Nev. Rev. Stat. § 370.683 — Liability of wholesale dealer for required escrow deposits; prepayment by nonparticipating manufacturer of amount of escrow deposit

NRS  370.683    Liability of wholesale dealer for required escrow deposits;
prepayment by nonparticipating manufacturer of amount of escrow deposit.
1.  Except as otherwise provided in
subsection 5:
(a) A wholesale dealer is liable for escrow
deposits required pursuant to this chapter and chapter
370A of NRS if:
(1) The wholesale dealer receives notice
from the Attorney General or the Department that there is a shortfall in a
qualified escrow fund with respect to cigarettes of a nonparticipating
manufacturer that were stamped or distributed by the wholesale dealer; and
(2) The shortfall is not cured by the
wholesale dealer or nonparticipating manufacturer within 90 calendar days after
the wholesale dealer receives that notice.
Ê The
liability of the wholesale dealer for the escrow deposits must be calculated
pursuant to paragraph (b).
(b) If there is a shortfall in the qualified
escrow fund of a nonparticipating manufacturer for a calendar quarter, each
wholesale dealer that sold or distributed cigarettes of that nonparticipating
manufacturer during that calendar quarter shall deposit into an escrow account
designated by the Attorney General an amount equal to the shortfall multiplied
by a fraction, the numerator of which is the number of cigarettes of that
nonparticipating manufacturer that were sold in or into this State by the
wholesale dealer during that calendar quarter, and the denominator of which is
the total number of cigarettes of that nonparticipating manufacturer that were
sold or distributed by all wholesale dealers in or into this State during that
calendar quarter. In making the calculation, any cigarettes of the
nonparticipating manufacturer that were sold or distributed in or into this
State by a wholesale dealer during the calendar quarter in which the wholesale
dealer collected and deposited the required escrow deposit amount on or before
the due date for deposits for that quarter must be excluded from both the
numerator and the denominator of the fraction.
2.  To the extent that a wholesale dealer
makes any payment with respect to a shortfall pursuant to this section, the
wholesale dealer has a claim against the nonparticipating manufacturer for the
amount of the payment.
3.  A wholesale dealer may require a
nonparticipating manufacturer, as a condition of the agreement of the wholesale
dealer to purchase the cigarettes of the nonparticipating manufacturer, to:
(a) Prepay the escrow deposit amount of the
nonparticipating manufacturer into the escrow account designated in the
certification of the nonparticipating manufacturer filed with the Attorney
General pursuant to NRS 370.665 ; and
(b) Require the escrow agent to provide to the
wholesale dealer and the Attorney General proof of that prepayment.
4.  Upon the request of a wholesale dealer
who requires a nonparticipating manufacturer to comply with the provisions of
paragraphs (a) and (b) of subsection 3, the Attorney General shall provide to
the wholesale dealer a written verification of whether the nonparticipating
manufacturer has made the escrow deposits required from the nonparticipating
manufacturer pursuant to this chapter and chapter
370A of NRS for a calendar quarter.
5.  If a wholesale dealer requires a
nonparticipating manufacturer to comply with the provisions of paragraph (a) of
subsection 3 and receives a written verification from the Attorney General that
the nonparticipating manufacturer has made the escrow deposits required from
the nonparticipating manufacturer pursuant to this chapter and chapter 370A of NRS for a calendar quarter:
(a) The wholesale dealer is not liable for any of
those escrow deposits required for that calendar quarter;
(b) The provisions of subsection 1 do not apply
to the wholesale dealer with respect to any cigarettes of the nonparticipating
manufacturer that were sold or distributed in or into this State during that
calendar quarter; and
(c) The cigarettes of the nonparticipating
manufacturer that were sold or distributed in or into this State by the wholesale
dealer during that calendar quarter must be excluded entirely from the
calculations required by subsection 1.