Arizona House of Representatives Committee on International Trade Meeting Minutes and Materials - February 18, 2026
Summary
The report of the regular meeting of the Arizona House of Representatives Committee on International Trade, Fifty-seventh Legislature, Second Regular Session, held Wednesday, February 18, 2026, with its attached agenda, request-to-speak report, attendance record, bill summaries and roll call votes. Chaired by Representative Rivero, the committee heard a presentation from Venionaire Capital AG on investment and innovation from a European perspective. The minutes record HB2746, a trade offices study committee, passing 7-0-0-3, HB2750, an Arizona-Sonora trade commission, passing 5-1-1-3, and HB4036, on bulk drug substances, failing 5-5-0-0. HB2765 was considered with a strike-everything amendment on vapor product manufacturers. The attachments include Majority Research Staff summaries and the House amendments to H.B. 2765.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Cite this document
“Arizona House of Representatives Committee on International Trade Meeting Minutes and Materials - February 18, 2026.”
Original at www.azleg.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/committee-8a7d1aefe0d4f0b1/
, SHA-256 7e59d378f310bdd87404a7aa40d6f4d0c7927abc36ddd34fcc15bd6aadb1674a.Full text
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - Second Regular Session
COMMITTEE ON INTERNATIONAL TRADE
Report of Regular Meeting
Wednesday, February 18, 2026
House Hearing Room | -- 8:30 A.M.
Convened 8:43 A.M.
Adjourned 11:16 A.M.
RECEIVED
CHIEF CLERKS OFFICE
FEB 19 2026
Members Present Members Not Present
Representative Austin Representative Wilmeth
Representative Carbone
Representative Cavero
Representative Hendrix
Representative Hernandez
Representative Martinez
Representative Travers
Representative Weninger
Representative Pefia, Vice-Chairman
Representative Rivero, Chairman
Agenda
Original Agenda — Attachment 1
Request to Speak
Report — Attachment 2
Committee Attendance
Report — Attachment 3
Presentations
Name Organization
Berthold Baurek-Karlic — Venionaire Capital AG
Committee Action
Bill Action Vote
HB2746 DP 7-0-0-3
HB2750 DP 5-1-1-3
HB4036 FAILED 5-5-0-0
Attachments (Handouts)
Attachments
4,5
6,7
8,9
HB2765 DPA/SE §-2-1-2 10, 11, 12
Niusly XK, Lf
Chfistie Kuhl, Committee Secretary
February 19, 2026
(Original attachments on file in the Office of the Chief Clerk; video archives available at http:/Avww.azleg.gov)
COMMITTEE ON INTERNATIONAL TRADE
February 18, 2026
REVISED - 2/16/26 REVISED - 2/16/26 REVISED - 2/16/26
ARIZONA HOUSE OF REPRESENTATIVES \
Fifty-seventh Legislature - Second Regular Session (‘on V S 6 ZOU"
REGULAR MEETING AGENDA Q) A \ \ ' \ A
COMMITTEE ON INTERNATIONAL TRADE ‘
DATE Wednesday, February 18, 2026 ROOM HHR1 TIME 8:30 A.M. (note time change)
Members of the public may access a livestream of the meeting here:
https://Awww.azleg.gov/videoplayer/?clientID=636 1 162879&eventID=202602 1106
Members:
Representative Austin Representative Hernandez C Representative Weninger
Representative Carbone Representative Martinez Representative Pefia, Vice-Chairman
Representative Cavero Representative Travers Representative Rivero, Chairman
Representative Hendrix
e Presentation: Jnvestment and Innovation from a European Perspective — Berthold Baurek-Karlic, Managing Partner
(CEO) and Founder of Venionaire Capital AG
Bills Short Title Strike Everything Title
() *HB2746 bi <7 trade offices study committee
(Rivero)
' 1-o 0 2 IT held 0-0-0-0-0, RULES
(2) HB2750 VY) rV Arizona-Sonora trade commission
(Rivero)
5 -| “ IT, RULES
‘U) HB2765 _ international trade commission S/E: vapor product manufacturer; rules;
DPAlse (Rivero) violations
5- "4 i } 4 IT, RULES
2 HB4036 ‘ bulk drug substances; prohibitions
5-5-0-0 HHS wéd, IT, RULES
* On previous agenda
ORDER OF BILLS TO BE SET BY THE CHAIRMAN
RA
vc
02H2/2026
02/16/2026
People with disabilities may request reasonable accommodations such as interpreters, alternative formats, or
assistance with physical accessibility. If you require accommodations, please contact the Chief Clerk's Office at
(602) 926-3032 or through Arizona Relay Service 7-1-1.
Page 1 of 1
Attachment |
Information Registered on the Request to Speak System
House International Trade (2/18/2026)
HB2746, trade offices study committee
Neutral:
Keith Watkins, Arizona Commerce Authority; Aaron Wodka, AZ COMMERCE AUTHORITY
HB2750, Arizona-Sonora trade commission
Support:
Dianne McCallister, Arizona Technology Council
Oppose:
Beverly Janowitz-Price, representing self; Geoff Habicht, representing self; Judith Lohr, representing self; Ted
Kaercher, representing self; michael damiano, representing self
All Comments:
Geoff Habicht, Self: This bill creates unfunded mandates for the state and destroys small businesses like mine who
are the good actors. It is a shill for Altria and RJ Big Tobacco and does nothing what they say it does. It hurts AZ
business and AZ adult consumers
HB2765, international trade commission
Testified in support:
Amanda Gray, Arizona Petroleum Marketers Association
Testified as opposed:
Brian Hummell, American Cancer Society Cancer Action Network; Tom Dorn, Vapor Technology Association; Jim
Norton, AZ Innovates Coalition
Support:
Jobe Dickinson, Border Security Alliance, COMBINED LAW ENFORCEMENT ASSOCIATION OF ARIZONA; Joshua Umar,
Arizona Petroleum Marketers Association
Oppose:
Dee Maitland, representing self; Geoff Habicht, representing self; John Paul Willett, representing self; Leslee
Steinmann, representing self; Joelene Williamson, representing self; Ted Kaercher, representing self; Bonnie Lund,
representing self; Anne Rankin, representing self; Brandon Bittner, representing self; Brett Mecum, FIFTY BAR;
JoAnna Strother, AMERICAN LUNG ASSOCIATION IN ARIZONA; Jeremy Gerlach, ARIZONA INNOVATES; michael
damiano, representing self; Robert Taney, representing self; David Kopilovitch, representing self
Attachment nt |
All Comments:
Jobe Dickinson, Border Security Alliance, COMBINED LAW ENFORCEMENT ASSOCIATION OF ARIZONA: | am in favor
of the strike everything amendment as this bill will help local law enforcement enforce regulation on illegal vapes.;
Joshua Umar, Arizona Petroleum Marketers Association: We support the strike everything amendment to HB2765.
We believe it protects AZ consumers by keeping illegal products out of the market. It cuts off profits to illicit
operators who rely on smuggling, while rewarding law-abiding businesses; Jim Norton, AZ Innovates Coalition: On
behalf of AZ INNOVATES; Geoff Habicht, Self: This is a bad bill from Big Tobacco that creates a duopoly for them. It
creates a unfunded mandate for the state and destroys the good AZ businesses, hurts AZ adult consumers, and
creates a paperwork nightmare that does nothing to stop bad actors; John Paul Willett, Self: President of Arizona
Innovates: The Harm Reduction Coalition; Joelene Williamson, Self: Don't California our Arizona!; Bonnie Lund,
Self: We need low regulations.; Jeremy Gerlach, ARIZONA INNOVATES: Oppose the S/E amendment.; Robert Taney,
Self: Always opposed to handouts to the tobacco industry when they are trying to destroy Arizona jobs and funnel
adults back onto their failing cigarettes by denying access to safer nicotine alternatives.
HB4036, bulk drug substances; prohibitions
Testified in support:
Gabrielle Cosel, representing self; Shabbir Safdar, PARTNERSHIP FOR SAFE MEDICINES
Testified as opposed:
Angela Derosa, representing self; Garet Turner, representing self
Support:
Julie Hoffman, representing self; Beatrice Rocklin, Arizona Bio Industry Association
Oppose:
Teresa Dickinson, representing self; Kevin Borg, representing self; Kris Kaniski, representing self; Xan Simonson,
representing self; Kristen Bishop, representing self; Catherine Tunget, representing self; Barbara Meaney, STRIVE
PHARMACY; Monique Whitney, representing self; Mark Boesen, Americans For Access To Compounded
Medication; Sarjit Patel, representing self; Erica Luiten, representing self; Steven Moortel, HIMS & HERS, INC;
Justin Brock, representing self; Valerie Richards, representing self; Dianne McCallister, ARIZONA PHARMACY
BUSINESS COUNCIL; Gibson McKay, AZ NATUROPATHIC MEDICAL ASSOCIATION
All Comments:
Angela Derosa, Self: As a women's health specialist, | rely on compounding pharmacies to properly care for the
special needs of my female patients. Restricting reputable & highly regulated compounding pharmacies would
greatly impact my ability to care for my patients.; Garet Turner, Self: Arizona Pharmacy Association; Valerie
Richards, Self: Will be in person for support.; Dianne McCallister, ARIZONA PHARMACY BUSINESS COUNCIL: .
