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[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 1147 Enrolled Bill (ENR)]

        S.1147

                      One Hundred Eleventh Congress

                                 of the

                        United States of America

                          AT THE SECOND SESSION

          Begun and held at the City of Washington on Tuesday,
             the fifth day of January, two thousand and ten

                                 An Act

 
 To prevent tobacco smuggling, to ensure the collection of all tobacco 
                     taxes, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; FINDINGS; PURPOSES.
    (a) Short Title.--This Act may be cited as the ``Prevent All 
Cigarette Trafficking Act of 2009'' or ``PACT Act''.
    (b) Findings.--Congress finds that--
        (1) the sale of illegal cigarettes and smokeless tobacco 
    products significantly reduces Federal, State, and local government 
    revenues, with Internet sales alone accounting for billions of 
    dollars of lost Federal, State, and local tobacco tax revenue each 
    year;
        (2) Hezbollah, Hamas, al Qaeda, and other terrorist 
    organizations have profited from trafficking in illegal cigarettes 
    or counterfeit cigarette tax stamps;
        (3) terrorist involvement in illicit cigarette trafficking will 
    continue to grow because of the large profits such organizations 
    can earn;
        (4) the sale of illegal cigarettes and smokeless tobacco over 
    the Internet, and through mail, fax, or phone orders, makes it 
    cheaper and easier for children to obtain tobacco products;
        (5) the majority of Internet and other remote sales of 
    cigarettes and smokeless tobacco are being made without adequate 
    precautions to protect against sales to children, without the 
    payment of applicable taxes, and without complying with the nominal 
    registration and reporting requirements in existing Federal law;
        (6) unfair competition from illegal sales of cigarettes and 
    smokeless tobacco is taking billions of dollars of sales away from 
    law-abiding retailers throughout the United States;
        (7) with rising State and local tobacco tax rates, the 
    incentives for the illegal sale of cigarettes and smokeless tobacco 
    have increased;
        (8) the number of active tobacco investigations being conducted 
    by the Bureau of Alcohol, Tobacco, Firearms, and Explosives rose to 
    452 in 2005;
        (9) the number of Internet vendors in the United States and in 
    foreign countries that sell cigarettes and smokeless tobacco to 
    buyers in the United States increased from only about 40 in 2000 to 
    more than 500 in 2005; and
        (10) the intrastate sale of illegal cigarettes and smokeless 
    tobacco over the Internet has a substantial effect on interstate 
    commerce.
    (c) Purposes.--It is the purpose of this Act to--
        (1) require Internet and other remote sellers of cigarettes and 
    smokeless tobacco to comply with the same laws that apply to law-
    abiding tobacco retailers;
        (2) create strong disincentives to illegal smuggling of tobacco 
    products;
        (3) provide government enforcement officials with more 
    effective enforcement tools to combat tobacco smuggling;
        (4) make it more difficult for cigarette and smokeless tobacco 
    traffickers to engage in and profit from their illegal activities;
        (5) increase collections of Federal, State, and local excise 
    taxes on cigarettes and smokeless tobacco; and
        (6) prevent and reduce youth access to inexpensive cigarettes 
    and smokeless tobacco through illegal Internet or contraband sales.
SEC. 2. COLLECTION OF STATE CIGARETTE AND SMOKELESS TOBACCO TAXES.
    (a) Definitions.--The Act of October 19, 1949 (15 U.S.C. 375 et 
seq.; commonly referred to as the ``Jenkins Act'') (referred to in this 
Act as the ``Jenkins Act''), is amended by striking the first section 
and inserting the following:
``SECTION 1. DEFINITIONS.
    ``As used in this Act, the following definitions apply:
        ``(1) Attorney general.--The term `attorney general', with 
    respect to a State, means the attorney general or other chief law 
    enforcement officer of the State.
        ``(2) Cigarette.--
            ``(A) In general.--The term `cigarette'--
                ``(i) has the meaning given that term in section 2341 
            of title 18, United States Code; and
                ``(ii) includes roll-your-own tobacco (as defined in 
            section 5702 of the Internal Revenue Code of 1986).
            ``(B) Exception.--The term `cigarette' does not include a 
        cigar (as defined in section 5702 of the Internal Revenue Code 
        of 1986).
        ``(3) Common carrier.--The term `common carrier' means any 
    person (other than a local messenger service or the United States 
    Postal Service) that holds itself out to the general public as a 
    provider for hire of the transportation by water, land, or air of 
    merchandise (regardless of whether the person actually operates the 
    vessel, vehicle, or aircraft by which the transportation is 
    provided) between a port or place and a port or place in the United 
    States.
        ``(4) Consumer.--The term `consumer'--
            ``(A) means any person that purchases cigarettes or 
        smokeless tobacco; and
            ``(B) does not include any person lawfully operating as a 
        manufacturer, distributor, wholesaler, or retailer of 
        cigarettes or smokeless tobacco.
        ``(5) Delivery sale.--The term `delivery sale' means any sale 
    of cigarettes or smokeless tobacco to a consumer if--
            ``(A) the consumer submits the order for the sale by means 
        of a telephone or other method of voice transmission, the 
        mails, or the Internet or other online service, or the seller 
        is otherwise not in the physical presence of the buyer when the 
        request for purchase or order is made; or
            ``(B) the cigarettes or smokeless tobacco are delivered to 
        the buyer by common carrier, private delivery service, or other 
        method of remote delivery, or the seller is not in the physical 
        presence of the buyer when the buyer obtains possession of the 
        cigarettes or smokeless tobacco.
        ``(6) Delivery seller.--The term `delivery seller' means a 
    person who makes a delivery sale.
        ``(7) Indian country.--The term `Indian country'--
            ``(A) has the meaning given that term in section 1151 of 
        title 18, United States Code, except that within the State of 
        Alaska that term applies only to the Metlakatla Indian 
        Community, Annette Island Reserve; and
            ``(B) includes any other land held by the United States in 
        trust or restricted status for one or more Indian tribes.
        ``(8) Indian tribe.--The term `Indian tribe', `tribe', or 
    `tribal' refers to an Indian tribe as defined in section 4(e) of 
    the Indian Self-Determination and Education Assistance Act (25 
    U.S.C. 450b(e)) or as listed pursuant to section 104 of the 
    Federally Recognized Indian Tribe List Act of 1994 (25 U.S.C. 479a-
    1).
        ``(9) Interstate commerce.--
            ``(A) In general.--The term `interstate commerce' means 
        commerce between a State and any place outside the State, 
        commerce between a State and any Indian country in the State, 
        or commerce between points in the same State but through any 
        place outside the State or through any Indian country.
            ``(B) Into a state, place, or locality.--A sale, shipment, 
        or transfer of cigarettes or smokeless tobacco that is made in 
        interstate commerce, as defined in this paragraph, shall be 
        deemed to have been made into the State, place, or locality in 
        which such cigarettes or smokeless tobacco are delivered.
        ``(10) Person.--The term `person' means an individual, 
    corporation, company, association, firm, partnership, society, 
    State government, local government, Indian tribal government, 
    governmental organization of such a government, or joint stock 
    company.
        ``(11) State.--The term `State' means each of the several 
    States of the United States, the District of Columbia, the 
    Commonwealth of Puerto Rico, or any territory or possession of the 
    United States.
        ``(12) Smokeless tobacco.--The term `smokeless tobacco' means 
    any finely cut, ground, powdered, or leaf tobacco, or other product 
    containing tobacco, that is intended to be placed in the oral or 
    nasal cavity or otherwise consumed without being combusted.
        ``(13) Tobacco tax administrator.--The term `tobacco tax 
    administrator' means the State, local, or tribal official duly 
    authorized to collect the tobacco tax or administer the tax law of 
    a State, locality, or tribe, respectively.
        ``(14) Use.--The term `use' includes the consumption, storage, 
    handling, or disposal of cigarettes or smokeless tobacco.''.
    (b) Reports to State Tobacco Tax Administrators.--Section 2 of the 
Jenkins Act (15 U.S.C. 376) is amended--
        (1) by striking ``cigarettes'' each place it appears and 
    inserting ``cigarettes or smokeless tobacco'';
        (2) in subsection (a)--
            (A) in the matter preceding paragraph (1)--
                (i) by inserting ``Contents.--'' after ``(a)'';
                (ii) by striking ``or transfers'' and inserting ``, 
            transfers, or ships'';
                (iii) by inserting ``, locality, or Indian country of 
            an Indian tribe'' after ``a State'';
                (iv) by striking ``to other than a distributor licensed 
            by or located in such State,''; and
                (v) by striking ``or transfer and shipment'' and 
            inserting ``, transfer, or shipment'';
            (B) in paragraph (1)--
                (i) by striking ``with the tobacco tax administrator of 
            the State'' and inserting ``with the Attorney General of 
            the United States and with the tobacco tax administrators 
            of the State and place''; and
                (ii) by striking ``; and'' and inserting the following: 
            ``, as well as telephone numbers for each place of 
            business, a principal electronic mail address, any website 
            addresses, and the name, address, and telephone number of 
            an agent in the State authorized to accept service on 
            behalf of the person;'';
            (C) in paragraph (2), by striking ``and the quantity 
        thereof.'' and inserting ``the quantity thereof, and the name, 
        address, and phone number of the person delivering the shipment 
        to the recipient on behalf of the delivery seller, with all 
        invoice or memoranda information relating to specific customers 
        to be organized by city or town and by zip code; and''; and
            (D) by adding at the end the following:
        ``(3) with respect to each memorandum or invoice filed with a 
    State under paragraph (2), also file copies of the memorandum or 
    invoice with the tobacco tax administrators and chief law 
    enforcement officers of the local governments and Indian tribes 
    operating within the borders of the State that apply their own 
    local or tribal taxes on cigarettes or smokeless tobacco.'';
        (3) in subsection (b)--
            (A) by inserting ``Presumptive Evidence.--'' after ``(b)'';
            (B) by striking ``(1) that'' and inserting ``that''; and
            (C) by striking ``, and (2)'' and all that follows and 
        inserting a period; and
        (4) by adding at the end the following:
    ``(c) Use of Information.--A tobacco tax administrator or chief law 
enforcement officer who receives a memorandum or invoice under 
paragraph (2) or (3) of subsection (a) shall use the memorandum or 
invoice solely for the purposes of the enforcement of this Act and the 
collection of any taxes owed on related sales of cigarettes and 
smokeless tobacco, and shall keep confidential any personal information 
in the memorandum or invoice except as required for such purposes.''.
    (c) Requirements for Delivery Sales.--The Jenkins Act is amended by 
inserting after section 2 the following:
  ``SEC. 2A. DELIVERY SALES.
    ``(a) In General.--With respect to delivery sales into a specific 
State and place, each delivery seller shall comply with--
        ``(1) the shipping requirements set forth in subsection (b);
        ``(2) the recordkeeping requirements set forth in subsection 
    (c);
        ``(3) all State, local, tribal, and other laws generally 
    applicable to sales of cigarettes or smokeless tobacco as if the 
    delivery sales occurred entirely within the specific State and 
    place, including laws imposing--
            ``(A) excise taxes;
            ``(B) licensing and tax-stamping requirements;
            ``(C) restrictions on sales to minors; and
            ``(D) other payment obligations or legal requirements 
        relating to the sale, distribution, or delivery of cigarettes 
        or smokeless tobacco; and
        ``(4) the tax collection requirements set forth in subsection 
    (d).
    ``(b) Shipping and Packaging.--
        ``(1) Required statement.--For any shipping package containing 
    cigarettes or smokeless tobacco, the delivery seller shall include 
    on the bill of lading, if any, and on the outside of the shipping 
    package, on the same surface as the delivery address, a clear and 
    conspicuous statement providing as follows: `CIGARETTES/SMOKELESS 
    TOBACCO: FEDERAL LAW REQUIRES THE PAYMENT OF ALL APPLICABLE EXCISE 
    TAXES, AND COMPLIANCE WITH APPLICABLE LICENSING AND TAX-STAMPING 
    OBLIGATIONS'.
        ``(2) Failure to label.--Any shipping package described in 
    paragraph (1) that is not labeled in accordance with that paragraph 
    shall be treated as nondeliverable matter by a common carrier or 
    other delivery service, if the common carrier or other delivery 
    service knows or should know the package contains cigarettes or 
    smokeless tobacco. If a common carrier or other delivery service 
    believes a package is being submitted for delivery in violation of 
    paragraph (1), it may require the person submitting the package for 
    delivery to establish that it is not being sent in violation of 
    paragraph (1) before accepting the package for delivery. Nothing in 
    this paragraph shall require the common carrier or other delivery 
    service to open any package to determine its contents.
        ``(3) Weight restriction.--A delivery seller shall not sell, 
    offer for sale, deliver, or cause to be delivered in any single 
    sale or single delivery any cigarettes or smokeless tobacco 
    weighing more than 10 pounds.
        ``(4) Age verification.--
            ``(A) In general.--A delivery seller who mails or ships 
        tobacco products--
                ``(i) shall not sell, deliver, or cause to be delivered 
            any tobacco products to a person under the minimum age 
            required for the legal sale or purchase of tobacco 
            products, as determined by the applicable law at the place 
            of delivery;
                ``(ii) shall use a method of mailing or shipping that 
            requires--

