1 SB138
2 209391-1
3 By Senator Waggoner
4 RFD: Tourism
5 First Read: 02-FEB-21
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1 209391-1:n:02/02/2021:LK*/tgw LSA2020-2452
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8 SYNOPSIS: Under existing law, wineries are not
9 permitted to ship or distribute wine directly to
10 retailers or residents in the state. Wine
11 manufacturers and importers are required to sell
12 wine through a licensed wholesaler.
13 This bill would require each supplier of
14 wine to designate sales territories for each of its
15 brands and enter into an exclusive franchise
16 agreement with a wholesaler for each sales
17 territory.
18 This bill would set conditions and
19 requirements for franchise agreements between
20 suppliers and wholesale distributors of wine,
21 including provisions for the modification,
22 termination, cancellation, nonrenewal, or
23 discontinuance of an agreement.
24 This bill would authorize certain wineries
25 to directly ship wine to individuals in the state.
26 This bill would provide further duties of
27 the Alcoholic Beverage Control Board.
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1 This bill would delete obsolete language
2 from the Code of Alabama 1975.
3 Amendment 621 of the Constitution of Alabama
4 of 1901, now appearing as Section 111.05 of the
5 Official Recompilation of the Constitution of
6 Alabama of 1901, as amended, prohibits a general
7 law whose purpose or effect would be to require a
8 new or increased expenditure of local funds from
9 becoming effective with regard to a local
10 governmental entity without enactment by a 2/3 vote
11 unless: it comes within one of a number of
12 specified exceptions; it is approved by the
13 affected entity; or the Legislature appropriates
14 funds, or provides a local source of revenue, to
15 the entity for the purpose.
16 The purpose or effect of this bill would be
17 to require a new or increased expenditure of local
18 funds within the meaning of the amendment. However,
19 the bill does not require approval of a local
20 governmental entity or enactment by a 2/3 vote to
21 become effective because it comes within one of the
22 specified exceptions contained in the amendment.
23
24 A BILL
25 TO BE ENTITLED
26 AN ACT
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1 Relating to alcoholic beverages; to amend Sections
2 28-1-4 and 28-3-1, Code of Alabama 1975; to add Chapter 8A to
3 Title 28 of the Code of Alabama 1975; to allow certain wine
4 manufacturers to obtain a direct wine shipper license from the
5 Alcoholic Beverage Control Board to allow the licensee to ship
6 limited quantities of wine directly to individuals in the
7 state for personal use in limited circumstances; to provide
8 for the permitting procedure; to authorize common or permit
9 carriers to ship wine to residents; to provide for reporting
10 from the carriers and wineries to the Alcoholic Beverage
11 Control Board and other applicable agencies; to provide that
12 the direct shipment of wine without a license constitutes a
13 Class C misdemeanor; to require licensed importers and
14 manufacturers of wine to enter into exclusive franchise
15 agreements with wholesalers; to regulate franchise agreements
16 between suppliers and wholesalers of wine; to provide for
17 other business relations between suppliers and wholesalers of
18 wine; to provide for an effective date; and in connection
19 therewith would have as its purpose or effect the requirement
20 of a new or increased expenditure of local funds within the
21 meaning of Amendment 621 of the Constitution of Alabama of
22 1901, now appearing as Section 111.05 of the Official
23 Recompilation of the Constitution of Alabama of 1901, as
24 amended.
25 BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
26 Section 1. The Legislature hereby finds and declares
27 that this act is enacted pursuant to the authority granted to
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1 the state under the Twenty-First Amendment to the United
2 States Constitution, the powers reserved to the state under
3 the Tenth Amendment to the United States Constitution, and the
4 inherent powers of the state under the Constitution of Alabama
5 of 1901, in order to regulate the traffic of alcoholic
6 beverages and to substitute the regulations and oversight
7 established in this act for the application of federal and
8 state antitrust laws that otherwise would apply to any
9 potential anti-competitive effects of this title. For the
10 avoidance of doubt, the intent of the Legislature is to
11 maintain the uniform three-tier system of control over the
12 sale, purchase, taxation, transportation, manufacture,
13 consumption, and possession of alcoholic beverages in the
14 state to promote the health, safety, and welfare of residents
15 of this state by, among other purposes, ensuring the state
16 shall be able to register, audit, inspect, seize, recall and
17 test alcoholic beverages shipped into, distributed, and sold
18 throughout this state; and this expression of the policy and
19 intent of the Legislature is intended to satisfy the clear
20 articulation test for state action immunity as has been
21 established by the United States Supreme Court in California
22 Retail Liquor Dealers Assn. v. Midcal Aluminum, Inc., et al.
23 Section 2. Section 28-1-4, Code of Alabama 1975, is
24 amended to read as follows:
25 "28-1-4.
26 "(a) The words and phrases used in this section
27 shall have the meanings ascribed to them in Section 28-3-1 and
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1 any acts amendatory thereof, supplementary thereto or
2 substituted therefor.
