The US Food and Drug Administration (FDA) recently announced plans to publish a proposed rule that would establish a maximum nicotine level in cigarettes and certain “other combusted tobacco products.” At the moment, it is not clear what “other combusted products” FDA might have in mind. According to the Spring 2022 Unified Agenda of Regulatory and Deregulatory Actions, FDA is targeting May 2023 to issue the proposed rule, but that could always change.
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Virginia Enacts Tobacco Products Tax Law Applicable to Remote Retail Sales of Cigars and Pipe Tobacco
New Virginia law addresses excise taxation and other requirements regarding remote retail sales of cigars and pipe tobacco to consumers in the Commonwealth.
On April 27, 2022, the Virginia General Assembly passed House Bill 1199 and Senate Bill 748 regarding the application of the Commonwealth’s tobacco products tax on “remote retail sales” of cigars and pipe tobacco and related requirements.
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Vermont Continues Its Crackdown on Online ENDS Sellers
Last year we reported that Vermont Attorney General T.J. Donovan’s office settled with several online sellers over alleged violations of the state’s delivery sales ban of electronic nicotine delivery systems (ENDS) (the Delivery Sale Ban) and that we expected Vermont’s scrutiny to continue. As predicted, Attorney General Donovan’s office recently announced two more settlements with online sellers, resulting in a total of 23 settlements with online ENDS sellers for a total of $833,750 in civil penalties dating back to December 2020.
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State Licensing and Excise Tax Considerations for Tobacco Companies
While it is always a good idea to focus on maintaining a healthy regulatory compliance program, the start of a new year seems like a particularly good time to review your tobacco company’s corporate hygiene with respect to state regulatory compliance. In this blog post, we provide a general overview of the state tobacco licensing and excise tax framework throughout the U.S. in a Q&A format. We also provide some general guidance about how to approach such laws and regulations. Tobacco companies, especially those operating in multiple states, should incorporate an appropriate state licensing and excise tax strategy into their compliance programs. Noncompliance with the myriad of state licensing and excise tax laws could have a significant impact on a tobacco company’s ability to operate and sell its products.
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California Passes CBD Law That Conflicts With FDA Guidance
Governor Gavin Newsome recently signed California Assembly Bill 45 (AB 45) into law, which, among other things, allows hemp-derived cannabidiol (CBD) to be included in any food, beverages, and dietary supplements sold in California. This is not only a break from California’s prior position prohibiting CBD from being included in such products even as the State began to tax and regulate its cannabis industry, but it is also in stark contrast with the U.S. Food and Drug Administration’s (FDA’s) current position on the issue.
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Delta-8’s 2018 Farm Bill Honeymoon May Be Slowly Coming to an End
The term tetrahydrocannabinol (THC) is most often associated with the delta-9 THC cannabinoid, which is one of over 100 cannabinoids found in both high-THC marijuana and low-THC hemp. Delta-9 THC is also the cannabinoid most often responsible for getting cannabis users “high” and is the cannabinoid that has been explicitly prohibited by the federal Controlled Substances Act (CSA).
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Vermont Settles with Online Retailers for Violations of Delivery Sale and Consumer Protection Laws
Vermont Attorney General T.J. Donovan recently announced that his office settled violations of the state’s delivery sale law with three online electronic nicotine delivery system (ENDS) sellers. Since December 2020 and including these most recent settlements, the state has collected $472,500 from 13 companies for such violations, signaling the state’s growing desire to enforce this law against online ENDS sellers.
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Congress Seeking to Limit FDA Authority Over Premium Cigars
A number of U.S. Representatives on both sides of the aisle recently cosponsored a proposed bill that would limit the U.S. Food & Drug Administration’s (FDA’s) ability to regulate premium cigars.
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FDA Withdraws Notice of Proposed Rulemaking For Premium Cigars
On June 11, 2021, the U.S. Food and Drug Administration (FDA) withdrew an advanced notice of proposed rulemaking (ANPRM) for premium cigars issued in March 2018 as part of the Spring 2021 Unified Agenda of Regulatory and Deregulatory Actions, which is published twice a year. Nevertheless, FDA commissioned a study to obtain information similar to what it sought in the ANPRM. The study is scheduled to be complete in Spring 2022. Thus, there is still a chance FDA takes a modified approach with respect to premium cigars in the future.
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Florida Court Finds Nonresident Tobacco Distributor On the Hook For Excise Taxes Regardless of Physical Presence
In Global Hookah Distribs. v. Florida, No. 1D20-822 (Apr. 12, 2021), a case before the First District Court of Appeal of Florida, Global Hookah Distributors (Global) unsuccessfully sought a refund of tobacco excise taxes it paid to the State of Florida. Global’s argument rested principally on its lack of a substantial “nexus” with the State.
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