Bellbrook graduation 2012
Fairfield Senior 2012 graduation
Kroger Aquatic Center opens
Home > Blogs > Uncorked > Archives > 2007 > May > 24
Thursday, May 24, 2007
A behind-the-scenes glimpse into how Ohio legislators want to change wine laws
For the purposes of discussion, I’ve posted a copy of proposed legislation that would greatly affect Ohio wine drinkers and even more profoundly affect Ohio wineries. A caveat, though: I do not know whether this proposal has been introduced as of yet, whether it is envisioned as a possible amendment to the state’s budget bill, whether it is envisioned as a separate bill, or whether it has already been modified through legislative negotiations. Perhaps others can guide us on that. But it certainly contains some rather interesting proposals.
Here’s a synopsis of the bill, included within the proposal:
Creates the S liquor permit and authorizes the permit to be issued to certain manufacturers and distributors of wine inside and outside of Ohio, establishes a $50 permit fee, allows the holder of an S permit to ship wine directly to personal consumers in accordance with specified procedures and requirements, defines “personal consumer,” and applies current statutes that impose a state tax on the sale and distribution of wine to S permit holders; creates the B-2a liquor permit and authorizes the permit to be issued to a wholesale wine distributor to manufacture wine, import and purchase wine in bond for blending purposes not to exceed 40% of all the wine manufactured and imported, manufacture, purchase, and import brandy for fortifying purposes, and sell wine and wine products to retail permit holders if the B-2a permit holder produces less than 150,000 gallons of wine and wine products per year, establishes a $50 permit fee, and specifies that the statute establishing restrictions on manufacturers and wholesale distributors of beer and intoxicating liquor does not prevent a manufacturer of beer or intoxicating liquor from securing and hold a B-2a liquor permit or permits and operating as a wholesale distributor; eliminates existing authority for A-2 liquor permit holders (wine manufacturers) to sell wine and wine products for home use and to retail permit holders, allows A-2 liquor permit holders to sell wine and wine products in sealed containers for consumption off the premises where manufactured; and prohibits a family household from purchasing more than 24 cases of nine-liter bottles of wine annually, but does not define “family household.”
Click on “continue reading” to view the full language of the proposal, and my apologies for the bad paragraph/end-of-line breaks.
Is this the current version of what is being considered by our legislators? Why the language allowing wholesalers to manufacture their own wine? And what the heck is the prohibition against “family households” from buying more than 24 cases of wine annually?
Let’s drag this out into the light of day and fully explore some of these issues, shall we?
Cheers!
Mark Fisher
“Sec. 4301.24. Except as provided in section 4301.242 of the Revised Code, no manufacturer shall aid or assist the holder of any permit for sale at wholesale, and no manufacturer or wholesale distributor shall aid or assist the holder of any permit for sale at retail, by gift or loan of any money or property of any description or other valuable thing, or by giving premiums or rebates. Except as provided in section 4301.242 of the Revised Code, no holder of any such permit shall accept the same, provided that the manufacturer or wholesale distributor may furnish to a retail permittee the inside signs or advertising and the tap signs or devices authorized by divisions (E) and (F) of section 4301.22 of the Revised Code. 6 7 8 9 10 11 12 13 14 15 16 17 No manufacturer shall have any financial interest, directly or indirectly, by stock ownership, or through interlocking directors in a corporation, or otherwise, in the establishment, 18 19 20 maintenance, or promotion in the business of any wholesale distributor. No retail permit holder shall have any interest, directly or indirectly, in the operation of, or any ownership in, the business of any wholesale distributor or manufacturer. 