As vaping becomes more popular, vaping product surety bond instruments and insurance coverages will appear to support the risks of the industry. Many states have already instituted regulations that govern the conduct of vape dealers and distributors. Much like hookah tobacco (“shisha”), vaping liquids can fall under the regulatory category of “non-tobacco” merchandise on which excise taxes are due. Vape product surety bonds are now required by many state agencies that oversee dealers and retail distributors. A “surety bond for tobacco products other than cigarettes” is a type of financial assurance that guarantees vape distributors’ obligations. The North Carolina Tobacco Products Other Than Cigarettes Surety Bond is an excellent example.
Some states are not treating vaping products as tobacco and have promulgated rules specific to the vapor market. For example, the Georgia General Assembly has recently amended Article 7 of Chapter 12, Title 12 of the Official Code of Georgia to include, . . .
“The manufacturer’s, importer’s, distributor’s, or dealer’s license (for vape products) shall be exhibited in the place of business for which it is issued in the manner prescribed by the commissioner. The Ccommissioner shall require each licensed distributor to file with the commissioner a vape surety bond in an amount of not less than one thousand dollars ($1,000.00) to guarantee the proper performance of the distributor’s duties and the discharge of the distributor’s liabilities. “
As the market matures, more states will begin to legislate property controls over the industry and likely surety bonds to ensure license compliance and tax payments. Stay tuned for more on vaping product surety bonds! Call (800) 373-2805, visit Surety One, Inc. or email Underwriting@SuretyOne.com for specific feedback on this surety bond class.