                    ``(I) the purchaser placing the delivery sale 
                order, or an adult who is at least the minimum age 
                required for the legal sale or purchase of tobacco 
                products, as determined by the applicable law at the 
                place of delivery, to sign to accept delivery of the 
                shipping container at the delivery address; and
                    ``(II) the person who signs to accept delivery of 
                the shipping container to provide proof, in the form of 
                a valid, government-issued identification bearing a 
                photograph of the individual, that the person is at 
                least the minimum age required for the legal sale or 
                purchase of tobacco products, as determined by the 
                applicable law at the place of delivery; and

                ``(iii) shall not accept a delivery sale order from a 
            person without--

                    ``(I) obtaining the full name, birth date, and 
                residential address of that person; and
                    ``(II) verifying the information provided in 
                subclause (I), through the use of a commercially 
                available database or aggregate of databases, 
                consisting primarily of data from government sources, 
                that are regularly used by government and businesses 
                for the purpose of age and identity verification and 
                authentication, to ensure that the purchaser is at 
                least the minimum age required for the legal sale or 
                purchase of tobacco products, as determined by the 
                applicable law at the place of delivery.

            ``(B) Limitation.--No database being used for age and 
        identity verification under subparagraph (A)(iii) shall be in 
        the possession or under the control of the delivery seller, or 
        be subject to any changes or supplementation by the delivery 
        seller.
    ``(c) Records.--
        ``(1) In general.--Each delivery seller shall keep a record of 
    any delivery sale, including all of the information described in 
    section 2(a)(2), organized by the State, and within the State, by 
    the city or town and by zip code, into which the delivery sale is 
    so made.
        ``(2) Record retention.--Records of a delivery sale shall be 
    kept as described in paragraph (1) until the end of the 4th full 
    calendar year that begins after the date of the delivery sale.
        ``(3) Access for officials.--Records kept under paragraph (1) 
    shall be made available to tobacco tax administrators of the 
    States, to local governments and Indian tribes that apply local or 
    tribal taxes on cigarettes or smokeless tobacco, to the attorneys 
    general of the States, to the chief law enforcement officers of the 
    local governments and Indian tribes, and to the Attorney General of 
    the United States in order to ensure the compliance of persons 
    making delivery sales with the requirements of this Act.
    ``(d) Delivery.--
        ``(1) In general.--Except as provided in paragraph (2), no 
    delivery seller may sell or deliver to any consumer, or tender to 
    any common carrier or other delivery service, any cigarettes or 
    smokeless tobacco pursuant to a delivery sale unless, in advance of 
    the sale, delivery, or tender--
            ``(A) any cigarette or smokeless tobacco excise tax that is 
        imposed by the State in which the cigarettes or smokeless 
        tobacco are to be delivered has been paid to the State;
            ``(B) any cigarette or smokeless tobacco excise tax that is 
        imposed by the local government of the place in which the 
        cigarettes or smokeless tobacco are to be delivered has been 
        paid to the local government; and
            ``(C) any required stamps or other indicia that the excise 
        tax has been paid are properly affixed or applied to the 
        cigarettes or smokeless tobacco.
        ``(2) Exception.--Paragraph (1) does not apply to a delivery 
    sale of smokeless tobacco if the law of the State or local 
    government of the place where the smokeless tobacco is to be 
    delivered requires or otherwise provides that delivery sellers 
    collect the excise tax from the consumer and remit the excise tax 
    to the State or local government, and the delivery seller complies 
    with the requirement.
    ``(e) List of Unregistered or Noncompliant Delivery Sellers.--
        ``(1) In general.--
            ``(A) Initial list.--Not later than 90 days after this 
        subsection goes into effect under the Prevent All Cigarette 
        Trafficking Act of 2009, the Attorney General of the United 
        States shall compile a list of delivery sellers of cigarettes 
        or smokeless tobacco that have not registered with the Attorney 
        General of the United States pursuant to section 2(a), or that 
        are otherwise not in compliance with this Act, and--
                ``(i) distribute the list to--

                    ``(I) the attorney general and tax administrator of 
                every State;
                    ``(II) common carriers and other persons that 
                deliver small packages to consumers in interstate 
                commerce, including the United States Postal Service; 
                and
                    ``(III) any other person that the Attorney General 
                of the United States determines can promote the 
                effective enforcement of this Act; and

                ``(ii) publicize and make the list available to any 
            other person engaged in the business of interstate 
            deliveries or who delivers cigarettes or smokeless tobacco 
            in or into any State.
            ``(B) List contents.--To the extent known, the Attorney 
        General of the United States shall include, for each delivery 
        seller on the list described in subparagraph (A)--
                ``(i) all names the delivery seller uses or has used in 
            the transaction of its business or on packages delivered to 
            customers;
                ``(ii) all addresses from which the delivery seller 
            does or has done business, or ships or has shipped 
            cigarettes or smokeless tobacco;
                ``(iii) the website addresses, primary e-mail address, 
            and phone number of the delivery seller; and
                ``(iv) any other information that the Attorney General 
            of the United States determines would facilitate compliance 
            with this subsection by recipients of the list.
            ``(C) Updating.--The Attorney General of the United States 
        shall update and distribute the list described in subparagraph 
        (A) at least once every 4 months, and may distribute the list 
        and any updates by regular mail, electronic mail, or any other 
        reasonable means, or by providing recipients with access to the 
        list through a nonpublic website that the Attorney General of 
        the United States regularly updates.
            ``(D) State, local, or tribal additions.--The Attorney 
        General of the United States shall include in the list 
        described in subparagraph (A) any noncomplying delivery sellers 
        identified by any State, local, or tribal government under 
        paragraph (6), and shall distribute the list to the attorney 
        general or chief law enforcement official and the tax 
        administrator of any government submitting any such 
        information, and to any common carriers or other persons who 
        deliver small packages to consumers identified by any 
        government pursuant to paragraph (6).
            ``(E) Accuracy and completeness of list of noncomplying 
        delivery sellers.--In preparing and revising the list described 
        in subparagraph (A), the Attorney General of the United States 
        shall--
                ``(i) use reasonable procedures to ensure maximum 
            possible accuracy and completeness of the records and 
            information relied on for the purpose of determining that a 
            delivery seller is not in compliance with this Act;
                ``(ii) not later than 14 days before including a 
            delivery seller on the list, make a reasonable attempt to 
            send notice to the delivery seller by letter, electronic 
            mail, or other means that the delivery seller is being 
            placed on the list, which shall cite the relevant 
            provisions of this Act and the specific reasons for which 
            the delivery seller is being placed on the list;
                ``(iii) provide an opportunity to the delivery seller 
            to challenge placement on the list;
                ``(iv) investigate each challenge described in clause 
            (iii) by contacting the relevant Federal, State, tribal, 
            and local law enforcement officials, and provide the 
            specific findings and results of the investigation to the 
            delivery seller not later than 30 days after the date on 
            which the challenge is made; and
                ``(v) if the Attorney General of the United States 
            determines that the basis for including a delivery seller 
            on the list is inaccurate, based on incomplete information, 
            or cannot be verified, promptly remove the delivery seller 
            from the list as appropriate and notify each appropriate 
            Federal, State, tribal, and local authority of the 
            determination.
            ``(F) Confidentiality.--The list described in subparagraph 
        (A) shall be confidential, and any person receiving the list 
        shall maintain the confidentiality of the list and may deliver 
        the list, for enforcement purposes, to any government official 
        or to any common carrier or other person that delivers tobacco 
        products or small packages to consumers. Nothing in this 
        section shall prohibit a common carrier, the United States 
        Postal Service, or any other person receiving the list from 
        discussing with a listed delivery seller the inclusion of the 
        delivery seller on the list and the resulting effects on any 
        services requested by the listed delivery seller.
        ``(2) Prohibition on delivery.--
            ``(A) In general.--Commencing on the date that is 60 days 
        after the date of the initial distribution or availability of 
        the list described in paragraph (1)(A), no person who receives 
        the list under paragraph (1), and no person who delivers 
        cigarettes or smokeless tobacco to consumers, shall knowingly 
        complete, cause to be completed, or complete its portion of a 
        delivery of any package for any person whose name and address 
        are on the list, unless--
                ``(i) the person making the delivery knows or believes 
            in good faith that the item does not include cigarettes or 
            smokeless tobacco;
                ``(ii) the delivery is made to a person lawfully 
            engaged in the business of manufacturing, distributing, or 
            selling cigarettes or smokeless tobacco; or
                ``(iii) the package being delivered weighs more than 
            100 pounds and the person making the delivery does not know 
            or have reasonable cause to believe that the package 
            contains cigarettes or smokeless tobacco.
            ``(B) Implementation of updates.--Commencing on the date 
        that is 30 days after the date of the distribution or 
        availability of any updates or corrections to the list 
        described in paragraph (1)(A), all recipients and all common 
        carriers or other persons that deliver cigarettes or smokeless 
        tobacco to consumers shall be subject to subparagraph (A) in 
        regard to the corrections or updates.
        ``(3) Exemptions.--
            ``(A) In general.--Subsection (b)(2) and any requirements 
        or restrictions placed directly on common carriers under this 
        subsection, including subparagraphs (A) and (B) of paragraph 
        (2), shall not apply to a common carrier that--
                ``(i) is subject to a settlement agreement described in 
            subparagraph (B); or
                ``(ii) if a settlement agreement described in 
            subparagraph (B) to which the common carrier is a party is 
            terminated or otherwise becomes inactive, is administering 
            and enforcing policies and practices throughout the United 
            States that are at least as stringent as the agreement.
            ``(B) Settlement agreement.--A settlement agreement 
        described in this subparagraph--
                ``(i) is a settlement agreement relating to tobacco 
            product deliveries to consumers; and
                ``(ii) includes--

                    ``(I) the Assurance of Discontinuance entered into 
                by the Attorney General of New York and DHL Holdings 
                USA, Inc. and DHL Express (USA), Inc. on or about July 
                1, 2005, the Assurance of Discontinuance entered into 
                by the Attorney General of New York and United Parcel 
                Service, Inc. on or about October 21, 2005, and the 
                Assurance of Compliance entered into by the Attorney 
                General of New York and Federal Express Corporation and 
                FedEx Ground Package Systems, Inc. on or about February 
                3, 2006, if each of those agreements is honored 
                throughout the United States to block illegal 
                deliveries of cigarettes or smokeless tobacco to 
                consumers; and
                    ``(II) any other active agreement between a common 
                carrier and a State that operates throughout the United 
                States to ensure that no deliveries of cigarettes or 
                smokeless tobacco shall be made to consumers or 
                illegally operating Internet or mail-order sellers and 
                that any such deliveries to consumers shall not be made 
                to minors or without payment to the States and 
                localities where the consumers are located of all taxes 
                on the tobacco products.