HOUSE OF REPRESENTATIVES
Please PRINT Clearly
Committee on YP yyTeewATIvvn, TAA Bill Number // R29b6S
Date © 2/ 13 | re (Support Oppose O Neutral
Name 2 spw i4wenrs Need to Speak? [Yes No
Representing BOLORR SE cnr) ALLpjace__ Are you a registered lobbyist? Mo _
Complete Address 20/ €. WASH TU na ? Hr At sso oY
E-mail Address 4 ustiaherrs H93L egw . «Phone Number (2 3) 2°5- 18Y 3
Comments:
***RTVE-MINUTE SPEAKING LIMIT***
ARIZONA STATE LEGISLATURE
Fifty-seventh Legislature - Second Regular Session
COMMITTEE ATTENDANCE RECORD
COMMITTEE ON INTERNATIONAL TRADE
CHAIRMAN: Tony Rivero VICE-CHAIRMAN: _ Michele Pefia
DATE 02/18/26
CONVENED els avn
RECESSED
RECONVENED
ADJOURNED lam
MEMBERS PRESENT NOT PRESENT
Austin
Carbone
Cavero
Hendrix
Hernandez C
Martinez
Travers
Weninger
Pefia, Vice-Chairman
Rivero, Chairman
TOTAL
SF SN SS
Attachment 4
ARIZONA HOUSE OF REPRESENTATIVES
57th Legislature, 2nd Regular Session
Majority Research Staff
HB2746: trade offices study committee
Sponsor: Representative Rivero, LD 27
Committee on International Trade
Overview
Establishes the Study Committee on Trade Offices (Study Committee). Lists the Study
Committee's membership and outlines its duties. Repeals the Study Committee on
September 30, 2029.
History
The Arizona Commerce Authority (ACA) must establish and supervise, at the direction of the
ACA Board of Directors, the operation of full-time or part-time offices in other states and
foreign countries for the purpose of expanding direct investment and export trade
opportunities for businesses and industries in this state, based on objective research, the
ACA determines that the effort would be beneficial to the economy of this state (A.R.S. § 41-
1504).
The ACA currently operates trade offices located in Canada (Toronto), Mexico (Mexico City
and Chihuahua), Israel (Tel Aviv), Europe (Frankfurt, Germany), Taiwan (Taipei), Republic
of Korea (Seoul), Japan (Tokyo) and more recently Romania (Bucharest), to provide support
for Arizona businesses to increase international trade and cross-border economic and
commercial ties.
Provisions
1. Creates the Study Committee, consisting of members from the House of Representatives
(House) as follows:
a. the chairperson of the International Trade Committee, or its successor committee, or
the chairperson's designee, who shall serve as the chairperson;
b. the chairpersons of the Commerce Committee, the Government Committee and the
Appropriations Committee, or its successor committees, or the chairpersons’
designees; and
c. two members of the House appointed by the House Speaker. (Sec. 1)
2. Requires the Study Committee to:
meet as the Study Committee deems necessary;
review and oversee all of the trade offices in this state under the authority of the ACA;
examine ways to improve the trade offices in this state;
solicit input and testimony form stakeholders regarding trade offices in this state;
develop findings and recommendations regarding the effectiveness of the trade offices
in this state; and
oP SS
O Prop 105 (45 votes) O Prop 108 (40 votes) 0 Emergency (40 votes) O Fiscal Note
Initials LM HB 2746
2/5/2026 Page 1 International Trade
Attachment4
f. submit a report by December 31, 2028, of the Study Committee's findings and
recommendations to the House Speaker. (Sec. 1)
3. Excludes the Study Committee members from being eligible to receive compensation.
(Sec. 1)
4, Repeals the Study Committee on September 30, 2029. (Sec. 1)
Initials LM HB 2746
2/5/2026 Page 2 International Trade
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - Second Regular Session
ROLL CALL VOTE
COMMITTEE ON International Trade BILL NO. HB 2746
DATE February 18, 2026 MOTION: \ ) \
PASS AYE NAY PRESENT | ABSENT
Austin "4
Carbone 4
Cavero /
Hendrix 4
Hernandez C 7 a
Martinez , i
Travers 4
Weninger v4
Pena, Vice-Chairman Y
Rivero, Chairman VA
tf o 0 =
APPROVED:
Fong fon:
TOMY RIVERO, Chairman
MICHELE PENA, Vice-Chairman
Muiahs <x, ,k0
COMMITTEE SECRETARY
ATTACHMENT. 5
ARIZONA HOUSE OF REPRESENTATIVES
57th Legislature, 2nd Regular Session
Majority Research Staff
HB 2750: Arizona-Sonora trade commission
Sponsor: Representative Rivero, LD 27
Committee on Transportation & Infrastructure
Overview
Establishes the Arizona-Sonora Trade Commission (Commission). Lists the Commission's
membership, duties and reporting requirements. Repeals the Commission on July 1, 2031.
History
The Arizona-Mexico Commission (AMC) is a group of binational committees run under the
executive powers of Arizona. The AMC committees are challenged by the Governors of
Arizona and Sonora to work on a wide range of issues, with the shared goal of improving the
quality of life in the shared region through cross-border collaboration. The AMC committees
are led by co-chairs and committee members from both the public and private sector who
come together under the leadership of the governors to identify areas where cooperation can
benefit both states.
The committee's welcome participation from members of the AMC and the Comisién Sonora-
Estados Unidos (CSEU). The AMC/CSEU binational committees meet formally four times
per year. Accomplishments from the committee are presented to the governors twice each
year at the summer and winter commission meetings.
Except as otherwise stated by statute or specific legislative appropriation, members of the
boards, commissions, councils or advisory committees who are authorized by law to receive
compensation may receive compensation at the rate of not to exceed thirty dollars for each
day engaged in the services of such board, commission, council or advisory committee (A.R.S.
§ 38-611).
A state employee, who is eligible for reimbursement, must be reimbursed for lodging, meal
and incidental expenses or long-term subsistence incurred when on authorized state
business. The director of the Department of Administration establishes maximum amounts
for reimbursement (A.R.S. § 88-624),
Provisions
1. Establishes the Commission, consisting of two members, appointed by the Senate
President and two members appointed by the Speaker of the House of Representatives,
who have knowledge of or any involvement in an organization that promotes Sonoran
affairs or who have interest in the well-being of trade relations between this state and
Sonora, Mexico. (Sec. 1)
O Prop 105 (45 votes) O Prop 108 (40 votes) O Emergency (40 votes) O Fiscal Note
Initials LM/IC HB 2750
1/21/2026 Page 1 Transportation & Infrastructure
Attachment 0
2. Instructs that all appointments to the Commission must be made no later than December
31, 2026, and for a four-year term. (Sec. 1)
3. Stipulates that vacancies must be filled in the same manner as the initial appointment.
(Sec. 1)
4, Mandates that appointed members of the Commission must receive compensation at a
rate of no more than $30 for each day spent in the performance of duties and are eligible
for reimbursement as prescribed. (Sec. 1)
5. Outlines the duties of the Commission, requiring that they must:
annually elect a chairperson and vice chairperson from among its members;
meet at least annually and at the call of the chairperson;
advance bilateral trade and investment between this state and Sonora, Mexico;
initiate joint action on policy issues of mutual interest between this state and Sonora,
Mexico;
promote business and academic exchanges between this state and Sonora, Mexico;
encourage mutual economic support between this state and Sonora, Mexico;
g. encourage mutual investment in the infrastructure of this state and Sonora, Mexico;
and
h, submit a report containing the Commission's findings, results and recommendations
to the Senate President and the Speaker of the House of Representatives and provide
and copy of the report to the Secretary of State, by December 31, 2027 and each year
thereafter. (Sec. 1)
6. Repeals the Commission on July 1, 2081, and repeals the Commission's duties and
reporting requirements on January 1, 2032. (Sec. 2)
Be op
rm ©
7, Contains a purpose statement. (Sec. 3)
Initials LM/IC HB 2750
1/21/2026 Page 2 Transportation & Infrastructure
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - Second Regular Session
ROLL CALL VOTE
COMMITTEE ON International Trade BILL NO. __HB 2750
DATE February 18, 2026 MOTION: Dr
PASS AYE NAY PRESENT | ABSENT
Austin ri
Carbone J
Cavero uf
Hendrix of
Hernandez C 4
Martinez /
Travers we
Weninger VA
Pena, Vice-Chairman V4
Rivero, Chairman ae
je
APPROVED:
‘dom Pow
TONY, IVERO, Chairman
MICHELE PENA, Vice-Chairman
“COMMITTEE SECRETARY
ATTACHMENT a
ARIZONA HOUSE OF REPRESENTATIVES
57th Legislature, 2nd Regular Session
Majority Research Staff
Ls
ae
. ad
o—
{EpivaY Deus
>
"
U
iE
Wat
HB4036: bulk drug substances; prohibitions
Sponsor: Representative Pena, LD 23
Committee on International Trade
Overview
Regulates compounded medications and bulk drug substances.
