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Master Settlement Agreement (MSA)

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On November 23, 1998, Tennessee and 51 other states and jurisdictions entered an historic multistate settlement with the major tobacco companies—the Master Settlement Agreement (MSA). Since its creation, more than 50 tobacco companies have joined the MSA.

In addition to providing the State of Tennessee with payments up to $4.8 billion through the year 2025 and additional payments in perpetuity, the Master Settlement Agreement (MSA) places significant restrictions on tobacco advertising and marketing and funds the American Legacy Foundation.

To date, Tennessee’s general fund has received over $2.3 billion in MSA payments from the tobacco companies.

The MSA prohibits many kinds of advertising, particularly advertising targeting youth:

  • Outdoor advertising including billboards, signs, and placards in arenas, stadiums, shopping malls, and video game arcades
  • Transit advertising of tobacco products
  • Distribution and sale of apparel and merchandise with brand name logos, such as caps and T-shirts
  • Payments to promote tobacco products in movies, television shows, theater productions or live performances, live or recorded music performances, videos and video games
  • Use of cartoons in the advertising, promotion, packaging, or labeling of tobacco products
  • Brand name sponsorship of events with a significant youth audience or where the paid participants or contestants are underage
  • Distribution of free samples except in a facility or enclosed area where the operator ensures no underage person
    is present

The MSA also requires the major tobacco companies to pay approximately $25 million annually for ten years to fund a charitable foundation, the American Legacy Foundation. The Foundation is carrying out a nationwide program of advertising and education to address youth tobacco use and to educate consumers about the cause and prevention of diseases associated with tobacco use. The tobacco companies will also establish a $1.45 billion fund for youth and consumer education.