MCA Chapter 23

in effect

Miss. Code Ann. § 75-23-1 Unfair Cigarette Sales Law; title.

This article shall be known and may be cited as the “Unfair Cigarette Sales Law.”

Miss. Code Ann. § 75-23-3 Legislative intent.

It is hereby declared to be the legislative intent to encourage fair and honest competition, and to safeguard the public against unfair, dishonest, deceptive, destructive, and fraudulent business practices existing in transactions involving the sale of, offer to sell, or inducement to sell, cigarettes in the wholesale and retail trades in this state. It is further declared that the advertising, offering for sale, or sale of cigarettes below cost in the wholesale or retail trades with the intent of injuring competitors or destroying or substantially lessening competition, is an unfair and deceptive trade practice. The policy of the state is to promote the general welfare through the prohibition of such sales, the purpose of the Unfair Cigarette Sales Law being to carry out that policy in the public interest.

Miss. Code Ann. § 75-23-5 Definitions.

The following words, terms and phrases, when used in the Unfair Cigarette Sales Law, shall have the meaning ascribed to them in this section except where the context clearly indicates a different meaning: “Person” shall mean and include any individual, firm, association, company, partnership, corporation, joint stock company, club, agency, syndicate, the State of Mississippi, county, municipal corporation or other political subdivision of this state, receiver, trustee, fiduciary, or trade association. “Commission” or “department” shall mean the Department of Revenue of the State of Mississippi. “Cigarettes” shall mean and include any roll for smoking made wholly or in part of tobacco, irrespective of size or shape and whether or not such tobacco is flavored, adulterated or mixed with any other ingredient, the wrapper or cover of which is made of paper or any other substance or material, excepting tobacco. “Wholesaler” shall mean and include any person qualified as a wholesaler with the Department of Revenue of Mississippi and shall also mean and include any person other than a buying pool as defined herein, wherever resident or located, who brings or causes to be brought into this state unstamped cigarettes purchased directly from the manufacturer thereof and who maintains an established place of business where substantially all of the business is the sale of cigarettes and related merchandise at wholesale to cigarette licensees and where at all times a substantial stock of cigarettes and related merchandise is available for resale; provided, that seventy-five percent (75%) thereof are sold to retailers or other wholesalers not connected with the wholesaler by reason of any business connection or otherwise; and also any person retailing cigarettes to consumers, provided, at least seventy-five percent (75%) of his purchases are made directly from the manufacturers thereof; and also any person in this state other than a buying pool as defined herein, who purchases cigarettes, from any other person who purchases from a manufacturer at least seventy-five percent (75%) of which are for purposes of resale to retailers in this state not connected with said wholesaler by reason of any business connection or otherwise and who maintains an established place of business where cigarettes and related merchandise are sold at wholesale to persons licensed under this law, and where at all times a substantial stock of cigarettes and related merchandise is available to all retailers for resale; and also any person in this state who acquires cigarettes solely for the purpose of resale in cigarette vending machines; provided, such person operated thirty (30) or more machines. “Retailer” shall mean and include any person who is engaged in this state in the business of selling cigarettes at retail and includes any group of persons, cooperative organizations, buying pools, and any other person or group of retailers purchasing cigarettes on a cooperative basis from licensed distributors or wholesalers. Any person placing a cigarette vending machine at, on or in any premises shall be deemed to be a retailer from each such vending machine. “Buying pool” means and includes any combination, corporation, association, affiliation or group of retail dealers