§ 76.3. Promotional sales plans.
(a) Only cigarette manufacturers may sponsor or initiate a promotional sales plan that lowers the price of cigarettes below the cost of the dealer.
(b) Every dealer on whose premises a manufacturer’s promotional sales plan is being conducted shall obtain a written statement from the manufacturer which describes the promotional sales plan and indicates the plan’s duration.
(c) When a manufacturer’s promotional sales plan involves the affixation of coupons to a retailer’s inventory of cigarettes, the retailer shall receive payment from the manufacturer representing the value of the coupons prior to the retailer’s customers’ purchase of the coupon-affixed cigarettes. The retailer shall also retain documentation showing the manufacturer’s payment of the coupons’ value. For example, if the cost of the retailer for a package of cigarettes is $2 and a 50¢ coupon is affixed to the package, the retailer may accept the coupon, sell the package of cigarettes for $1.50 and be in compliance with the act and the code only if the retailer possesses evidence that the manufacturer prepaid the value of the 50¢ coupon to the retailer prior to the retailer’s sale of the package of cigarettes.
(d) Retailers may redeem manufacturer-issued coupons issued to the general public that reduce the retail purchase price of cigarettes below the cost of the retailer as long as the manufacturer reimburses the retailer for the redeemed coupon and the retailer maintains documentation showing the sale of the cigarettes to its customers and the manufacturer’s subsequent reimbursement. For example, if the cost of the retailer is $18 per carton of cigarettes and the retailer sells the carton for $18, the retailer may accept a $1 coupon that reduces the cost of the retailer to $17 and not be in violation of the code or act. However, the retailer may not sell the carton at $17 unless the retail customer tenders a valid $1 manufacturer coupon.
(e) A dealer participating in a manufacturer’s promotional sales plan which is not evidenced by a coupon and which occurs subsequent to the dealer’s purchase of cigarettes from that manufacturer is in violation of the code.
(f) A dealer may sponsor or initiate a promotional sales plan if the plan does not result in the sale of cigarettes at a price below the cost of that dealer.
Cross References This section cited in 61 Pa. Code § 76.2 (relating to combination sales and inducements).
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