Existing law sets forth various requirements concerning a franchise between a supplier and a wholesaler of malt beverages, distilled spirits and wines. (NRS 597.120-597.180) Existing law prohibits a supplier from unreasonably withholding or delaying approval of any assignment, sale or transfer of stock of a wholesaler or of all or any portion of a wholesaler's assets, a wholesaler's voting stock, the voting stock of any parent corporation or the beneficial ownership or control of any other entity owning or controlling the wholesaler if the person to be substituted under the terms of the franchise meets certain reasonable standards. (NRS 597.157) Section 1.7 of this bill requires a supplier to approve or deny approval for any such transaction in writing within 60 days after receiving notice of the transaction if the person to be substituted under the terms of the franchise meets certain reasonable standards. Section 1.7 provides that if a supplier does not approve or deny approval for the transaction within that time period, the transaction is deemed approved. Section 1 of this bill provides that a provision of any contract or other agreement that attempts to alter or waive the provisions of law governing a franchise between a supplier and a wholesaler of malt beverages, distilled spirits and wines is void and unenforceable. Sections 1.3 and 3.5 of this bill make conforming changes to indicate the proper placement of section 1 in the Nevada Revised Statutes. Section 3 of this bill prohibits a supplier from: (1) failing to approve or disapprove an invoice or claim for reimbursement within 45 days or failing to pay an invoice or claim for reimbursement within 45 days after such approval; (2) entering into an agreement with a wholesaler which purports to waive the rights and remedies of the wholesaler if the supplier retaliates against the wholesaler for reporting a violation of law to the Department of Taxation; (3) requiring a wholesaler to make payments under terms that are materially different from the payment terms applicable to payments made by the supplier; or (4) withdrawing credit or credit terms from a wholesaler except in accordance with a written policy of the supplier which is provided or otherwise made available to the wholesaler. Existing law regulates the operation of brew pubs in this State, including limiting the amount of malt beverages which a person who operates one or more brew pubs is authorized to manufacture per year to not more than 40,000 barrels. (NRS 597.230) Section 4 of this bill authorizes a person who operates one or more brew pubs to manufacture and sell an additional 20,000 barrels of malt beverages to a wholesaler located outside of this State, subject to such auditing as the Department of Taxation establishes by regulation. Existing law provides for the operation of wineries in this State. (NRS 597.240) Section 4.5 of this bill authorizes a winery to operate from multiple noncontiguous locations, provided that the winery has obtained a license for each such location. Section 4.5 authorizes a winery that was issued a wine-maker's license on or after October 1, 2015, to sell alcoholic beverages at retail if the winery has obtained any licenses or permits required in the jurisdiction in which the winery is located and the winery complies with the requirement to purchase liquor from a state-licensed wholesaler. Section 4.5 removes the prohibition against a winery selling alcoholic beverages on the premises of the winery or producing, blending or aging wine at a location other than the premises of the winery. Existing law authorizes a winery to transfer in bulk, directly or through a wholesaler, wine produced, blended or aged by the winery to an estate distillery for the purpose of distillation and blending only if 25 percent or more of the wine produced, blended or aged by the winery is produced blended or aged from fruit grown in this State. (NRS 597.240) Section 4.5 provides that the 25-percent requirement may also be satisfied with wine that is produced, blended or aged from honey produced in this State. Section 4.3 of this bill authorizes an estate distillery to blend and distill wine manufactured by a winery if 25 percent or more of the wine produced, blended or aged by the winery is produced, blended or aged from fruit grown or honey produced in this State. Existing law requires certain persons and businesses, including importers of liquor, wholesale dealers of alcoholic beverages, winemakers, instructional wine-making facilities, breweries, brew pubs and craft and estate distilleries to obtain a state license or permit to engage in certain activities involving alcoholic beverages. (NRS 369.180) Existing law further requires an application for a license for these persons or businesses to be made to the board of county commissioners or the governing body of the city in which the applicant maintains his or her principal place of business. (NRS 369.190) Section 5 of this bill requires the board of county commissioners or the governing body of a city, in approving such an application, to require satisfactory proof that the applicant is not in violation of the prohibition against engaging in certain activities involving alcoholic beverages without a license and that the applicant is not applying for a license for a business in which he or she is prohibited by law from engaging. Section 4.7 of this bill authorizes a retail liquor store, or a delivery support service acting on behalf of a retail liquor store, to deliver liquor in its original package to a consumer in connection with a retail sale of such liquor if: (1) the liquor was purchased by the retail liquor store from a licensed wholesaler; and (2) the delivery takes place in a jurisdiction where the retail liquor store is licensed to sell liquor at retail. Section 4.7 requires the Department of Taxation to adopt regulations governing such deliveries. Section 4.7 also exempts such deliveries from certain provisions of law governing the transport of liquor, including laws which authorize the transport of liquor for delivery only by persons who have been issued certain state licenses. Section 6 of this bill revises terminology relating to applications for a certificate of compliance by suppliers of liquor by replacing the term “vendor” with “out-of-state supplier.” Existing law prohibits a person from keeping or possessing for sale, furnishing or selling, or soliciting the purchase or sale of any liquor in this State, or transporting or importing or causing to be transported or imported any liquor in or into this State for delivery, storage, use or sale unless the person complies with the relevant provisions of law and holds the appropriate license, permit or certificate, except for certain limited exceptions for liquor purchased for household or personal use. (NRS 369.490) Section 7 of this bill additionally requires a person to be duly designated by the supplier of such liquor or to have purchased the liquor from certain authorized sources. Section 7 also revises an existing exception from licensing requirements for consumers who import 1 gallon or less of alcoholic beverage per month for household or personal use to provide that the exception applies only if the person enters this State with such alcoholic beverage rather than importing it. Sections 6.3 and 6.7 of this bill make a conforming change to reflect that this exception does not apply to the shipping of alcoholic beverages into this State other than wine.

Statutes affected:
As Introduced: 597.157, 597.160, 597.162, 597.230, 369.190, 369.430, 369.490
Reprint 1: 597.157, 597.162, 597.230, 369.190, 369.430, 369.490
Reprint 2: 597.120, 597.157, 597.162, 597.170, 597.230, 597.237, 597.240, 369.190, 369.430, 369.462, 369.468, 369.490
Reprint 3: 597.120, 597.157, 597.162, 597.170, 597.230, 597.237, 597.240, 369.190, 369.430, 369.462, 369.468, 369.490
As Enrolled: 597.120, 597.157, 597.162, 597.170, 597.230, 597.237, 597.240, 369.190, 369.430, 369.462, 369.468, 369.490