Sec. 411.5. Refusal to register

Tax Law, § 283(2), (5), (10)

(a)

(1) Where a person files an application for registration as a distributor of motor fuel, the Department of Taxation and Finance in circumstances described herein may refuse to register such applicant and deny such application, without a prior hearing, pursuant to the provisions of this section.

(2) Definitions.

For purposes of this section:

(i) A shareholder of the applicant shall mean only those shareholders of a corporate applicant who directly or indirectly own more than 10 percent of the number of shares of stock of such applicant entitling the shareholder to vote for the election of the applicant's directors or trustees. In the case of a corporate applicant which at the relevant time has four or fewer shareholders entitled to vote for the election of directors or trustees, in lieu of the more than 10 percent threshold prescribed herein, a direct or indirect ownership of 25 percent or more of the voting stock shall apply.

(ii) An employee of the applicant shall mean only those employees of an applicant who are under a duty to file a return under or pursuant to the authority of article 12-A of the Tax Law or pay the taxes imposed by or pursuant to the authority of such article on behalf of the applicant.

(b)

(1) The department may refuse to register the applicant if any tax imposed under the Tax Law or by any law, ordinance or resolution enacted pursuant to the authority of such law or the City Earnings Tax on Nonresidents imposed pursuant to the authority of article two-E of the General City Law has been finally determined to be due from the applicant, or from any officer, director or partner of such applicant, or from any shareholder of the applicant or employee of the applicant, and such tax has not been paid in full.

(2) The department may refuse to register the applicant if a liability for the penalty provided for in section 289-b(2) of the Tax Law (see section 416.2 of this Title) has been finally determined to be due from an officer, director, employee or partner of such applicant or from a shareholder of the applicant and such penalty has not been paid in full.

(3)

(i) The department may refuse to register the applicant if the applicant, or an officer, director or partner of such applicant, or a shareholder of the applicant or employee of the applicant, has been convicted within the preceding five years of a crime provided for in the Tax Law.

(ii) A registration may also be denied the applicant, if such applicant's employee was, in the capacity as a person under a duty to file a return under or pursuant to the authority of article 12-A of the Tax Law or pay the taxes imposed by or pursuant to the authority of such article on behalf of any person convicted within the preceding five years of a crime provided for in the Tax Law.

(4) The department may refuse to register the applicant if a registration as a distributor of motor fuel of the applicant, or of an officer, director or partner of such applicant, or of a shareholder of the applicant or employee of the applicant, has been cancelled or suspended as described in section 411.6 of this Part within the preceding five years.

(5) The department may refuse to register the applicant if the applicant, or an officer, director or partner of such applicant, or a shareholder of the applicant or employee of the applicant:

(i) was:

(a) an officer, director or partner of another person;

(b) a direct or indirect shareholder of more than 10 percent of the number of shares of another person, where such other person is a corporation, entitling the shareholder to vote for the election of directors or trustees (25 percent or more shall apply in the case of another entity which at the relevant time had four or fewer shareholders entitled to so vote); or

(c) an employee of another person, under a duty to file a return under or pursuant to the authority of article 12-A of the Tax Law or pay the taxes imposed by or pursuant to the authority of such article on behalf of such other person;

(ii) at a time when:

(a) any tax imposed under the Tax Law or by any law, ordinance or resolution enacted pursuant to the authority of such law or the city earnings tax on nonresidents imposed pursuant to the authority of article two-E of the General City Law was finally determined to be due from such other person and where such tax has not been paid in full;

(b) such other person was convicted of a crime provided for in the Tax Law, but only if such conviction occurred within the preceding five years; or

(c) the registration as a distributor of motor fuel of such other person was cancelled or suspended as provided in section 411.6 of this Part, but only if such cancellation or suspension occurred within the preceding five years.

Provided, however, where the applicant or such officer, director, partner, shareholder or employee of such applicant was only an employee of another person:

(iii) the department's examination of the tax payment history of such other person shall be limited to the taxes imposed by article 12-A of the Tax Law or by or pursuant to articles 28 and 29 of such law in respect to motor fuel; and

(iv) the department's examination of prior criminal convictions shall be limited to those which relate to motor fuel.

(6) The department may refuse to register the applicant if the applicant, or an officer, director or partner of such applicant, or a shareholder of the applicant or employee of the applicant, has within the preceding five years committed any of the acts specified in section 411.6 of this Part.

(7) The department may, in its discretion, register an applicant upon such terms and conditions as it may deem necessary in protection of the revenues under articles 12-A, 28 and 29 of the Tax Law.