History
It is unlawful for any person to compound, sell or dispense any drugs or to dispense or
compound the prescription orders of a medical practitioner, unless that person is a
pharmacist or a pharmacy intern acting under the direct supervision of a pharmacist. A
pharmacy technician or support personnel is not prevented from assisting in the dispensing
of drugs if this is done pursuant to rules adopted by the Arizona State Board of Pharmacy
(Board) and under the direct supervision of a licensed pharmacist or under remote
supervision by a pharmacist (A.R.S. § 32-1961).
Compounding pharmacies licensed in this state must have access to active pharmaceutical
ingredients for use in compounding that meet United States pharmacopeia monographs, if
the active pharmaceutical ingredient: 1) is prepared for use by a United States Food and
Drug Administration-registered (FDA) active pharmaceutical ingredient manufacturer or
packager; and 2) is shipped into this state in compliance with state law and arrives with a
certificate of analysis detailing quality specifications, in order to provide chronically ill
patients and terminally ill patients with the prescribed individual course of treatment (A.R.S.
§ 32-1971).
Provisions
1. Mandates that is it unlawful for any person or entity to engage in the sale, transfer or
distribution of a drug compounded under the Federal Food, Drug, and Cosmetic Act
(FD&C Act) using a drug substance that is a glucose-dependent insulinotropic
polypeptide receptor or glucagon-like peptide-1 receptor agonist used for obesity or weight
management or a drug substance component of a similar drug approved by the FDA for
obesity or weight management. (Sec. 1)
2. Allows the drug compounder to be sold, transferred or distributed only if the compounder:
a. uses bulk drug substances that comply with the standards of a United States
pharmacopoeia or national formulary monograph and the United States
pharmacopoeia chapter on pharmacy compounding, as prescribed;
b. confirms that any bulk drug substance used was manufactured according to the
process prescribed by federal law;
c. ensures that the bulk drug substance is a pharmaceutical grade product;
O Prop 105 (45 votes) O Prop 108 (40 votes) UO Emergency (40 votes) UO Fiscal Note
Initials LM HB 4036
2/13/2026 Page 1 International Trade
Attachment ©
d. verifies that the bulk drug substance is accompanied by a valid certificate of analysis;
e. conducts and documents quality control testing of any bulk drug substance before its
use in a compounded drug, as outlined;
f. conducts and documents quality control testing of the finished drug product
compounded, as prescribed;
g. obtains proof that the manufacture of the bulk drug substance took place in an
establishment that meets listed requirements; and
h. complies with the FD&C Act. (Sec. 1)
3. Stipulates that it is unlawful for any manufacturer or wholesaler to sell, transfer or
distribute a bulk drug substance for use in compounding without providing to the
purchaser written verification that the substance is pharmaceutical grade and meets
sourcing requirements and documentation of any quality control testing as outlined. (Sec.
1)
4, Requires any person or entity engaging in the sale, transfer or distribution of compounded
drugs to maintain all records related to the acquisition, examination and testing of the
bulk drug substance for at least two years after the expiration date of the last lot of drug
substance, as prescribed. (Sec. 1)
5, Authorizes the Board or the Board's authorized agent to inspect any person or entity
engaging in compounding drugs, as well as any domestic supplier, wholesaler, repackager
or other provider of the drug substance. (Sec. 1)
6. Asserts that refusal to allow the Board access to conduct an inspection constitutes a
violation. (Sec. 1)
7. Mandates that it is unlawful for any person to advertise or otherwise promote
compounded medications unless the advertisement is truthful and not misleading as
outlined. (Sec. 1)
8. Subjects a person or entity in violation to a civil penalty of $1,000 per dose of the illegally
compounded drug sold, transferred or distributed and a suspension or revocation of the
licensee's or permittee's license or permit. (Sec. 1)
9. Allows the Board to adopt rules as necessary to implement regulation on compounded
medications. (Sec. 1)
10. Defines pertinent terms. (Sec. 1)
11. Contains legislative findings. (Sec. 1)
Initials LM HB 4036
2/13/2026 Page 2 International Trade
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - Second Regular Session
ROLL CALL VOTE
COMMITTEE ON International Trade BILL NO. HB 4036
DATE February 18, 2026 MOTION: Cartel
PASS AYE NAY PRESENT | ABSENT
Austin V
Carbone 4
Cavero if
Hendrix “ff
Hernandez C ev
Martinez 4
Travers VA
Weninger ri
Pena, Vice-Chairman
Rivero, Chairman
APPROVED:
Yen fa
TONY RIVERO, Chairman
MICHELE PENA, Vice-Chairman
Q
V4
“4
é Es Bee
[hug Kh
- COMMITTEE SECRETARY
ATTACHMENT 4
ARIZONA HOUSE OF REPRESENTATIVES
57th Legislature, 2nd Regular Session
Majority Research Staff
HB 2765: internationaltrade commission
S/E: vapor product manufacturer; rules; violations
Sponsor: Representative Rivero, LD 27
Committee on International Trade
Summary of Strike-Everything Amendment to HB 2765
Overview
Regulates vapor products. Mandates rules and requirements for vapor product
manufacturers and for the Arizona Department of Revenue (DOR).
History
Current statute tasks DOR with regulating the licensure of tobacco retailers, the taxation of
tobacco products and recordkeeping of importers, distributors and retailers of tobacco
products. Every person acquiring or possessing for the purposes of making the initial sale or
distribution in this state of any tobacco products on which a luxury privilege tax is imposed
must obtain from DOR a license to sell tobacco products.
The application for the tobacco distributor has a fee of $25 for each place of business listed in
the application, The applicant must include in the application form the identity of the
applicant, the applicant's place of business, any location that maintains inventory of the
tobacco products, and any other location requested by DOR. If the applicant is a firm,
partnership, limited liability company or corporation, they must list the name and address
of the members or officers (A.R.S. § 42-3401, 42-8404, 42-3405).
Provisions
Vapor Product Manufacturer Licensing Fund
1. Establishes the Vapor Product Manufacturer Licensing Fund (Fund), consisting of
licensing fees and civil penalties which are subject to legislative appropriation. (Sec. 5)
2. Requires DOR to administer the Fund. (Sec. 5)
3. Mandates that Fund monies must be used for the enforcement of vapor product
manufacturer license regulation. (Sec. 5)
Vapor Product Manufacturer License
4, Allows a vapor manufacturer whether directly or through an importer, distributor,
retailer or a similar intermediary, after December 31, 2026, to offer for sale or sell vapor
products only if they hold a valid vapor product manufacturer license. (Sec. 5)
O Prop 105 (45 votes) 0 Prop 108 (40 votes) O Emergency (40 votes) CO Fiscal Note
Initials LM/IC HB 2765
2/12/2026 Page 1 International Trade
Attachment [{ )
5. Tasks DOR with establishing the rules, fees and renewal associated with the vapor
product manufacturing license (license). (Sec. 5)
6. Mandates that DOR must deposit fees related to the license into the Fund. (Sec. 5)
7. Stipulates that a license is only valid for one year, unless DOR suspends or revokes the
license and must be renewed annually. (Sec. 5)
8. Restricts renewal for a license if the manufacturer is liable for any outstanding civil
penalties. (Sec. 5)
9. Allows DOR to receive and review license applications electronically. (Sec. 5)
10. Asserts the manufacturer's license is nontransferable. (Sec. 5)
Vapor Product Certification
11. Instructs each license applicant to file, as prescribed, a certification as a condition
precedent to obtain a license. (Sec. 5)
12. Prohibits a vapor manufacturer, that has not filed the required certification, from being
issued a license and prohibits the manufacturer to sell its vapor products. (Sec. 5)
13. Requires the certification to be made under penalty of perjury on a form and in a manner
prescribed by DOR. (Sec. 5)
14, Lists the certification's requirements. (Sec. 5)
15. Restricts a vapor manufacturer from selling at retail or to a consumer any type or model
of vapor products not included in the vapor product list found in the manufacturer's
certification without first filing a DOR-approved amended certification. (Sec. 5)
16. Tasks each manufacturer that obtains a license to submit to DOR within 30 days a notice
of any changes to the manufacturer's vapor product list submitted with the required
certification and every six months, an attestation that confirms the information
submitted in the manufacturer's license application remains accurate, as outlined. (Sec.
