N.Y. Tax Law § 283-b: Licensing of terminal operators

§ 283-b. Licensing of terminal operators. 1. The department of

taxation and finance, upon the application of a person who operates a

facility where motor fuel is deposited, shall license such person as a

terminal operator under this article except as otherwise provided in

this section. The application shall be in a form and contain such

information as the department of taxation and finance shall prescribe.

No person, unless so licensed, shall operate a terminal, except that a

person may operate a terminal without a license if all of the motor fuel

stored in such facility is solely for such person's own use and

consumption.

2. Where a person files an application for a license under this

section and in considering such application the commissioner ascertains

that (a) any tax imposed under this chapter or any related statute as

defined in section eighteen hundred of this chapter has been finally

determined to be due from such applicant or from any officer, director

or partner of such applicant, shareholder directly or indirectly owning

more than ten percent of the number of shares of stock of such applicant

(where such applicant is a corporation) entitling the holder thereof to

vote for the election of directors or trustees, or any shareholder or

employee of such applicant under a duty to act for such applicant in

complying with any requirement of this article, and has not been paid in

full, (b) a liability for the penalty provided for under subdivision two

of section two hundred eighty-nine-b of this article has been finally

determined to be due from an officer, director, shareholder directly or

indirectly owning more than ten percent of the number of shares of stock

of such applicant (where such applicant is a corporation) entitling the

holder thereof to vote for the election of directors or trustees,

employee or partner of such applicant or a shareholder of such applicant

under a duty to act for such applicant in complying with any requirement

of this article, and has not been paid in full, (c) such applicant has

been convicted of a crime provided for in this chapter or has been

convicted under the tax laws or penal laws of any other state, or a

political subdivision of this state or such other state, or of the

United States of a criminal offense which, if committed and prosecuted

in this state, would constitute a similar crime under this chapter,

within the preceding five years, (d) an officer, director or partner of

such applicant, a shareholder directly or indirectly owning more than

ten percent of the number of shares of stock of such applicant (where

such applicant is a corporation) entitling the holder thereof to vote

for the election of directors or trustees, or an employee or shareholder

of such applicant who, as such employee or shareholder, is under a duty

to act for such applicant in complying with any requirement of this

article, has been convicted of a crime provided for in this chapter or

has been convicted under the tax laws or penal laws of any other state,

or a political subdivision of this state or such other state, or of the

United States of a criminal offense which, if committed and prosecuted

in this state, would constitute a similar crime under this chapter,

within the preceding five years, (e) such applicant, or an officer,

director or partner of such applicant, shareholder directly or

indirectly owning more than ten percent of the number of shares of stock

of such applicant (where such applicant is a corporation) entitling the

holder thereof to vote for the election of directors or trustees, or

employee or shareholder of such applicant under a duty to act for such

applicant in complying with any requirement of this article, who was an

officer, director or partner of another person, or who directly or

indirectly owned more than ten percent of the number of shares of stock

of another person (where such other person is a corporation) entitling

the holder thereof to vote for the election of directors or trustees, or

who was an employee or shareholder of another person under a duty to act

for such other person in complying with any requirement of this article

at the time any tax imposed under this chapter or any related statute as

defined in section eighteen hundred of this chapter was finally

determined to be due with respect from such other person and where such

tax has not been paid in full, or at the time such other person was

convicted of a crime provided for in this chapter or has been convicted

under the tax laws or penal laws of any other state, or a political

subdivision of this state or such other state, or of the United States

of a criminal offense which, if committed and prosecuted in this state,

would constitute a similar crime under this chapter, within the

preceding five years, or at the time the registration of such other

person was cancelled or suspended pursuant to subdivision four of this

section within the preceding five years, or at the time such other

person committed any of the acts or omissions which are, or was

convicted as, specified in subdivision four of this section within the

preceding five years, provided, however, where an applicant or such

officer, director, partner, shareholder or employee of such applicant

was only an employee of another person, the applicable examination of

tax payment history of such other person shall be limited to the taxes

imposed by this article or by or pursuant to article twenty-eight or

twenty-nine of this chapter with respect to motor fuel and the

applicable examination of prior criminal convictions shall be limited to

those which relate to motor fuel, (f) the license of such applicant or

of an officer, director or partner of such applicant, shareholder

directly or indirectly owning more than ten percent of the number of

shares of stock of such applicant (where such applicant is a

corporation) entitling the holder thereof to vote for the election of

directors or trustees, or employee or shareholder of such applicant

under a duty to act for such applicant in complying with any requirement

of this article has been cancelled or suspended pursuant to subdivision

four of this section within the preceding five years, or (g) the

applicant, an officer, director or partner of the applicant, a

shareholder directly or indirectly owning more than ten percent of the

number of shares of stock of such applicant (where such applicant is a

corporation) entitling the holder thereof to vote for the election of

directors or trustees, or an employee or shareholder of such applicant

under a duty to act for such applicant in complying with any requirement

of this article, has committed any of the acts or omissions which are,

or was convicted as, specified in subdivision four of this section

within the preceding five years, the commissioner may refuse to grant

such applicant a license.