        ``(4) Shipments from persons on list.--
            ``(A) In general.--If a common carrier or other delivery 
        service delays or interrupts the delivery of a package in the 
        possession of the common carrier or delivery service because 
        the common carrier or delivery service determines or has reason 
        to believe that the person ordering the delivery is on a list 
        described in paragraph (1)(A) and that clauses (i), (ii), and 
        (iii) of paragraph (2)(A) do not apply--
                ``(i) the person ordering the delivery shall be 
            obligated to pay--

                    ``(I) the common carrier or other delivery service 
                as if the delivery of the package had been timely 
                completed; and
                    ``(II) if the package is not deliverable, any 
                reasonable additional fee or charge levied by the 
                common carrier or other delivery service to cover any 
                extra costs and inconvenience and to serve as a 
                disincentive against such noncomplying delivery orders; 
                and

                ``(ii) if the package is determined not to be 
            deliverable, the common carrier or other delivery service 
            shall offer to provide the package and its contents to a 
            Federal, State, or local law enforcement agency.
            ``(B) Records.--A common carrier or other delivery service 
        shall maintain, for a period of 5 years, any records kept in 
        the ordinary course of business relating to any delivery 
        interrupted under this paragraph and provide that information, 
        upon request, to the Attorney General of the United States or 
        to the attorney general or chief law enforcement official or 
        tax administrator of any State, local, or tribal government.
            ``(C) Confidentiality.--Any person receiving records under 
        subparagraph (B) shall--
                ``(i) use the records solely for the purposes of the 
            enforcement of this Act and the collection of any taxes 
            owed on related sales of cigarettes and smokeless tobacco; 
            and
                ``(ii) keep confidential any personal information in 
            the records not otherwise required for such purposes.
        ``(5) Preemption.--
            ``(A) In general.--No State, local, or tribal government, 
        nor any political authority of 2 or more State, local, or 
        tribal governments, may enact or enforce any law or regulation 
        relating to delivery sales that restricts deliveries of 
        cigarettes or smokeless tobacco to consumers by common carriers 
        or other delivery services on behalf of delivery sellers by--
                ``(i) requiring that the common carrier or other 
            delivery service verify the age or identity of the consumer 
            accepting the delivery by requiring the person who signs to 
            accept delivery of the shipping container to provide proof, 
            in the form of a valid, government-issued identification 
            bearing a photograph of the individual, that the person is 
            at least the minimum age required for the legal sale or 
            purchase of tobacco products, as determined by either State 
            or local law at the place of delivery;
                ``(ii) requiring that the common carrier or other 
            delivery service obtain a signature from the consumer 
            accepting the delivery;
                ``(iii) requiring that the common carrier or other 
            delivery service verify that all applicable taxes have been 
            paid;
                ``(iv) requiring that packages delivered by the common 
            carrier or other delivery service contain any particular 
            labels, notice, or markings; or
                ``(v) prohibiting common carriers or other delivery 
            services from making deliveries on the basis of whether the 
            delivery seller is or is not identified on any list of 
            delivery sellers maintained and distributed by any entity 
            other than the Federal Government.
            ``(B) Relationship to other laws.--Except as provided in 
        subparagraph (C), nothing in this paragraph shall be construed 
        to nullify, expand, restrict, or otherwise amend or modify--
                ``(i) section 14501(c)(1) or 41713(b)(4) of title 49, 
            United States Code;
                ``(ii) any other restrictions in Federal law on the 
            ability of State, local, or tribal governments to regulate 
            common carriers; or
                ``(iii) any provision of State, local, or tribal law 
            regulating common carriers that is described in section 
            14501(c)(2) or 41713(b)(4)(B) of title 49 of the United 
            States Code.
            ``(C) State laws prohibiting delivery sales.--
                ``(i) In general.--Except as provided in clause (ii), 
            nothing in the Prevent All Cigarette Trafficking Act of 
            2009, the amendments made by that Act, or in any other 
            Federal statute shall be construed to preempt, supersede, 
            or otherwise limit or restrict State laws prohibiting the 
            delivery sale, or the shipment or delivery pursuant to a 
            delivery sale, of cigarettes or other tobacco products to 
            individual consumers or personal residences.
                ``(ii) Exemptions.--No State may enforce against a 
            common carrier a law prohibiting the delivery of cigarettes 
            or other tobacco products to individual consumers or 
            personal residences without proof that the common carrier 
            is not exempt under paragraph (3) of this subsection.
        ``(6) State, local, and tribal additions.--
            ``(A) In general.--Any State, local, or tribal government 
        shall provide the Attorney General of the United States with--
                ``(i) all known names, addresses, website addresses, 
            and other primary contact information of any delivery 
            seller that--

                    ``(I) offers for sale or makes sales of cigarettes 
                or smokeless tobacco in or into the State, locality, or 
                tribal land; and
                    ``(II) has failed to register with or make reports 
                to the respective tax administrator as required by this 
                Act, or that has been found in a legal proceeding to 
                have otherwise failed to comply with this Act; and