operating jointly in the purchase, sale, exchange, or barter of cigarettes, the profits of which accrue directly or indirectly to such retail dealers. “Sale” or “sell” shall mean any transfer for a consideration, exchange, barter, gift, offer for sale, advertising for sale, soliciting an order for cigarettes and distribution in any manner or by any means whatsoever. “Sell at wholesale,” “sale at wholesale” and “wholesale sales” shall mean and include any sale made in the ordinary course of trade or usual conduct of the wholesaler’s business to a retailer for the purpose of resale. “Sell at retail,” “sale at retail” or “retail sales” shall mean and include any sale for consumption or use made in the ordinary course of trade or usual conduct of the seller’s business. “Basic cost of cigarettes” shall mean whichever of the two (2) following amounts is lower, namely, (i) the invoice cost of cigarettes to the wholesaler or retailer, as the case may be, or (ii) the lowest replacement cost of cigarettes to the wholesaler or retailer, as the case may be, within thirty (30) days prior to the date of sale, in the quantity last purchased (whether within or before the thirty-day period), less, in either of the two (2) cases, all trade discounts except customary discounts for cash, plus the full face value of any stamps or any tax which may be required by any cigarette tax act of this state or political subdivision thereof, now in effect or hereafter enacted, if not already included in the invoice cost of the cigarettes to the wholesaler or retailer, as the case may be. (i) “Cost to wholesaler” shall mean the basic cost of the cigarettes involved to the wholesaler plus the cost of doing business by the wholesaler as evidenced by the standards and methods of accounting regularly employed by him, and must include, without limitation, labor costs (including salaries of executives and officers), rent, depreciation, selling costs, maintenance of equipment, delivery costs, all types of licenses, taxes, insurance and advertising. In the absence of proof of a lesser or higher cost of doing business by the wholesale dealer making the sale, the cost of doing business by the wholesale dealer shall be presumed to be two percent (2%) of the basic cost of cigarettes to the wholesale dealer, any fraction of a cent thus computed shall be rounded off to the next highest cent, plus cartage to the retail outlet, if performed or paid for by the wholesale dealer, which cartage cost, in the absence of proof of a lesser or higher cost, shall be presumed to be one-half of one percent (1/2 of 1%) of the basic cost of the cigarettes to the wholesale dealer, any fraction of a cent in computing the amount of the cartage shall be rounded off to the next highest cent. (i) “Cost to the retailer” shall mean the basic cost of the cigarettes involved to the retailer plus the cost of doing business by the retailer as evidenced by the standards and methods of accounting regularly employed by him and must include, without limitation, labor (including salaries of executives and officers), rent, depreciation, selling costs, maintenance of equipment, delivery costs, all types of licenses, taxes, insurance and advertising. In the absence of proof of a lesser or higher cost of doing business by the retailer making the sale, the cost of doing business by the retailer shall be presumed to be six percent (6%) of the basic cost of cigarettes to the retailer. Any fraction of a cent thus computed shall be rounded off to the next highest cent. In the case of any retail dealer who in connection with the retail dealer’s purchase of any cigarettes shall receive not only the discounts ordinarily allowed upon purchases by a retail dealer but also in whole or in part the discounts ordinarily allowed upon purchases by a wholesale dealer, the cost of doing business by the retail dealer with respect to the cigarettes shall be, in the absence of proof of a lesser or higher cost of doing business by the retail dealer, the sum of the cost of doing business by the retail dealer and, to the extent that he shall have received the full discounts ordinarily allowed to a wholesale dealer, the cost of doing business by a wholesale dealer as hereinabove defined in paragraph (j)(ii) of this section.

Miss. Code Ann. § 75-23-7 Sale at less than cost; rebate in price.

