S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  8670

                          I N  A S S E M B L Y

                            January 12, 2016
                               ___________

Introduced  by M. of A. GUNTHER -- read once and referred to the Commit-
  tee on Economic Development

AN ACT to amend the general business law, the tax law and the  alcoholic
  beverage  control law, in relation to prohibiting the sale or distrib-
  ution of kratom

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The general business law is amended by adding a new section
399-hh to read as follows:
  S  399-HH.  SALE  OR  DISTRIBUTION  OF  KRATOM; PROHIBITED. 1. FOR THE
PURPOSES OF THIS SECTION, "KRATOM" MEANS  ANY  FORM  OR  DERIVATIVES  OF
MITRAGYNA SPECIOSA AND SHALL INCLUDE, BUT NOT BE LIMITED TO, ANY MATERI-
AL,  COMPOUND,  MIXTURE  OR  PREPARATION  THAT  IS  NOT  DESIGNATED AS A
CONTROLLED SUBSTANCE PURSUANT TO SECTION THIRTY-THREE HUNDRED SIX OF THE
PUBLIC HEALTH LAW.
  2. NO PERSON, FIRM,  CORPORATION,  PARTNERSHIP,  ASSOCIATION,  LIMITED
LIABILITY COMPANY OR OTHER ENTITY SHALL SELL, OFFER FOR SALE, DISTRIBUTE
OR GIVE AWAY, FOR RETAIL, WHOLESALE OR PROMOTIONAL PURPOSES ANY KRATOM.
  3.  ANY  PERSON,  FIRM, CORPORATION, PARTNERSHIP, ASSOCIATION, LIMITED
LIABILITY COMPANY OR OTHER ENTITY THAT IS  FOUND  BY  A  LOCAL  CRIMINAL
COURT,  AS DEFINED IN SUBDIVISION THREE OF SECTION 10.10 OF THE CRIMINAL
PROCEDURE LAW, TO HAVE VIOLATED THE PROVISIONS  OF  SUBDIVISION  TWO  OF
THIS  SECTION  SHALL  BE  SUBJECT  TO  A  CIVIL  PENALTY OF TWO THOUSAND
DOLLARS; PROVIDED, HOWEVER, THAT UPON A FINDING OF A  SECOND  OR  SUBSE-
QUENT  VIOLATION  WITHIN ANY PERIOD OF FIVE YEARS, THE VIOLATOR SHALL BE
SUBJECT TO A CIVIL PENALTY  OF  FIVE  THOUSAND  DOLLARS;  AND  PROVIDED,
FURTHER,  THAT  UPON A FINDING OF A THIRD OR SUBSEQUENT VIOLATION WITHIN
ANY PERIOD OF FIVE YEARS, THE COURT SHALL PROVIDE NOTICE THEREOF TO  THE
COMMISSIONER  OF  TAXATION  AND FINANCE, THE DIVISION OF THE LOTTERY AND
THE STATE LIQUOR AUTHORITY, AND THE VIOLATOR SHALL  BE  PROHIBITED  FROM
SELLING  CIGARETTES AND TOBACCO PRODUCTS, LOTTERY TICKETS, AND ALCOHOLIC
BEVERAGES FOR A PERIOD OF FIVE YEARS.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD13483-01-6

              