                ``(ii) a list of common carriers and other persons who 
            make deliveries of cigarettes or smokeless tobacco in or 
            into the State, locality, or tribal land.
            ``(B) Updates.--Any government providing a list to the 
        Attorney General of the United States under subparagraph (A) 
        shall also provide updates and corrections every 4 months until 
        such time as the government notifies the Attorney General of 
        the United States in writing that the government no longer 
        desires to submit information to supplement the list described 
        in paragraph (1)(A).
            ``(C) Removal after withdrawal.--Upon receiving written 
        notice that a government no longer desires to submit 
        information under subparagraph (A), the Attorney General of the 
        United States shall remove from the list described in paragraph 
        (1)(A) any persons that are on the list solely because of the 
        prior submissions of the government of the list of the 
        government of noncomplying delivery sellers of cigarettes or 
        smokeless tobacco or a subsequent update or correction by the 
        government.
        ``(7) Deadline to incorporate additions.--The Attorney General 
    of the United States shall--
            ``(A) include any delivery seller identified and submitted 
        by a State, local, or tribal government under paragraph (6) in 
        any list or update that is distributed or made available under 
        paragraph (1) on or after the date that is 30 days after the 
        date on which the information is received by the Attorney 
        General of the United States; and
            ``(B) distribute any list or update described in 
        subparagraph (A) to any common carrier or other person who 
        makes deliveries of cigarettes or smokeless tobacco that has 
        been identified and submitted by a government pursuant to 
        paragraph (6).
        ``(8) Notice to delivery sellers.--Not later than 14 days 
    before including any delivery seller on the initial list described 
    in paragraph (1)(A), or on an update to the list for the first 
    time, the Attorney General of the United States shall make a 
    reasonable attempt to send notice to the delivery seller by letter, 
    electronic mail, or other means that the delivery seller is being 
    placed on the list or update, with that notice citing the relevant 
    provisions of this Act.
        ``(9) Limitations.--
            ``(A) In general.--Any common carrier or other person 
        making a delivery subject to this subsection shall not be 
        required or otherwise obligated to--
                ``(i) determine whether any list distributed or made 
            available under paragraph (1) is complete, accurate, or up-
            to-date;
                ``(ii) determine whether a person ordering a delivery 
            is in compliance with this Act; or
                ``(iii) open or inspect, pursuant to this Act, any 
            package being delivered to determine its contents.
            ``(B) Alternate names.--Any common carrier or other person 
        making a delivery subject to this subsection--
                ``(i) shall not be required to make any inquiries or 
            otherwise determine whether a person ordering a delivery is 
            a delivery seller on the list described in paragraph (1)(A) 
            who is using a different name or address in order to evade 
            the related delivery restrictions; and
                ``(ii) shall not knowingly deliver any packages to 
            consumers for any delivery seller on the list described in 
            paragraph (1)(A) who the common carrier or other delivery 
            service knows is a delivery seller who is on the list and 
            is using a different name or address to evade the delivery 
            restrictions of paragraph (2).
            ``(C) Penalties.--Any common carrier or person in the 
        business of delivering packages on behalf of other persons 
        shall not be subject to any penalty under section 14101(a) of 
        title 49, United States Code, or any other provision of law 
        for--
                ``(i) not making any specific delivery, or any 
            deliveries at all, on behalf of any person on the list 
            described in paragraph (1)(A);
                ``(ii) refusing, as a matter of regular practice and 
            procedure, to make any deliveries, or any deliveries in 
            certain States, of any cigarettes or smokeless tobacco for 
            any person or for any person not in the business of 
            manufacturing, distributing, or selling cigarettes or 
            smokeless tobacco; or
                ``(iii) delaying or not making a delivery for any 
            person because of reasonable efforts to comply with this 
            Act.
            ``(D) Other limits.--Section 2 and subsections (a), (b), 
        (c), and (d) of this section shall not be interpreted to impose 
        any responsibilities, requirements, or liability on common 
        carriers.
    ``(f) Presumption.--For purposes of this Act, a delivery sale shall 
be deemed to have occurred in the State and place where the buyer 
obtains personal possession of the cigarettes or smokeless tobacco, and 
a delivery pursuant to a delivery sale is deemed to have been initiated 
or ordered by the delivery seller.''.
    (d) Penalties.--The Jenkins Act is amended by striking section 3 
and inserting the following:
``SEC. 3. PENALTIES.
    ``(a) Criminal Penalties.--
        ``(1) In general.--Except as provided in paragraph (2), whoever 
    knowingly violates this Act shall be imprisoned for not more than 3 
    years, fined under title 18, United States Code, or both.
        ``(2) Exceptions.--
            ``(A) Governments.--Paragraph (1) shall not apply to a 
        State, local, or tribal government.
            ``(B) Delivery violations.--A common carrier or independent 
        delivery service, or employee of a common carrier or 
        independent delivery service, shall be subject to criminal 
        penalties under paragraph (1) for a violation of section 2A(e) 
        only if the violation is committed knowingly--
                ``(i) as consideration for the receipt of, or as 
            consideration for a promise or agreement to pay, anything 
            of pecuniary value; or
                ``(ii) for the purpose of assisting a delivery seller 
            to violate, or otherwise evading compliance with, section 
            2A.
    ``(b) Civil Penalties.--
        ``(1) In general.--Except as provided in paragraph (3), whoever 
    violates this Act shall be subject to a civil penalty in an amount 
    not to exceed--
            ``(A) in the case of a delivery seller, the greater of--
                ``(i) $5,000 in the case of the first violation, or 
            $10,000 for any other violation; or
                ``(ii) for any violation, 2 percent of the gross sales 
            of cigarettes or smokeless tobacco of the delivery seller 
            during the 1-year period ending on the date of the 
            violation.
            ``(B) in the case of a common carrier or other delivery 
        service, $2,500 in the case of a first violation, or $5,000 for 
        any violation within 1 year of a prior violation.
        ``(2) Relation to other penalties.--A civil penalty imposed 
    under paragraph (1) for a violation of this Act shall be imposed in 
    addition to any criminal penalty under subsection (a) and any other 
    damages, equitable relief, or injunctive relief awarded by the 
    court, including the payment of any unpaid taxes to the appropriate 
    Federal, State, local, or tribal governments.
        ``(3) Exceptions.--
            ``(A) Delivery violations.--An employee of a common carrier 
        or independent delivery service shall be subject to civil 
        penalties under paragraph (1) for a violation of section 2A(e) 
        only if the violation is committed intentionally--
                ``(i) as consideration for the receipt of, or as 
            consideration for a promise or agreement to pay, anything 
            of pecuniary value; or
                ``(ii) for the purpose of assisting a delivery seller 
            to violate, or otherwise evading compliance with, section 
            2A.
            ``(B) Other limitations.--No common carrier or independent 
        delivery service shall be subject to civil penalties under 
        paragraph (1) for a violation of section 2A(e) if--
                ``(i) the common carrier or independent delivery 
            service has implemented and enforces effective policies and 
            practices for complying with that section; or
                ``(ii) the violation consists of an employee of the 
            common carrier or independent delivery service who 
            physically receives and processes orders, picks up 
            packages, processes packages, or makes deliveries, taking 
