KRS 131.608: 131.608 Annual and quarterly certifications to Attorney General by participating

and nonparticipating manufacturers -- Contents -- Scope -- Records.

(1) Prior to selling cigarettes in Kentucky, directly or through a distributor, retailer, or

similar interm ediary or intermediaries, every tobacco product manufacturer shall

certify as true under penalty of perjury that, as of the date of certification, the

tobacco product manufacturer is a:

(a) Participating manufacturer; or

(b) Nonparticipating manufacturer;

in full compliance with the provisions of KRS 131.600 to 131.630, 138.130 to

138.205, 248.752, and 248.754 and any administrative regulations promulgated

thereunder. The participating manufacturer and the nonparticipating manufacturer

shall execute and de liver an annual certification to the Attorney General on a form

prescribed by the Attorney General no later than April 30 of each year. The

nonparticipating manufacturer shall also submit a quarterly certification at the time

and on a form prescribed by the Attorney General.

(2) A participating manufacturer shall include in its certification a list of its brand

families. The participating manufacturer shall update the list thirty (30) calendar

days prior to any addition to or modification of its brand famil ies by executing and

delivering a supplemental certification to the Attorney General.

(3) A nonparticipating manufacturer shall include in its certification:

(a) A complete list of its brand families;

(b) A separate list of its brand families and the numbe r of units sold in Kentucky

for each brand family during the preceding calendar year;

(c) A separate list of all of its brand families that have been sold in Kentucky at

any time during the current calendar year including:

1. Indicating by an asterisk any brand family sold in Kentucky during the

preceding calendar year that is no longer being sold in Kentucky as of

the date of the certification; and

2. Identifying by name and address any other manufacturer of such brand

families in the preceding or current calendar year;

(d) A full disclosure of any removals or notices of removal from other state

directories, which may be used as a basis to deny certification;

(e) A listing of and a declaration from each of its importers of any of its brand

families. The declaration shall state the following:

1. The importer accepts joint and several liability with the nonparticipating

manufacturer for all obligations to place funds into a qualified escrow

fund, for payment of all civil penalties, and for payment of all reasonable

costs and expenses of investigation and prosecution, including attorneys'

fees, as provided in KRS 131.602;

2. The importer consents to personal jurisdicti on in this state for the

purpose of claims by the state for any obligation to place funds into a

qualified escrow fund, for payment of all civil penalties, and for

payment of any reasonable costs and expenses of investigation or

prosecution, including attorneys' fees, as provided in KRS 131.602;

3. The importer has appointed a registered agent for service of process in

this state according to the same requirements established for the

nonparticipating manufacturer as provided in KRS 131.614;

4. The importer holds a valid permit under 26 U.S.C. sec. 5713;

5. The importer is in compliance with the federal Jenkins Act, 15 U.S.C.

secs. 375 et seq., as amended by the Prevent All Cigarette Trafficking

(Pact) Act, Pub. L. No. 111-154, 124 Stat. 108; and

6. The importer has complied with KRS 138.130 to 138.205, 248.752, and

248.754 and any administrative regulations promulgated thereunder; and

(f) Verification that the nonparticipating manufacturer has provided the

following:

1. The name, address, and telephone number of the financial institution

where the nonparticipating manufacturer has established a qualified

escrow fund required under KRS 131.602 and all administrative

regulations promulgated thereunder;

2. The account number of the qualified escrow fund and any s ubaccount

number for the state of Kentucky;

3. The amount the nonparticipating manufacturer placed in the fund for

cigarettes sold in Kentucky during the preceding calendar year, the date

and amount of each deposit and evidence or verification, as may be

deemed necessary, by the Attorney General to confirm the foregoing;

4. The amount and date of any withdrawal or transfer of funds the

nonparticipating manufacturer made at any time from the fund, or from

any other qualified escrow fund into which it ever ma de escrow

payments pursuant to KRS 131.602 and all administrative regulations

promulgated thereunder.

(4) A nonparticipating manufacturer requesting certification shall further certify that it:

(a) Is registered to do business in Kentucky or has appointed a resident agent for

service of process and provided notice as required by KRS 131.614;

(b) Holds a valid permit under 26 U.S.C. sec. 5713;

(c) Has established and continues to maintain a qualified escrow fund pursuant to

KRS 131.602 and has executed a qua lified escrow agreement that governs the

qualified escrow fund and that has been reviewed and approved by the

Attorney General;

(d) Is in full compliance with KRS 131.600 to 131.630 and 138.130 to 138.205

and any administrative regulations promulgated thereunder;

(e) Is in compliance with the federal Jenkins Act, 15 U.S.C. secs. 375 et seq., as

amended by the Prevent All Cigarette Trafficking (Pact) Act, Pub. L. No. 111-

154, 124 Stat. 108; and

(f) Whether acting as an individual, entity, or any other group or combination

acting as a unit, or any partner, director, principal officer, or manager of the

entity or any other group or combination acting as a unit, has not been

convicted of or entered a plea of guilty or nolo contendere to:

1. A crime relating to t he reporting, distribution, sale, or taxation of

cigarettes or tobacco products; or

2. A crime involving fraud, falsification of records, improper business

transactions, or reporting;

for ten (10) years from the expiration of probation or final discharge from

parole or maximum expiration of sentence.

(5) A tobacco product manufacturer may not include a brand family in its certification

unless:

(a) In the case of a participating manufacturer, the participating manufacturer

affirms that the brand family is t o be deemed to be its cigarettes for purposes

of calculating its payments under the master settlement agreement for the

relevant year, in the volume and shares determined pursuant to the master

settlement agreement; and

(b) In the case of a nonparticipatin g manufacturer, the nonparticipating

manufacturer affirms that the brand family is to be deemed to be its cigarettes

pursuant to KRS 131.602.

(6) The nonparticipating manufacturer shall update all lists thirty (30) calendar days

prior to any addition to or modification of its brand families by executing and

delivering a supplemental certification to the Attorney General.

(7) Nothing in this section shall be construed as limiting or otherwise affecting the

state's right to maintain that a brand family consti tutes cigarettes of a different

tobacco product manufacturer for purposes of calculating payments under the

master settlement agreement or for purposes of KRS 131.602.

(8) The tobacco product manufacturers shall main tain all invoices and documentation

of sales and other information relied upon for a certification for a period of five (5)

years.