5)
17. Asserts that applications or certificates that contain false information violate consumer
fraud regulation and are subject to remedies pertaining to consumer fraud. (Sec. 5)
18. Allows DOR to notify appropriate federal and state agencies regarding fraudulent
information submitted on an application or certificate form. (Sec. 5)
Nonresident or Foreign Manufacturer
19. Requires any nonresident or foreign manufacturer not registered to do business relating
to vapor products in this state as a foreign corporation or business entity to;
a. appoint and continually engage the services of an agent for the service of process
relating to the sale of vapor products in this state, as prescribed;
b. provide the name, address, telephone number and proof of the appointment and
availability of the agent to DOR;
c. notify DOR, as outlined:
i. at least 30 days before terminating the authority of the agent;
ii, at least 5 days before terminating the existing agent of the new agent's
appointment; and
iii. within 5 days of an agent terminating an appointment and include satisfactory
proof to DOR of the new agent's appointment. (Sec. 5)
Initials LM/IC HB 2765
2/12/2026 Page 2 International Trade
20.
21
22.
23.
24,
25.
26.
27.
28.
29.
30.
31.
Directs any nonresident or foreign manufacturer not registered in this state to submit to
DOR a surety bond or other cash security payable to this state in the amount of $25,000.
(Sec. 5)
.Outlines requirements pertaining to surety bonds for nonresident or foreign
manufacturers. (Sec. 5)
Vapor Product Manufacturer and DOR Rules
Requires a manufacturer that ceases business because of discontinuation, sale or transfer
of the manufacturer's business to notify DOR in writing at the time that the
discontinuance, sale or transfer takes effect. (Sec. 5)
Instructs a vapor manufacturer to have established sufficient contact with this state for
the exercise of personal jurisdiction over the manufacturer in any matter or issue related
to the sale of vapor products. (Sec. 5)
Tasks DOR with maintaining and making publicly available on DOR's website all licensed
vapor product manufacturers and all vapor products included in the vapor product list
submitted by the licensed manufacturer. (Sec. 5)
Restricts the sale of vapor products that are not included on the manufacturer's vapor
products list to retail consumers in this state, either directly or through an importer,
distributor, retailer or a similar intermediary. (Sec. 5)
Requires retailers to only purchase vapor products from a distributor or licensed
manufacturer and for distributors to only purchase vapor products from licensed
manufacturers. (Sec. 5)
Violations of Rules
Subjects any business operating as a vapor manufacturer without a license and a licensed
manufacturer found in violation to:
a. acivil penalty of $2,500 for their first violation;
b. a civil penalty of $5,000 and a class 2 misdemeanor, for their second violation within
36 months; and
c. acivil penalty $10,000, a class 1 misdemeanor, for their third or subsequent violation
within 36 months. An unlicensed manufacturer is ineligible to be licensed for 36
months and a manufacturer's license is to be revoked and is ineligible to receive or
renew a license for 36 months. (Sec. 5)
Tasks DOR with depositing the civil penalties collected for any violation of vapor products
rules into the Fund. (Sec. 5)
Subjects vapor products in violation of vapor regulation to seizure and destruction. (Sec.
5)
Delegation of Authority
Allows DOR to delegate the enforcement and compliance inspections to any county or law
enforcement agency that accepts this delegation and to collaborate and use the findings
of other state agencies to carry out the obligations as prescribed. (Sec. 5)
Requires the delegated licensing authority or any law enforcement agency, conducting
compliance checks to assess retail tobacco vendor compliance with the legal age, to report
the compliance check results to DOR. (Sec. 5)
Initials LM/IC HB 2765
2/12/2026 Page 3 International Trade
Miscellaneous
32. Adds vapor products to the list of items exempted from tobacco taxes. (Sec. 3)
33. Conforms vapor products, vapor product manufacturer, importer and distributor to
recordkeeping requirements on tobacco products. (Sec. 4)
34, Modifies the heading of title 42, chapter 3, article 10. (Sec. 2)
35. Contains an effective date of December 31, 2026. (Sec. 6)
36. Contains a severability clause. (Sec. 7)
37. Makes conforming and technical changes. (Sec. 1 and 4)
38. Defines pertinent terms. (Sec. 1)
Initials LM/IC HB 2765
2/12/2026 Page 4 International Trade
Fifty-seventh Legislature International Trade
Second Regular Session H.B. 2765
ONO HP WDM FE
PROPOSED
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2765
(Reference to printed bill)
Strike everything after the enacting clause and insert:
"Section 1. Section 42-3001, Arizona Revised Statutes, is amended
to read:
42-3001. Definitions
In this chapter, unless the context otherwise requires:
1. “Affix" and "affixed" include imprinting tax meter stamps on
packages and individual containers as authorized by the department.
2. “Brand family" has the same meaning prescribed in_ section
44-7111.
3. "Cavendish" means a tobacco product that is smoked from a pipe
and that meets one of the following criteria:
(a) Is described as cavendish, as containing cavendish or as a
cavendish blend on its packaging, labeling or promotional materials.
(b) Appears to have been processed or manufactured with an amount
of flavorings and humectants that exceeds twenty percent of the weight of
the tobacco contained in the product.
(c) Appears to be blended with or contain a tobacco product
described in subdivision (b) of this paragraph.
4. "Cider" means vinous liquor that is made from the normal
alcoholic fermentation of the juice of sound, ripe apples, pears or other
pome fruit, including flavored, sparkling and carbonated cider and cider
made from condensed apple, pear or other pome fruit must, and that
contains more than one-half of one percent of alcohol by volume but not
more than seven percent of alcohol by volume.
5. "Cigar" means any roll of tobacco wrapped in leaf tobacco or in
any substance containing tobacco other than any roll of tobacco that is a
cigarette, as defined in paragraph 6, subdivision (b) of this section.
6. "Cigarette" means either of the following:
(a) Any roll of tobacco wrapped in paper or any substance not
containing tobacco.
(b) Any roll of tobacco wrapped in any substance containing tobacco
that, because of its appearance, the type of tobacco used in the filler or
its packaging and labeling, is likely to be offered to or purchased by a
consumer as a cigarette described in subdivision (a) of this paragraph.
This subdivision shall be interpreted consistently with the classification
guidelines established by the federal alcohol and tobacco tax and trade
bureau.
7. “Consumer” means a person in this state that comes into
possession of any luxury subject to the tax imposed by this chapter and
House Amendments to H.B. 2765
ONO nF WDM FE
that, on coming into possession of the luxury, is not a distributor
intending to sell or distribute the luxury, a retailer or a wholesaler.
8. "Craft distiller" means a distiller in the United States or in a
territory or possession of the United States that holds a license pursuant
to section 4-205.10.
9. "Distributor" means any person that manufactures, produces,
ships, transports or imports into this state or in any manner acquires or
possesses for the purpose of making the first sale of the following:
(a) Cigarettes without Arizona tax stamps affixed ds required by
this article.
(b) Roll-your-own tobacco or other tobacco products on which the
taxes have not been paid as required by this chapter.
(c) VAPOR PRODUCTS.
(d) OTHER PRODUCTS THAT CONTAIN NICOTINE OR A NICOTINE ANALOG,
UNLESS THE PRODUCT IS REGULATED BY THE UNITED STATES FOOD AND DRUG
ADMINISTRATION UNDER CHAPTER V OF THE FEDERAL FOOD, DRUG, AND COSMETIC
ACT.
10. “Farm winery" has the same meaning prescribed in section 4-101.
11. "First sale" means the initial sale or distribution in
intrastate commerce or the initial use or consumption of cigarettes,
roll-your-own tobacco or other tobacco products.
12. "Luxury" means any article, object or device on which a tax is
imposed under this chapter.
13. "Malt liquor" means any liquid that contains more than one-half
of one percent alcohol by volume and that is made by the process of
fermentation and not distillation of hops or grains, but not including:
(a) Liquids made by the process of distillation of such substances.
(b) Medicines that are unsuitable for beverage purposes.
14. "Master settlement agreement" has the same meaning prescribed
in section 44-7101.
15. "Microbrewery" has the same meaning prescribed in section
4-101.
