AN ACT TO CONFIRM THE STATE'S SUPPORT OF THE THREE-TIER SYSTEM FOR DISTRIBUTION OF MALT BEVERAGES AND THE FRANCHISE LAWS, TO MAKE ADJUSTMENTS TO MODERNIZE THE EXEMPTIONS TO THE THREE-TIER SYSTEM, AND TO PROMOTE THE GROWTH OF SMALL AND MID-SIZED INDEPENDENT CRAFT BREWERIES. Enacted May 30, 2019. Effective May 30, 2019.
Summary date: May 31 2019 - View summary
Summary date: Apr 3 2019 - View summary
House committee substitute to the 1st edition makes the following changes.
Modifies the whereas clauses.
Modifies the proposed changes to GS 18B-1104(a)(8) regarding the authority of a brewery permit holder to obtain a malt beverage wholesaler permit. Further specifies that the ABC Commission has no authority to grant an exemption to or otherwise allow a brewery permittee (previously not specified) more than three additional retail locations authorized. Clarifies that malt beverages manufactured by a supplier permitee (previously permittee was not specified) that owns 5% or more of a brewery permittee acting under the authorization is included in the determination of whether the brewery permittee complies with the barrelage limitations, as proposed.
Amends GS 18B-1116 to require that any exemption entered by the ABC Commission in which any brewery or any officer, director, or affiliate of the brewery has a direct or indirect financial interest in the business of any retailer beyond the number of additional retail locations authorized by GS 18B-1104, as amended, must prohibit the brewery's malt beverages from being sold to or purchased by that retailer.
Adds that the act does not apply to any exemption order or amendment entered by the ABC Commission prior to the act's effective date that is renewed or issued after the effective date of the act.
Summary date: Mar 14 2019 - View summary
Identical to S 246, filed 3/13/19.
Includes whereas clauses.
Amends GS 18B-100, which establishes the purpose of GS Chapter 18B (Regulation of Alcoholic Beverages). Adds that if any provision or application of the Chapter is determined to be invalid or unconstitutional, the provision is stricken, and directs the remainder of the Chapter to be construed with the legislative intent to further limit commerce in alcoholic beverages, and with respect to malt beverages, unfortified wine, and fortified wine, construed to enhance regulatory control over taxation, distribution, and sale of alcoholic beverages through the three-tier regulatory system and the franchise laws imposed by the Chapter.
Amends GS 18B-1104(a)(8) regarding the authority of a brewery permit holder to obtain a malt beverage wholesaler permit. Expands the scope of the authorization to include breweries that sell, to consumers at the brewery, to wholesalers, to retailers, and to exporters, fewer than 100,000 barrels (was, fewer than 25,000 barrels) of malt beverages produced by it per year. Modifies the authorization to allow a brewery permit holder to obtain a malt beverage wholesaler permit to sell, deliver, and ship at wholesale up to 50,000 barrels of malt beverages manufactured by the brewery per year to unaffiliated retail permittees (previously, limited to malt beverages by the brewery only, with no reference to year). Adds that the barrelege limitations of subsection (a)(8) apply regardless of the number or type of permits that can be issued to a brewery. Specifies that the ABC Commission has no authority to allow more than three additional retail locations authorized. Includes malt beverages manufactured by a supplier that owns 5% or more of a brewery permittee acting under the authorization in the determination of whether the brewery permittee complies with the barrelage limitations. Does not apply to any exemption order or amendment thereto entered by the ABC Commission prior to the effective date of the act.
Amends GS 18B-300 regarding the purposes of the regulation of business relations between malt beverage manufacturers and importers and the malt beverage wholesalers. Adds seven purposes to the regulation, including protecting wholesalers against unfair treatment by suppliers, and promoting consumer choice by ensuring an independent wholesale distribution tier that enables wholesalers to distribute competing products of other suppliers.
Makes conforming changes to GS 18B-1305(a1), concerning termination of a franchise agreement by a small brewery authorized to distribute its own malt beverage products pursuant to GS 18B-1104(a)(8), as amended. Specifies that the term barrel is defined as in GS 18B-1104.
Includes a severability clause.