It shall be unlawful for any wholesaler or retailer, with intent to injure competitors or destroy or substantially lessen competition, to advertise, offer to sell, or sell, at retail or wholesale, cigarettes at less than cost to such wholesaler or retailer, as the case may be. It shall be unlawful for any wholesaler or retailer with intent to injure competitors or destroy or substantially lessen competition to offer a rebate in price, to give a rebate in price, to offer a concession of any kind or to give a concession of any kind or nature whatsoever in connection with the sale of cigarettes. It shall be unlawful for any retail dealer to induce or attempt to induce or to procure or attempt to procure the purchase of cigarettes at a price less than “cost to wholesaler” and it shall be unlawful for any retail dealer to induce or attempt to induce or to procure or attempt to procure any rebate or concession of any kind or nature whatsoever in connection with the purchase of cigarettes. Any wholesaler or retailer who violates the provisions of this section shall by guilty of a misdemeanor and be punishable by a fine of not more than five hundred dollars ($500.00). Evidence of advertisement, offering to sell or sale of cigarettes by any wholesaler, or retailer, at less than cost to him, or evidence of any offer of a rebate in price or the giving of a rebate in price or an offer of a concession or the giving of a concession of any kind or nature whatsoever in connection with the sale of cigarettes or the inducing or attempt to induce or the procuring or the attempt to procure the purchase of cigarettes at a price less than cost to the wholesaler or the retailer shall be prima facie evidence of intent to injure competitors and to destroy or substantially lessen competition.

Miss. Code Ann. § 75-23-9 Sale at less than cost; combined with gift or concession.

In all advertisements, offers for sale or sales involving two (2) or more items, at least one (1) of which items is cigarettes, at a combined price, and in all advertisements, offers for sale, or sales, involving the giving of any gift or concession of any kind whatsoever (whether it be coupons or otherwise), the wholesaler’s or retailer’s combined selling price shall not be below the cost to the wholesaler or the cost to the retailer, respectively, of the total of all articles, products, commodities, gifts and concessions included in such transactions, except that if any such articles, products, commodities, gifts or concessions, shall not be cigarettes, the basic cost thereof shall be determined in like manner as provided in subdivision (j) of Section 75-23-5.

Miss. Code Ann. § 75-23-11 Sale to another wholesaler.

When one (1) wholesaler sells cigarettes to any other wholesaler, the former shall not be required to include in his selling price to the latter “cost to the wholesaler,” as provided by Section 75-23-5 of the Unfair Cigarette Sales Law, but the latter wholesaler, upon resale to a retailer, shall be subject to the provisions of said section.

Miss. Code Ann. § 75-23-13 When provisions of law not applicable.

The provisions of the Unfair Cigarette Sales Law shall not apply to a sale at wholesale or a sale at retail made (a) in an isolated transaction and not in the usual course of business; (b) where cigarettes are advertised, offered for sale, or sold in a bona fide clearance sale for the purpose of discontinuing trade in such cigarettes, and said advertising, offer to sell, or sale shall state the reason therefor and the quantity of such cigarettes advertised, offered for sale, or to be sold; (c) where cigarettes are advertised, offered for sale, or sold as imperfect or damaged, and said advertising, offer to sell, or sale shall state the reason therefor and the quantity of such cigarettes advertised, offered for sale, or to be sold; (d) where cigarettes are sold upon the final liquidation of a business; or (e) where cigarettes are advertised, offered for sale, or sold by any fiduciary or other officer acting under the order or direction of any court; (f) the resale of any of the cigarettes purchased from sales under provisions (c) and (e) above.

Miss. Code Ann. § 75-23-15 May sell at price to meet competition.

Any wholesaler may advertise, offer to sell, or sell cigarettes at a price made in good faith to meet the price of a competitor who is rendering the same type of service and is selling the same article at cost to the said competing wholesaler as defined in the Unfair Cigarette Sales Law. Any retailer may advertise, offer to sell, or sell cigarettes at a price made in good faith to meet the price of a competitor who is selling the same article at cost to the said competing retailer as defined in the Unfair Cigarette Sales Law. The price of cigarettes advertised, offered for sale, or sold under the exceptions specified in Section 75-23-13 shall not be considered the price of a competitor and shall not be used as a basis for establishing prices below cost, nor shall the price established at a bankrupt sale be considered the price of a competitor within the purview of this section. In the absence of proof of the actual cost to the said competing wholesaler or the said competing retailer, as the case may be, such cost may be presumed to be the lowest cost to wholesalers or the lowest cost to retailers, as the case may be, within the same trading area as determined by a cost survey made pursuant to in subsection (b) of Section 75-23-19.