A. 8670                             2

  S 2. Paragraphs (e) and (f) of subdivision 2 of section 480 of the tax
law, as amended by chapter 744 of the laws of 1990, are  amended  and  a
new paragraph (g) is added to read as follows:
  (e)  Any controlling person of such applicant has committed any of the
acts specified in subdivision three of this section within the preceding
five years, [or]
  (f) Such applicant or any controlling person has been  finally  deter-
mined  to have violated any of the provisions of this article or article
twenty-A of this chapter, or any rule or regulation adopted pursuant  to
this article or article twenty-A of this chapter[.], OR
  (G)  SUCH  APPLICANT  OR ANY CONTROLLING PERSON HAS BEEN DETERMINED TO
HAVE VIOLATED SUBDIVISION TWO OF SECTION THREE HUNDRED NINETY-NINE-HH OF
THE GENERAL BUSINESS LAW THREE OR MORE TIMES DURING  A  PERIOD  OF  FIVE
YEARS, IN WHICH CASE THE VIOLATOR SHALL BE DENIED A LICENSE FOR A PERIOD
OF FIVE YEARS AFTER THE LAST SUCH VIOLATION.
  S 3. Subparagraphs (iii) and (iv) of paragraph (b) of subdivision 3 of
section  480  of the tax law, subparagraph (iii) as added by chapter 860
of the laws of 1987 and subparagraph (iv) as amended by  chapter  61  of
the  laws  of  1989,  are amended and a new subparagraph (v) is added to
read as follows:
  (iii) Has impersonated any person represented to be a wholesale dealer
under this article but not in fact licensed under this section, [or]
  (iv) Has knowingly aided and abetted the sale of cigarettes or tobacco
products by a person which such licensee or controlling person knows (A)
has not been licensed by the commissioner of taxation  and  finance  and
(B)  is a wholesale dealer pursuant to the terms of subdivision eight of
section four hundred seventy of this chapter[.], OR
  (V) HAS BEEN DETERMINED TO HAVE VIOLATED SUBDIVISION  TWO  OF  SECTION
THREE  HUNDRED  NINETY-NINE-HH OF THE GENERAL BUSINESS LAW THREE OR MORE
TIMES DURING A PERIOD OF  FIVE  YEARS,  IN  WHICH  CASE  THE  VIOLATOR'S
LICENSE SHALL BE CANCELLED OR SUSPENDED FOR A PERIOD OF FIVE YEARS.
  S 4. Subdivision a of section 1605 of the tax law, as amended by chap-
ter 217 of the laws of 2011, is amended to read as follows:
  a.  The  division  may  license as agents to sell lottery tickets such
persons as in its opinion will best  serve  public  convenience,  except
that  no  license  shall  be  issued to any person to engage in business
exclusively as a lottery sales agent; AND  PROVIDED,  FURTHER,  THAT  NO
LICENSE  SHALL  BE  ISSUED TO ANY PERSON WHO HAS BEEN DETERMINED TO HAVE
VIOLATED SUBDIVISION TWO OF SECTION THREE HUNDRED NINETY-NINE-HH OF  THE
GENERAL  BUSINESS LAW THREE OR MORE TIMES DURING A PERIOD OF FIVE YEARS,
IN WHICH CASE THE VIOLATOR SHALL BE DENIED A LICENSE  FOR  A  PERIOD  OF
FIVE YEARS AFTER THE LAST SUCH VIOLATION.  The division may license such
persons  as  in its opinion are suitable to participate in video lottery
gaming pursuant to section sixteen hundred seventeen-a of this article.
  S 5. Section 1607 of the tax law is amended by adding a  new  subdivi-
sion i to read as follows:
  I.  THREE  OR  MORE  VIOLATIONS  OF  SUBDIVISION  TWO OF SECTION THREE
HUNDRED NINETY-NINE-HH OF THE GENERAL BUSINESS LAW WITHIN ANY PERIOD  OF
FIVE  YEARS,  IN  WHICH  CASE, THE DIVISION SHALL SUSPEND THE VIOLATOR'S
LICENSE FOR A PERIOD OF FIVE YEARS.
  S 6. Section 105 of the alcoholic beverage control law is  amended  by
adding a new subdivision 4 to read as follows:
  4.  NO  PERSON SHALL RECEIVE A LICENSE TO ENGAGE IN THE RETAIL SALE OF
ALCOHOLIC BEVERAGES FOR OFF-PREMISES CONSUMPTION, WHO  HAS  BEEN  DETER-
MINED  TO HAVE VIOLATED SUBDIVISION TWO OF SECTION THREE HUNDRED NINETY-
NINE-HH OF THE GENERAL BUSINESS LAW THREE OR MORE TIMES DURING A  PERIOD

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OF  FIVE YEARS, IN WHICH CASE THE VIOLATOR SHALL BE DENIED A LICENSE FOR
A PERIOD OF FIVE YEARS AFTER THE LAST SUCH VIOLATION.
  S  7.  Section 106 of the alcoholic beverage control law is amended by
adding a new subdivision 4-b to read as follows:
  4-B. NO PERSON SHALL RECEIVE A LICENSE TO ENGAGE IN THE RETAIL SALE OF
ALCOHOLIC BEVERAGES FOR ON PREMISES CONSUMPTION, WHO HAS BEEN DETERMINED
TO HAVE VIOLATED SUBDIVISION TWO OF SECTION THREE HUNDRED NINETY-NINE-HH
OF THE GENERAL BUSINESS LAW THREE OR MORE TIMES DURING A PERIOD OF  FIVE
YEARS, IN WHICH CASE THE VIOLATOR SHALL BE DENIED A LICENSE FOR A PERIOD
OF FIVE YEARS AFTER THE LAST SUCH VIOLATION.
  S  8.  Section 118 of the alcoholic beverage control law is amended by
adding a new subdivision 1-a to read as follows:
  1-A. A LICENSE OR PERMIT ISSUED PURSUANT  TO  THIS  CHAPTER  SHALL  BE
SUSPENDED  FOR  A  PERIOD OF FIVE YEARS WHEN THE HOLDER THEREOF HAS BEEN
DETERMINED TO HAVE VIOLATED SUBDIVISION TWO  OF  SECTION  THREE  HUNDRED
NINETY-NINE-HH  OF THE GENERAL BUSINESS LAW THREE OR MORE TIMES DURING A
PERIOD OF FIVE YEARS.
  S 9. This act shall take effect on the first of January next  succeed-
ing the date on which it shall have become a law.