Okla. Stat. tit. 68, § 68-360.9

Oklahoma Tobacco Directory - Bond.

A. Notwithstanding any other provision of law, any

nonparticipating manufacturer shall post a bond for the exclusive

benefit of this state if:

1. It was not listed in the Oklahoma Tobacco Directory,

hereinafter referred to as the Directory, during the four (4)

consecutive calendar quarters preceding its application to be on the

Directory;

2. It had been previously listed in the Directory, but was

involuntarily removed or denied recertification for noncompliance

with the Master Settlement Agreement Complementary Act or the

Prevention of Youth Access to Tobacco Act, unless the removal was

determined to have been erroneous or illegal; or

3. The Attorney General reasonably determines that the

nonparticipating manufacturer who has filed a certification pursuant

to Section 360.4 of this title poses an elevated risk for

noncompliance with the Master Settlement Agreement Complementary Act

or with the Prevention of Youth Access to Tobacco Act. A reasonable

risk of noncompliance with this section or the Prevention of Youth

Access to Tobacco Act includes, but is not limited to, the following

circumstances and a nonparticipating manufacturer shall be deemed to

pose an elevated risk for noncompliance if:

a. any state has removed the manufacturer or its brand or

brand families or an affiliate or any of the

affiliate's brands or brand families from the tobacco

directory of the state or placed the manufacturer or

its brand or brand families or an affiliate or any of

the affiliate's brands on a list of noncompliant

companies, brands or brand families for noncompliance

with the state law at any time during the calendar

year or within the past five (5) consecutive calendar

years, unless it submits proof that its brands, or the

brands of an affiliate were erroneously or illegally

removed from a tobacco directory of a state,

b. any state, or the federal government, has filed

litigation against or has an unsatisfied judgment

against the manufacturer or any affiliate thereof for

escrow or for penalties, costs, or attorney fees

related to noncompliance with state escrow laws or

complementary legislation, or

c. the nonparticipating manufacturer or any affiliate has

been charged, entered a plea or has been convicted of

violating the Contraband Cigarette Trafficking Act,

the Jenkins Act or the PACT Act.

Oklahoma Statutes - Title 68. Revenue and Taxation Page 218

B. For purposes of this section, an affiliate is an entity or

individual that either controls or is controlled by the

nonparticipating manufacturer, regardless of whether the control

being exercised is direct or indirect.

C. Neither a nonparticipating manufacturer nor any of its brand

families shall be included in the Directory unless and until the

nonparticipating manufacturer:

1. Undertakes joint and several liability with its importer for

the performance of the manufacturer in accordance with Section

360.5-1 of this title and, if required, has posted a joint bond in

accordance with this section;

2. The manufacturer and importer, if any, have:

a. registered to do business within the state with the

Secretary of State,

b. maintained a registered service agent within the State

of Oklahoma, and

c. agreed that the Secretary of State will act as service

agent if the registered service agent dies, resigns or

otherwise is unavailable to accept service on behalf

of the nonparticipating manufacturer or importer; and

3. The manufacturer and importer, if any, consent to be sued in

the district courts of the State of Oklahoma for purposes of the

state enforcing any provision of the Prevention of Youth Access to

Tobacco Act, the Master Settlement Agreement Complementary Act and

Oklahoma cigarette excise tax statutes.

D. The bond shall be posted by corporate surety located within

the United States in an amount equal to the greater of Fifty
, if any, consent to be sued in

the district courts of the State of Oklahoma for purposes of the

state enforcing any provision of the Prevention of Youth Access to

Tobacco Act, the Master Settlement Agreement Complementary Act and

Oklahoma cigarette excise tax statutes.

D. The bond shall be posted by corporate surety located within

the United States in an amount equal to the greater of Fifty

Thousand Dollars ($50,000.00) or fifty percent (50%) of the required

escrow that the manufacturer in either its current or predecessor

form was required to deposit as a result of its sales in Oklahoma

during the last full calendar year it was listed in the Directory.

The bond shall be written in favor of the State of Oklahoma and

shall be conditioned on the performance by the nonparticipating

manufacturer, or its United States importer that undertakes joint

and several liability for the performance of the manufacturer in

accordance with Section 360.5-1 of this title, of all of its duties

and obligations under the Prevention of Youth Access to Tobacco Act

and the Master Settlement Agreement Complementary Act during the

year in which the certification is filed and the next succeeding

calendar year.

E. Any manufacturer or importer required to post a bond in

accordance with this section shall do so for three (3) consecutive

years, or longer if the Attorney General determines the manufacturer

or importer poses an elevated risk at the end of the three-year

period.

F. If a nonparticipating manufacturer fails to make or have

made in its behalf deposits equal to the full amount owed for a

Oklahoma Statutes - Title 68. Revenue and Taxation Page 219

quarter within fifteen (15) days of the due date of the quarter, the

State of Oklahoma may execute on the bond in the amount of the

remaining escrow deposit due. Escrow amounts collected from the

bond shall be used to reduce the amount of escrow due from and

penalties assessed against that nonparticipating manufacturer and

unpaid escrow that exceeds the amount covered by the bond remains

due from the nonparticipating manufacturer and any importer that is

jointly and severally liable for its cigarette sales into the state.

G. In addition to the grounds contained in paragraph 3 of

subsection B of Section 360.4 of this title, the Attorney General

has the authority to not retain or not to include in the Directory

any nonparticipating manufacturer, its brands and brand families if

the manufacturer:

1. Does not certify it is subject to, without any immunity, the

Master Settlement Agreement Complementary Act and the Prevention of

Youth Access to Tobacco Act;

2. Fails to disclose that a state or the federal government has

brought an action in compliance with any state or federal law,

regulating the sale and or distribution of tobacco products,

including the escrow statute of another state; or

3. Fails to sell only through an Oklahoma-licensed wholesaler

any tobacco product sold into the state or fails to provide monthly

PACT Act reports to the Oklahoma Tax Commission and the Oklahoma

Attorney General for sales into the state.

H. The Attorney General shall have the authority to require a

nonparticipating manufacturer to submit all information and

materials the Attorney General deems appropriate to determine

compliance of the nonparticipating manufacturer with this section

and other related laws including the grounds for retaining or not

including a manufacturer or its brands and brand families in the

Directory.