16. “NICOTINE ANALOG" MEANS A SUBSTANCE THAT HAS A_ CHEMICAL
STRUCTURE THAT IS SUBSTANTIALLY SIMILAR TO THE CHEMICAL STRUCTURE OF
NICOTINE OR THAT HAS, PURPORTS TO HAVE OR IS REPRESENTED TO HAVE AN EFFECT
ON THE CENTRAL NERVOUS SYSTEM THAT IS SIMILAR TO OR GREATER THAN THE
EFFECT OF NICOTINE ON THE CENTRAL NERVOUS SYSTEM. FACTORS RELEVANT TO
DETERMINING WHETHER A SUBSTANCE IS A _ NICOTINE ANALOG INCLUDE THE
MARKETING, ADVERTISING AND LABELING OF THE SUBSTANCE AND WHETHER THE
SUBSTANCE HAS BEEN MANUFACTURED, FORMULATED, SOLD, DISTRIBUTED OR MARKETED
WITH THE INTENT TO AVOID THE PROVISIONS OF THIS CHAPTER OR ANY OTHER
SECTION OF LAW APPLICABLE TO NICOTINE ANALOGS.
t6> 17. “Nonparticipating manufacturer" has the same meaning
prescribed in section 44-7111.
t> 18. “Other tobacco products" means tobacco products other than
cigarettes and roll-your-own tobacco.
t8> #19. "Participating manufacturer" has the same meaning
prescribed in section 44-7111.
-2-
House Amendments to H.B. 2765
OnNanfPWNME-E
30
t8- 20 "Person" means any individual, firm, partnership, joint
venture, association, corporation, municipal corporation, estate, trust,
club, society or other group or combination acting as a unit, and the
plural as well as the singular number.
20> 21. "Place of business":
(a) Means a building, facility site or location where an order is
received or where tobacco products are sold, distributed or transferred.
Ptrace-of—-busiess
(b) Does not include a vehicle.
2t> 22. "Retailer" means any person that comes into possession of
any luxury subject to the taxes imposed by this chapter for the purpose of
selling it for consumption and not for resale.
22> 23. “Roll-your-own tobacco" means any tobacco that, because of
its appearance, type, packaging or labeling, is suitable for use and
likely to be offered to or purchased by consumers as tobacco for making
cigarettes. This paragraph shall be interpreted consistently with the
term as used in section 44-7101. This paragraph shall be interpreted
consistently with the classification guidelines established by the federal
alcohol and tobacco tax and trade bureau.
238— « 24. "Smoking tobacco":
(a) Means any tobacco that, because of its appearance, type,
packaging, labeling or promotion, is suitable for use and likely to be
offered to or purchased by consumers as tobacco for making cigarettes or
otherwise consumed by burning. ‘Smokitg—tobacco
(b) Includes pipe tobacco and roll-your-own tobacco.
2a; «25. «=—"Spirituous liquor":
(a) Means any liquid that contains more than one-half of one
percent alcohol by volume, that is produced by distillation of any
fermented substance and that is used or prepared for use as a beverage.
Spirittuors—tiquor
(b) Does not include medicines that are unsuitable for beverage
purposes.
25> 26. “Tobacco product manufacturer" has the same meaning
prescribed in section 44-7101.
26> 27. “Tobacco products" means all luxuries included in section
42-3052, paragraphs 5 through 9.
28. “VAPOR PRODUCT":
(a) MEANS A NONCOMBUSTIBLE PRODUCT THAT CONTAINS NICOTINE OR A
NICOTINE ANALOG AND THAT EMPLOYS A MECHANICAL HEATING ELEMENT, BATTERY OR
CIRCUIT, REGARDLESS OF SHAPE OR SIZE, THAT CAN BE USED TO HEAT A SOLUTION
CONTAINING NICOTINE OR A NICOTINE ANALOG.
(b) DOES NOT INCLUDE ANY PRODUCT THAT IS REGULATED BY THE UNITED
STATES FOOD AND DRUG ADMINISTRATION UNDER CHAPTER V OF THE FEDERAL FOOD,
DRUG, AND COSMETIC ACT.
29. "VAPOR PRODUCT MANUFACTURER" MEANS A PERSON OR ENTITY THAT
MANUFACTURES, FABRICATES, ASSEMBLES, PROCESSES OR LABELS A FINISHED VAPOR
PRODUCT FOR SALE IN THIS STATE.
House Amendments to H.B. 2765
ONO TNF WNY FE
27> 30. "Vehicle" means a device in, on or by which a person or
property is or may be transported or drawn on the roads of this state
regardless of the means by which it is propelled or whether it runs on a
track.
28> «431. "Vinous liquor":
(a) Means any liquid that contains more than one-half of one
percent alcohol by volume and that is made by the process of fermentation
of grapes, berries, fruits, vegetables or other substances. fut
(b) Does not include:
tay (i) Liquids in which hops or grains are used in the process of
fermentation.
toby (ii) Liquids made by the process of distillation of hops or
grains.
tcy (iii) Medicines that are unsuitable for beverage purposes.
29> 32. "Wholesaler" means a person that sells any spirituous,
vinous or malt liquor taxed under this chapter to retail dealers or for
the purposes of resale only.
Sec. 2. Heading change
The article heading of title 42, chapter 3, article 10, Arizona
Revised Statutes, is changed from "DISTRIBUTORS AND RETAILERS OF TOBACCO
PRODUCTS" to "DISTRIBUTORS, RETAILERS AND MANUFACTURERS OF TOBACCO
PRODUCTS AND VAPOR PRODUCTS".
Sec. 3. Section 42-3404, Arizona Revised Statutes, is amended to
read:
42-3404. Exemptions and exclusions of certain tobacco
products from tobacco taxes
A. The taxes imposed by this chapter do not apply to:
1. Tobacco products that are sold to the United States army, air
force, navy, marine corps or coast guard exchanges and commissaries and
navy or coast guard ships’ stores.
2. Tobacco products that are sold to the United States department
of veterans affairs.
3. Tobacco products that are non-tax-paid under subtitle E, chapter
52 of the internal revenue code and that are under internal revenue bond
or customs control.
4. Tobacco products that are sold or transferred to a_ law
enforcement agency for use in a criminal investigation if the sale or
transfer is authorized by the department. A law enforcement agency
authorized by the department to receive or purchase tobacco products is
not required to:
(a) Be licensed as a distributor.
(b) Collect or remit the tax imposed by this chapter with respect
to authorized distributions.
5. Tobacco products that are sold by a distributor licensed under
section 42-3401 to a common carrier engaged in foreign passenger service
or to a retailer that sells tobacco products on the facilities of the
carrier that are dedicated to foreign passenger service.
-4-
House Amendments to H.B. 2765
ONOnHPWNMF-E
6. Federally tax free tobacco products that are sold or given for
delivery directly from the manufacturer under internal revenue bond to a
veterans' home of this state or a hospital or domiciliary facility of the
United States department of veterans affairs for gratuitous issue to
veterans receiving hospitalization or domiciliary care. The taxes are not
imposed with respect to the use or consumption of the tobacco products by
the institution, veteran patients or domiciliaries.
7. Tobacco products that are sold by a manufacturer to a
distributor licensed under section 42-3401.
8. Tobacco products that are manufactured outside the United States
and that are sold by an importer to a distributor licensed under section
42-3401.
9. VAPOR PRODUCTS.
B. Subsection A, paragraphs 1 and 2 of this section do not apply
after the first day of the first calendar month beginning more than sixty
days after existing federal law is amended to permit state taxation of
cigarettes sold by or through federal military installations.
C. Sales of tobacco products by a licensed distributor to an
instrumentality of the United States government must be supported by a
separate sales invoice and a properly completed federal exemption
certificate. Each sales invoice must be numbered, be dated and show the
name of the seller, the name of the purchaser and the destination.
D. This section does not affect the imposition of transaction
privilege and use taxes pursuant to chapter 5 of this title to any
transactions described in subsection A of this section if the transaction
is otherwise subject to transaction privilege tax or use tax.
E. The exemptions and exclusions provided in subsection A of this
section do not affect the taxability under this chapter of tobacco
products that are sold, given or transferred to a person in this state
subsequent to the transactions described in subsection A of this section.
Sec. 4. Section 42-3405, Arizona Revised Statutes, is amended to
read:
42-3405. Tobacco and vapor product manufacturers, importers,
distributors and retailers; recordkeeping and
invoicing requirements; retention period
A. Except for retail transactions with consumers, each
manufacturer, importer and distributor of tobacco products AND EACH VAPOR
PRODUCT MANUFACTURER, IMPORTER AND DISTRIBUTOR shall maintain copies of
invoices or equivalent documentation for each facility and for each
transaction that involves the sale, purchase, transfer, consignment or
receipt of tobacco products AND VAPOR PRODUCTS within this state. The
invoices or equivalent documentation for each transaction shall be in the
form and manner prescribed by the department and shall indicate the name
and address of the other party and the quantity by brand style of the
tobacco products OR VAPOR PRODUCTS involved in the transaction.
B. A distributor of tobacco products OR VAPOR PRODUCTS shall issue
an invoice or equivalent documentation for each transaction that involves
the sale, purchase or consignment of tobacco products OR VAPOR PRODUCTS to
-5-
House Amendments to H.B. 2765
a retailer. The invoice or equivalent documentation must include the
license number of the distributor, which the retailer may use to ascertain
whether the license is current and valid.
