1 HB437
2 212923-4
3 By Representatives Collins, Wadsworth, Simpson, Ball,
4 Reynolds, Pettus, Ledbetter, Isbell, Faulkner, Wilcox, Brown
5 (K), Baker, Meadows, Nordgren, Carns, Greer, Rafferty, Hollis,
6 Coleman, Lovvorn, McMillan, Shiver, Faust, Wood (D),
7 Robertson, Sorrells, Stringer, Ellis and Sells
8 RFD: Economic Development and Tourism
9 First Read: 23-FEB-21
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1
2 ENROLLED, An Act,
3 Relating to wine; to amend Section 28-1-4, Code of
4 Alabama 1975; to add Sections 28-3A-6.1 and 28-3A-6.2 and
5 Chapter 8A of Title 28 to the Code of Alabama 1975; to allow
6 certain wine manufacturers to obtain a direct wine shipper
7 license from the Alcoholic Beverage Control Board to allow the
8 licensee to ship limited quantities of wine to Alabama
9 residents for personal use in limited circumstances; to
10 provide for the licensing procedure for direct wine shippers
11 and wine fulfillment centers; to authorize common or permit
12 carriers to ship wine to residents; to provide for reporting
13 from the carriers and wineries to the Alcoholic Beverage
14 Control Board and other applicable agencies; to provide that
15 the direct shipment of wine without a license constitutes a
16 Class C misdemeanor; to authorize the Alcoholic Beverage
17 Control Board to adopt rules; to require licensed importers
18 and manufacturers of wine to enter into exclusive franchise
19 agreements with wholesalers; to regulate franchise agreements
20 between suppliers and wholesalers of wine; to provide for
21 other business relations between suppliers and wholesalers of
22 wine; to provide for an effective date; and in connection
23 therewith would have as its purpose or effect the requirement
24 of a new or increased expenditure of local funds within the
25 meaning of Amendment 621 of the Constitution of Alabama of
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1 1901, now appearing as Section 111.05 of the Official
2 Recompilation of the Constitution of Alabama of 1901, as
3 amended.
4 BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
5 Section 1. The Legislature hereby finds and declares
6 that this act is enacted pursuant to the authority granted to
7 the state under the Twenty-First Amendment to the United
8 States Constitution, the powers reserved to the state under
9 the Tenth Amendment to the United States Constitution, and the
10 inherent powers of the state under the Constitution of Alabama
11 of 1901, in order to regulate the traffic of alcoholic
12 beverages and to substitute the regulations and oversight
13 established in this act for the application of federal and
14 state antitrust laws that otherwise would apply to any
15 potential anti-competitive effects of this title. For the
16 avoidance of doubt, the intent of the Legislature is to
17 maintain the uniform three-tier system of control over the
18 sale, purchase, taxation, transportation, manufacture,
19 consumption, and possession of alcoholic beverages in the
20 state to promote the health, safety, and welfare of residents
21 of this state by, among other purposes, ensuring the state
22 shall be able to register, audit, inspect, seize, recall and
23 test alcoholic beverages shipped into, distributed, and sold
24 throughout this state; and this expression of the policy and
25 intent of the Legislature is intended to satisfy the clear
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1 articulation test for state action immunity as has been
2 established by the United States Supreme Court in California
3 Retail Liquor Dealers Assn. v. Midcal Aluminum, Inc., et al.
4 Section 2. Section 28-1-4, Code of Alabama 1975, is
5 amended to read as follows:
6 "28-1-4.
7 "(a) The words and phrases used in this section
8 shall have the meanings ascribed to them in Section 28-3-1 and
9 any acts amendatory thereof, supplementary thereto or
10 substituted therefor.
11 "(b)It Except as provided in subsection (c), it
12 shall be unlawful for common or permit carriers, operators of
13 trucks, buses or other conveyances or out-of-state
14 manufacturers or suppliers to make delivery of any alcoholic
15 beverage from without outside the State of Alabama to any
16 person, association, or corporation within the state, except
17 to the Alabama Alcoholic Beverage Control Board and to
18 manufacturers, importers, wholesalers and warehouses licensed
19 by the Alabama Alcoholic Beverage Control Board to receive the
20 alcoholic beverages so delivered.
21 "(c) A common or permit carrier may ship and
22 transport shipments of wine to an Alabama resident who is at
23 least 21 years of age at the direction of a direct wine
24 shipper licensee, as provided in Sections 28-3A-6.1 and
25 28-3A-6.2. A common or permit carrier making a shipment as
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1 provided in Sections 28-3A-6.1 or 28-3A-6.2 is not required to
2 maintain in the vehicle or within the possession of the driver
3 of the vehicle a bill of lading, consignment, or any other
4 documentary evidence of the cargo being transported other than
5 information available on the package shipping label.
