Chapter 5 - Inspections, Prohibitions, and Penalties

California Business and Professions Code — §§ 22980-22983

Sections (10)

Amended by Stats. 2024, Ch. 849, Sec. 4. (AB 3218) Effective January 1, 2025.

(a)A peace officer or department employee granted limited peace officer status pursuant to paragraph (6) of subdivision (a) of Section 830.11 of the Penal Code, upon presenting appropriate credentials, is authorized to enter any place as described in paragraph (2) or (3) and to conduct inspections in accordance with all of the following:

(1)Inspections shall be performed in a reasonable manner and at times that are reasonable under the circumstances, taking into consideration the normal business hours of the place to be entered.

(2)Inspections may be at any place at which cigarettes or tobacco products are sold, produced, or stored or at any site where evidence of activities involving evasion of

cigarette or tobacco products tax and violations of Section 30165.1 of the Revenue and Taxation Code may be discovered.

(3)Inspections may be at any place where evidence of a violation of Section 104559.1 or 104559.5 of the Health and Safety Code may be discovered.

(4)Inspections shall be requested or conducted no more than once in a 24-hour period.

(b)Any person that refuses to allow an inspection shall be subject to the penalties imposed pursuant to Section 22981.

§ 22980.1

Amended by Stats. 2019, Ch. 497, Sec. 18. (AB 991) Effective January 1, 2020.

(a)A manufacturer or importer shall not sell cigarettes or tobacco products to a distributor, wholesaler, retailer, or any other person who is not licensed pursuant to this division or whose license has been suspended or revoked.

(b)(1) Except as provided in paragraph (2), a distributor or wholesaler shall not sell cigarettes or tobacco products to a retailer, wholesaler, distributor, or any other person who is not licensed pursuant to this division or whose license has been suspended or revoked.

(2)This subdivision does not apply to any sale of cigarettes or tobacco products by a distributor, wholesaler, or any other person to a retailer, wholesaler, distributor, or any

other person that the state, pursuant to the United States Constitution, the laws of the United States, or the California Constitution, is prohibited from regulating.

(c)A retailer, distributor, or wholesaler shall not purchase packages of cigarettes or tobacco products from a manufacturer or importer who is not licensed pursuant to this division or whose license has been suspended or revoked.

(d)(1) A retailer or wholesaler shall not purchase cigarettes or tobacco products from any person who is not licensed pursuant to this division or whose license has been suspended or revoked.

(2)Notwithstanding subdivision (c), a distributor shall not purchase cigarettes or tobacco products from any person who is required to be licensed pursuant to this division but who is not licensed or whose license

has been suspended or revoked.

(e)Each separate sale to, or by, a retailer, wholesaler, distributor, importer, manufacturer, or any other person who is not licensed pursuant to this division shall constitute a separate violation.

(f)A manufacturer, distributor, wholesaler, or importer shall not sell cigarette or tobacco products to any retailer or wholesaler whose license has been suspended or revoked unless all outstanding debts of that retailer or wholesaler that are owed to a wholesaler or distributor for cigarette or tobacco products are paid and the license of that retailer or wholesaler has been reinstated by the board. Any payment received from a retailer or wholesaler shall be credited first to the outstanding debt for cigarettes or tobacco products and must be immediately reported to the board. The board shall determine the debt status of a suspended retailer or

wholesaler licensee 25 days prior to the reinstatement of the license.

(g)An importer, distributor, or wholesaler, or distributor functioning as a wholesaler, or retailer, shall not purchase, obtain, or otherwise acquire any package of cigarettes to which a stamp or meter impression may not be affixed in accordance with subdivision (b) of Section 30163 or subdivision (e) of Section 30165.1 of the Revenue and Taxation Code, or any cigarettes obtained from a manufacturer or importer that cannot demonstrate full compliance with all requirements of the federal Cigarette Labeling and Advertising Act (15 U.S.C. Sec. 1335a et seq.) for the reporting of ingredients added to cigarettes.

(h)(1) Failure to comply with the provisions of this section is a misdemeanor subject to penalties pursuant to Section 22981.

(2)Notwithstanding paragraph (1), a manufacturer or importer who uses the most up-to-date licensing information provided by the board on the board’s website to determine a person’s licensing status is presumed to be in compliance with this section.

(i)The amendments that are made to this section by the act adding this subdivision shall become operative May 1, 2007.

§ 22980.2

Amended by Stats. 2025, Ch. 269, Sec. 9. (AB 573) Effective January 1, 2026.

(a)A person or entity that engages in the business of selling cigarettes or tobacco products in this state either without a valid license or after a license has been suspended or revoked, and each officer of any corporation that so engages in this business, is guilty of a misdemeanor punishable as provided in Section 22981.

(b)Each day after notification by the board or by a law enforcement agency that a manufacturer, wholesaler, distributor, importer, retailer, or any other person required to be licensed under this division offers cigarette and tobacco products for sale or exchange without a valid license for the location from which they are offered for sale shall constitute a separate violation.