21 22 23 24 No manufacturer shall, except as authorized by section 4303.021 of the Revised Code, have any financial interest, directly or indirectly, by stock ownership, or through interlocking directors in a corporation, or otherwise, in the establishment, maintenance, or promotion of the business of any retail dealer. No wholesale distributor or employee of a wholesale distributor shall have any financial interest, directly or indirectly, by stock ownership, interlocking directors in a corporation, or otherwise, in the establishment, maintenance, or promotion of the business of any retail dealer. No manufacturer or wholesale distributor or any stockholder of a manufacturer or wholesale distributor shall acquire, by ownership in fee, leasehold, mortgage, or otherwise, directly or indirectly, any interest in the premises on which the business of any other person engaged in the business of trafficking in beer or intoxicating liquor is conducted. All contracts, covenants, conditions, and limitations whereby any person engaged or proposing to engage in the sale of beer or intoxicating liquors promises to confine the person’s sales of a particular kind or quality of beer or intoxicating liquor to one or more products, or the products of a specified manufacturer or wholesale distributor, or to give preference to those products, shall to the extent of that promise be void. The making of a promise in any such form shall be cause for the revocation or suspension of any permit issued to any party. This section does not prevent the holder of an A permit from securing and holding a wholesale distributor’s permit or permits and operating as a wholesale distributor. 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 127HB119-SC1416 Page 2 No manufacturer shall sell or offer to sell to any wholesale distributor or retail permit holder, no wholesale distributor shall sell or offer to sell to any retail permit holder, and no wholesale distributor or retail permit holder shall purchase or receive from any manufacturer or wholesale distributor, any beer, brewed beverages, or wine manufactured in the United States except for cash. No right of action shall exist to collect any claims for credit extended contrary to this section. This section does not prohibit a licensee from crediting to a purchaser the actual prices charged for packages or containers returned by the original purchaser as a credit on any sale or from refunding to any purchaser the amount paid by that purchaser for containers or as a deposit on containers when title is retained by the vendor, if those containers or packages have been returned to the manufacturer or distributor. This section does not prohibit a manufacturer from extending usual and customary credit for beer, brewed beverages, or wine manufactured in the United States and sold to customers who live or maintain places of business outside this state when the beverages so sold are actually transported and delivered to points outside this state. No wholesale or retail permit shall be issued to an applicant unless the applicant has paid in full all accounts for beer or wine, manufactured in the United States, outstanding as of September 6, 1939. No beer or wine manufactured in the United States shall be imported into the state unless the beer or wine has been paid for in cash, and no supplier registration for any such beer or wine manufactured in the United States shall be issued by the division of liquor control until the A-2, B-1, or B-5 permit holder establishes to the satisfaction of the division that the beer or wine has been paid for in cash. 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 This section does not prevent a manufacturer from securing and holding any financial interest, directly or indirectly, by 82 83 127HB119-SC1416 Page 3 stock ownership or through interlocking directors in a corporation, or otherwise, in the establishment, maintenance, or promotion of the business or premises of any C or D permit holder, provided that the following conditions are met: 84 85 86 87 (A) Either the manufacturer or one of its parent companies is listed on a national securities exchange. 88 89 (B) All purchases of alcoholic beverages by the C or D permit holder are made from wholesale distributors in this state or agency stores licensed by the division of liquor control. 90 91 92 (C) If the C or D permit holder sells brands of alcoholic beverages that are produced or distributed by the manufacturer that holds the financial interest, the C or D permit holder also sells other competing brands of alcoholic beverages produced by other manufacturers, no preference is given to the products of the manufacturer, and there is no exclusion, in whole or in part, of products sold or offered for sale by other manufacturers, suppliers, or importers of alcoholic beverages that constitutes a substantial impairment of commerce. 93 94 95 96 97 98 99 100 101 (D) The primary purpose of the C or D permit premises is a purpose other than to sell alcoholic beverages, and the sale of other goods and services exceeds fifty per cent of the total gross receipts of the C or D permit holder at its premises. 102 103 104 105 This section does not prevent a manufacturer from giving financial assistance to the holder of a B permit for the purpose of the holder purchasing an ownership interest in the business, existing inventory and equipment, or property of another B permit holder, including, but not limited to, participation in a limited liability partnership, limited liability company, or any other legal entity authorized to do business in this state. This section does not permit a manufacturer to give financial assistance to the holder of a B permit to purchase inventory or equipment used in 106 107 108 109 110 111 112 113 114 127HB119-SC1416 Page 4 the daily operation of a B permit holder. 