3. The tax commission may require a terminal operator to file with the

department of taxation and finance a bond issued by a surety company

approved by the superintendent of financial services as to solvency and

responsibility and authorized to transact business in this state or

other security acceptable to the tax commission, in such amount as the

tax commission may fix, in an amount determined in accordance with rules

and regulations prescribed by it, to secure the performance by such

terminal operator of the duties and responsibilities required (i)

pursuant to this article and (ii) pursuant to articles twenty-eight and

twenty-nine of this chapter with respect to motor fuel. The tax

commission may require that such a bond or other security be filed

before a terminal operator is licensed, and the amount thereof may be

increased at any time when in its judgment the same is necessary. If

securities are deposited as security under this subdivision, such

securities shall be kept in the joint custody of the comptroller and the

commissioner of taxation and finance and may be sold by the tax

commission if it becomes necessary so to do in order to recover against

such terminal operator but no such sale shall be had until after such

terminal operator shall have had opportunity to litigate the validity of

the liability if it elects so to do. Upon any such sale the surplus, if

any, above the sums due shall be returned to such terminal operator. The

department, when authorized by the terminal operator, shall furnish

information regarding the terminal operator's license and any other

information which the terminal operator authorizes it to disclose.

4. The license of any terminal operator may be cancelled or suspended

by the commissioner where a licensee, or an officer, director,

shareholder, employee or partner of the registrant who as such officer,

director, shareholder, employee or partner is under a duty to act for

such licensee or any shareholder directly or indirectly owning more than

ten percent of the number of shares of stock of the licensee (where such

licensee is a corporation) entitling the holder thereof to vote for the

election of directors or trustees of such licensee, fails to file a bond

or other security when required or when the amount thereof is increased,

or fails to comply with any of the provisions of this article or article

twenty-eight of this chapter with respect to motor fuel or any rule or

regulation with respect to motor fuel adopted pursuant to such articles

by the department of taxation and finance or by the commissioner or,

knowingly aids and abets another person in violating any of the

provisions of such articles or of any such rule or regulation with

respect to motor fuel, or transfers its license as a terminal operator.

A license may also be cancelled or suspended if the commissioner

determines that a licensee or an officer, director, shareholder,

employee or partner of the licensee who as such officer, director,

shareholder, employee or partner is under a duty to act for such

licensee or any shareholder directly or indirectly owning more than ten

percent of the number of shares of stock of the licensee (where such

licensee is a corporation) entitling the holder thereof to vote for the

election of directors or trustees of such licensee:

(i) commits fraud or deceit in his operations as a terminal operator

or has committed fraud or deceit in procuring his license;

(ii) has been convicted in a court of competent jurisdiction, either

within or without the state, of a felony, within the meaning of

subdivision eight of section two hundred eighty-three of this article,

bearing on such terminal operator's duties and obligations under this

chapter;

(iii) has knowingly aided and abetted a person who is not registered

as a distributor in the importation, production, refining, manufacture

or compounding of motor fuel; or

(iv) has knowingly aided and abetted the distribution of motor fuel

which he has knowledge of as being imported, caused to be imported,

produced, refined, manufactured or compounded by a distributor who is

not registered by the department of taxation and finance.

A license may also be cancelled or suspended if the commissioner

determines that a licensee or an officer, director, shareholder,

employee or partner of the licensee who as such officer, director,

shareholder, employee or partner is under a duty to act for such

licensee or any shareholder directly or indirectly owning more than ten

percent of the number of shares of stock of the licensee (where such

licensee is a corporation) entitling the holder thereof to vote for the

election of directors or trustees of such licensee, was an officer,

director, shareholder, employee or partner of another person who as such

officer, director, shareholder, employee or partner was under a duty to

act for such other person or was a shareholder directly or indirectly

owning more than ten percent of the number of shares of stock of such

other person (where such other person is a corporation) entitling the

holder thereof to vote for the election of directors or trustees of such

other person at the time such other person committed any of the acts or

omissions which are, or was convicted as, specified in this subdivision

within the preceding five years.

5. A license shall not be cancelled or suspended nor shall an

application for a license be refused unless the licensee or applicant

for a license has had an opportunity for a hearing, provided, however,

that an application for a license may be denied without a prior hearing.

Provided, further, a license may be cancelled or suspended without a

prior hearing, for failure to file a return or report within ten days of

the date prescribed for filing under this article or nonpayment of any

sums due pursuant to this article or article twenty-eight or twenty-nine

of this chapter with respect to motor fuel if the licensee shall have

failed to file such return or report or pay taxes within ten days after

the date the demand therefor is sent by registered or certified mail to

the address of the terminal operator given in his application for a

license, or an address substituted therefor as in this subdivision. A

license may be cancelled or suspended prior to a hearing for the failure

to continue to maintain in full force and effect at all times the

required bond or other security filed with the tax commission. Provided,

however, if a surety bond is cancelled prior to expiration, the tax

commission, after considering all the relevant circumstances, may make

such other arrangements and require the filing of such other bond or

other security as it deems appropriate. Provided, further, a license may

be cancelled or suspended prior to a hearing for the transfer of such

license. A terminal operator shall immediately inform the department, in

writing, of any change in its address and, if the terminal operator is a

corporation or partnership, the terminal operator shall immediately

inform the department, in writing, of any change in its officers,

directors or partners or their residence addresses as shown in its

application for a license.

6. The provisions of subdivisions six, eight, nine and ten of section

two hundred eighty-three of this article shall apply to the provisions

of this section in the same manner and with the same force and effect as

if the language of these subdivisions had been incorporated in full into

this section and had expressly referred to the terminal operator's

license under this section, except to the extent that any such provision

is either inconsistent with a provision of this section or is not

relevant to this section.