6 "(1) A common or permit carrier that ships and
7 transports wine to a resident of the state shall make shipment
8 as provided in Sections 28-3A-6.1 and 28-3A-6.2, shall confirm
9 that any individual physically receiving a shipment of wine is
10 at least 21 years of age, and shall require the individual's
11 signature before releasing the shipment to that individual.
12 Any failure by a common or permit carrier, upon receipt of the
13 shipment, to verify the age of the individual receiving the
14 wine may result in the suspension of the common or permit
15 carrier's license to operate in the state or the imposition of
16 any other penalty the relevant licensing authority in the
17 state is authorized to impose.
18 "(2) A common or permit carrier that ships and
19 transports wine to a resident of the state shall make shipment
20 as provided in Sections 28-3A-6.1 and 28-3A-6.2, shall
21 maintain a copy of the signature of the individual who
22 physically received the shipment for at least three years
23 following the date of completion of that shipment, and, upon
24 request, shall provide a copy of that signature to the Tax and
25 Trade Practices Division of the board. Failure by a common or
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1 permit carrier to maintain a copy of the signature of the
2 individual receiving the wine pursuant to this section, or
3 failure to provide a copy of that signature to the board or
4 the Department of Revenue upon request, may result in the
5 suspension of the common or permit carrier's license to
6 operate in the state or the imposition of any other penalty
7 the relevant licensing authority in the state is authorized to
8 impose.
9 "(d) A common or permit carrier that ships and
10 transports wine to a resident of the state shall make shipment
11 as provided in Sections 28-3A-6.1 and 28-3A-6.2 and shall file
12 quarterly reports with the Tax and Trade Practices Division of
13 the board of all wine shipments during the reporting period
14 that report all of the following with regard to each shipment:
15 "(1) The name and business address of the person who
16 directed the common or permit carrier to ship wine.
17 "(2) The weight of the shipment.
18 "(3) The name and address of the consumer to whom
19 the wine was shipped.
20 "(4) A unique tracking number.
21 "(5) The date of delivery.
22 "(e) Reports made under subsection (c) shall be
23 considered public records for purposes of Article 3,
24 commencing with Section 36-12-40, of Chapter 12 of Title 36,
25 and shall be made available to law enforcement officers.
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1 "(f) A willful failure by a common or permit carrier
2 to comply with the reporting requirements in this section
3 which continues for more than 30 days after receiving notice
4 by the board or Department of Revenue of the failure may
5 result in the suspension of the common or permit carrier's
6 license to operate in the state or the imposition of any other
7 penalty the relevant licensing authority in the state is
8 authorized to impose.
9 "(c) Any violation of subsection (a) of this section
10 shall be a misdemeanor, punishable as provided in paragraph
11 (1) of subsection (b) of Section 28-3A-25.
12 "(d) All laws or parts of law which conflict or are
13 inconsistent with this section are hereby repealed, provided,
14 however, the provisions of Section 28-1-3 are excluded."
15 Section 3. Sections 28-3A-6.1 and 28-3A-6.2 are
16 added to the Code of Alabama 1975, to read as follows:
17 28-3A-6.1. Direct shipment of wine by a
18 manufacturer.
19 (a) Any person licensed by the board as a wine
20 manufacturer who holds a federal basic wine manufacturing
21 permit pursuant to the Federal Alcohol Administration Act, 27
22 U.S.C. 201 et seq., and who is in the business of
23 manufacturing and bottling wine may obtain a direct wine
24 shipper license from the board as provided in this section. A
25 direct wine shipper licensee may ship annually up to 12 cases
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1 of unopened containers of wine to any one Alabama resident in
2 a 12-month period, each case not exceeding nine liters of
3 wine. A direct wine shipper licensee may ship only wine (i)
4 produced by the direct wine shipper licensee; (ii) produced by
5 or for the direct wine shipper licensee under a written
6 contract, existing at the time of shipment, with another
7 manufacturer of wine that holds a federal basic wine
8 manufacturing permit pursuant to the Federal Alcohol
9 Administration Act, 27 U.S.C. 201 et seq., and who is in the
10 business of manufacturing and bottling wine; or (iii)
11 exclusively produced and bottled for the direct wine shipper
12 licensee by a manufacturer of wine that holds a federal basic
13 wine manufacturing permit pursuant to the Federal Alcohol
14 Administration Act, 27 U.S.C. 201 et seq., and who is in the
15 business of manufacturing and bottling wine. The wine shall be
16 shipped and transported by common or permit carrier directly
17 from the direct wine shipper licensee's licensed premises, or
18 from the direct wine shipper licensee through a wine
19 fulfillment center as provided in Section 28-3A-6.2, to a
20 resident of Alabama who is at least 21 years of age for the
21 resident's personal use and not for resale.
22 (b) In order to receive a license to ship wine to an
23 Alabama resident, the applicant for a direct wine shipper
24 license shall do all of the following:
25 (1) File an application with the board.
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1 (2) Pay a filing an application fee of two hundred
2 dollars ($200).