C. Any retailer of tobacco products OR VAPOR PRODUCTS shall retain
all invoices or equivalent documentation received under subsection B of
this section.
D. Records required under this section shall be preserved on the
premises described in the relevant license in a manner as to ensure
accessibility for inspection at reasonable hours by authorized personnel
of the department. With the department's permission, persons with
multiple places of business may retain centralized records;— but shall
transmit duplicates of the invoices or the equivalent documentation to
each place of business within three business days after a request by the
department.
E. The records required by this section shall be retained for a
period of four years after the date of the transaction.
F. On request, the department and the United States secretary of
the treasury or secretary's designee shall have access to records required
under this section and reports required under section 42-3462. The
department at its sole discretion may share the records and reports
required by this chapter with other law enforcement officials of federal
and state governments under conditions that assume the confidentiality of
taxpayer information contained in the records and reports.
Sec. 5. Title 42, chapter 3, article 10, Arizona Revised Statutes,
is amended by adding sections 42-3407, 42-3408 and 42-3409, to read:
42-3407. Vapor product manufacturer license; rules; fees;
certification; application; bond; product list;
civil penalties; violation; classification
A. FROM AND AFTER DECEMBER 31, 2026, A VAPOR PRODUCT MANUFACTURER
MAY NOT OFFER FOR SALE OR SELL VAPOR PRODUCTS, WHETHER DIRECTLY OR THROUGH
AN IMPORTER, DISTRIBUTOR OR RETAILER OR A_ SIMILAR INTERMEDIARY OR
INTERMEDIARIES, WITHOUT A VALID VAPOR PRODUCT MANUFACTURER LICENSE.
B. THE DEPARTMENT SHALL ADOPT RULES TO ADMINISTER THIS SECTION AND
ESTABLISH FEES FOR AN INITIAL VAPOR PRODUCT MANUFACTURER LICENSE AND THE
RENEWAL OF THE LICENSE. THE DEPARTMENT SHALL DEPOSIT, PURSUANT TO
SECTIONS 35-146 AND 35-147, THE FEES COLLECTED PURSUANT TO THIS SECTION IN
THE VAPOR PRODUCT MANUFACTURER LICENSING FUND ESTABLISHED BY SECTION
42-3409.
C. A VAPOR PRODUCT MANUFACTURER LICENSE IS VALID FOR ONE YEAR,
UNLESS THE DEPARTMENT OR THE DEPARTMENT'S DESIGNEE SUSPENDS OR REVOKES THE
LICENSE, AND MUST BE RENEWED ANNUALLY. A VAPOR PRODUCT MANUFACTURER
LICENSE MAY NOT BE RENEWED IF THE VAPOR PRODUCT MANUFACTURER IS LIABLE FOR
ANY OUTSTANDING CIVIL PENALTIES PURSUANT TO THIS SECTION. THE DEPARTMENT
MAY RECEIVE AND REVIEW VAPOR PRODUCT MANUFACTURER LICENSE APPLICATIONS
ELECTRONICALLY.
D. EACH APPLICANT FOR A VAPOR PRODUCT MANUFACTURER LICENSE SHALL
FILE A CERTIFICATION AS PROVIDED IN THIS SECTION AS A CONDITION PRECEDENT
TO OBTAIN A LICENSE. WITHOUT FILING THE CERTIFICATION, THE VAPOR PRODUCT
-6-
House Amendments to H.B. 2765
ONOnNFP WN FE
MANUFACTURER MAY NOT BE ISSUED A VAPOR PRODUCT MANUFACTURER LICENSE AND
MAY NOT SELL ITS VAPOR PRODUCTS IN THIS STATE OR TO A CONSUMER IN THIS
STATE, WHETHER DIRECTLY OR THROUGH A DISTRIBUTOR OR RETAILER OR A SIMILAR
INTERMEDIARY OR INTERMEDIARIES.
E. A CERTIFICATION FILED UNDER THIS SECTION SHALL BE MADE UNDER
PENALTY OF PERJURY ON A FORM AND IN A MANNER PRESCRIBED BY THE DEPARTMENT.
THE CERTIFICATION MUST INCLUDE THE FOLLOWING:
1. THE NAME AND ADDRESS OF THE APPLICANT OR, IF THE APPLICANT IS A
FIRM, PARTNERSHIP, LIMITED LIABILITY COMPANY OR ASSOCIATION, THE NAME AND
ADDRESS OF EACH OF ITS MEMBERS OR, IF THE APPLICANT IS A CORPORATION, THE
NAME AND ADDRESS OF EACH OF ITS OFFICERS AND THE ADDRESS OF ITS PRINCIPAL
PLACE OF BUSINESS.
2. THE ADDRESS OF THE PRINCIPAL PLACE OF BUSINESS OF THE APPLICANT
THAT IS SEEKING A LICENSE.
3. EITHER OF THE FOLLOWING:
(a) A COPY OF THE PREVENT ALL CIGARETTE TRAFFICKING ACT OF 2009
REGISTRATION FORM, OR AN EQUIVALENT SUCCESSOR FORM, DESIGNATED BY THE
BUREAU OF ALCOHOL, TOBACCO, FIREARMS AND EXPLOSIVES OF THE UNITED STATES
DEPARTMENT OF JUSTICE AS SUBMITTED BY THE APPLICANT TO THE BUREAU OF
ALCOHOL, TOBACCO, FIREARMS AND EXPLOSIVES AND AN ATTESTATION THAT THE
APPLICANT IS IN COMPLIANCE WITH, AND WILL CONTINUE TO COMPLY WITH, ALL
APPLICABLE REQUIREMENTS OF 15 UNITED STATES CODE SECTIONS 375 AND 376.
(b) A STATEMENT EXPLAINING WHY THE PREVENT ALL CIGARETTE
TRAFFICKING ACT OF 2009 IS NOT APPLICABLE TO THE APPLICANT AND THE
APPLICANT'S PRODUCTS.
4. AN ATTESTATION THAT THE APPLICANT WILL COMPLY WITH ALL
APPLICABLE LAWS OF THIS STATE AND ALL APPLICABLE LAWS OF THE JURISDICTION
THAT ENCOMPASSES THE APPLICANT'S PRINCIPAL PLACE OF BUSINESS.
5. A LIST OF EACH TYPE OR MODEL OF THE APPLICANT'S VAPOR PRODUCT
THAT IS SOLD OR OFFERED FOR SALE IN THIS STATE, INCLUDING FOR EACH VAPOR
PRODUCT THE VAPOR PRODUCT NAME, VAPOR PRODUCT CATEGORY, VOLUME OF NICOTINE
BY WEIGHT AND TOTAL VOLUME.
6. A NOTARIZED ATTESTATION THAT THE APPLICANT'S VAPOR PRODUCTS, AS
WELL AS ALL COMPONENTS OR PARTS OF VAPOR PRODUCTS, FULLY COMPLY WITH THE
REQUIREMENTS OF THE UNITED STATES CUSTOMS AND BORDER PROTECTION, INCLUDING
ACCURATE ENTRY SUMMARY FORMS, OR EQUIVALENT SUCCESSOR FORMS, AND THAT THE
APPLICANT IS NOT IN VIOLATION OF 18 UNITED STATES CODE SECTION 541, 542 OR
545. THE DEPARTMENT MAY REQUEST THAT THE APPLICANT PROVIDE ADDITIONAL
RELEVANT DOCUMENTS, INCLUDING COPIES OF OTHER UNITED STATES CUSTOMS AND
BORDER PROTECTION FORMS, COMMERCIAL INVOICES, CARGO RELEASE RESULTS
REPORTS AND AIRWAY BILLS OR BILLS OF LADING.
7. FOR AN APPLICANT WITH A PRINCIPAL PLACE OF BUSINESS LOCATED
OUTSIDE OF THE UNITED STATES, A DECLARATION, IN A FORM PRESCRIBED BY THE
DEPARTMENT, FROM EACH OF THE APPLICANT'S IMPORTERS INTO THE UNITED STATES
OF ANY OF THE APPLICANT'S BRANDS TO BE SOLD OR OFFERED FOR SALE IN THIS
STATE, THAT THE IMPORTER ACCEPTS JOINT AND SEVERAL LIABILITY WITH THE
APPLICANT FOR ALL LIABILITY IMPOSED IN ACCORDANCE WITH THIS SECTION,
-7-
House Amendments to H.B. 2765
WOON A AHP WNMHEHE
PHPHHPFPHP HPP PWWWWWWWWWWDNYDYDMYDNDNY DY DY DNMDEDN DN FFF RP RP RRP RR
ONAN FP WHF TWO ON DOR WHF TOWO AON A TNHPWNHEFOWO ANA TNHWNHEHE OC
INCLUDING ANY FEES, COSTS, ATTORNEY FEES AND PENALTIES IMPOSED UNDER THIS
CHAPTER.
