Guam § 221203 - Requirements.

§ 221203. Requirements.

Any tobacco product manufacturer selling cigarettes to

consumers within the State (whether directly or through a

distributor, retailer or similar intermediary or intermediaries) after

the date of enactment of this article shall do one of the following:

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(a) become a participating manufacturer (as that term

is defined in section II (jj) of the Master Settlement

Agreement) and generally perform its financial obligations

under the Master Settlement Agreement; or

(b) (1) place into a qualified escrow fund by April 15

of the year following the year in question the following

amounts (as such amounts are adjusted for inflation) --

2000: $.0104712 per unit sold after the date of

enactment of this article;

For each of 2001 and 2002: $.0136125 per unit

sold;

For each of 2003 through 2006: $.0167539 per unit

sold;

For each of 2007 and each year thereafter:

$.0188482 per unit sold.

(2) A tobacco product manufacturer that places

funds into escrow pursuant to Paragraph (1) shall

receive the interest or other appreciation on such funds

as earned. Such funds themselves shall be released from

escrow only under the following circumstances:

(A) to pay a judgment or settlement on any

released claim brought against such tobacco

product manufacturer by the State or any releasing

party located or residing in the State. Funds shall

be released from escrow under this Subparagraph

(i) in the order in which they were placed

into escrow and

(ii) only to the extent and at the time

necessary to make payments required under

such judgment or settlement;

(B) to the extent that a tobacco product

manufacturer establishes that the amount it was

required to place into escrow in a particular year

was greater than the State’s allocable share of the

total payments that such manufacturer would have

been required to make in that year under the Master

Settlement Agreement (as determined pursuant to

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section IX (i)(2) of the Master Settlement

Agreement, and before any of the adjustments or

offsets described in section IX (i)(3) of that

Agreement other than the Inflation Adjustment)

had it been a participating manufacturer, the excess

shall be released from escrow and revert back to

such tobacco product manufacturer; or

(C) to the extent not released from escrow

under Subparagraphs (A) or (B), funds shall be

released from escrow and revert back to such

tobacco product manufacturer twenty-five (25)

years after the date on which they were placed into

escrow.

(3) Each tobacco product manufacturer that elects

to place funds into escrow pursuant to this subsection

shall annually certify to the Attorney General that it is

in compliance with this subsection. The Attorney

General may bring a civil action on behalf of the State

against any tobacco product manufacturer that fails to

place into escrow the funds required under this section.

Any tobacco product manufacturer that fails in any year

to place into escrow the funds required under this

Section shall:

(A) be required within fifteen (15) days to

place such funds into escrow as shall bring it into

compliance with this section. The court, upon a

finding of a violation of this subsection, may

impose a civil penalty to be paid to the General

Fund in an amount not to exceed five percent (5%)

of the amount improperly withheld from escrow

per day of the violation and in a total amount not to

exceed one hundred percent (100%) of the original

amount improperly withheld from escrow;

(B) in the case of a knowing violation, be

required within fifteen (15) days to place such

funds into escrow as shall bring it into compliance

with this section. The court, upon a finding of a

knowing violation of this subsection, may impose

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a civil penalty to be paid to the General Fund in an

amount not to exceed fifteen percent (15%) of the

amount improperly withheld from escrow per day

of the violation and in a total amount not to exceed

three hundred percent (300%) of the original

amount improperly withheld from escrow; and

(C) in the case of a second knowing

violation, be prohibited from selling cigarettes to

consumers within the State (whether directly or

through a distributor, retailer or similar

intermediary) for a period not to exceed two (2)

years; and

(D) be required to pay the State’s costs and

attorney’s fees incurred during a successful

prosecution of any action brought under this

Paragraph (3).

(4) Each failure to make an annual deposit required

under this section shall constitute a separate violation.