Senate Bill sb0282c1

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    Florida Senate - 2006                            CS for SB 282

    By the Committee on Regulated Industries; and Senators
    Dockery, Argenziano, Lynn and Diaz de la Portilla




    580-2021-06

  1                      A bill to be entitled

  2         An act relating to the Beverage Law; amending

  3         s. 561.14, F.S.; prohibiting vendor purchases

  4         and acquisitions of wine from direct shippers;

  5         providing for direct shipper license

  6         classification; creating s. 561.575, F.S.;

  7         providing for the direct shipment of wine from

  8         within or outside the state; requiring that a

  9         shipper hold a direct shipper's license;

10         providing requirements for licensure; requiring

11         that each container of wine shipped directly be

12         labeled with a notice; requiring that a direct

13         shipper file a surety bond with the Division of

14         Alcoholic Beverages and Tobacco of the

15         Department of Business and Professional

16         Regulation; providing for attorney's fees and

17         costs in an action to collect unpaid taxes;

18         authorizing the division to suspend or revoke a

19         direct shipper's license or impose fines;

20         providing for criminal penalties; authorizing

21         the division to adopt rules; amending ss.

22         561.54 and 561.545, F.S.; specifying that

23         provisions prohibiting the direct shipment of

24         alcoholic beverages are inapplicable to wine

25         shipped under s. 561.575, F.S.; amending s.

26         561.57, F.S.; including Internet sales as sales

27         construed to be actually made at the vendor's

28         licensed place of business; exempting common

29         carriers from certain report filing

30         requirements; requiring common carriers to

31         verify the age of persons receiving shipments;

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    Florida Senate - 2006                            CS for SB 282
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 1         providing a defense to certain actions;

 2         providing an effective date.

 3  

 4  Be It Enacted by the Legislature of the State of Florida:

 5  

 6         Section 1.  Section 561.14, Florida Statutes, is

 7  amended to read:

 8         561.14  License and registration

 9  classification.--Licenses and registrations referred to in the

10  Beverage Law shall be classified as follows:

11         (1)  Manufacturers licensed to manufacture alcoholic

12  beverages and distribute the same at wholesale to licensed

13  distributors and to no one else within the state, unless

14  authorized by statute. Persons engaged in the business of

15  distilling, rectifying, or blending spirituous liquors

16  licensed under s. 565.03(1)(a)1. and (b) shall sell and

17  distribute such beverages at wholesale only to other

18  manufacturers and to licensed distributors and to no one else

19  within this state.

20         (2)  Distributors licensed to sell and distribute

21  alcoholic beverages at wholesale to persons who are licensed

22  to sell alcoholic beverages.

23         (3)  Vendors licensed to sell alcoholic beverages at

24  retail only. No vendor shall purchase or acquire in any manner

25  for the purpose of resale any alcoholic beverages from any

26  person not licensed as a vendor, manufacturer, bottler, or

27  distributor under the Beverage Law.  Purchases of alcoholic

28  beverages by vendors from vendors shall be strictly limited to

29  purchases between members of a pool buying group for which the

30  initial purchase of the alcoholic beverages was ordered by a

31  pool buying agent as a single transaction.  No vendor shall be

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    Florida Senate - 2006                            CS for SB 282
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 1  a member of more than one cooperative or pool buying group at

 2  any time.  No vendor shall import, or engage in the

 3  importation of, any alcoholic beverages from places beyond the

 4  limits of the state. No vendor shall purchase or acquire wine

 5  from a direct shipper for the purpose of resale, except that a

 6  vendor may purchase or acquire wine from a manufacturer that

 7  is licensed as a distributor.

 8         (4)  Brokers or sales agents, whether resident or

 9  nonresident, licensed to sell, or to cause to be sold,

10  shipped, and invoiced, alcoholic beverages to licensed

11  manufacturers or licensed distributors, and to no one else, in

12  this state.  Such licensed brokers or sales agents, except as

13  relates to malt beverages, only shall represent one or more

14  primary American sources of supply, registered as such with

15  the division, and may be compensated on a commission or

16  remuneration basis and shall have no direct or indirect

17  affiliation with any vendor licensed in this state.  This

18  license classification does not include manufacturers'

19  representatives who are registered with the division under the

20  provisions of ss. 564.045(1) and (2) and 565.095(1) and (2).

21         (5)  Importers, whether resident or nonresident,

22  licensed to sell, or to cause to be sold, shipped, and

23  invoiced, alcoholic beverages to licensed manufacturers or

24  licensed distributors, and to no one else, in this state;

25  provided that the provisions of ss. 564.045 and 565.095 are in

26  no way violated by such imports.  Such licensed importers

27  shall have no direct or indirect affiliation with any vendor

28  licensed in this state.  The holder of an importer's license

29  shall be considered as having complied with the licensing

30  requirements of a broker or sales agent.  This license

31  classification does not include manufacturers' representatives

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    Florida Senate - 2006                            CS for SB 282
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 1  who are registered with the division under the provisions of

 2  ss. 564.045(1) and (2) and 565.095(1) and (2).

