H. B. 3037


(By Delegate Louisos)
[Introduced March 28, 2001; referred to the
Committee on the Judiciary.]




A BILL to amend and reenact section three, article eleven-c, chapter forty-seven of the code of West Virginia, one thousand nine hundred thirty-one, as amended; and to amend sections one, two and four, article nine, chapter sixty of said code, all relating to providing that the sales price of gasoline is required to at least be the daily "Rack" price that exists on the date it is sold plus seven percent and an allowance for the cost of transportation; providing inspectors from the division of labor check bills of lading and take other action considered appropriate to insure compliance; providing a criminal penalty; prohibiting wholesalers of cigarettes from offering discounts to retailers or consumers; and providing a criminal penalty.

Be it enacted by the Legislature of West Virginia:
That section three, article eleven-c, chapter forty-seven of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted; and that sections one, two and four, article nine, chapter sixty of said code be amended and reenacted, all to read as follows:
CHAPTER 47. REGULATION OF TRADE.

 ARTICLE 11C. WEST VIRGINIA PETROLEUM PRODUCTS FRANCHISE ACT.
§47-11C-3. Franchise agreement.

Every franchise agreement between a producer and a dealer shall be subject to the following provisions whether or not they are expressly set forth in the agreement:
(1) The term of the initial agreement between the producer and the dealer relating to specific premises shall not be less than one year; the term of the second agreement between the producer and the dealer, relating to the same premises, shall also be for not less than one year; and the term of all subsequent agreements between the producer and the dealer, relating to the same premises, shall be of not less than two years. This subdivision shall may not be construed to require a term of greater duration than the remainder of the term to which the producer is entitled under its lease without regard to any renewal rights which the producer may have;
(2) No producer shall require a dealer to keep his station open for business more than seventy-two hours per week;
(3) The dealer alone shall determine his retail sale price of the products listed in the franchise agreement: Provided, That the sales price of gasoline may not be less than the daily rack price that exists on the date of sale plus seven percent and the cost of transportation. The division of labor shall provide inspectors to check bills of lading and to take any additional action considered appropriate to insure compliance with this requirement. Any person who violates this provision is guilty of a misdemeanor and, upon conviction thereof, shall be fined one hundred thousand dollars;
(4) In the absence of any express agreement, the dealer shall not be required to participate financially in the use of any premium, coupon, giveaway or rebate in the operation of his retail outlet: Provided, That the producer may require the dealer to distribute to customers premiums, coupons or giveaways which are furnished to the dealer at the expense of the producer;
(5) In the event of any termination, cancellation or failure to renew, whether by mutual agreement or otherwise, a producer shall, within thirty days, tender to the dealer, for the products he sold to the dealer which the dealer has been unable to sell, except to the extent that such may be damaged or not resalable, the full price originally paid by the dealer for the products: Provided, That the producer shall have the right to apply the proceeds against any existing indebtedness owed to him by the dealer and that such the repurchase obligation is conditioned upon there being no other claims or liens against such the products by or on behalf of other creditors of the dealer. Such The repurchase shall not constitute a waiver of the dealer's other rights and remedies under this article. If the producer does not make such tender within thirty days, the dealer may sell the products for a price which is not less than the full price originally paid by the dealer for such the products, and shall have a cause of action against the producer for the balance;
(6) The right of either party to a trial by jury or to the interposition of counterclaims or cross claims shall not be waived;
(7) Liability imposed on, and rights granted to, any person by this article shall not be waived;
(8) The dealer shall not be required to forego his right of free association with other dealers for any lawful purpose;
(9) No transfer or assignment of a franchise by a dealer to a qualified transferee or assignee shall be unreasonably disapproved by the producer;
(10) No producer shall require any dealer to sell exclusively any products, other than petroleum products, that such the producer offers for sale.
CHAPTER 60. STATE CONTROL OF ALCOHOLIC LIQUORS.