8. ANY OTHER INFORMATION AS THE DEPARTMENT MAY REQUIRE FOR THE
PURPOSE OF ADMINISTERING THIS CHAPTER.
F. A VAPOR PRODUCT MANUFACTURER MAY NOT CAUSE TO BE SOLD OR OFFER
FOR SALE AT RETAIL IN THIS STATE OR TO A CONSUMER IN THIS STATE ANY TYPE
OR MODEL OF VAPOR PRODUCT THAT IS NOT INCLUDED IN THE VAPOR PRODUCT LIST
PROVIDED WITH THE VAPOR PRODUCT MANUFACTURER'S CERTIFICATION WITHOUT FIRST
FILING AN AMENDED CERTIFICATION ON A FORM AND IN A MANNER PRESCRIBED BY
THE DEPARTMENT.
G. EACH VAPOR PRODUCT MANUFACTURER THAT OBTAINS A LICENSE UNDER
THIS SECTION SHALL SUBMIT TO THE DEPARTMENT:
1. WITHIN THIRTY DAYS OF ANY CHANGES TO THE VAPOR PRODUCT
MANUFACTURER'S VAPOR PRODUCT LIST SUBMITTED WITH THE CERTIFICATION
REQUIRED BY THIS SECTION, A NOTICE OF THE CHANGES.
2. EVERY SIX MONTHS, AN ATTESTATION THAT CONFIRMS THE INFORMATION
SUBMITTED IN THE VAPOR PRODUCT MANUFACTURER'S LICENSE APPLICATION REMAINS
ACCURATE. THE DEPARTMENT MAY REQUEST THAT THE VAPOR PRODUCT MANUFACTURER
PROVIDE ADDITIONAL RELEVANT DOCUMENTS RELATED TO THE ATTESTATION.
H. SUBMISSION OF AN APPLICATION OR CERTIFICATION THAT CONTAINS
FALSE INFORMATION IS A VIOLATION OF TITLE 44, CHAPTER 10, ARTICLE 7 AND IS
SUBJECT TO REMEDIES AVAILABLE UNDER TITLE 44, CHAPTER 10, ARTICLE 7. THE
DEPARTMENT MAY NOTIFY APPROPRIATE FEDERAL AND STATE AGENCIES REGARDING
FALSE INFORMATION SUBMITTED ON AN APPLICATION OR CERTIFICATION FORM.
I. ANY NONRESIDENT OR FOREIGN VAPOR PRODUCT MANUFACTURER THAT HAS
NOT REGISTERED TO DO BUSINESS IN THIS STATE AS A FOREIGN CORPORATION OR
BUSINESS ENTITY, AS A CONDITION PRECEDENT TO RECEIVING A VAPOR PRODUCT
MANUFACTURER LICENSE, SHALL APPOINT AND CONTINUALLY ENGAGE WITHOUT
INTERRUPTION THE SERVICES OF AN AGENT IN THIS STATE TO ACT AS AGENT FOR
THE SERVICE OF PROCESS ON WHOM ALL PROCESS, AND ANY ACTION OR PROCEEDING
AGAINST THE VAPOR PRODUCT MANUFACTURER CONCERNING OR ARISING OUT OF THE
ENFORCEMENT OF THIS SECTION OR PROVISIONS RELATING TO THE SALE OF THE
VAPOR PRODUCT MANUFACTURER'S VAPOR PRODUCTS IN THIS STATE, MAY BE SERVED
IN ANY MANNER AUTHORIZED BY LAW. SERVICE ON THE AGENT CONSTITUTES LEGAL
AND VALID SERVICE OF PROCESS ON THE VAPOR PRODUCT MANUFACTURER. THE VAPOR
PRODUCT MANUFACTURER SHALL PROVIDE THE NAME, ADDRESS, TELEPHONE NUMBER AND
PROOF OF THE APPOINTMENT AND AVAILABILITY OF THE AGENT TO THE DEPARTMENT.
THE VAPOR PRODUCT MANUFACTURER SHALL NOTIFY THE DEPARTMENT AT LEAST THIRTY
CALENDAR DAYS BEFORE TERMINATING THE AUTHORITY OF AN AGENT AND PROVIDE
PROOF TO THE SATISFACTION OF THE DEPARTMENT OF A NEW AGENT'S APPOINTMENT
AT LEAST FIVE CALENDAR DAYS BEFORE TERMINATING THE EXISTING AGENT
APPOINTMENT. IF AN AGENT TERMINATES AN APPOINTMENT, THE VAPOR PRODUCT
MANUFACTURER SHALL NOTIFY THE DEPARTMENT OF THE TERMINATION WITHIN FIVE
CALENDAR DAYS AND INCLUDE PROOF TO THE SATISFACTION OF THE DEPARTMENT OF A
NEW AGENT'S APPOINTMENT.
J. ANY NONRESIDENT OR FOREIGN VAPOR PRODUCT MANUFACTURER THAT HAS
NOT REGISTERED TO DO BUSINESS IN THIS STATE AS A FOREIGN CORPORATION OR
BUSINESS ENTITY, AS A CONDITION PRECEDENT TO RECEIVING A VAPOR PRODUCT
-8-
House Amendments to H.B. 2765
WO ONDA AHWNHH
MANUFACTURER LICENSE, SHALL SUBMIT TO THE DEPARTMENT A SURETY BOND OR
OTHER CASH SECURITY PAYABLE TO THIS STATE IN THE AMOUNT OF $25,000. THE
BOND SHALL BE POSTED BY A CORPORATE SURETY LOCATED WITHIN THE UNITED
STATES. THE BOND SHALL BE CONDITIONED ON THE PERFORMANCE BY THE VAPOR
PRODUCT MANUFACTURER OF THE REQUIREMENTS PRESCRIBED BY THIS SECTION. A
SURETY ON A VAPOR PRODUCT MANUFACTURER'S BOND IS LIABLE FOR UP TO THE
AMOUNT OF THE BOND, AND THIS STATE MAY EXECUTE ON THE SURETY BOND FOR THE
PAYMENT OF FEES AND CIVIL PENALTIES IMPOSED ON THE VAPOR PRODUCT
MANUFACTURER UNDER THIS SECTION AND FOR THE COSTS OF SEIZURE AND
DESTRUCTION OF VAPOR PRODUCTS SOLD OR OFFERED FOR SALE IN VIOLATION OF
THIS SECTION. IF THIS STATE EXECUTES ON THE SURETY BOND, THE DEPARTMENT
MAY REQUIRE THE VAPOR PRODUCT MANUFACTURER TO PROVIDE AN ADDITIONAL BOND
BEFORE RETAINING THE VAPOR PRODUCT MANUFACTURER OR THE VAPOR PRODUCT
MANUFACTURER'S VAPOR PRODUCTS ON THE LISTS ON THE DEPARTMENT'S WEBSITE. A
SURETY ON A BOND FURNISHED BY A VAPOR PRODUCT MANUFACTURER AS PROVIDED IN
THIS SECTION SHALL BE RELEASED AND DISCHARGED FROM LIABILITY TO THIS
STATE, ACCRUING ON THE BOND AFTER SIXTY DAYS FROM THE DATE ON WHICH THE
SURETY PROVIDES A WRITTEN REQUEST TO BE RELEASED AND DISCHARGED TO THE
DEPARTMENT. THIS SUBSECTION DOES NOT RELIEVE, RELEASE OR DISCHARGE THE
SURETY FROM LIABILITY ALREADY ACCRUED OR THAT WILL ACCRUE BEFORE THE
SIXTY-DAY PERIOD EXPIRES. THE DEPARTMENT, ON RECEIVING ANY SUCH REQUEST,
SHALL NOTIFY THE VAPOR PRODUCT MANUFACTURER THAT FURNISHED THE BOND.
UNLESS THE VAPOR PRODUCT MANUFACTURER, ON OR BEFORE THE SIXTY-DAY PERIOD
EXPIRES, FILES WITH THE DEPARTMENT A NEW BOND, WITH THE SURETY APPROVED BY
AND ACCEPTABLE TO THE DEPARTMENT, THE DEPARTMENT SHALL CANCEL THE VAPOR
PRODUCT MANUFACTURER'S VAPOR PRODUCT MANUFACTURER LICENSE.
K. A VAPOR PRODUCT MANUFACTURER LICENSE IS NONTRANSFERABLE. IF A
VAPOR PRODUCT MANUFACTURER CEASES TO ODO BUSINESS BY REASON OF
DISCONTINUATION, SALE OR TRANSFER OF THE VAPOR PRODUCT MANUFACTURER'S
BUSINESS, THE VAPOR PRODUCT MANUFACTURER SHALL NOTIFY THE DEPARTMENT IN
WRITING AT THE TIME THE DISCONTINUANCE, SALE OR TRANSFER TAKES EFFECT.