 3         (6)  Bottle clubs.  It is the finding of the

 4  Legislature that bottle clubs are susceptible to a distinct

 5  and separate classification under the Beverage Law for

 6  purposes of regulating establishments permitting the

 7  consumption of alcoholic beverages.  Any person operating a

 8  bottle club must be licensed pursuant to this chapter and may

 9  not hold any other alcoholic beverage license for such

10  premises while licensed as a bottle club. Nothing in this

11  subsection shall be construed to permit the purchase at

12  wholesale or retail of alcoholic beverages for supplying or

13  reselling to the patrons pursuant to a license issued under

14  this chapter.  Any such business shall be subject to all

15  general, special, and local laws regulating vendors of

16  alcoholic beverages.  Bottle club licenses shall be issued at

17  a fee of $500 annually and shall be renewed in accordance with

18  the schedule set out in ss. 561.26 and 561.27.  This

19  subsection shall include bottle clubs in existence on January

20  1, 1991.  The Division of Alcoholic Beverages and Tobacco is

21  hereby authorized to adopt rules to carry out the purposes of

22  this section.

23         (7)  Exporters registered to sell alcoholic beverages.

24         (8)  Direct shippers licensed under s. 561.575 to sell

25  wine directly to a resident of this state who is at least 21

26  years of age for that resident's personal use and not for

27  resale.

28         Section 2.  Section 561.575, Florida Statutes, is

29  created to read:

30         561.575  Direct shipment of wine.--

31  

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    Florida Senate - 2006                            CS for SB 282
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 1         (1)  LICENSE REQUIRED.--Notwithstanding any other law

 2  to the contrary, a manufacturer of wine which is located

 3  within or outside this state, holds a wine producer and

 4  blender's basic permit issued in accordance with the Federal

 5  Alcohol Administration Act, and obtains a direct shipper's

 6  license may ship wine directly to a resident of this state who

 7  is at least 21 years of age for that resident's personal use

 8  and not for resale.

 9         (2)  LICENSURE QUALIFICATIONS.--

10         (a)  Before shipping wine to a resident of this state,

11  a manufacturer must obtain a direct shipper's license by:

12         1.  Filing an application with the division;

13         2.  Paying an annual license fee of $100; and

14         3.  Providing to the division a certified copy of its

15  current wine manufacturer's license issued by this state or

16  another state and its current basic permit as a wine producer

17  and blender issued in accordance with the Federal Alcohol

18  Administration Act.

19         (b)  Each licensee holding a direct shipper's license

20  shall:

21         1.  Maintain a current license as provided in this

22  section.

23         2.  Maintain a wine manufacturer's license issued by

24  this state or another state and a federal basic permit as a

25  wine producer and blender issued in accordance with the

26  Federal Alcohol Administration Act.

27         (c)  A direct shipper shall obtain and maintain a

28  current license as a primary American source of supply as

29  provided in s. 564.045.

30         (d)  A direct shipper must comply with s. 564.05, which

31  limits the size of wine containers.

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    Florida Senate - 2006                            CS for SB 282
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 1         (e)  An applicant for licensure as a direct shipper is

 2  exempt from the fingerprinting and license investigation

 3  requirements in ss. 561.17 and 561.18 if he or she holds a

 4  current active wine manufacturer's license in another state

 5  and has met qualifications substantially similar to,

 6  equivalent to, or greater than the qualifications required of

 7  applicants in this state. The division shall adopt rules

 8  pursuant to ss. 120.536(1) and 120.54 specifying procedures

 9  for determining whether the applicant is qualified under this

10  exemption.

11         (f)  A direct shipper shall renew on or before August 1

12  of each year its license with the division by paying a renewal

13  fee of $100.

14         (3)  JURISDICTION.--By obtaining a direct shipper's

15  license, a licensee consents to the jurisdiction of the

16  division, any other state agency, and the courts of this state

17  concerning compliance with state laws.

18         (4)  AGE-VERIFICATION REQUIREMENTS.--

19         (a)  Each direct shipper shall use an age-verification

20  process that is approved by the division to ensure that any

21  sale made to a resident of this state is to a person at least

22  21 years of age. The process must be sufficient to accurately

23  verify the age and identity of the purchaser.

24         (b)  Each direct shipper shall ensure that the outside

25  shipping label on each package is conspicuous and includes the

26  following information:

27         1.  This package contains alcohol.

28         2.  An adult signature is required.

29         3.  The recipient must be at least 21 years of age.

30         (c)  If the direct shipper uses a common carrier to

31  make, or cause to be made, deliveries within or from outside

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    Florida Senate - 2006                            CS for SB 282
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 1  the state, the direct shipper shall require that the common

 2  carrier comply with the age-verification procedures required

 3  for deliveries made under this section. The direct shipper

 4  shall use any age-verification service provided by the common

 5  carrier which complies with these requirements.