3 "(b) It shall be unlawful for common or permit
4 carriers, operators of trucks, buses or other conveyances or
5 out-of-state manufacturers or suppliers to make delivery of
6 any alcoholic beverage from without outside the State of
7 Alabama to any person, association or corporation within the
8 state, except to the Alabama Alcoholic Beverage Control Board
9 and to manufacturers, importers, wholesalers and warehouses
10 licensed by the Alabama Alcoholic Beverage Control Board to
11 receive the alcoholic beverages so delivered.
12 "(c)(1) Notwithstanding subsection (b), a common or
13 permit carrier may transport and ship shipments of table wine
14 to an individual in the state who is at least 21 years of age
15 at the direction of a direct wine shipper licensee, as
16 provided in Section 28-3A-6.1. A common or permit carrier
17 making a shipment as provided in Section 28-3A-6.1 is not
18 required to maintain in the vehicle or within the possession
19 of the driver of the vehicle a bill of lading, consignment, or
20 any other documentary evidence of the cargo being transported
21 other than information available on the package shipping
22 label.
23 "(2) A common or permit carrier who transports and
24 ships shipments of wine under this subsection shall file
25 quarterly reports with the Tax and Trade Practices Division of
26 the board and the Sales and Use Tax Division of the Department
27 of Revenue on all wine shipments during the reporting period.
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1 The quarterly report shall contain all of the following with
2 regard to each shipment:
3 "a. The name and business address of the carrier
4 making the report.
5 "b. The period of time covered by the report.
6 "c. The name and business address of the direct wine
7 shipper licensee.
8 "d. The weight of the shipment.
9 "e. The name and address of the individual person to
10 whom the wine was shipped.
11 "f. A unique tracking number.
12 "g. The date of receipt of the shipment by the
13 individual.
14 "(3) Any failure by a common or permit carrier to
15 comply with the reporting requirements in this subsection that
16 continues for more than 30 days after receiving notice by the
17 board or Department of Revenue of the failure, may result in
18 the suspension of the carrier's license to operate in the
19 state or the imposition of any other penalty the relevant
20 licensing authority in the state is authorized to impose.
21 "(c) (d) Any violation of subsection (a) of this
22 section (b) shall be a misdemeanor, punishable as provided in
23 paragraph subdivision (1) of subsection (b) of Section
24 28-3A-25.
25 "(d) All laws or parts of law which conflict or are
26 inconsistent with this section are hereby repealed, provided,
27 however, the provisions of Section 28-1-3 are excluded."
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1 Section 3. Section 28-3-1, Code of Alabama 1975, is
2 amended to read as follows:
3 "28-3-1.
4 "As used in this title, the following words shall
5 have the following meanings unless the context clearly
6 indicates otherwise:
7 "(1) ALCOHOLIC BEVERAGES. Any alcoholic, spirituous,
8 vinous, fermented, or other alcoholic beverage, or combination
9 of liquors and mixed liquor, a part of which is spirituous,
10 vinous, fermented, or otherwise alcoholic, and all drinks or
11 drinkable liquids, preparations or mixtures intended for
12 beverage purposes, which contain one-half of one percent or
13 more of alcohol by volume, and shall include liquor, beer, and
14 wine.
15 "(2) ASSOCIATION. A partnership, limited
16 partnership, or any form of unincorporated enterprise owned by
17 two or more persons.
18 "(3) BEER, or MALT OR BREWED BEVERAGES. Except as
19 otherwise provided in this subdivision, any Any beer, lager
20 beer, ale, porter, malt or brewed beverage, or similar
21 fermented malt liquor beverage containing one-half of one
22 percent or more of alcohol by volume and not in excess of
23 thirteen and nine-tenths percent alcohol by volume, by
24 whatever name the same may be called brewed or produced from
25 malt, wholly or in part, or from rice, grain of any kind,
26 bran, glucose, sugar, or molasses. A beer or malt or brewed
27 beverage may incorporate honey, fruit, fruit juice, fruit
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1 concentrate, herbs, spices, or other flavorings during the
2 fermentation process. The term does not include any product
3 defined as liquor, table wine, or wine.
4 "(4) BOARD. The Alcoholic Beverage Control Board.
5 "(5) BRANDY. All beverages which are an alcoholic
6 distillate from the fermented juice, mash, or wine of fruit,
7 or from the residue thereof, produced in such manner that the
8 distillate possesses the taste, aroma, and characteristics
9 generally attributed to the beverage, as bottled at not less
10 than 80 degree proof.
11 "(6) CARTON. The package or container or containers
12 in which alcoholic beverages are originally packaged for
13 shipment to market by the manufacturer or its designated
14 representatives or the importer.
15 "(7) CIDER. A fermented alcoholic beverage made from
16 apple juice and containing not more than 8.5 percent alcohol
17 by volume.
18 "(8) CLUB.
