S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                    231
 
                        2017-2018 Regular Sessions
 
                           I N  A S S E M B L Y
 
                              January 5, 2017
                                ___________
 
 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:
   §  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
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD03842-01-7
              

 A. 231                              2
 
 SELLING  CIGARETTES AND TOBACCO PRODUCTS, LOTTERY TICKETS, AND ALCOHOLIC
 BEVERAGES FOR A PERIOD OF FIVE YEARS.
   § 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.
   § 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.
   § 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.
   §  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.
   §  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-

 A. 231                              3
 
 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
 OF FIVE YEARS, IN WHICH CASE THE VIOLATOR SHALL BE DENIED A LICENSE  FOR
 A PERIOD OF FIVE YEARS AFTER THE LAST SUCH VIOLATION.
   §  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.
   §  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.
   § 9. This act shall take effect on the first of January next  succeed-
 ing the date on which it shall have become a law.