50-6a02. Definitions.

50-6a02

Chapter 50.--UNFAIR TRADE AND CONSUMER PROTECTION
Article 6a.--REQUIREMENTS FOR SALE OF CIGARETTES

      50-6a02.   Definitions.As used in this act:

      (a)   "Adjusted for inflation" means increased in accordance with the formulafor inflation adjustment set forth in exhibit C to the master settlementagreement.

      (b)   "Affiliate" means a person who directly or indirectly owns or controls,is owned or controlled by, or is under common ownership or control with,another person. Solely for purposes of this definition, the terms "owns," "isowned" and "ownership" mean ownership of an equity interest, or the equivalentthereof, of 10% or more, and the term "person" means an individual,partnership, committee, association, corporation or any other organization orgroup of persons.

      (c)   "Allocable share" means allocable share as that term is defined in themaster settlement agreement.

      (d)   "Cigarette" means any product that contains nicotine, is intended tobe burned or heated under ordinary conditions of use and consists of orcontains (1) any roll of tobacco wrapped in paper or in any substance notcontaining tobacco; or (2) tobacco, in any form, that is functional in theproduct, which, because of its appearance, the type of tobacco used in thefiller, or its packaging and labeling, is likely to be offered to, or purchasedby, consumers as a cigarette; or (3) any roll of tobacco wrapped in anysubstance containing tobacco which, because of its appearance, the type oftobacco used in the filler, or its packaging and labeling, is likely to beoffered to, or purchased by, consumers as a cigarette described in clause (1)of this subsection (d). The term "cigarette" includes "roll-your-own" (i.e.,any tobacco which, because of its appearance, type, packaging or labeling issuitable for use and likely to be offered to, or purchased by, consumers astobacco for making cigarettes). For purposes of this definition of "cigarette,"0.09 ounces of "roll-your-own" tobacco shall constitute one individual"cigarette."

      (e)   "Master settlement agreement" means the settlement agreement (and relateddocuments) entered into on November 23, 1998, by the state and leading UnitedStates tobacco product manufacturers.

      (f)   "Qualified escrow fund" means an escrow arrangement with a federally orstate chartered financial institution having no affiliation with any tobaccoproduct manufacturer and having assets of at least $1,000,000,000 where sucharrangement requires that such financial institution hold the escrowed funds'principal for the benefit of releasing parties and prohibits the tobaccoproduct manufacturer placing the funds into escrow from using, accessing ordirecting the use of the funds' principal except as consistent with subsection(b)(2) of K.S.A. 50-6a03.

      (g)   "Released claims" means released claims as that term is defined in themaster settlement agreement.

      (h)   "Releasing parties" means releasing parties as that term is defined inthe master settlement agreement.

      (i)   "Tobacco product manufacturer" means an entity that after the date ofenactment of this act directly (and not exclusively through any affiliate):

      (1)   Manufactures cigarettes anywhere that such manufacturer intends to besold in the United States, including cigarettes intended to be sold in theUnited States through an importer (except where such importer is an originalparticipating manufacturer, as that term is defined in the master settlementagreement, that will be responsible for the payments under the mastersettlement agreement with respect to such cigarettes as a result of theprovisions of subsections II(mm) of the master settlement agreement and thatpays the taxes specified in subsection II(z) of the master settlementagreement, and provided that the manufacturer of such cigarettes does notmarket or advertise such cigarettes in the United States);

      (2)   is the first purchaser anywhere for resale in the United States ofcigarettes manufactured anywhere that the manufacturer does not intend to besold in the United States; or

      (3)   becomes a successor of an entity described in paragraph (1) or (2).The term "tobacco product manufacturer" shall not include an affiliate of atobacco product manufacturer unless such affiliate itself falls within any ofparts (1)-(3) of subsection (i) above.

      (j)   "Units sold" means the number of individual cigarettes sold in the stateby the applicable tobacco product manufacturer (whether directly or through adistributor, retailer or similar intermediary or intermediaries) during theyear in question, as measured by excise taxes collected by the state on packs(or "roll-your-own" tobacco containers) bearing the excise tax stamp of thestate. The department of revenue shall promulgate such rules and regulations asare necessary to ascertain the amount of state excise tax paid on thecigarettes of such tobacco product manufacturer for each year.

      History:   L. 1999, ch. 136, § 2;L. 2001, ch. 20, § 1; March 22.