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7 LONG TITLE
8 General Description:
9 This bill modifies the Alcoholic Beverage Control Act to address sampling.
10 Highlighted Provisions:
11 This bill:
12 ▸ addresses a manufacturing licensee providing samples under limited circumstances;
13 and
14 ▸ makes technical and conforming amendments.
15 Money Appropriated in this Bill:
16 None
17 Other Special Clauses:
18 None
19 Utah Code Sections Affected:
20 AMENDS:
21 32B-4-401, as enacted by Laws of Utah 2010, Chapter 276
22 32B-4-708, as enacted by Laws of Utah 2010, Chapter 276
23 32B-11-303, as enacted by Laws of Utah 2010, Chapter 276
24 32B-11-403, as enacted by Laws of Utah 2010, Chapter 276
25 32B-11-503, as last amended by Laws of Utah 2011, Chapter 334
26
27 Be it enacted by the Legislature of the state of Utah:
28 Section 1. Section 32B-4-401 is amended to read:
29 32B-4-401. Unlawful sale or furnishing.
30 (1) It is unlawful for a retail licensee, a permittee, or staff of a retail licensee or
31 permittee to keep for sale, or to directly or indirectly, sell, offer for sale, or furnish to another,
32 an alcoholic product, except as otherwise provided by this title.
33 (2) It is unlawful for a person in the business of selling liquor, a manufacturer, a
34 supplier, an importer of liquor, or staff of the person, manufacturer, supplier, or importer to
35 sell, ship, transport, or cause to be sold, shipped, or transported liquor from an out-of-state
36 location directly or indirectly into this state except to the extent authorized by this title to:
37 (a) the department;
38 (b) a military installation;
39 (c) a holder of a special use permit, to the extent authorized in the special use permit;
40 or
41 (d) a liquor warehouser licensee licensed to distribute and transport liquor to:
42 (i) the department; or
43 (ii) an out-of-state wholesaler or retailer.
44 (3) (a) It is unlawful for a person in the business of selling beer, a manufacturer, a
45 supplier, an importer of beer, or staff of the person, manufacturer, or importer to sell, ship,
46 transport, or cause to be sold, shipped, or transported beer from an out-of-state location directly
47 or indirectly into this state except to the extent authorized by this title to:
48 (i) a beer wholesaler licensee;
49 (ii) a military installation; or
50 (iii) a holder of a special use permit, to the extent authorized in the special use permit.
51 (b) Subsection (3)(a) does not preclude a small brewer that holds a certificate of
52 approval from selling, shipping, or transporting beer to the extent authorized by Subsection
53 32B-11-503[
54 (i) a beer retailer; or
55 (ii) an event permittee.
56 (4) (a) It is unlawful for a manufacturer, supplier, or importer of liquor in this state, or
57 staff of the manufacturer, supplier, or importer to sell, ship, transport, or cause to be sold,
58 shipped, or transported liquor directly or indirectly to a person in this state except to the extent
59 authorized by this title to:
60 (i) the department;
61 (ii) a military installation;
62 (iii) a holder of a special use permit, to the extent authorized in the special use permit;
63 or
64 (iv) a liquor warehouser licensee who is licensed to distribute and transport liquor to:
65 (A) the department; or
66 (B) an out-of-state wholesaler or retailer.
67 (b) Subsection (4)(a) does not preclude a winery manufacturing licensee located in this
68 state from selling wine to a person on its winery premises:
69 (i) to the extent authorized by Subsection 32B-11-303[
70 (ii) under a package agency issued by the commission on the winery premises.
71 (c) Subsection (4)(a) does not preclude a distillery manufacturing licensee located in
72 this state from furnishing liquor to a person on its distillery premises to the extent authorized
73 by Subsection 32B-11-403(6).
74 (5) (a) It is unlawful for a manufacturer, supplier, or importer of beer in this state, or
75 staff of the manufacturer, supplier, or importer to sell, ship, transport, or cause to be sold,
76 shipped, or transported beer directly or indirectly to a person in this state except to the extent
77 authorized by this title to:
78 (i) a beer wholesaler licensee;
79 (ii) a military installation; or
80 (iii) a holder of a special use permit, to the extent authorized in the special use permit.