Miss. Code Ann. § 75-23-17 Contracts in violation of law, illegal.

Any contract, express or implied, made by any person in violation of any of the provisions of the Unfair Cigarette Sales Law, is illegal and void and no recovery shall be had thereon.

Miss. Code Ann. § 75-23-19 How cost determined.

In determining cost to the wholesaler and cost to the retailer the court shall receive and consider as bearing on the bona fides of such cost, evidence tending to show that any person complained against under any of the provisions of the Unfair Cigarette Sales Law purchased the cigarettes involved in the complaint before the court, at a fictitious price, or upon terms, or in such a manner, or under such invoices, as to conceal the true cost, discounts or terms of purchase, and shall also receive and consider as bearing on the bona fides of such costs, evidence of the normal, customary and prevailing terms and discounts in connection with other sales of a similar nature in the trade area or state. Where a cost survey pursuant to recognized statistical and cost accounting practices has been made for the trading area in which a violation of the Unfair Cigarette Sales Law is committed or charged, to determine and establish on the basis of actual existing conditions the lowest cost to wholesalers or the lowest cost to retailers within the said area, the said cost survey shall be deemed competent evidence in any action or proceeding under this law as tending to prove actual cost to the wholesaler or actual cost to the retailer complained against, but any party against whom any such cost survey may be introduced in evidence shall have the right to offer evidence tending to prove any inaccuracy of such cost survey or any state of facts which would impair its probative value.

Miss. Code Ann. § 75-23-21 Determination of cost of cigarettes purchased outside of ordinary channels of trade.

In establishing the basic cost of cigarettes to a wholesaler or a retailer, it shall not be permissible to use the invoice cost or the actual cost of any cigarettes purchased at a forced, bankrupt, or closeout sale, or other sale outside of the ordinary channels of trade.

Miss. Code Ann. § 75-23-23 Injunction.

The state tax commission, or any person injured by any violation, or who would suffer injury from any threatened violation of the Unfair Cigarette Sales Law, may maintain an action in any court of equity jurisdiction to prevent, restrain, or enjoin such violation or threatened violation. If in such action a violation or threatened violation of this law shall be established the court shall enjoin and restrain, or otherwise prohibit, such violation or threatened violation, and, in addition thereto, the court shall assess in favor of the plaintiff and against the defendant the costs of suit including reasonable attorney’s fees. In such action it shall not be necessary that actual damages to the plaintiff be alleged or proved, but where alleged and proved, the plaintiff in said action, in addition to such injunctive relief and cost of suit, including reasonable attorney’s fees shall be entitled to recover from the defendant the actual damages sustained by him. In the event that no injunctive relief is sought or required, any person injured by a violation of Unfair Cigarette Sales Law may maintain an action for damages and costs of suit in any court of general jurisdiction.

Miss. Code Ann. § 75-23-25 Rules and regulations.

The State Tax Commission shall prescribe, adopt and enforce rules and regulations relating to the administration and enforcement of the Unfair Cigarette Sales Law. The commission is hereby empowered to and may from time to time undertake and make or cause to be made one or more cost surveys for the state or such trading area or areas as it shall define and when a cost survey shall have been made by or approved by it, it shall be permissible to use the cost survey as provided in Section 75-23-19(b). The commission may revoke or suspend the license issued under the provisions of this law or the tobacco tax law of this state, of any person who refuses or neglects to comply with any provisions of this article or any rule or regulation of the commission prescribed under this article. Whenever any person fails to comply with any provision of the Unfair Cigarette Sales Law or any rule or regulation of the commission promulgated thereunder, the commission, or a hearing officer or the board of review, as designated by the commissioner, after a show cause hearing, may revoke or suspend the license held by the person. Any ruling, order or decision of the commission shall be subject to review, as provided by law, in any court of competent jurisdiction in the county in which the person affected resides.

Miss. Code Ann. § 75-23-27 License required.

