DISTILLER REGULATORY REFORM BILL.

View NCGA Bill Details2019-2020 Session
House Bill 378 (Public) Filed Tuesday, March 19, 2019
AN ACT TO ALLOW A DISTILLERY TO SELL MALT BEVERAGES AND UNFORTIFIED AND FORTIFIED WINE; TO ALLOW A DISTILLERY TO SELL MIXED BEVERAGES; TO ALLOW A DISTILLERY TO SELL SPIRITUOUS LIQUOR DISTILLED BY THE DISTILLER DIRECTLY TO MIXED BEVERAGES PERMITTEES AND OUT-OF-STATE CONSUMERS; TO REVISE THE LAW GOVERNING THE SALE OF SPIRITUOUS LIQUOR BY A DISTILLERY TO VISITORS FOR CONSUMPTION OFF THE PREMISES; TO ALLOW A DISTILLERY TO ISSUE PURCHASE-TRANSPORTATION PERMITS FOR SPIRITUOUS LIQUOR SOLD BY THE DISTILLERY; TO ALLOW SPIRITUOUS LIQUOR TASTINGS AT AN ABC STORE; AND TO ALLOW BARS TO OBTAIN ON-PREMISES ABC PERMITS.
Intro. by McGrady, Hardister, Fisher, B. Turner.

Status: Ref to the Com on Alcoholic Beverage Control, if favorable, Finance, if favorable, Rules, Calendar, and Operations of the House (House action) (Mar 20 2019)
H 378

Bill Summaries:

  • Summary date: Mar 19 2019 - More information

    Identical to S 290, filed 3/18/19.

    Part I.

    Amends GS 18B-1105 by allowing a distillery permit holder to sell malt beverages, unfortified wine, and fortified wine for consumption on the premises after obtaining the appropriate permit. Makes conforming changes to GS 18B-1001 to allow holders of distillery permits to be issued on-premises malt beverage permits, on-premises unfortified wine permits, and on-premises fortified wine permits.

    Part II.

    Amends GS 18B-1105 further by allowing a distillery permit holder to sell mixed beverages for consumption on the premises in an area where the sale of mixed beverages is authorized. Specifies that a mixed beverages permit is not required but subjects the distillery to the laws governing the sale of mixed beverages by a permittee. 

    Part III. 

    Amends GS 18B-1105 further by allowing a distillery permit holder to sell, deliver, and ship spirituous liquor in closed containers (1) at wholesale to holders of a mixed beverages permit and (2) at wholesale or retail to consumers in other states or nations, subject to the laws of other jurisdictions. Makes organizational changes and makes conforming changes to GS 18B-1007. Adds that each month a distillery permit holder must make the specified payments for the mixed beverage surcharges and guest room cabinet surcharges to the Department of Revenue and Department of Health and Human Services for spirituous liquor sold to a mix beverages permittee. 

    Requires the Alcoholic Beverage Control Commission (Commission) to develop and implement a process that allows a distillery permit holder to place a mixed beverages tax stamp to liquor sold to a mixed beverages permit holder. Requires revising the specified rule as appropriate in order to implement this requirement.

    Applies to sales made on or after July 1, 2019. 

    Part IV.

    Amends GS 18B-1105 to allow distillery permit holders to sell spirituous liquor distilled at the distillery in closed containers to visitors for consumption off the premises, no longer requiring that the visitors tour the distillery. Removes the limit of no more than five bottles per 12-month period. Makes conforming changes. Makes the provision concerning the price of spirituous liquor sold at a distillery applicable to all sales of spirituous liquor distilled at the permit holder's distillery.  

    Amends GS 18B-1116 which makes it unlawful for any manufacturer, bottler, or wholesaler of alcoholic beverages or specified affiliates to directly or indirectly take specified actions, including (1) having any direct or indirect financial interest in the business of any alcoholic beverage retailer in this state or in the premises where the business of any alcoholic beverage retailer in this State is conducted or (2) lending or giving any alcoholic beverage retailer in this State, their employee, or the owner of the premises where the business of any alcoholic beverage retailer in this State is conducted any money, service, equipment, furniture, fixtures, or any other thing of value. Adds that a distillery is not subject the these provisions concerning financial interests in, and lending or giving things of value to, a wholesaler or retailer with respect to the distillery's transactions with the retail business allowed on its premises. Applies to sales made on or after July 1, 2019.

    Part V.

    Amends GS 18B-403 to allow a purchase-transportation permit to be issued by the owner, or a designated employee, of a distiller authorized to sell spirituous liquor, for spirituous liquor sold by the distillery only. Makes additional clarifying and conforming changes.

    Amends GS 18B-404 to allow a mixed beverages permittee to obtain a mixed beverages purchase-transportation permit for spirituous liquor that will be purchased from a distillery. Makes conforming changes. 

    Makes conforming changes to GS 18B-901 and GS 18B-1007.

    Applies to purchases made on or after July 1, 2019.

    Part VI.

    Amends GS 18B-1114.7 to allow the holders of a supplier representative permit, brokerage representative permit, or distillery permit to obtain a spirituous liquor special event permit allowing the permittee to give free tastings at ABC stores where the local ABC board has approved the tastings (in addition to the already allowed trade shows, conventions, shopping malls, street festivals, holiday festivals, agricultural festivals, balloon races, local fund-raisers, and similar events). Also requires the Commission, for tastings in an ABC store, to adopt rules to ensure distillery permit holders are given reasonable opportunities by local ABC boards to conduct tastings. Makes conforming changes to GS 18B-301. Effective July 1, 2019.

    Part VII.

    Amends GS 18B-1001 to allow bars to obtain an on-premises malt beverage permit, on-premises unfortified wine permit, on-premises fortified wine permit, brown-bagging permit, special occasion permit, and mixed beverages permit. Defines bar under GS 18B-1000 as an establishment substantially engaged in the business of serving alcoholic beverages for consumption on the premises. Requires that in order to qualify as a bar that the establishment's gross receipts from alcoholic beverages for consumption on the premises be no less than 75% of the establishment's total gross receipts.

    Part VIII.

    Requires the Commission to amend its rules consistent with the act.

    Part IV.

    Contains a severability clause.

    Part X.

    Except as otherwise provided, effective July 1, 2019.


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