            actions that are outside the scope of employment of the 
            employee, or that violate the implemented and enforced 
            policies of the common carrier or independent delivery 
            service described in clause (i).''.
    (e) Enforcement.--The Jenkins Act is amended by striking section 4 
and inserting the following:
``SEC. 4. ENFORCEMENT.
    ``(a) In General.--The United States district courts shall have 
jurisdiction to prevent and restrain violations of this Act and to 
provide other appropriate injunctive or equitable relief, including 
money damages, for the violations.
    ``(b) Authority of the Attorney General.--The Attorney General of 
the United States shall administer and enforce this Act.
    ``(c) State, Local, and Tribal Enforcement.--
        ``(1) In general.--
            ``(A) Standing.--A State, through its attorney general, or 
        a local government or Indian tribe that levies a tax subject to 
        section 2A(a)(3), through its chief law enforcement officer, 
        may bring an action in a United States district court to 
        prevent and restrain violations of this Act by any person or to 
        obtain any other appropriate relief from any person for 
        violations of this Act, including civil penalties, money 
        damages, and injunctive or other equitable relief.
            ``(B) Sovereign immunity.--Nothing in this Act shall be 
        deemed to abrogate or constitute a waiver of any sovereign 
        immunity of a State or local government or Indian tribe against 
        any unconsented lawsuit under this Act, or otherwise to 
        restrict, expand, or modify any sovereign immunity of a State 
        or local government or Indian tribe.
        ``(2) Provision of information.--A State, through its attorney 
    general, or a local government or Indian tribe that levies a tax 
    subject to section 2A(a)(3), through its chief law enforcement 
    officer, may provide evidence of a violation of this Act by any 
    person not subject to State, local, or tribal government 
    enforcement actions for violations of this Act to the Attorney 
    General of the United States or a United States attorney, who shall 
    take appropriate actions to enforce this Act.
        ``(3) Use of penalties collected.--
            ``(A) In general.--There is established a separate account 
        in the Treasury known as the `PACT Anti-Trafficking Fund'. 
        Notwithstanding any other provision of law and subject to 
        subparagraph (B), an amount equal to 50 percent of any criminal 
        and civil penalties collected by the Federal Government in 
        enforcing this Act shall be transferred into the PACT Anti-
        Trafficking Fund and shall be available to the Attorney General 
        of the United States for purposes of enforcing this Act and 
        other laws relating to contraband tobacco products.
            ``(B) Allocation of funds.--Of the amount available to the 
        Attorney General of the United States under subparagraph (A), 
        not less than 50 percent shall be made available only to the 
        agencies and offices within the Department of Justice that were 
        responsible for the enforcement actions in which the penalties 
        concerned were imposed or for any underlying investigations.
        ``(4) Nonexclusivity of remedy.--
            ``(A) In general.--The remedies available under this 
        section and section 3 are in addition to any other remedies 
        available under Federal, State, local, tribal, or other law.
            ``(B) State court proceedings.--Nothing in this Act shall 
        be construed to expand, restrict, or otherwise modify any right 
        of an authorized State official to proceed in State court, or 
        take other enforcement actions, on the basis of an alleged 
        violation of State or other law.
            ``(C) Tribal court proceedings.--Nothing in this Act shall 
        be construed to expand, restrict, or otherwise modify any right 
        of an authorized Indian tribal government official to proceed 
        in tribal court, or take other enforcement actions, on the 
        basis of an alleged violation of tribal law.
            ``(D) Local government enforcement.--Nothing in this Act 
        shall be construed to expand, restrict, or otherwise modify any 
        right of an authorized local government official to proceed in 
        State court, or take other enforcement actions, on the basis of 
        an alleged violation of local or other law.
    ``(d) Persons Dealing in Tobacco Products.--Any person who holds a 
permit under section 5712 of the Internal Revenue Code of 1986 
(regarding permitting of manufacturers and importers of tobacco 
products and export warehouse proprietors) may bring an action in an 
appropriate United States district court to prevent and restrain 
violations of this Act by any person other than a State, local, or 
tribal government.
    ``(e) Notice.--
        ``(1) Persons dealing in tobacco products.--Any person who 
    commences a civil action under subsection (d) shall inform the 
    Attorney General of the United States of the action.
        ``(2) State, local, and tribal actions.--It is the sense of 
    Congress that the attorney general of any State, or chief law 
    enforcement officer of any locality or tribe, that commences a 
    civil action under this section should inform the Attorney General 
    of the United States of the action.
    ``(f) Public Notice.--
        ``(1) In general.--The Attorney General of the United States 
    shall make available to the public, by posting information on the 
    Internet and by other appropriate means, information regarding all 
    enforcement actions brought by the United States, or reported to 
    the Attorney General of the United States, under this section, 
    including information regarding the resolution of the enforcement 
    actions and how the Attorney General of the United States has 
    responded to referrals of evidence of violations pursuant to 
    subsection (c)(2).
        ``(2) Reports to congress.--Not later than 1 year after the 
    date of enactment of the Prevent All Cigarette Trafficking Act of 
    2009, and every year thereafter until the date that is 5 years 
    after such date of enactment, the Attorney General of the United 
    States shall submit to Congress a report containing the information 
    described in paragraph (1).''.
SEC. 3. TREATMENT OF CIGARETTES AND SMOKELESS TOBACCO AS NONMAILABLE 
MATTER.
    (a) In General.--Chapter 83 of title 18, United States Code, is 
amended by inserting after section 1716D the following:
``Sec. 1716E. Tobacco products as nonmailable
    ``(a) Prohibition.--
        ``(1) In general.--All cigarettes and smokeless tobacco (as 
    those terms are defined in section 1 of the Act of October 19, 
    1949, commonly referred to as the Jenkins Act) are nonmailable and 
    shall not be deposited in or carried through the mails. The United 
    States Postal Service shall not accept for delivery or transmit 
    through the mails any package that it knows or has reasonable cause 
    to believe contains any cigarettes or smokeless tobacco made 
    nonmailable by this paragraph.
        ``(2) Reasonable cause.--For the purposes of this subsection 
    reasonable cause includes--
            ``(A) a statement on a publicly available website, or an 
        advertisement, by any person that the person will mail matter 
        which is nonmailable under this section in return for payment; 
        or
            ``(B) the fact that the person is on the list created under 
        section 2A(e) of the Jenkins Act.
    ``(b) Exceptions.--
        ``(1) Cigars.--Subsection (a) shall not apply to cigars (as 
    defined in section 5702(a) of the Internal Revenue Code of 1986).
        ``(2) Geographic exception.--Subsection (a) shall not apply to 
    mailings within the State of Alaska or within the State of Hawaii.
        ``(3) Business purposes.--
            ``(A) In general.--Subsection (a) shall not apply to 
        tobacco products mailed only--
                ``(i) for business purposes between legally operating 
            businesses that have all applicable State and Federal 
            Government licenses or permits and are engaged in tobacco 
            product manufacturing, distribution, wholesale, export, 
            import, testing, investigation, or research; or
                ``(ii) for regulatory purposes between any business 
            described in clause (i) and an agency of the Federal 
            Government or a State government.
            ``(B) Rules.--
                ``(i) In general.--Not later than 180 days after the 
            date of enactment of the Prevent All Cigarette Trafficking 
            Act of 2009, the Postmaster General shall issue a final 
            rule which shall establish the standards and requirements 
            that apply to all mailings described in subparagraph (A).
                ``(ii) Contents.--The final rule issued under clause 
            (i) shall require--