19 "a. Class I. A corporation or association organized
20 or formed in good faith by authority of law and which must
21 have at least 150 paid-up members. It must be the owner,
22 lessee, or occupant of an establishment operated solely for
23 the objects of a national, social, patriotic, political, or
24 athletic nature or the like, but not for pecuniary gain, and
25 the property as well as the advantages of which, belong to all
26 the members and which maintains an establishment provided with
27 special space and accommodations where, in consideration of
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1 payment, food with or without lodging is habitually served.
2 The club shall hold regular meetings, continue its business
3 through officers regularly elected, admit members by written
4 application, investigation, and ballot and charge and collect
5 dues from elected members.
6 "b. Class II. A corporation or association organized
7 or formed in good faith by authority of law and which must
8 have at least 100 paid-up members. It must be the owner,
9 lessee, or occupant of an establishment operated solely for
10 the objects of a national, social, patriotic, political, or
11 athletic nature or the like. The club shall hold regular
12 meetings, continue its business through officers regularly
13 elected, admit members by written application, investigation
14 and ballot and charge and collect dues from elected members.
15 "(9) CONTAINER. The single bottle, can, keg, bag, or
16 other receptacle, not a carton, in which alcoholic beverages
17 are originally packaged for the market by the manufacturer or
18 importer and from which the alcoholic beverage is consumed by
19 or dispensed to the public.
20 "(10) CORPORATION. A corporation or joint stock
21 association organized under the laws of this state, the United
22 States, or any other state, territory or foreign country, or
23 dependency.
24 "(11) DIRECT WINE SHIPPER LICENSE. A license that
25 authorizes the licensee to ship wine or contract for the
26 shipment of wine directly from a manufacturer to an individual
27 pursuant to Section 28-3A-6.1.
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1 "(11)(12) DRY COUNTY. Any county which by a majority
2 of those voting voted in the negative in an election
3 heretofore held under the applicable statutes at the time of
4 the election or may hereafter vote in the negative in an
5 election or special method referendum hereafter held in
6 accordance with the provisions of Chapter 2 of this title, or
7 held in accordance with the provisions of any act hereafter
8 enacted permitting such election.
9 "(12)(13) DRY MUNICIPALITY. Any municipality within
10 a wet county which has, by its governing body or by a majority
11 of those voting in a municipal election heretofore held in
12 accordance with the provisions of Section 28-2-22, or in a
13 municipal option election heretofore or hereafter held in
14 accordance with the provisions of Act 84-408, Acts of Alabama
15 1984, appearing as Chapter 2A of this title, or any act
16 hereafter enacted permitting municipal option election, voted
17 to exclude the sale of alcoholic beverages within the
18 corporate limits of the municipality.
19 "(13)(14) GENERAL WELFARE PURPOSES.
20 "a. The administration of public assistance as set
21 out in Sections 38-2-5 and 38-4-1;
22 "b. Services, including supplementation and
23 supplementary services under the federal Social Security Act,
24 to or on behalf of persons to whom such public assistance may
25 be given under Sections 38-2-5 and 38-4-1;
26 "c. Service to and on behalf of dependent, neglected
27 or delinquent children; and
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1 "d. Investigative and referral services to and on
2 behalf of needy persons.
3 "(14)(15) HEARING COMMISSION. A body appointed by
4 the board to hear and decide all contested license
5 applications and all disciplinary charges against any licensee
6 for violation of this title or the regulations of the board.
7 "(15)(16) HOTEL. A building or buildings held out to
8 the public for housing accommodations of travelers or
9 transients, and shall include motel, but shall not include a
10 rooming house or boarding house.
11 "(16)(17) IMPORTER. Any person, association, or
12 corporation engaged in importing alcoholic beverages, liquor,
13 wine, or beer, manufactured outside of the United States of
14 America into this state or for sale or distribution in this
15 state, or to the board or to a licensee of the board.
16 "(17)(18) KEG. A pressurized factory sealed
17 container with a capacity equal to or greater than five US
18 gallons, from which beer is withdrawn by means of an external
19 tap.
20 "(18)(19) LIQUOR. Any alcoholic, spirituous, vinous,
21 fermented, or other alcoholic beverage, or combination of
22 liquors and mixed liquor, a part of which is spirituous,
23 fermented, vinous or otherwise alcoholic, and all drinks or
24 drinkable liquids, preparations or mixtures intended for
25 beverage purposes, which contain one-half of one percent or
26 more of alcohol by volume, except beer and table wine.
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1 "(19)(20) LIQUOR STORE. A liquor store operated by
2 the board, where alcoholic beverages other than beer are
3 authorized to be sold in unopened containers.
4 "(20)(21) MANUFACTURER. Any person, association, or
5 corporation engaged in the producing, bottling, manufacturing,
6 distilling, rectifying, or compounding of alcoholic beverages,
7 liquor, beer, or wine in this state or for sale or
8 distribution in this state or to the board or to a licensee of
9 the board.
10 "(21)(22) MEAD. An alcoholic beverage produced by