After March 24, 1954, no person shall engage in or conduct the business of purchasing for resale or selling cigarettes without having first obtained the appropriate license for that purpose. All such licenses shall be issued by the state tax commission or its designated agent, who shall make rules and regulations respecting applications therefor and issuance thereof. A wholesaler or retailer who sells or intends to sell cigarettes at one, two (2) or more places of business shall be required to obtain a separate license for each place of business. Any person licensed only as a wholesaler shall not operate as a retailer unless the appropriate license therefor is first secured, and any person licensed only as a retailer shall not operate as a wholesaler unless the appropriate license therefor is first secured.

Miss. Code Ann. § 75-23-31 Definitions.

As used in this article: “Commission” or “department” means the Mississippi Department of Revenue. “Cigarette” means any roll for smoking made wholly or in part of tobacco, irrespective of size or shape and whether such tobacco is flavored, adulterated or mixed with any other ingredient, the wrapper or cover of which is made of paper or any other substance or material except tobacco. “Person” means any individual, firm, association, agency, syndicate, the State of Mississippi, county, municipal corporation or other political subdivision of this state, receiver, trustee, fiduciary or trade association.

Miss. Code Ann. § 75-23-33 Prohibited acts.

It shall be unlawful for any person: To sell or distribute in this state or to acquire, hold, own, possess or transport, for sale or distribution in this state; or to import, or cause to be imported, into this state for sale or distribution in this state: Any cigarettes the package of which: 1. Bears any statement, label, stamp, sticker or notice indicating that the manufacturer did not intend the cigarettes to be sold, distributed or used in the United States, including, but not limited to, labels stating “For Export Only,” “U.S. Tax-Exempt,” “For Use Outside U.S.” or similar wording; or 2. Does not comply with: a. All requirements imposed by or pursuant to federal law regarding warnings and other information on packages of cigarettes manufactured, packaged or imported for sale, distribution or use in the United States, including, but not limited to, the precise warning labels specified in the Federal Cigarette Labeling and Advertising Act, 15 USCS 1333; and b. All federal trademark and copyright laws; Any cigarettes imported into the United States in violation of 26 USCS 5754 or any other federal law, or implementing federal regulations; Any cigarettes that such person otherwise knows or has reason to know the manufacturer did not intend to be sold, distributed or used in the United States; or Any cigarettes for which there has not been submitted to the Secretary of the United States Department of Health and Human Services the list or lists of the ingredients added to tobacco in the manufacture of such cigarettes required by the Federal Cigarette Labeling and Advertising Act, 15 USCS 1335a; To alter the package of any cigarettes, prior to sale or distribution to the ultimate consumer, so as to remove, conceal or obscure: Any statement, label, stamp, sticker or notice described in paragraph (a)(i)1 of this section; Any health warning that is not specified in, or does not conform with the requirements of, the Federal Cigarette Labeling and Advertising Act, 15 USCS 1333; or To affix any stamp required pursuant to Chapter 69, Title 27, Mississippi Code of 1972, to the package of any cigarettes described in paragraph (a) of this section or altered in violation of paragraph (b) of this section.

Miss. Code Ann. § 75-23-35 Penalties.

Any person who commits any of the acts prohibited by Section 75-23-33, either knowing or having reason to know he is doing so, shall be guilty of a felony, and upon conviction thereof shall be punished by a fine of not more than Five Thousand Dollars ($5,000.00) or imprisonment of not more than five (5) years, or both.

Miss. Code Ann. § 75-23-37 Revocation and suspension of licenses and permits to sell tobacco; seizure, forfeiture, and destruction of contraband cigarettes.