                    ``(I) the United States Postal Service to verify 
                that any person submitting an otherwise nonmailable 
                tobacco product into the mails as authorized under this 
                paragraph is a business or government agency permitted 
                to make a mailing under this paragraph;
                    ``(II) the United States Postal Service to ensure 
                that any recipient of an otherwise nonmailable tobacco 
                product sent through the mails under this paragraph is 
                a business or government agency that may lawfully 
                receive the product;
                    ``(III) that any mailing described in subparagraph 
                (A) shall be sent through the systems of the United 
                States Postal Service that provide for the tracking and 
                confirmation of the delivery;
                    ``(IV) that the identity of the business or 
                government entity submitting the mailing containing 
                otherwise nonmailable tobacco products for delivery and 
                the identity of the business or government entity 
                receiving the mailing are clearly set forth on the 
                package;
                    ``(V) the United States Postal Service to maintain 
                identifying information described in subclause (IV) 
                during the 3-year period beginning on the date of the 
                mailing and make the information available to the 
                Postal Service, the Attorney General of the United 
                States, and to persons eligible to bring enforcement 
                actions under section 3(d) of the Prevent All Cigarette 
                Trafficking Act of 2009;
                    ``(VI) that any mailing described in subparagraph 
                (A) be marked with a United States Postal Service label 
                or marking that makes it clear to employees of the 
                United States Postal Service that it is a permitted 
                mailing of otherwise nonmailable tobacco products that 
                may be delivered only to a permitted government agency 
                or business and may not be delivered to any residence 
                or individual person; and
                    ``(VII) that any mailing described in subparagraph 
                (A) be delivered only to a verified employee of the 
                recipient business or government agency, who is not a 
                minor and who shall be required to sign for the 
                mailing.

            ``(C) Definition.--In this paragraph, the term `minor' 
        means an individual who is less than the minimum age required 
        for the legal sale or purchase of tobacco products as 
        determined by applicable law at the place the individual is 
        located.
        ``(4) Certain individuals.--
            ``(A) In general.--Subsection (a) shall not apply to 
        tobacco products mailed by individuals who are not minors for 
        noncommercial purposes, including the return of a damaged or 
        unacceptable tobacco product to the manufacturer.
            ``(B) Rules.--
                ``(i) In general.--Not later than 180 days after the 
            date of enactment of the Prevent All Cigarette Trafficking 
            Act of 2009, the Postmaster General shall issue a final 
            rule which shall establish the standards and requirements 
            that apply to all mailings described in subparagraph (A).
                ``(ii) Contents.--The final rule issued under clause 
            (i) shall require--

                    ``(I) the United States Postal Service to verify 
                that any person submitting an otherwise nonmailable 
                tobacco product into the mails as authorized under this 
                paragraph is the individual identified on the return 
                address label of the package and is not a minor;
                    ``(II) for a mailing to an individual, the United 
                States Postal Service to require the person submitting 
                the otherwise nonmailable tobacco product into the 
                mails as authorized by this paragraph to affirm that 
                the recipient is not a minor;
                    ``(III) that any package mailed under this 
                paragraph shall weigh not more than 10 ounces;
                    ``(IV) that any mailing described in subparagraph 
                (A) shall be sent through the systems of the United 
                States Postal Service that provide for the tracking and 
                confirmation of the delivery;
                    ``(V) that a mailing described in subparagraph (A) 
                shall not be delivered or placed in the possession of 
                any individual who has not been verified as not being a 
                minor;
                    ``(VI) for a mailing described in subparagraph (A) 
                to an individual, that the United States Postal Service 
                shall deliver the package only to a recipient who is 
                verified not to be a minor at the recipient address or 
                transfer it for delivery to an Air/Army Postal Office 
                or Fleet Postal Office number designated in the 
                recipient address; and
                    ``(VII) that no person may initiate more than 10 
                mailings described in subparagraph (A) during any 30-
                day period.