L. VAPOR PRODUCTS OFFERED FOR SALE IN VIOLATION OF THIS SECTION,
INCLUDING OFFERING FOR SALE VAPOR PRODUCTS MANUFACTURED BY A BUSINESS THAT
DOES NOT HOLD A VALID VAPOR PRODUCT MANUFACTURER LICENSE, ARE SUBJECT TO
SEIZURE. ALL VAPOR PRODUCTS THAT ARE SEIZED AS A VIOLATION OF THIS
SECTION ARE FORFEITED TO THIS STATE AND SHALL BE DESTROYED CONSISTENT WITH
SECTION 42-1124.
M. A VAPOR PRODUCT MANUFACTURER SHALL HAVE ESTABLISHED SUFFICIENT
CONTACT WITH THIS STATE FOR THE EXERCISE OF PERSONAL JURISDICTION OVER THE
VAPOR PRODUCT MANUFACTURER IN ANY MATTER OR ISSUE ARISING UNDER THIS
SECTION OR RELATED TO THE SALE OF VAPOR PRODUCTS.
N. THE DEPARTMENT SHALL MAINTAIN AND MAKE PUBLICLY AVAILABLE ON THE
DEPARTMENT'S OFFICIAL WEBSITE LISTS OF BOTH OF THE FOLLOWING:
1. ALL VAPOR PRODUCT MANUFACTURERS THAT ARE LICENSED PURSUANT TO
THIS SECTION.
2. ALL VAPOR PRODUCTS INCLUDED IN THE VAPOR PRODUCT LISTS SUBMITTED
BY VAPOR PRODUCT MANUFACTURERS THAT ARE LICENSED PURSUANT TO THIS SECTION.
-9-
House Amendments to H.B. 2765
ONO TNH WNHE
O. FROM AND AFTER DECEMBER 31, 2026, VAPOR PRODUCTS THAT ARE NOT
INCLUDED ON THE A LICENSED VAPOR PRODUCT MANUFACTURER'S VAPOR PRODUCT LIST
MAY NOT BE SOLD OR OFFERED FOR RETAIL SALE TO A CONSUMER IN THIS STATE,
EITHER DIRECTLY OR THROUGH AN IMPORTER, DISTRIBUTOR OR RETAILER OR A
SIMILAR INTERMEDIARY OR INTERMEDIARIES.
P. A RETAILER SHALL PURCHASE VAPOR PRODUCTS ONLY FROM A DISTRIBUTOR
OR LICENSED VAPOR PRODUCT MANUFACTURER THAT IS LICENSED PURSUANT TO THIS
SECTION.
Q. <A DISTRIBUTOR SHALL PURCHASE VAPOR PRODUCTS ONLY FROM A VAPOR
PRODUCT MANUFACTURER THAT IS LICENSED PURSUANT TO THIS SECTION.
R. ANY BUSINESS OPERATING AS A VAPOR PRODUCT MANUFACTURER WITHOUT A
VAPOR PRODUCT MANUFACTURER LICENSE:
1. FOR A FIRST VIOLATION, SHALL PAY A CIVIL PENALTY OF $2,500.
2. FOR A SECOND VIOLATION WITHIN A THIRTY-SIX MONTH PERIOD, SHALL
PAY A CIVIL PENALTY OF $5,000 AND IS GUILTY OF A CLASS 2 MISDEMEANOR.
3. FOR A THIRD OR SUBSEQUENT VIOLATION WITHIN A THIRTY-SIX MONTH
PERIOD, SHALL PAY A CIVIL PENALTY OF $10,000, IS GUILTY OF A CLASS 1
MISDEMEANOR AND IS INELIGIBLE TO BE LICENSED AS A_ VAPOR’ PRODUCT
MANUFACTURER FOR A PERIOD OF THIRTY-SIX MONTHS AFTER THE DATE OF A THIRD
VIOLATION.
S. A VAPOR PRODUCT MANUFACTURER THAT IS LICENSED UNDER THIS SECTION
AND THAT VIOLATES THIS SECTION:
1. FOR A FIRST VIOLATION, SHALL PAY A CIVIL PENALTY OF $2,500.
2. FOR A SECOND VIOLATION WITHIN A THIRTY-SIX MONTH PERIOD, SHALL
PAY A CIVIL PENALTY OF $5,000 AND IS GUILTY OF A CLASS 2 MISDEMEANOR, AND
THE VAPOR PRODUCT MANUFACTURER LICENSE SHALL BE SUSPENDED FOR THIRTY DAYS.
3. FOR A THIRD OR SUBSEQUENT VIOLATION WITHIN A THIRTY-SIX MONTH
PERIOD, SHALL PAY A CIVIL PENALTY OF $10,000 AND IS GUILTY OF A CLASS 1
MISDEMEANOR, AND THE VAPOR PRODUCT MANUFACTURER LICENSE SHALL BE REVOKED.
A VAPOR PRODUCT MANUFACTURER LICENSE REVOKED PURSUANT TO THIS PARAGRAPH IS
INELIGIBLE TO RECEIVE OR RENEW A VAPOR PRODUCT MANUFACTURER LICENSE FOR A
PERIOD OF THIRTY-SIX MONTHS AFTER THE DATE OF THE THIRD VIOLATION.
T. THE DEPARTMENT SHALL DEPOSIT CIVIL PENALTIES COLLECTED PURSUANT
TO SUBSECTIONS R AND S OF THIS SECTION IN THE VAPOR PRODUCT MANUFACTURER
LICENSING FUND ESTABLISHED BY SECTION 42-3409.
42-3408. Delegation of authority; compliance reporting
A. THE DEPARTMENT MAY:
1. DELEGATE THE ENFORCEMENT AND COMPLIANCE INSPECTIONS REQUIRED
UNDER THIS ARTICLE TO ANY COUNTY OR LAW ENFORCEMENT AGENCY THAT ACCEPTS
THIS DELEGATION.
2. COLLABORATE WITH AND USE THE FINDINGS OF OTHER STATE AGENCIES TO
CARRY OUT THE OBLIGATIONS OF THIS ARTICLE AND TO ENSURE THAT THE
COMPLAINTS RECEIVED BY OTHER AGENCIES OR A DELEGATED LICENSING AUTHORITY
ARE FORWARDED TO THE DEPARTMENT FOR TIMELY INVESTIGATION AND ACTION.
B. A DELEGATED LICENSING AUTHORITY OR ANY LAW ENFORCEMENT AGENCY OR
OTHER LOCAL ENTITY CONDUCTING COMPLIANCE CHECKS TO ASSESS RETAIL TOBACCO
VENDOR COMPLIANCE WITH THE LEGAL AGE FOR SALES OF TOBACCO PRODUCTS AND
-10-
House Amendments to H.B. 2765
OnNanNLPWDH FE
VAPOR PRODUCTS SHALL REPORT THE COMPLIANCE CHECK RESULTS TO THE
DEPARTMENT.
42-3409. Vapor product manufacturer licensing fund
THE VAPOR PRODUCT MANUFACTURER LICENSING FUND IS _ ESTABLISHED
CONSISTING OF LICENSING FEES AND CIVIL PENALTIES COLLECTED PURSUANT TO
SECTION 42-3407. THE DEPARTMENT SHALL ADMINISTER THE FUND. MONIES IN THE
FUND ARE SUBJECT TO LEGISLATIVE APPROPRIATION. MONIES IN THE FUND SHALL BE
USED FOR THE ENFORCEMENT OF SECTION 42-3407.
Sec. 6. Effective date
This act is effective from and after December 31, 2026.
Sec. 7. Severability
If a provision of this act or its application to any person or
circumstance is held invalid, the invalidity does not affect other
provisions or applications of the act that can be given effect without the
invalid provision or application, and to this end the provisions of this
act are severable."
Amend title to conform
TERESA MARTINEZ
2765MARTINEZ SE.docx
02/16/2026
4:02 PM
Gi JED
130XBNTCN
-11-
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - Second Regular Session
ROLL CALL VOTE
COMMITTEE ON International Trade BILL NO. HB 2765
DATE February 18, 2026 MOTION: || A a
PASS AYE NAY PRESENT | ABSENT
Austin ; v4
Carbone VA
Cavero Vv
Hendrix a
Hernandez C
Martinez 4
Travers Yv
Weninger 4
Pefia, Vice-Chairman i
Rivero, Chairman 4
‘E
APPROVED:
“TO IVERO, Chairman
MICHELE PENA, Vice-Chairman
i eed |
Make Ky
COMMITTEE SECRETARY
ATTACHMENT. |Z
File and source
- File
- 2026-02-18_international-trade-minutes.pdf
- Size
- 12,421,591 bytes
- SHA-256
- 7e59d378f310bdd87404a7aa40d6f4d0c7927abc36ddd34fcc15bd6aadb1674a
- Original
- www.azleg.gov