(c)Continued sales or gifting of cigarettes and tobacco products either without a valid license or after a notification of suspension or revocation shall constitute a violation punishable as provided in Section 22981, and shall result in the seizure of all cigarettes and tobacco products in the possession of the person by the board or a law enforcement agency. Any cigarettes and tobacco products seized by the board or by a law enforcement agency shall be deemed forfeited.

(d)For the purposes of this section, notwithstanding subdivision (v) of Section 22971, “tobacco products” includes a product or device as defined in subdivision (d) of Section 22950.5.

(e)This section

shall be operative on January 1, 2017.

§ 22980.3

Amended by Stats. 2010, Ch. 607, Sec. 7. (AB 2733) Effective January 1, 2011.

(a)Licenses issued pursuant to this division shall be subject to suspension or revocation for violations of this division or the Revenue and Taxation Code as provided in this section.

(1)In addition to any applicable fines or penalties for a violation, upon first conviction of a violation, a licensee shall receive a written notice from the board detailing the suspension and revocation provisions of this division. At its discretion, the board may also suspend a license for up to 30 days.

(2)In addition to any applicable fines or penalties for a violation, upon a second conviction of a violation within four years of

a previous violation, the license shall be revoked.

(b)The date of the occurrence of a violation shall be used to calculate the duration between subsequent violations. A violation shall be noted in the license record at the board only after judicial conviction or final adjudication of a violation.

(c)Upon updating a record for a violation triggering a suspension, the board shall serve the licensee with a notice of suspension and shall order the licensee to cease the sale, gifting, or displaying for sale of cigarettes or tobacco products for the period of the suspension. The notice of suspension shall inform the licensee of the effective dates of the suspension.

(d)Continued sales or gifting of cigarettes or tobacco products after the effective date of the suspension shall constitute a violation of this division

and result in the revocation of a license.

(e)Upon completion of a suspension period, a license shall be reinstated by the board upon certification that all outstanding debts of that retailer or wholesaler that are owed to a wholesaler or distributor for the purchase of cigarettes and tobacco products are paid.

(f)Upon updating a record for a violation triggering a revocation, the board shall serve the licensee with a notice of revocation and shall order the licensee to cease the sale, gifting, or displaying for sale of cigarettes or tobacco products on and after the effective date of the revocation. The notice of revocation shall inform the licensee of the effective date of the revocation.

(g)After a revocation, a previously licensed applicant may apply for a new license after six months. The board may, at its

discretion, issue a new license.

(h)Upon updating a license record for a violation, suspension, or revocation to a license of a person or entity that owns or controls more than one location, the board shall send notice in writing of the violations, suspensions, or revocations within 15 days of the board’s action to the address included in the application and listed on the license for receipt of correspondence or notices from the board.

(i)Upon suspension or revocation of a license pursuant to this section, the board shall notify all licensed distributors and wholesalers by electronic mail within 48 hours of the suspension or revocation of that license. All licensed distributors and wholesalers shall provide the board and shall update, as necessary, an electronic mail address that the board can use for purposes of making the notifications required by this subdivision.

(j)Violations by a licensee at one location may not be accumulated against other locations of that same licensee. Violations accumulated against a prior owner at a licensed location may not be accumulated against a new owner at the same licensed location.

(k)For purposes of this section, a violation includes violations of the Revenue and Taxation Code relating to cigarettes and tobacco products, and violations of this division. Only one violation per discrete action shall be counted toward a suspension or revocation of a license.

§ 22980.4

Added by Stats. 2010, Ch. 607, Sec. 8. (AB 2733) Effective January 1, 2011.

A person who, after receiving a notice of suspension or revocation, continues to display for sale cigarettes or tobacco products shall be subject to a civil penalty of one thousand dollars ($1,000) for each offense, and shall not be subject to Section 22981.

§ 22980.5

Added by Stats. 2010, Ch. 607, Sec. 9. (AB 2733) Effective January 1, 2011.

(a)A retailer whose license has been suspended or revoked by order of the board shall conspicuously post a notice at both of the following locations:

(1)Each public entrance to the retail location. The notice shall directly face any person who enters the retail location and shall not be obstructed from view or placed at a height of less than four feet or greater than nine feet from the floor.

(2)Each cash register and other point of retail sale. The notice shall be posted so as to be readily viewable by a person standing at or approaching the cash register or other point of retail sale. The notice shall directly face the purchaser and

shall not be obstructed from view or placed at a height of less than four feet or greater than nine feet from the floor.

(b)The notices described in this section shall be in the size and form prescribed by the board. The notice shall be provided by the board and may be reproduced in the same size and form in order to comply with subdivision (a).

(c)A retailer whose license was suspended shall post the notice at the retail location that was the subject of the suspension for the duration of the suspension.

(d)A retailer whose license was revoked shall post the notice at the retail location that was the subject of the revocation for a 30-day period from the effective date of the revocation.

(e)Every retailer who fails to post the notices as required by

this section, who alters the notice provided by the board, or who removes the notice before the posting period required in subdivision (c) or (d), as appropriate, expires, shall be subject, notwithstanding Section 22981, to a civil penalty of one thousand dollars ($1,000) for each offense.