3 (3) Provide to the board a true copy of its current
4 wine manufacturer license issued by the board or issued by the
5 state in which it manufactures wine and a true copy of its
6 federal basic wine manufacturing permit.
7 (c) A direct wine shipper licensee:
8 (1) May not ship more wine than is specified in
9 subsection (a) to any one consumer in a 12-month period.
10 (2) May not ship any wine to any address or property
11 that is any of the following:
12 a. Any premises licensed by the board.
13 b. A public or private elementary, secondary, or
14 post-secondary educational school, including any dormitory,
15 housing, or common space located on the campus of any
16 elementary, secondary or post-secondary educational school.
17 c. A prison, reformatory, or other correctional
18 facility.
19 d. A hospital or other healthcare facility,
20 including, but not limited to, an acute care, addiction or
21 substance abuse, or mental or psychiatric care facility.
22 e. A locker, a mailbox, a storage facility, or a
23 package shipping or similar service business.
24 f. An address that is not a permanent street
25 address.
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1 (3) May only ship wine that has been approved by the
2 board for sale and shipment within or into the state and for
3 which the direct wine shipper licensee does either of the
4 following:
5 a. Owns the Certificate of Label Approval issued by
6 the Alcohol and Tobacco Tax and Trade Bureau.
7 b. Has the exclusive right to sell the wine in the
8 United States under a written contract, existing at time of
9 shipment, with the manufacturer of wine that holds a federal
10 basic wine manufacturing permit pursuant to the Federal
11 Alcohol Administration Act, 27 U.S.C. 201 et seq., and is
12 the owner of the Certificate of Label Approval issued by the
13 Alcohol and Tobacco Tax and Trade Bureau.
14 (4) Shall ensure that all containers of wine shipped
15 directly to a resident in this state are conspicuously labeled
16 with the words: "CONTAINS ALCOHOL: SIGNATURE OF PERSON AGE 21
17 OR OLDER REQUIRED FOR DELIVERY."
18 (5) Shall report to the board on a quarterly basis
19 in a manner prescribed by the board all of the following
20 information for each wine shipment into the state pursuant to
21 this section:
22 a. The name and address of the Alabama resident who
23 placed the order.
24 b. For each completed shipment, evidence of
25 signature by an individual of age 21 or older.
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1 c. The name and license number of the common or
2 permit carrier engaged in the shipment.
3 d. For each shipment by a wine fulfillment center
4 licensee on behalf of the direct wine shipper, the name and
5 license number of the wine fulfillment center licensee engaged
6 in the shipment.
7 e. The date of shipment.
8 f. The carrier tracking number.
9 g. The quantity of wine in the shipment.
10 (6) Whether located within or outside of this state,
11 shall collect and properly remit all state and local sales or
12 use taxes and excise taxes due on sales to Alabama residents.
13 (7) Shall permit the board or the Department of
14 Revenue to perform an audit of the direct wine shipper
15 licensee's records upon request.
16 (8) Shall obtain from the customer an attestation
17 that he or she is at least 21 years of age at the time the
18 order is placed.
19 (9) Shall be deemed to have consented to the
20 jurisdiction of the board or any law enforcement agency and
21 the Alabama courts concerning enforcement of this section and
22 any related laws or administrative rules.
23 (d) A direct wine shipper licensee may renew its
24 license with the board by paying annually a renewal fee of one
25 hundred fifty dollars ($150) and providing the board a true
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1 copy of its current manufacturer license issued by the board
2 and its federal basic wine manufacturing permit.
3 (e) The board may adopt rules pursuant to the
4 Administrative Procedure Act to implement this section.
5 (f) The board may enforce the requirements of this
6 section to suspend or revoke a direct wine shipper license by
7 the same administrative proceedings that apply to alcoholic
8 beverage licenses, and the board may accept payment of a fine
9 in lieu of suspension or revocation. Payments of fines shall
10 be determined by rule adopted by the board.
11 (g) Shipments of wine direct to consumers in Alabama
12 from persons who do not possess a current direct wine shipper
13 license pursuant to this section are prohibited. Any person
14 that violates this section is guilty of a Class C misdemeanor
15 and shall also be subject to a civil penalty imposed by the
16 board by administrative proceedings that apply to alcoholic
17 beverage licenses, as follows:
18 (1) For the first violation, a civil penalty not to
19 exceed five hundred dollars ($500).
20 (2) For a second violation, a civil penalty not to
21 exceed three thousand dollars ($3,000).
22 (3) For a third or any subsequent violation, a civil
23 penalty not to exceed six thousand dollars ($6,000).
24 (h) Any fines or fees received by the board under
25 this section, including, but not limited to, the direct wine
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1 shipper licensee fee, shall be used by the board in order to
2 perform its regulatory duties under Title 28.
3 (i) A direct wine shipper licensee may not avoid
4 liability under this section by subcontracting with a third
5 party to perform its obligations required pursuant to this
6 section.