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HECTOR BALDERAS
ATTORNEY GENERAL
NPM QUARTERLY ESCROW CERTIFICATION
Certificate of Compliance by Non-Participating Manufacturer Regarding Escrow
Payment
GENERAL INFORMATION: What is the definition of a tobacco product manufacturer?
1. Any entity that manufactures cigarettes and/or roll-your-own tobacco
anywhere, and that said manufacturer intends to be sold in the United States, including
cigarettes to be sold in the United States through an importer;
2. The first purchaser anywhere for resale in the United Sates of cigarettes
manufactured anywhere that the manufacturer does not intend to be sold in the United
States; or
3. A successor of any entity described above.
Who is required to file this certificate of compliance?
Any tobacco product manufacturer which:
(1) sells cigarettes within the state of New Mexico (whether directly or through
any distributor, retailer, or similar intermediary) and;
(2) is not a Participating Manufacturer or Subsequent Participating
Manufacturer, as defined in the tobacco Master Settlement Agreement
executed on 12/23/98 between 46 U.S. States and territories, including
New Mexico, and certain tobacco companies (the MSA).
If you satisfy these requirements, you must file this Certificate of Compliance to report
the units of cigarettes manufactured by you and sold in New Mexico and pay the
amount calculated into your qualified escrow fund.
What is a Non-Participating Manufacturer?
A Non-Participating Manufacturer is any tobacco product manufacturer who has not
signed on to the MSA.
What is a qualified escrow fund?
A non-participating manufacturer must establish a qualified escrow fund. This means
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an escrow arrangement with a U.S. federal or U.S. state-chartered financial institution
having no affiliation with any tobacco product manufacturer and having assets of at
least $1,000,000,000, where such arrangement (1) requires that the financial
institution hold the escrowed funds' principal for the benefit of the State of New
Mexico and other "Releasing Parties" as defined in the Master Settlement
Agreement and (2) prohibits the non-participating manufacturer from using,
accessing, or directing the use of the funds' principal except as consistent with NMSA
1978, Section 6-4-13 (B).
When is this certificate of compliance due?
This certificate of compliance is to be filed quarterly, as follows:
1
st
Quarter (January through March) due April 30 of that year
2
nd
Quarter (April through June) due July 30 of that year
3
rd
Quarter (July through September) due October 30 of that year
4
th
Quarter (October through December) due January 31 of the next year
following the sales year.
When must I make my escrow payment?
You must deposit all escrow payments into your qualified escrow fund quarterly
by the due date of your certificate of compliance set forth in the paragraph above.
1
st
Quarter is due April 30, 2
nd
Quarter is due July 30, 3
rd
Quarter is due October
30 and 4
th
Quarter is due January 31 of the next year following the sales year.
Attach a copy of your receipt or other proof of deposit from your financial institution to
the signed and notarized Certificate of Compliance. In addition, after you have made
your initial deposit into the qualified escrow fund, forward a copy of the escrow
agreement as executed.
SPECIFIC INSTRUCTIONS:
Part 1: Manufacturer's Identification: Write your name, address, telephone and
fax number.
Part 2: Sales Year 2019: Check the appropriate quarter. 1
st
Quarter is from
January 1, 2019 to March 31, 2019; 2
nd
Quarter is from April 1, 2019 to June 30,
2019; 3
rd
Quarter is from July 1, 2019 to September 30, 2019; and 4
th
Quarter is from
October 1, 2019 to December 31, 2019.
Part 3: Units Sold: Write the number of Units Sold in New Mexico for the quarter
indicated. A Unit Sold equals an individual cigarette from a pack that bears a New
Mexico state cigarette excise tax stamp or .09 ounces of roll-your-own tobacco.
Part 4: Deposit Amount: Multiply the Units Sold by the adjusted inflation rate of
$0.0357965 to arrive at the total deposit to be paid into your qualified escrow
account for the applicable sales year. Attach a copy of the financial institution’s
receipt or other proof from the Escrow Agent of the escrow deposit.
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Part 5: Financial Institution Write the name and address of the financial
institution holding your escrow account. Include your escrow account number. Also,
write the total cumulative amount currently in your escrow account.
Part 6: Signature An authorized notary public must also sign and date this
certificate of compliance.
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New Mexico Office of the Attorney General
QUARTERLY Certificate of Compliance by Non-Participating
Manufacturer Regarding Escrow Payment
Part 1: Manufacturer’s Identification:
Name: ___________________________________________________________
Address: ___________________________________________________________
Phone: ___________________________________________________________
Part 2: Sales Year 2019 (check one):
The Quarter being reported for this Certificate of Compliance is:
1
st
Quarter:
2
nd
Quarter:
3
rd
Quarter:
4
th
Quarter:
Part 3: Units Sold:
Indicate the number of Units Sold (an individual cigarette from a pack that bears a New
Mexico state cigarette excise tax stamp or .09 ounces of roll-your-own tobacco equals
one Unit Sold) for the 2019 quarter indicated in Part 2:
Units Sold: _____________________
Part 4: Quarterly Escrow Payment Amount:
Calculate the appropriate quarterly escrow deposit amount. Multiply the
number of Units Sold by $0.0357965 and write that amount here:
Escrow Deposit Amount: _____________________
Attach a copy of the financial institution’s receipt or other proof from the Escrow
Agent of the escrow deposit.
NMSA § 6-4-13(A)(2) requires payments to beadjusted for inflation.” NMSA § 6-4-12(A) definesadjusted for
inflation” as “increased in accordance with the formula for inflation adjustment set forth in Exhibit C to the Master
Settlement Agreement.” Each year this figure increases 3% or the actual inflation rate, whichever is greater.
Because the actual inflation rate cannot be determined until the end of 2019, tobacco product manufacturers
required to make quarterly escrow payments will be required, in their quarterly escrow payments, to deposit an
amount that has been cumulatively adjusted for inflation by 3%. When the adjusted for inflation rate for 2019 has
been determined, manufacturers will be advised and then have until April 15, 2020 to deposit any additional
money, if necessary, to satisfy the actual adjusted for inflation amount under the Act. The 2019 cumulative adjusted
for inflation rate, increased by 3%, is 89.91984%. Multiplying the base escrow deposit amount of $0.0188482 by
the cumulative adjusted for inflation rate of 89.91984% equals the cumulative inflations adjustment amount of
$0.0169483. Adding the base escrow deposit amount $0.0188482 to the cumulative inflation adjustment amount
$0.0169483 equals $0.0357965.
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Part 5: Financial Institution:
Name of Institution: ________________________________________________
Address: ________________________________________________
Escrow Fund Acct. No.: ________________________________________________
Escrow Fund New Mexico Subaccount No.: _____________________________________
Total Amount Held: ________________________________________________
Part 6: Signature
Under penalty of perjury, I state that, to the best of my knowledge, all of the information
contained in this Certificate of compliance is true and accurate.
This certificate of compliance must also be signed and dated by an authorized notary
public.
Name of Authorized Agent: __________________________ Title: ________________
Signature of Authorized Agent: _______________________ Date: _______________
Subscribed and sworn to before me on this date: ______________________________
Signature of Notary Public: _______________________________
City or County of: ________________________
My Commission expires: _______________________
Mail this certificate of compliance to:
New Mexico Office of the Attorney General
Litigation Division Tobacco Project
P.0. Drawer 1508
Santa Fe, NM 87504-1508
Fax: 505-490-4881
Street Address for overnight or hand delivery:
New Mexico Office of the Attorney General
Litigation Division Tobacco Project
408 Galisteo
Santa Fe, NM 87504
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