Upon finding a violation of this article or a regulation promulgated pursuant to this article, the commission may revoke or suspend the license or licenses of any permittee pursuant to the procedures set forth in Section 27-69-9 and may also impose on the permittee a civil penalty in an amount not to exceed the greater of five hundred percent (500%) of the retail value of the cigarettes involved or Five Thousand Dollars ($5,000.00). Cigarettes that are acquired, held, owned, possessed, transported in, imported into, or sold or distributed in this state in violation of this article shall be deemed contraband under Sections 27-69-53 through 27-69-57 and shall be subject to seizure and forfeiture as provided therein. Such cigarettes so seized and forfeited shall be destroyed. Such cigarettes shall be deemed contraband whether the violation of this article is knowing or otherwise.

Miss. Code Ann. § 75-23-39 Presumption that imported cigarettes with confusingly similar trade name or trademark to that of domestic brand have been purchased outside ordinary channels of trade.

For purposes of this chapter, cigarettes imported or reimported into the United States for sale or distribution under any trade name, trade dress or trademark that is the same as, or is confusingly similar to, any trade name, trade dress or trademark used for cigarettes manufactured in the United States for sale or distribution in the United States shall be presumed to have been purchased outside of the ordinary channels of trade.

Miss. Code Ann. § 75-23-41 Enforcement of this article; injunctive or other equitable relief.

This article shall be enforced by the Attorney General, local district attorneys and local county prosecuting attorneys. The authority enforcing this article may request the assistance of local law enforcement agencies, and local law enforcement agencies receiving a request for assistance in the enforcement of this article shall provide the necessary assistance. The commission may provide assistance to the enforcing authority, including, but not limited to, the providing of information to the enforcing authority. The commission and any enforcing authority may request information from each other and from any other state agency, local or federal agency, or permittee. In addition to any other remedy provided by law, any person may bring an action for appropriate injunctive or other equitable relief, actual damages, if any, sustained by reason of a violation of this article, interest, reasonable attorney’s fees and court costs. For purposes of promoting enforcement of this article, information identifying which permittee affixed the tax stamp to a particular package of cigarettes shall be public information. If the trier of fact finds that the violation is egregious, it may increase recovery to an amount not in excess of three (3) times the actual damages sustained by reason of the violation.

Miss. Code Ann. § 75-23-43 This article inapplicable to cigarettes imported for personal use and/or sold as duty-free merchandise; penalties additional to other penalties.

This article shall not apply to: Cigarettes allowed to be imported or brought into the United States for personal use; and Cigarettes sold or intended to be sold as duty-free merchandise by a duty-free sales enterprise in accordance with the provisions of 19 USCS 1555(b) and any implementing regulations; provided, however, that this article shall apply to any such cigarettes that are brought back into the customs territory for resale within the customs territory. The penalties provided in this article are in addition to any other penalties imposed under other law.

Miss. Code Ann. § 75-23-51 Fair competition in sales of books, magazines and other printed matter; public protected.

It is hereby declared to be the legislative intent to encourage fair and honest competition; and to provide the retail merchants of this state with a freedom of choice concerning those books, pamphlets, magazines, periodicals, newspapers, picture magazines, comic books, story papers, and/or similar printed or written matters or materials which they might desire to offer for sale within their individual establishments; and to safeguard the public from exposure to printed or written materials or matters which appeal to the prurient interest, and concerning which the retail merchants of this state, or any one or more of them, might not desire to voluntarily offer for sale within their individual establishments.

Miss. Code Ann. § 75-23-53 Fair competition in sales of books, magazines and other printed matter; contracts in violation of antitrust laws.

Any contract or agreement of any nature which would, directly or indirectly, require, or result in requiring, any retail merchant located in this state to obtain or offer for sale within his individual establishment any books, pamphlets, magazines, periodicals, newspapers, picture magazines, comic books, story papers, and/or similar printed or written matters or materials, other than those which he might voluntarily select for such purpose, or as a requirement or condition to obtaining those he might voluntarily select for such purpose, shall be deemed to be a contract or agreement in restraint of the freedom of trade and a violation of the antitrust laws of this state; and the party offering such contract or agreement shall be subject to all the laws of this state pertaining to the operation of trusts and combines. In addition, the said contract or agreement shall be deemed void and cannot be enforced in any court.