§ 22980.6

Added by Stats. 2025, Ch. 248, Sec. 1. (AB 8) Effective January 1, 2026.

(a)A person that is engaged in the business of selling cigarettes or tobacco products in this state shall not possess, store, own, or make a retail sale of cannabis, cannabis products, or a product presumed to be a cannabis product pursuant to subdivision (b), or any regulations promulgated pursuant to that chapter, at any site where cigarettes or tobacco products are stored or sold. A person that violates this subdivision is subject to civil penalties and suspension or revocation of their license pursuant to subdivision (d).

(b)For purposes of this section, it shall be presumed that a product that contains or purports to contain a cannabinoid, including a

synthetic cannabinoid, is a cannabis product, regardless of the nature or source of the cannabinoid. This presumption may be rebutted by evidence showing that the product does either of the following:

(1)Complies with Chapter 9 (commencing with Section 111920) of Part 5 of Division 104 of the Health and Safety Code and any regulations promulgated pursuant to that chapter.

(2)Meets the definition of industrial hemp, as that term is defined in Section 11018.5 of the Health and Safety Code.

(c)(1) In addition to the authority provided pursuant to Section 34016 of the Revenue and Taxation Code, upon discovery by the department that any person possesses, stores, owns, or has made a retail sale of

cannabis or cannabis products in violation of this section, the department is authorized to seize such products at the person’s location. Any cannabis or cannabis products seized by the department pursuant to this subdivision shall be deemed forfeited and the department shall comply with the procedures set forth in Sections 30436 to 30449, inclusive, of the Revenue and Taxation Code.

(2)Any seizures or penalties authorized pursuant to this section are in addition to any criminal or civil penalties that may be imposed by law.

(d)(1) (A) A first violation of subdivision (a) involving the seizure of cannabis or cannabis products shall be punishable as follows:

(i)Cannabis

or cannabis products with an aggregate retail value of less than two hundred dollars ($200) shall be punishable by a civil penalty of one thousand dollars ($1,000).

(ii) Cannabis or cannabis product with an aggregate retail value of two hundred dollars ($200) or more shall be punishable by a civil penalty of two thousand dollars ($2,000).

(B) A second violation of subdivision (a) within five years involving a seizure of cannabis or cannabis products shall be punishable as follows:

(i)Cannabis or cannabis products with an aggregate retail value of less than two hundred dollars ($200) shall be punishable by a civil penalty of two thousand dollars ($2,000) and shall also result in a five-day suspension of the license.

(ii) Cannabis or cannabis product with an aggregate retail value of two hundred dollars ($200) or more shall be punishable by a civil penalty of five thousand dollars ($5,000) and shall result in a 10-day suspension of the license.

(C) A third violation of subdivision (a) within five years involving a seizure of cannabis or cannabis products shall be punishable as follows:

(i)Cannabis or cannabis products with an aggregate retail value of less than two hundred dollars ($200) shall be punishable by a civil penalty of five thousand dollars ($5,000) and shall also result in a revocation of the license.

(ii) Cannabis or cannabis products with an aggregate retail

value of two hundred dollars ($200) or more shall be punishable by a civil penalty of ten thousand dollars ($10,000) and shall result in a revocation of the license.

(2)The department shall ascertain as best it may the retail value based on any information within the department’s possession or that may come into its possession of the cannabis or cannabis product.

(3)The department shall issue the civil penalty in accordance with the procedures applicable to the civil penalty authorized under Section 22974.7.

(4)The department shall revoke or suspend the license of a person who violates subdivision (a) in accordance with the procedures set forth in Section 22980.3.

(e)For purposes of this section:

(1)“Cannabis” and “cannabis products” shall have the same meaning as provided in Part 14.5 (commencing with Section 34010) of Division 2 of the Revenue and Taxation Code.

(2)“Cannabinoid” and “synthetic cannabinoid” shall have the same meaning as provided in Division 10 (commencing with Section 26000).

(f)Civil penalties collected pursuant to this section shall be deposited into the Cigarette and Tobacco Products Compliance Fund created pursuant to Section 22990.

§ 22981

Added by Stats. 2003, Ch. 890, Sec. 1. Effective January 1, 2004.

Any violation of this division by any person, except as otherwise provided, is a misdemeanor. Each offense shall be punished by a fine not to exceed five thousand dollars ($5,000), or imprisonment not exceeding one year in a county jail, or both the fine and imprisonment. The court shall order any fines assessed be deposited in the Cigarette and Tobacco Products Compliance Fund.

§ 22982

Added by Stats. 2003, Ch. 890, Sec. 1. Effective January 1, 2004.

Any prosecution for a violation of any of the penal provisions of this division shall be instituted within four years after the commission of the offense.

§ 22983

Added by Stats. 2004, Ch. 82, Sec. 8. Effective June 30, 2004.

The provisions of Chapter 4 (commencing with Section 55121) of Part 30 of Division 2 of the Revenue and Taxation Code apply with respect to the collection of the fees, civil fines, and penalties imposed pursuant to this division.