115 This section does not prevent a manufacturer from securing and holding a B-2a permit or permits and operating as a wholesale distributor.” 116 117 118 Between lines 30612 and 30613, insert: 119 “Sec. 4303.03. Permit A-2 may be issued to a manufacturer to manufacture wine from grapes or other fruits; to import and purchase wine in bond for blending purposes, the total amount of wine so imported during the year covered by the permit not to exceed forty per cent of all the wine manufactured and imported; to manufacture, purchase, and import brandy for fortifying purposes; and to sell those products either in glass or container for consumption on the premises where manufactured, for home use, in sealed containers for consumption off the premises where manufactured, and to retail and wholesale permit holders under the rules adopted by the division of liquor control. 120 121 122 123 124 125 126 127 128 129 130 The fee for this permit is one hundred twenty-six dollars for each plant to which this permit is issued. 131 132 Sec. 4303.071. Permit B-2a may be issued to a wholesale distributor of wine to manufacture wine from grapes or other fruits; to import and purchase wine in bond for blending purposes, the total amount of wine so imported during the year covered by the permit not to exceed forty per cent of all the wine manufactured and imported; to manufacture, purchase, and import brandy for fortifying purposes; and to sell wine and wine products to retail permit holders under the rules adopted by the division of liquor control, but only if the B-2a permit holder produces less than one hundred fifty thousand gallons of wine and wine products per year and is eligible for the tax credit described in 133 134 135 136 137 138 139 140 141 142 143 127HB119-SC1416 Page 5 27 C.F.R. 24.278 (d)(1). Permit B-2a authorizes a wholesale distributor to sell only wine and wine products that the wholesale distributor has manufactured to retail permit holders. The fee for this permit is fifty dollars for each plant during the year covered by the permit. 144 145 146 147 148 Sec. 4303.232. (A)(1) Except as provided in division (A)(2) of this section, permit S may be issued to a person that manufactures wine, is the brand owner or United States importer of wine, or is the designated agent of a brand owner or importer for all wine sold in this state for that owner or importer. If the person resides outside this state, the person shall comply with the requirements governing the issuance of licenses or permits that authorize the sale of intoxicating liquor by the appropriate authority of the state in which the person resides or by the bureau of alcohol, tobacco, firearms, and explosives in the United States department of justice. 149 150 151 152 153 154 155 156 157 158 159 (2) An S permit shall not be issued to a manufacturer of wine that is not entitled to a tax credit under 27 C.F.R. 24.278 and that produces one hundred fifty thousand gallons or more of wine per year. 160 161 162 163 (3) The fee for the S permit is fifty dollars. 164 (4) The holder of an S permit may sell wine to a personal consumer by receiving and filling orders that the personal consumer submits to the permit holder. The permit holder shall sell only wine that the permit holder has manufactured to a personal consumer. 165 166 167 168 169 (5) The holder of an S permit shall renew the permit in accordance with section 4303.271 of the Revised Code, except that the renewal shall not be subject to the notice and hearing requirements established in division (B) of that section. 170 171 172 173 127HB119-SC1416 Page 6 (6) The division of liquor control may refuse to renew an S permit for any of the reasons specified in section 4303.292 of the Revised Code or if the holder of the permit fails to do any of the following: 174 175 176 177 (a) Collect and pay all applicable taxes specified in division (B) of this section; 178 179 (b) Pay the permit fee; 180 (c) Comply with this section or any rules adopted by the liquor control commission under section 4301.03 of the Revised Code. 181 182 183 (B) The holder of an S permit shall collect and pay all applicable taxes relating to the delivery of wine to a personal consumer, including, but not limited to, taxes levied under section 4301.43 and Chapters 5739. and 5741. of the Revised Code. 184 185 186 187 (C)(1) The holder of an S permit shall send a shipment of wine that has been paid for by a personal consumer to that personal consumer via the holder of an H permit. Prior to sending a shipment of wine to a personal consumer, the holder of an S permit, or an employee of the permit holder, shall make a bona fide effort to ensure that the personal consumer is at least twenty-one years of age. The shipment of wine shall be shipped in a package that clearly has written on it in bold print the words “wine enclosed.” No person shall fail to comply with division (C)(1) of this section. 