H.F. 279 Section 1. NEW SECTION . 124E.1 Synthetic substances —— 1 regulation —— civil penalties. 2 1. The following factors, taken in the totality of the 3 circumstances, may be considered in determining whether a 4 product should be classified as a synthetic substance. For 5 the purposes of enforcement pursuant to this section, the 6 establishment of two or more factors shall constitute prima 7 facie evidence that the product is a synthetic substance. 8 a. Advertising a product for a purpose for which the product 9 is rarely, if ever, suitably used. 10 b. Displaying or selling a product in businesses such as 11 liquor stores, smoke shops, or gas or convenience stores where 12 such a product is not typically sold. 13 c. Marketing a product as a common nonconsumable product 14 with warning labels not normally found on such a product. The 15 warning labels may be similar but not limited to the following: 16 (1) Not for human consumption. 17 (2) Not for purchase by minors. 18 d. Labeling a product in a manner not normally found on 19 similar products including but not limited to the following: 20 (1) Does not contain any chemical compounds prohibited by 21 state law. 22 (2) Contains no prohibited chemicals. 23 (3) Product is in accordance with state and federal laws. 24 (4) Does not contain AM-2201 or any substance banned by the 25 United States drug enforcement administration. 26 (5) Legal herbal substance. 27 (6) One hundred percent compliant guaranteed. 28 (7) One hundred percent chemical free. 29 (8) One hundred percent synthetic free. 30 e. Labeling a product by suggesting that a user will achieve 31 a high, euphoria, relaxation, mood enhancement, or other 32 effects on the body. 33 f. Pricing a product as more expensive than other products 34 marketed in the area for the same or similar use. 35 -1- LSB 1434YH (5) 86 jm/rj 1/ 4

H.F. 279 g. Providing directions for a product that are not 1 consistent for the type of product advertised. 2 h. Designing a product to make the substance appear similar 3 to illicit street drugs. 4 i. Advertising a product using brand names and packaging 5 designed to make the product appear similar to illicit street 6 drugs, or labeling a product with names similar to commonly 7 used street slang for illicit drugs, which names or labeling 8 has no relation to the advertised use of the product being 9 sold. 10 j. Enhancing a product with a synthetic chemical or 11 synthetic chemical compound that has no legitimate relation to 12 the advertised use of the product but mimics the effects of a 13 controlled substance when the product, or the smoke from the 14 burned product, is introduced into the human body. 15 k. Making verbal or written representations at the place of 16 sale or display regarding the purpose, methods, use, or effect 17 of the product. 18 2. A retailer or person shall not sell, offer to sell, 19 give, or offer to give, or otherwise transfer a product labeled 20 as or represented to be a synthetic substance under this 21 section after the product has been determined to be a synthetic 22 substance under subsection 4. 23 3. A city or a county may enforce subsection 2 after 24 giving a retailer or person engaged in the business of selling 25 products in the city or county an opportunity to be heard upon 26 ten days’ written notice by restricted certified mail stating 27 the alleged violation and the time and place for a hearing 28 where the retailer or person may appear and be heard. 29 4. If after notice has been provided under subsection 30 3, and a hearing where a determination has been made that 31 the product is a synthetic substance under subsection 1, the 32 retailer or a person who has received notice under subsection 33 3 shall be assessed a civil penalty as provided in subsection 34 5 if the retailer or person sells, offers to sell, gives or 35 -2- LSB 1434YH (5) 86 jm/rj 2/ 4

H.F. 279 offers to give, or otherwise transfers a product labeled as or 1 represented to be a synthetic substance. 2 5. a. For a first violation, the retailer or person shall 3 be assessed a civil penalty in the amount of two hundred 4 dollars. 5 b. For a second or subsequent violation, the retailer or 6 person shall be assessed a civil penalty in the amount of five 7 hundred dollars. 8 6. The civil penalty shall be collected by the clerk of the 9 district court and shall be distributed as provided in section 10 602.8105, subsection 4. 11 Sec. 2. Section 602.8105, subsection 4, Code 2015, is 12 amended to read as follows: 13 4. The clerk of the district court shall collect a civil 14 penalty assessed against a retailer or person pursuant to 15 section 124E.1 or against a retailer pursuant to section 16 126.23B . Any moneys collected from the civil penalty shall be 17 distributed to the city or county that brought the enforcement 18 action for a violation of section 124E.1 or 126.23A . 19 EXPLANATION 20 The inclusion of this explanation does not constitute agreement with 21 the explanation’s substance by the members of the general assembly. 22 This bill relates to the regulation of synthetic substances. 23 A retailer or person shall not sell, offer to sell, give, or 24 offer to give, or otherwise transfer a product labeled as or 25 represented to be a synthetic substance under the bill. For 26 the purposes of enforcement, the establishment of two or more 27 of the following factors shall constitute prima facie evidence 28 that the product is a synthetic substance: advertising for 29 which it is rarely suitable to be used; marketing as common 30 nonconsumable products which contain warning labels not 31 normally found on such products; labeling not normally found 32 on similar products; labeling suggesting the user will achieve 33 a high, euphoria, or that the product has other effects on 34 the body; pricing which is more expensive than other products 35 -3- LSB 1434YH (5) 86 jm/rj 3/ 4

H.F. 279 marketed in the area for the same or similar use; directions 1 that are not consistent for the type of product advertised; 2 designing to make the substance appear similar to illicit 3 street drugs; advertising using brand names and packaging 4 designed to make the product appear similar to illicit street 5 drugs, or labeled with names similar to commonly used street 6 slang for illicit drugs; enhancing with a synthetic chemical 7 or synthetic chemical compound that has no legitimate relation 8 to the advertised use of the product; or verbal or written 9 representations made at the place of sale regarding the 10 purpose, methods, use, or effect of the product. 11 A city or a county may enforce the bill after giving a 12 retailer or person engaged in the business selling products 13 in the city or county an opportunity to be heard upon 10 14 days’ written notice by restricted certified mail stating the 15 alleged violation and the time and place of a hearing where the 16 retailer or person may appear and be heard. 17 After a hearing where a determination has been made that the 18 product is a synthetic substance under the bill, a retailer 19 or a person, who has received notice of such a hearing, 20 shall be assessed a civil penalty, if the retailer or person 21 sells, offers to sell, gives, or offers to give, or otherwise 22 transfers a product labeled as or represented to be a synthetic 23 substance. 24 For a first violation of the bill, a retailer or person shall 25 be assessed a civil penalty in the amount of $200. 26 For a second or subsequent violation of the bill, a retailer 27 or person shall be assessed a civil penalty in the amount of 28 $500. 29 Any moneys collected from the civil penalty shall be 30 distributed to the city or county that brought the enforcement 31 action relating to the bill. 32 -4- LSB 1434YH (5) 86 jm/rj 4/ 4