ARTICLE 9. CIGARETTES PRODUCED FOR EXPORT; IMPORTED CIGARETTES.
§60-9-1. Definitions.
(a) As used in this article:
(1) "Package" means a pack, carton or container of any kind in which cigarettes are offered for sale, sold or otherwise distributed, or intended for distribution, to consumers.
(2) "Importer" means "importer" as that term is defined in 26 U.S.C. 5702(1).
(3) "Person" means and includes any individual, firm, association, company, partnership, corporation, joint-stock company, club, agency, syndicate, municipal corporation or other political subdivision of this state, trust, receiver, trustee, fiduciary or conservator, and when used in connection with any penalties imposed by this article, means and includes officers, directors, trustees or members of any firm, copartnership, association, corporation, trust or any other unit acting as a group.
(4) "Retailer" means and includes every person in this state, other than a wholesaler or subjobber, as defined in section two, article seventeen, chapter eleven of this code, engaged in the selling of cigarettes at retail to a consumer or to any person for any purpose other than resale.
(5) "Wholesaler" means a merchant middleperson who sells cigarettes chiefly to retailers or other merchants for resale to consumers.
§60-9-2. Cigarettes produced for export -- Prohibitions.
(a) It is unlawful for any person:
(1) To sell or distribute to consumers in this state, to acquire, hold, own, possess or transport, for sale or distribution in this state, or to import, or cause to be imported, into this state for sale or distribution in this state:
(A) Any cigarettes the package of which:
(i) Bears any statement, label, stamp, sticker, or notice indicating that the manufacturer did not intend the cigarettes to be sold, distributed, or used in the United States, including, but not limited to, labels stating "for export only," "U.S. tax-exempt," "for use outside U.S." or similar wording; or
(ii) Does not comply with:
(I) All requirements imposed by or pursuant to federal law regarding warnings and other information on packages of cigarettes manufactured, packaged or imported for sale, distribution, or use in the United States, including, but not limited to, the precise warning labels specified in the Federal Cigarette Labeling and Advertising Act, 15 U.S.C. 1333; and
(II) All federal trademark and copyright laws;
(B) Any cigarettes imported into the United States in violation of 26 U.S.C. 5754 or any other federal law or the implementing federal regulations;
(C) Who, as a wholesaler, offers discounts for the purchase of cigarettes to a retailer or consumer, whether the offers include discount coupons or otherwise. Any person who violates this subdivision is guilty of a misdemeanor and, upon conviction thereof, shall be fined one hundred thousand dollars;
(C) (D) Any cigarettes that the person otherwise knows or has reason to know the manufacturer did not intend to be sold, distributed or used in the United States; or
(D) (E) Any cigarettes for which there has not been submitted to the secretary of the United States department of health and human services, the list or lists of the ingredients added to tobacco in the manufacture of such the cigarettes required by the Federal Cigarette Labeling and Advertising Act, 15 U.S.C. 1355a;
(2) To alter the package of any cigarettes, prior to sale or distribution to the ultimate consumer, so as to remove, conceal or obscure:
(A) Any statement, label, stamp, sticker or notice described in subparagraph (i), paragraph (A), subdivision (1), subsection (a) of this section; or
(B) Any health warning that is not specified in, or does not conform with the requirements of, the Federal Cigarette Labeling and Advertising Act, 15 U.S.C. 1333; or
(3) To affix any stamp required pursuant to article seventeen, chapter eleven of this code to the package of any cigarettes described in subdivision (1), subsection (a) of this section or altered in violation of subdivision (2), subsection (a) of this section.
§60-9-4. Criminal penalties.
Any person that commits any of the acts prohibited by section two of this article in which no criminal penalty has been expressly prescribed, and either knowing or having reason to know he or she is doing so, or that fails to comply with any of the requirements of section three of this article, is guilty of a felony and, upon conviction thereof, shall be fined not more than five thousand dollars, or imprisoned in a state correctional facility not more than five years, or both fined and imprisoned.
NOTE: The purpose of this bill is to provide that the sales price of gasoline can not be less than the actual cost to the dealer plus seven percent of the daily "rack" price that exists on the date of sale plus seven percent and an allowance for the cost of transporting it; and prohibiting wholesalers of cigarettes from offering discounts to retailers or consumers; and providing a criminal penalty.

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.