81 (b) Subsection (5)(a) does not preclude:
82 (i) a small brewer who is a brewery manufacturing licensee located in this state from
83 selling, shipping, and transporting beer to the extent authorized by Subsection
84 32B-11-503[
85 (A) a beer retailer; or
86 (B) an event permittee; or
87 (ii) a brewery manufacturing licensee from selling beer to a person on its
88 manufacturing premises under Subsection 32B-11-503[
89 (6) It is unlawful for a person other than a person described in Subsection (2) or (3) to
90 sell, ship, transport, or cause to be sold, shipped, or transported an alcoholic product from an
91 out-of-state location directly or indirectly into this state, except as otherwise provided by this
92 title.
93 (7) It is unlawful for a person in this state other than a person described in Subsection
94 (4) or (5) to sell, ship, transport, or cause to be sold, shipped, or transported an alcoholic
95 product directly or indirectly to another person in this state, except as otherwise provided by
96 this title.
97 (8) (a) A violation of Subsection (1) is a class B misdemeanor, except when otherwise
98 provided by this title.
99 (b) A violation of Subsection (2), (3), (4), or (5) is a third degree felony.
100 (c) A violation of Subsection (6) or (7) is a class B misdemeanor.
101 Section 2. Section 32B-4-708 is amended to read:
102 32B-4-708. Unlawful act involving consumers.
103 (1) (a) It is unlawful for an industry member, directly or indirectly, or through an
104 affiliate, to give away any of its product to a person except for testing, analysis, and sampling
105 purposes by the department [
106 general public to the extent authorized by this title.
107 (b) This Subsection (1) does not preclude an industry member from serving its product
108 to others at a private event hosted by the industry member in the industry member's home or
109 elsewhere so long as the product is not served:
110 (i) as part of a promotion of the industry member's product; or
111 (ii) as a subterfuge to provide a sample to a person for product testing, analysis, or
112 sampling purposes.
113 (2) It is unlawful for an industry member or retailer, directly or indirectly, or through
114 an affiliate, to engage in an advertisement or promotional scheme that requires the purchase or
115 sale of an alcoholic product, or consumption of an alcoholic product, in order to participate in a
116 promotion, program, or other activity.
117 (3) It is unlawful for an industry member or retailer, directly or indirectly, or through
118 an affiliate, to pay, give, or deliver to a person money or any other thing of value, including a
119 rebate, refund, or prize, on the basis of the purchase, display, use, sale, or consumption of an
120 alcoholic product.
121 (4) It is unlawful for an industry member or retailer to sponsor or underwrite an
122 athletic, theatrical, scholastic, artistic, or scientific event that:
123 (a) overtly promotes the consumption of a product;
124 (b) offers a product to the general public without charge; or
125 (c) takes place on the premises of a school, college, university, or other educational
126 institution.
127 Section 3. Section 32B-11-303 is amended to read:
128 32B-11-303. Specific authority and operational requirements for winery
129 manufacturing license.
130 (1) A winery manufacturing license allows a winery manufacturing licensee to:
131 (a) store, manufacture, transport, import, or export wine;
132 (b) sell wine at wholesale to the department and to out-of-state customers;
133 (c) purchase liquor for fortifying wine, if the department is notified of the purchase and
134 date of delivery; and
135 (d) warehouse on the licensed premises liquor that is manufactured or purchased for
136 manufacturing purposes.
137 (2) (a) A wine, brandy, wine spirit, or other liquor imported under authority of a winery
138 manufacturing license shall conform to the standards of identity and quality established in the
139 regulations issued under Federal Alcohol Administration Act, 27 U.S.C. Sec. 201 et seq.
140 (b) The federal definitions, standards of identity, and quality and labeling requirements
141 for wine, in regulations issued under Federal Alcohol Administration Act, 27 U.S.C. Sec. 201
142 et seq., are adopted to the extent the regulations are not contrary to or inconsistent with the
143 laws of this state.