188 189 190 191 192 193 194 195 196 197 (2) Upon delivering a shipment of wine to a personal consumer, the holder of the H permit, or an employee of the permit holder, shall verify that the personal consumer is at least twenty-one years of age by checking the personal consumer’s driver’s or commercial driver’s license or identification card issued under sections 4507.50 to 4507.52 of the Revised Code. 198 199 200 201 202 203 127HB119-SC1416 Page 7 (3) The holder of an S permit shall keep a record of each shipment of wine that the permit holder sends to a personal consumer. The records shall be used for all of the following: 204 205 206 (a) To provide a copy of each wine shipment invoice to the tax commissioner in a manner prescribed by the commissioner. The invoice shall include the name of each personal consumer that purchased wine from the S permit holder in accordance with this section and any other information required by the tax commissioner. 207 208 209 210 211 212 (b) To provide annually in electronic format by electronic means a report to the division. The report shall include the name and address of each personal consumer that purchased wine from the S permit holder in accordance with this section, the quantity of wine purchased by each personal consumer, and any other information requested by the division. The division shall prescribe and provide an electronic form for the report and shall determine the specific electronic means that the S permit holder must use to submit the report. 213 214 215 216 217 218 219 220 221 (c) To notify a personal consumer of any health or welfare recalls of the wine that has been purchased by the personal consumer. 222 223 224 (D) As used in this section, “personal consumer” means an individual who is at least twenty-one years of age, is a resident of this state, does not hold a permit issued under this chapter, and intends to use wine purchased in accordance with this section for personal consumption only and not for resale or other commercial purposes. 225 226 227 228 229 230 Sec. 4303.233. No family household shall purchase more than twenty-four cases of nine-liter bottles of wine in one year.” 231 232 In line 50142, after “4141.09,” insert “4301.24,”; after 233 127HB119-SC1416 Page 8 “4301.43,” insert “4303.03,” 234 In line 41 of the title, after “4141.09,” insert “4301.24,”; after “4301.43,” insert “4303.03,” 235 236 In line 97 of the title, after “3701.135,” insert “4303.071, 4303.232, 4303.233,” 237 238 The motion was __ agreed to. SYNOPSIS Sale of Beer and Wine 239 R.C. 4301.24, 4303.03, 4303.071, 4303.232, and 4303.233 240 Creates the S liquor permit and authorizes the permit to be issued to certain manufacturers and distributors of wine inside and outside of Ohio, establishes a $50 permit fee, allows the holder of an S permit to ship wine directly to personal consumers in accordance with specified procedures and requirements, defines “personal consumer,” and applies current statutes that impose a state tax on the sale and distribution of wine to S permit holders; creates the B-2a liquor permit and authorizes the permit to be issued to a wholesale wine distributor to manufacture wine, import and purchase wine in bond for blending purposes not to exceed 40% of all the wine manufactured and imported, manufacture, purchase, and import brandy for fortifying purposes, and sell wine and wine products to retail permit holders if the B-2a permit holder produces less than 150,000 gallons of wine and wine products per year, establishes a $50 permit fee, and specifies that the statute establishing restrictions on manufacturers and wholesale distributors of beer and intoxicating liquor does not prevent a manufacturer of beer or intoxicating liquor from 241 242 243 244 245 246 247 248 249 250 251 252 253 254 255 256 257 258 127HB119-SC1416 Page 9 securing and hold a B-2a liquor permit or permits and operating as a wholesale distributor; eliminates existing authority for A-2 liquor permit holders (wine manufacturers) to sell wine and wine products for home use and to retail permit holders, allows A-2 liquor permit holders to sell wine and wine products in sealed containers for consumption off the premises where manufactured; and prohibits a family household from purchasing more than 24 cases of nine-liter bottles of wine annually, but does not define “family household.” 259 260 261 262 263 264 265 266 267 127HB119-SC1416 Page 10
TweetGo to my facebook page and click Like to comment.