            ``(C) Definition.--In this paragraph, the term `minor' 
        means an individual who is less than the minimum age required 
        for the legal sale or purchase of tobacco products as 
        determined by applicable law at the place the individual is 
        located.
        ``(5) Exception for mailings for consumer testing by 
    manufacturers.--
            ``(A) In general.--Subject to subparagraph (B), subsection 
        (a) shall not preclude a legally operating cigarette 
        manufacturer or a legally authorized agent of a legally 
        operating cigarette manufacturer from using the United States 
        Postal Service to mail cigarettes to verified adult smoker 
        solely for consumer testing purposes, if--
                ``(i) the cigarette manufacturer has a permit, in good 
            standing, issued under section 5713 of the Internal Revenue 
            Code of 1986;
                ``(ii) the package of cigarettes mailed under this 
            paragraph contains not more than 12 packs of cigarettes 
            (240 cigarettes);
                ``(iii) the recipient does not receive more than 1 
            package of cigarettes from any 1 cigarette manufacturer 
            under this paragraph during any 30-day period;
                ``(iv) all taxes on the cigarettes mailed under this 
            paragraph levied by the State and locality of delivery are 
            paid to the State and locality before delivery, and tax 
            stamps or other tax-payment indicia are affixed to the 
            cigarettes as required by law; and
                ``(v)(I) the recipient has not made any payments of any 
            kind in exchange for receiving the cigarettes;
                ``(II) the recipient is paid a fee by the manufacturer 
            or agent of the manufacturer for participation in consumer 
            product tests; and
                ``(III) the recipient, in connection with the tests, 
            evaluates the cigarettes and provides feedback to the 
            manufacturer or agent.
            ``(B) Limitations.--Subparagraph (A) shall not--
                ``(i) permit a mailing of cigarettes to an individual 
            located in any State that prohibits the delivery or 
            shipment of cigarettes to individuals in the State, or 
            preempt, limit, or otherwise affect any related State laws; 
            or
                ``(ii) permit a manufacturer, directly or through a 
            legally authorized agent, to mail cigarettes in any 
            calendar year in a total amount greater than 1 percent of 
            the total cigarette sales of the manufacturer in the United 
            States during the calendar year before the date of the 
            mailing.
            ``(C) Rules.--
                ``(i) In general.--Not later than 180 days after the 
            date of enactment of the Prevent All Cigarette Trafficking 
            Act of 2009, the Postmaster General shall issue a final 
            rule which shall establish the standards and requirements 
            that apply to all mailings described in subparagraph (A).
                ``(ii) Contents.--The final rule issued under clause 
            (i) shall require--

                    ``(I) the United States Postal Service to verify 
                that any person submitting a tobacco product into the 
                mails under this paragraph is a legally operating 
                cigarette manufacturer permitted to make a mailing 
                under this paragraph, or an agent legally authorized by 
                the legally operating cigarette manufacturer to submit 
                the tobacco product into the mails on behalf of the 
                manufacturer;
                    ``(II) the legally operating cigarette manufacturer 
                submitting the cigarettes into the mails under this 
                paragraph to affirm that--

                        ``(aa) the manufacturer or the legally 
                    authorized agent of the manufacturer has verified 
                    that the recipient is an adult established smoker;
                        ``(bb) the recipient has not made any payment 
                    for the cigarettes;
                        ``(cc) the recipient has signed a written 
                    statement that is in effect indicating that the 
                    recipient wishes to receive the mailings; and
                        ``(dd) the manufacturer or the legally 
                    authorized agent of the manufacturer has offered 
                    the opportunity for the recipient to withdraw the 
                    written statement described in item (cc) not less 
                    frequently than once in every 3-month period;

                    ``(III) the legally operating cigarette 
                manufacturer or the legally authorized agent of the 
                manufacturer submitting the cigarettes into the mails 
                under this paragraph to affirm that any package mailed 
                under this paragraph contains not more than 12 packs of 
                cigarettes (240 cigarettes) on which all taxes levied 
                on the cigarettes by the State and locality of delivery 
                have been paid and all related State tax stamps or 
                other tax-payment indicia have been applied;
                    ``(IV) that any mailing described in subparagraph 
                (A) shall be sent through the systems of the United 
                States Postal Service that provide for the tracking and 
                confirmation of the delivery;
                    ``(V) the United States Postal Service to maintain 
                records relating to a mailing described in subparagraph 
                (A) during the 3-year period beginning on the date of 
                the mailing and make the information available to 
                persons enforcing this section;
                    ``(VI) that any mailing described in subparagraph 
                (A) be marked with a United States Postal Service label 
                or marking that makes it clear to employees of the 
                United States Postal Service that it is a permitted 
                mailing of otherwise nonmailable tobacco products that 
                may be delivered only to the named recipient after 
                verifying that the recipient is an adult; and
                    ``(VII) the United States Postal Service shall 
                deliver a mailing described in subparagraph (A) only to 
                the named recipient and only after verifying that the 
                recipient is an adult.

            ``(D) Definitions.--In this paragraph--
                ``(i) the term `adult' means an individual who is not 
            less than 21 years of age; and
                ``(ii) the term `consumer testing' means testing 
            limited to formal data collection and analysis for the 
            specific purpose of evaluating the product for quality 
            assurance and benchmarking purposes of cigarette brands or 
            sub-brands among existing adult smokers.
        ``(6) Federal government agencies.--An agency of the Federal 
    Government involved in the consumer testing of tobacco products 
    solely for public health purposes may mail cigarettes under the 
    same requirements, restrictions, and rules and procedures that 
    apply to consumer testing mailings of cigarettes by manufacturers 
    under paragraph (5), except that the agency shall not be required 
    to pay the recipients for participating in the consumer testing.
    ``(c) Seizure and Forfeiture.--Any cigarettes or smokeless tobacco 
made nonmailable by this subsection that are deposited in the mails 
shall be subject to seizure and forfeiture, pursuant to the procedures 
set forth in chapter 46 of this title. Any tobacco products seized and 
forfeited under this subsection shall be destroyed or retained by the 
Federal Government for the detection or prosecution of crimes or 
related investigations and then destroyed.
    ``(d) Additional Penalties.--In addition to any other fines and 
penalties under this title for violations of this section, any person 
violating this section shall be subject to an additional civil penalty 
in the amount equal to 10 times the retail value of the nonmailable 
cigarettes or smokeless tobacco, including all Federal, State, and 
local taxes.
    ``(e) Criminal Penalty.--Whoever knowingly deposits for mailing or 
delivery, or knowingly causes to be delivered by mail, according to the 
direction thereon, or at any place at which it is directed to be 
delivered by the person to whom it is addressed, anything that is 
nonmailable matter under this section shall be fined under this title, 
imprisoned not more than 1 year, or both.
    ``(f) Use of Penalties.--There is established a separate account in 
the Treasury, to be known as the `PACT Postal Service Fund'. 
Notwithstanding any other provision of law, an amount equal to 50 
percent of any criminal fines, civil penalties, or other monetary 
penalties collected by the Federal Government in enforcing this section 
shall be transferred into the PACT Postal Service Fund and shall be 
available to the Postmaster General for the purpose of enforcing this 
subsection.
    ``(g) Coordination of Efforts.--The Postmaster General shall 
cooperate and coordinate efforts to enforce this section with related 
enforcement activities of any other Federal agency or agency of any 
State, local, or tribal government, whenever appropriate.
    ``(h) Actions by State, Local, or Tribal Governments Relating to 
Certain Tobacco Products.--
        ``(1) In general.--A State, through its attorney general, or a 
    local government or Indian tribe that levies an excise tax on 
    tobacco products, through its chief law enforcement officer, may in 
    a civil action in a United States district court obtain appropriate 
    relief with respect to a violation of this section. Appropriate 
    relief includes injunctive and equitable relief and damages equal 
    to the amount of unpaid taxes on tobacco products mailed in 
    violation of this section to addressees in that State, locality, or 
    tribal land.
        ``(2) Sovereign immunity.--Nothing in this subsection shall be 
    deemed to abrogate or constitute a waiver of any sovereign immunity 
    of a State or local government or Indian tribe against any 
    unconsented lawsuit under paragraph (1), or otherwise to restrict, 
    expand, or modify any sovereign immunity of a State or local 
    government or Indian tribe.
        ``(3) Attorney general referral.--A State, through its attorney 
    general, or a local government or Indian tribe that levies an 
    excise tax on tobacco products, through its chief law enforcement 
    officer, may provide evidence of a violation of this section for 
    commercial purposes by any person not subject to State, local, or 
    tribal government enforcement actions for violations of this 
    section to the Attorney General of the United States, who shall 
    take appropriate actions to enforce this section.
        ``(4) Nonexclusivity of remedies.--The remedies available under 
    this subsection are in addition to any other remedies available 
    under Federal, State, local, tribal, or other law. Nothing in this 
    subsection shall be construed to expand, restrict, or otherwise 
    modify any right of an authorized State, local, or tribal 
    government official to proceed in a State, tribal, or other 
    appropriate court, or take other enforcement actions, on the basis 
    of an alleged violation of State, local, tribal, or other law.
        ``(5) Other enforcement actions.--Nothing in this subsection 
    shall be construed to prohibit an authorized State official from 
    proceeding in State court on the basis of an alleged violation of 
    any general civil or criminal statute of the State.
    ``(i) Definition.--In this section, the term `State' has the 
meaning given that term in section 1716(k).''.
    (b) Clerical Amendment.--The table of sections for chapter 83 of 
title 18 is amended by inserting after the item relating to section 
1716D the following:

``1716E. Tobacco products as nonmailable.''.
SEC. 4. INSPECTION BY BUREAU OF ALCOHOL, TOBACCO, FIREARMS, AND 
EXPLOSIVES OF RECORDS OF CERTAIN CIGARETTE AND SMOKELESS TOBACCO 
SELLERS; CIVIL PENALTY.
    Section 2343(c) of title 18, United States Code, is amended to read 
as follows:
    ``(c)(1) Any officer of the Bureau of Alcohol, Tobacco, Firearms, 
and Explosives may, during normal business hours, enter the premises of 
any person described in subsection (a) or (b) for the purposes of 
inspecting--
        ``(A) any records or information required to be maintained by 
    the person under this chapter; or
        ``(B) any cigarettes or smokeless tobacco kept or stored by the 
    person at the premises.
    ``(2) The district courts of the United States shall have the 
authority in a civil action under this subsection to compel inspections 
authorized by paragraph (1).
    ``(3) Whoever denies access to an officer under paragraph (1), or 
who fails to comply with an order issued under paragraph (2), shall be 
subject to a civil penalty in an amount not to exceed $10,000.''.
SEC. 5. EXCLUSIONS REGARDING INDIAN TRIBES AND TRIBAL MATTERS.
    (a) In General.--Nothing in this Act or the amendments made by this 
Act shall be construed to amend, modify, or otherwise affect--
        (1) any agreements, compacts, or other intergovernmental 
    arrangements between any State or local government and any 
    government of an Indian tribe (as that term is defined in section 
    4(e) of the Indian Self-Determination and Education Assistance Act 
    (25 U.S.C. 450b(e)) relating to the collection of taxes on 
    cigarettes or smokeless tobacco sold in Indian country;
        (2) any State laws that authorize or otherwise pertain to any 
    such intergovernmental arrangements or create special rules or 
    procedures for the collection of State, local, or tribal taxes on 
    cigarettes or smokeless tobacco sold in Indian country;
        (3) any limitations under Federal or State law, including 
    Federal common law and treaties, on State, local, and tribal tax 
    and regulatory authority with respect to the sale, use, or 
    distribution of cigarettes and smokeless tobacco by or to Indian 
    tribes, tribal members, tribal enterprises, or in Indian country;
        (4) any Federal law, including Federal common law and treaties, 
    regarding State jurisdiction, or lack thereof, over any tribe, 
    tribal members, tribal enterprises, tribal reservations, or other 
    lands held by the United States in trust for one or more Indian 
    tribes; or
        (5) any State or local government authority to bring 
    enforcement actions against persons located in Indian country.
    (b) Coordination of Law Enforcement.--Nothing in this Act or the 
amendments made by this Act shall be construed to inhibit or otherwise 
affect any coordinated law enforcement effort by 1 or more States or 
other jurisdictions, including Indian tribes, through interstate 
compact or otherwise, that--
        (1) provides for the administration of tobacco product laws or 
    laws pertaining to interstate sales or other sales of tobacco 
    products;
        (2) provides for the seizure of tobacco products or other 
    property related to a violation of such laws; or
        (3) establishes cooperative programs for the administration of 
    such laws.
    (c) Treatment of State and Local Governments.--Nothing in this Act 
or the amendments made by this Act shall be construed to authorize, 
deputize, or commission States or local governments as 
instrumentalities of the United States.
    (d) Enforcement Within Indian Country.--Nothing in this Act or the 
amendments made by this Act shall prohibit, limit, or restrict 
enforcement by the Attorney General of the United States of this Act or 
an amendment made by this Act within Indian country.
    (e) Ambiguity.--Any ambiguity between the language of this section 
or its application and any other provision of this Act shall be 
resolved in favor of this section.
    (f) Definitions.--In this section--
        (1) the term ``Indian country'' has the meaning given that term 
    in section 1 of the Jenkins Act, as amended by this Act; and
        (2) the term ``tribal enterprise'' means any business 
    enterprise, regardless of whether incorporated or unincorporated 
    under Federal or tribal law, of an Indian tribe or group of Indian 
    tribes.
SEC. 6. EFFECTIVE DATE.
    (a) In General.--Except as provided in subsection (b), this Act 
shall take effect on the date that is 90 days after the date of 
enactment of this Act.
    (b) BATFE Authority.--The amendments made by section 4 shall take 
effect on the date of enactment of this Act.
SEC. 7. SEVERABILITY.
    If any provision of this Act, or any amendment made by this Act, or 
the application thereof to any person or circumstance, is held invalid, 
the remainder of the Act and the application of the Act to any other 
person or circumstance shall not be affected thereby.
SEC. 8. SENSE OF CONGRESS CONCERNING THE PRECEDENTIAL EFFECT OF THIS 
ACT.
    It is the sense of Congress that unique harms are associated with 
online cigarette sales, including problems with verifying the ages of 
consumers in the digital market and the long-term health problems 
associated with the use of certain tobacco products. This Act was 
enacted recognizing the longstanding interest of Congress in urging 
compliance with States' laws regulating remote sales of certain tobacco 
products to citizens of those States, including the passage of the 
Jenkins Act over 50 years ago, which established reporting requirements 
for out-of-State companies that sell certain tobacco products to 
citizens of the taxing States, and which gave authority to the 
Department of Justice and the Bureau of Alcohol, Tobacco, Firearms, and 
Explosives to enforce the Jenkins Act. In light of the unique harms and 
circumstances surrounding the online sale of certain tobacco products, 
this Act is intended to help collect cigarette excise taxes, to stop 
tobacco sales to underage youth, and to help the States enforce their 
laws that target the online sales of certain tobacco products only. 
This Act is in no way meant to create a precedent regarding the 
collection of State sales or use taxes by, or the validity of efforts 
to impose other types of taxes on, out-of-State entities that do not 
have a physical presence within the taxing State.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.
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