144 (3) If considered necessary, the commission or department may require:
145 (a) the alteration of the plant, equipment, or licensed premises;
146 (b) the alteration or removal of unsuitable wine-making equipment or material;
147 (c) a winery manufacturing licensee to clean, disinfect, ventilate, or otherwise improve
148 the sanitary and working conditions of the plant, licensed premises, and wine-making
149 equipment;
150 (d) that a marc, pomace, or fruit be destroyed, denatured, or removed from the licensed
151 premises because it is considered:
152 (i) unfit for wine making; or
153 (ii) as producing or likely to produce an unsanitary condition;
154 (e) a winery manufacturing licensee to distill or cause to be distilled or disposed of
155 under the department's supervision:
156 (i) any unsound, poor quality finished wine; or
157 (ii) unfinished wine that will not be satisfactory when finished; or
158 (f) that a record pertaining to the grapes and other materials and ingredients used in the
159 manufacture of wine be available to the commission or department upon request.
160 (4) A winery manufacturing licensee may not permit wine to be consumed on its
161 premises, except under the following circumstances:
162 (a) A winery manufacturing licensee may allow its staff to consume on the licensed
163 premises wine as the winery manufacturing licensee furnishes to the staff without charge.
164 (b) A winery manufacturing licensee may allow a person who can lawfully purchase
165 wine for wholesale or retail distribution to consume a bona fide sample of the winery
166 manufacturing licensee's product on the licensed premises.
167 (c) A winery manufacturing licensee may [
168
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171 manufacturing licensee's product in accordance with Subsection (5).
172 (5) A winery manufacturing licensee may offer a sample tasting to an individual on the
173 licensed premises in accordance with the following:
174 (a) the winery manufacturing licensee shall charge for the sample;
175 (b) the maximum amount of samples allowed in the aggregate may not exceed 10
176 ounces at a single serving;
177 (c) a sample may be served only by a person who is 21 years of age or older;
178 (d) a sample may be served only to an individual who is 21 years of age or older;
179 (e) the winery manufacturing licensee shall dispense the sample in an area designated
180 for sampling;
181 (f) if the designated area for sampling is in a separate building than where the
182 manufacturing occurs, the designated area for sampling shall be located on the same
183 identifiable contiguous unit of property that is treated as separate for valuation or zoning
184 purposes and includes an improvement on that unit of property; and
185 (g) the winery manufacturing licensee shall purchase the wine used for the sample from
186 the department and not use wine from its own package agency.
187 Section 4. Section 32B-11-403 is amended to read:
188 32B-11-403. Specific authority and operational requirements for distillery
189 manufacturing license.
190 (1) A distillery manufacturing license allows a distillery manufacturing licensee to:
191 (a) store, manufacture, transport, import, or export liquor;
192 (b) sell liquor to:
193 (i) the department;
194 (ii) an out-of-state customer; and
195 (iii) as provided in Subsection (2);
196 (c) purchase an alcoholic product for mixing and manufacturing purposes if the
197 department is notified of:
198 (i) the purchase; and
199 (ii) the date of delivery; and
200 (d) warehouse on its licensed premises an alcoholic product that the distillery
201 manufacturing licensee manufactures or purchases for manufacturing purposes.
202 (2) (a) Subject to the other provisions of this Subsection (2), a distillery manufacturing
203 licensee may directly sell an alcoholic product to a person engaged within the state in:
204 (i) a mechanical or industrial business that requires the use of an alcoholic product; or
205 (ii) scientific pursuits that require the use of an alcoholic product.
206 (b) A person who purchases an alcoholic product under Subsection (2)(a) shall hold a
207 valid special use permit issued in accordance with Chapter 10, Special Use Permit Act,
208 authorizing the use of the alcoholic product.
209 (c) A distillery manufacturing licensee may sell to a special use permittee described in
210 Subsection (2)(b) an alcoholic product only in the type for which the special use permit
211 provides.
