufacturer or a product shall be subject to review by the filing of a civil action for prospective declaratory or injunctive relief in the Circuit Court for the City of Richmond.

D. If a liquid nicotine or nicotine vapor product is removed from the directory:

1. Each retailer, distributor, and wholesaler shall have 30 days to sell the product or remove such product intended for retail sale in the Commonwealth from its inventory and return the product to the manufacturer for disposal. After 21 30 days following the removal from the directory, the liquid nicotine and nicotine vapor products removed from the directory shall be subject to seizure, forfeiture, and destruction by the Attorney General, the attorney for the Commonwealth, or the attorney for the county, city, or town or by local law enforcement and shall not be purchased or sold in the Commonwealth.

2. Each manufacturer, wholesaler, or retail dealer selling the product intended for retail sale in the Commonwealth shall notify each purchaser of the product that it has been removed from the directory at the time of delivery of such product. Unless otherwise provided by contract or purchase agreement, the manufacturer, wholesaler, or retail dealer shall provide the purchaser a refund of the purchase price of the removed product. If a manufacturer, wholesaler, or retail dealer fails to provide such refund, the purchaser may bring an action against the manufacturer, wholesaler, or retail dealer in a court of competent jurisdiction to recover the purchase price and reasonable attorney fees and costs.

§ 59.1-293.18. Agent for service of process.

A. Any nonresident manufacturer of liquid nicotine or nicotine vapor products that has not registered to do business in the Commonwealth as a foreign corporation or business entity shall, as a condition precedent to being included in the directory established by the Attorney General pursuant to § 59.1-293.12 59.1-293.15, appoint and continually engage without interruption the services of an agent in the Commonwealth to act as agent for the service of process in any action or proceeding against such nonresident manufacturer concerning or arising out of the enforcement of this chapter, and such nonresident manufacturer may be served in any manner authorized by law. Such service shall constitute legal and valid service of process on the nonresident manufacturer. The manufacturer shall provide the name, address, telephone number, and proof of the appointment and availability of such agent to the Attorney General.

B. The manufacturer shall provide notice to the Attorney General 30 calendar days prior to termination of the authority of an agent and shall further provide proof to the satisfaction of the Attorney General of the appointment of a new agent no less than five calendar days prior to the termination of an existing agent appointment. In the event an agent terminates an agency appointment, the manufacturer shall notify the Attorney General of the termination within five calendar days and shall include proof to the satisfaction of the Attorney General of the appointment of a new agent.

C. Any manufacturer whose liquid nicotine or nicotine vapor products are sold in the Commonwealth who has not appointed and engaged the services of an agent as required by this section shall be deemed to have appointed the Secretary of the Commonwealth as its agent for service of process. The appointment of the Secretary of the Commonwealth as agent shall not satisfy the condition precedent required in subsection A to be included in the directory.

§ 59.1-293.20. Sale or distribution prohibited.

A. Beginning December 31, 2025, no person shall sell, distribute, or import for resale, or offer for sale a liquid nicotine or nicotine vapor product for retail sale in the Commonwealth unless such liquid nicotine or nicotine vapor product is included in the directory established by the Attorney General pursuant to § 59.1-293.12 59.1-293.15.

B. Beginning December 31, 2025, no liquid nicotine or nicotine vapor product manufacturer shall sell for retail sale, either directly or through a wholesaler, distributor, retailer, or similar intermediary or intermediaries, a liquid nicotine or nicotine vapor product in the Commonwealth unless such liquid nicotine or nicotine vapor product is included in the directory established by the Attorney General pursuant to § 59.1-293.12 59.1-293.15.

C. Any person that violates the provisions of subsection A or B is subject to a fine of $1,000 per day for each product offered for sale in violation until the offending product is removed from the market or until the offending product is properly listed on the directory.

D. A liquid nicotine or nicotine vapor product manufacturer that violates the provisions of subsection B is subject to a fine of $1,000 per day for each product offered for sale in violation until the offending product is removed from the market or until the offending product is properly listed on the directory.