212 (d) The sale of an alcoholic product under this Subsection (2) is subject to rules
213 prescribed by the department and the federal government.
214 (3) The federal definitions, standards of identity and quality, and labeling requirements
215 for distilled liquor, in the regulations issued under Federal Alcohol Administration Act, 27
216 U.S.C. Sec. 201 et seq., are adopted to the extent the regulations are not contrary to or
217 inconsistent with laws of this state.
218 (4) If considered necessary, the commission or department may require:
219 (a) the alteration of the plant, equipment, or licensed premises;
220 (b) the alteration or removal of unsuitable alcoholic product-making equipment or
221 material;
222 (c) a distillery manufacturing licensee to clean, disinfect, ventilate, or otherwise
223 improve the sanitary and working conditions of the plant, licensed premises, and equipment; or
224 (d) that a record pertaining to the materials and ingredients used in the manufacture of
225 an alcoholic product be made available to the commission or department upon request.
226 (5) A distillery manufacturing licensee may not permit an alcoholic product to be
227 consumed on its premises, except that:
228 (a) a distillery manufacturing licensee may allow its staff to consume on the licensed
229 premises an alcoholic product that the distillery furnishes to the staff without charge; [
230 (b) a distillery manufacturing licensee may allow a person who can lawfully purchase
231 an alcoholic product for wholesale or retail distribution to consume a bona fide sample of the
232 distillery manufacturing licensee's product on the licensed premises[
233 (c) a distillery manufacturing licensee may allow an individual to sample the distillery
234 manufacturing licensee's product in accordance with Subsection (6).
235 (6) A distillery manufacturing licensee may offer a sample tasting to an individual on
236 the licensed premises in accordance with the following:
237 (a) the distillery manufacturing licensee shall charge for the sample;
238 (b) the maximum amount of samples allowed in the aggregate may not exceed 2.5
239 ounces at a single serving;
240 (c) a sample may be served only by a person who is 21 years of age or older;
241 (d) a sample may be served only to an individual who is 21 years of age or older;
242 (e) the distillery manufacturing licensee shall dispense the sample in an area designated
243 for sampling;
244 (f) if the designated area for sampling is in a separate building than where the
245 manufacturing occurs, the designated area for sampling shall be located on the same
246 identifiable contiguous unit of property that is treated as separate for valuation or zoning
247 purposes and includes an improvement on that unit of property; and
248 (g) the distillery manufacturing licensee shall purchase the product used for the sample
249 from the department and not use product from its own package agency.
250 Section 5. Section 32B-11-503 is amended to read:
251 32B-11-503. Specific authority and operational requirements for brewery
252 manufacturing license.
253 (1) A brewery manufacturing license allows a brewery manufacturing licensee to:
254 (a) store, manufacture, brew, transport, or export beer, heavy beer, and flavored malt
255 beverages;
256 (b) sell heavy beer and a flavored malt beverage to:
257 (i) the department;
258 (ii) a military installation; or
259 (iii) an out-of-state customer;
260 (c) sell beer to a beer wholesaler licensee;
261 (d) in the case of a small brewer, in accordance with Subsection (5), sell beer
262 manufactured by the small brewer to:
263 (i) a retail licensee;
264 (ii) an off-premise beer retailer; or
265 (iii) an event permittee; and
266 (e) warehouse on its premises an alcoholic product that the brewery manufacturing
267 licensee manufactures or purchases for manufacturing purposes.
268 (2) A brewery manufacturing licensee may not sell the following to a person within the
269 state except the department or a military installation:
270 (a) heavy beer; or
271 (b) a flavored malt beverage.
272 (3) If considered necessary, the commission or department may require:
273 (a) the alteration of the plant, equipment, or licensed premises;
274 (b) the alteration or removal of any unsuitable alcoholic product-making equipment or
275 material;
276 (c) a brewery manufacturing licensee to clean, disinfect, ventilate, or otherwise
277 improve the sanitary and working conditions of the plant, licensed premises, and equipment; or
278 (d) that a record pertaining to the materials and ingredients used in the manufacture of
279 an alcoholic product be available to the commission or department upon request.
280 (4) A brewery manufacturing licensee may not permit any beer, heavy beer, or flavored
281 malt beverage to be consumed on the licensed premises, except under the circumstances
282 described in this Subsection (4).
283 (a) A brewery manufacturing licensee may allow its off-duty staff to consume beer,
284 heavy beer, or a flavored malt beverage on its premises without charge.
285 (b) A brewery manufacturing licensee may allow a person who can lawfully purchase
286 the following for wholesale or retail distribution to consume a bona fide sample of the brewery
287 manufacturing licensee's product on the licensed premises:
288 (i) beer;
289 (ii) heavy beer; or
290 (iii) a flavored malt beverage.
291 (c) (i) A brewery manufacturing licensee may [
292
293
294 beer in accordance with Subsection (5).
295 [
296
297 [
298 (5) A brewery manufacturing licensee may offer a sample tasting of beer or heavy beer
299 to an individual on the licensed premises in accordance with the following:
300 (a) the brewery manufacturing licensee shall charge for the sample;
301 (b) the maximum amount of samples allowed in the aggregate may not exceed 24
302 ounces at a single serving;
303 (c) a sample may be served only by a person who is 21 years of age or older;
304 (d) a sample may be served only to an individual who is 21 years of age or older;
305 (e) the brewery manufacturing licensee shall dispense the sample in an area designated
306 for sampling;
307 (f) if the designated area for sampling is in a separate building than where the
308 manufacturing occurs, the designated area for sampling shall be located on the same
309 identifiable contiguous unit of property that is treated as separate for valuation or zoning
310 purposes and includes an improvement on that unit of property;
311 (g) the brewery manufacturing licensee shall purchase the product used for the sample
312 from the department and not use product from its own package agency; and
313 (h) a brewery manufacturing licensee shall comply with the requirements of Chapter 7,
314 Part 2, Off-Premise Beer Retailer Local Authority.
315 [
316 facility located in this state for the storage of beer to be sold to a person described in
317 Subsection (1)(d) if the small brewer:
318 (i) (A) (I) is located in this state; and
319 (II) holds a brewery manufacturing license; or
320 (B) (I) is located outside this state; and
321 (II) holds a certificate of approval to sell beer in this state; and
322 (ii) sells beer manufactured by the small brewer directly to a person described in
323 Subsection (1)(d).
324 (b) A small brewer may not sell beer to a person described in Subsection (1)(d) unless
325 the beer:
326 (i) is manufactured by the small brewer; and
327 (ii) is first placed in the small brewer's warehouse facility in this state.
328 (c) (i) A small brewer warehouse shall make and maintain complete beer importation,
329 inventory, tax, distribution, sales records, and other records as the department and State Tax
330 Commission may require.
331 (ii) The records described in Subsection [
332 (A) the department; and
333 (B) the State Tax Commission.
334 (iii) Section 32B-1-205 applies to a record required to be made or maintained in
335 accordance with this Subsection [
336 action described in Section 32B-1-205 made for the purpose of deceiving the State Tax
337 Commission, or an official or employee of the State Tax Commission.
338 [
339 (a) A brewery manufacturing licensee may not sell beer in this state except under a
340 written agreement with a beer wholesaler licensee in this state.
341 (b) An agreement described in Subsection [
342 (i) create a restricted exclusive sales territory that is mutually agreed upon by the
343 persons entering into the agreement;
344 (ii) designate the one or more brands that may be distributed in the sales territory; and
345 (iii) set forth the exact geographical area of the sales territory.
346 (c) A brewery manufacturing licensee may have more than one agreement described in
347 this Subsection [
348 exclusive sales territory.
349 (d) A brewery manufacturing licensee may not enter into an agreement with more than
350 one beer wholesaler licensee to distribute the same brand of beer in the same sales territory or
351 any portion of the sales territory.
352 [
Legislative Review Note
as of 2-4-15 5:11 PM
Office of Legislative Research and General Counsel