E. the following civil penalties:

1. For the first violation, a penalty of no less than $5,000 per liquid nicotine or nicotine vapor product offered for sale;

2. For a second violation, a penalty of no less than $10,000 per liquid nicotine or nicotine vapor product offered for sale; and

3. For a third violation, a penalty of no less than $15,000 per liquid nicotine or nicotine vapor product offered for sale.

Such civil penalties shall only apply to the specific licensed location where the violation occurred.

D. Each retailer shall have 60 days from the date that the Attorney General first makes the directory available for inspection on its public website to sell any products that were in its inventory and not included in the directory or to remove from inventory and return such products to the manufacturer for disposal.

F. E. Each distributor or wholesaler shall have 60 days from the date that the Attorney General first makes the directory available for inspection on its public website to remove any products intended for sale in the Commonwealth from its inventory and return such products to the manufacturer for disposal.

G. F. In an action brought under this section, the Attorney General, the attorney for the Commonwealth, or the attorney for the county, city, or town may recover reasonable costs of investigation, the costs of the action, and attorney fees in addition to any civil penalties.

H. G. Any civil penalties, costs, and attorney fees assessed under this section in an action brought in the name of a locality shall be paid into the general fund of the locality.

I. H. All civil penalties, costs, and attorney fees assessed under this section in an action brought in the name of the Commonwealth by the Attorney General and fees collected by the Attorney General pursuant to this chapter § 59.1-293.15 shall be used for the administration and enforcement of this chapter.

§ 59.1-293.21. Enforcement; inspection; forfeiture.

A. Notwithstanding any other provisions of law to the contrary, the Attorney General, any attorney for the Commonwealth, or the attorney for any city, county, or town may cause an action to be brought in the appropriate circuit court in the name of the Commonwealth or of the county, city, or town to enjoin any violation of this chapter. The circuit court having jurisdiction may enjoin such violations notwithstanding the existence of an adequate remedy at law. In any action under this section, it shall not be necessary that damages be proved.

B. The circuit courts are authorized to (i) issue temporary or permanent injunctions to restrain and prevent violations of this chapter and (ii) order forfeiture of any property seized for a violation of this chapter.

C. Each violation of this chapter shall constitute a separate violation and shall be subject to any penalties imposed under this chapter.

D. Any retailer or wholesaler that sells or distributes any liquid nicotine or nicotine vapor product in the Commonwealth shall be subject to scheduled or unscheduled compliance checks carried out by the Attorney General, or an agent thereof, for the purposes of enforcing the provisions of this chapter and Article 4 (§ 4.1-241 et seq.) of Chapter 2 of Title 4.1.

E. Any liquid nicotine or nicotine vapor product that has been sold, offered for sale, or possessed for sale in the Commonwealth, or imported for personal consumption in the Commonwealth, in violation of this chapter shall be deemed contraband and may not be sold or offered for sale unless such liquid nicotine or nicotine vapor product are listed in the directory. Any such liquid nicotine or nicotine vapor product that is sold or offered for sale when not included in the directory shall be subject to confiscation and forfeiture. Any such confiscation and forfeiture shall be governed by the procedures contained in Chapter 22.1 (§ 19.2-386.1 et seq.) of Title 19.2, which shall apply mutatis mutandis, except that all such liquid nicotine or nicotine vapor product so confiscated and forfeited shall be destroyed and not resold.

F. Any violation of this chapter shall constitute a prohibited practice under the provisions of § 59.1-200 and shall be subject to any and all of the enforcement provisions of Chapter 17 (§ 59.1-200 et seq.).

2. That § 58.1-1021.04:1 of the Code of Virginia is repealed.

3. That the Board of Directors of the Virginia Alcoholic Beverage Control Authority (the Board) shall provide an annual report, beginning December 1, 2026, to the General Assembly on the efficacy of an unannounced underage buyer operation to verify that each retail tobacco licensee is not selling retail tobacco products to persons younger than 21 years of age.