 6         (d)  Each direct shipper licensee and common carrier

 7  shall require, prior to delivery, that the signature of the

 8  addressee or other person at least 21 years of age is obtained

 9  after presentation of a valid driver's license, an

10  identification card issued under the provisions of s. 322.051,

11  or, if the person is physically handicapped, a comparable

12  identification card issued by another state which indicates

13  the person's age, a passport, or a United States Uniformed

14  Services identification card.

15         (e)  A direct shipper licensee or common carrier who

16  violates this section shall have a complete defense to any

17  civil action therefor, except for any administrative action by

18  the division, if, at the time the alcoholic beverage was sold,

19  given, delivered, or transferred, the person falsely evidenced

20  that he or she was of legal age to purchase or consume the

21  alcoholic beverage and the appearance of the person was such

22  that an ordinarily prudent person would believe him or her to

23  be of legal age to purchase or consume the alcoholic beverage

24  and if the direct shipper licensee or common carrier acted in

25  good faith and in reliance upon the representation and

26  appearance of the person in the belief that he or she was of

27  legal age to purchase or consume the alcoholic beverage and

28  carefully checked one of the following forms of identification

29  with respect to the person: a valid driver's license, an

30  identification card issued under the provisions of s. 322.051,

31  or, if the person is physically handicapped, a comparable

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    Florida Senate - 2006                            CS for SB 282
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 1  identification card issued by another state which indicates

 2  the person's age, a passport, or a United States Uniformed

 3  Services identification card.

 4         (5)  TAXATION.--

 5         (a)  Each direct shipper shall collect and remit

 6  monthly to the Department of Revenue all sales taxes and to

 7  the division all excise taxes due on sales to persons in this

 8  state for the preceding month. The amount of such taxes shall

 9  be calculated as if the sale took place in this state.

10         (b)  File with the division a bond of $5,000 as surety

11  for the payment of taxes required under this chapter. However,

12  the division may authorize a lesser bond if the volume of

13  business done by the direct shipper is such that a bond of

14  less than $5,000 will be adequate to secure the payment of

15  taxes assessed or authorized under the Beverage Law. The

16  division may not accept a bond of less than $1,000 and may

17  require a bond to be increased to $5,000. The surety bond

18  currently on file with the division for a winery pursuant to

19  s. 561.37 is deemed to comply with this requirement. Any

20  applicant that has a surety bond for another license on file

21  with the division that is in excess of $5,000 shall be deemed

22  to be in compliance with this requirement.

23         (6)  REPORTING REQUIREMENTS.--Each direct shipper shall

24  report to the division, by the 10th day of each month, on

25  forms prescribed by the division:

26         (a)  Whether any wine product was shipped into or

27  within this state during the preceding month;

28         (b)  The total amount of wine shipped into or within

29  this state during the preceding month;

30         (c)  The quantity and brands of wine shipped into or

31  within this state during the preceding month;

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    Florida Senate - 2006                            CS for SB 282
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 1         (d)  The amount of tax paid to the division and the

 2  Department of Revenue for the shipments of wine to residents

 3  of this state during the preceding month; and

 4         (e)  Any other information that the division determines

 5  is necessary to enforce this section.

 6  

 7  The report required by this paragraph is not required from a

 8  direct shipper licensee who files a monthly report pursuant to

 9  s. 561.55 which contains all the information required in

10  paragraph (a). The division may prescribe the format for

11  submission of this information in order to avoid duplicate

12  filings.

13         (7)  RECORDKEEPING REQUIREMENT.--Each direct shipper

14  shall keep complete, accurate, and separate records of wine

15  products sold and shipped to this state for at least 3 years.

16         (8)  AUDIT REQUIREMENTS.--

17         (a)  Each direct shipper shall permit the division and

18  the Department of Revenue to audit the records of the direct

19  shipper upon request.

20         (b)  The cost of performing an audit under paragraph

21  (2)(i) shall be assigned to the division or the Department of

22  Revenue, as applicable, unless the licensee is found to be in

23  material violation of this section, in which case the cost of

24  the audit shall be assigned to the licensee. A direct shipper

25  shall pay all attorney's fees and costs in any action to

26  collect unpaid taxes.

27         (9)  PENALTIES.--

28         (a)  In addition to any other penalty provided in the

29  Beverage Law, the division may suspend or revoke a direct

30  shipper license or impose fines on the direct shipper licensee

31  

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 1  in an amount not to exceed $2,500 per violation for any

 2  violation of this section.

 3         (b)  A direct shipper licensee that knowingly and

 4  intentionally ships, or causes to be shipped, wine to any

 5  person in this state who is under 21 years of age commits a

 6  felony of the third degree, punishable as provided in s.

 7  775.082, s. 775.083, or s. 775.084.

 8         (c)  Any common carrier, permit carrier, or other

 9  commercial conveyance that knowingly and intentionally

10  delivers wine directly to any person in this state who is

11  under 21 years of age commits a misdemeanor of the second

12  degree, punishable as provided in s. 775.082 or s. 775.083.

13         (10)  RULEMAKING AUTHORITY.--The division may adopt

14  rules pursuant to ss. 120.536(1) and 120.54 to administer this

15  section.

16         Section 3.  Section 561.54, Florida Statutes, is

17  amended to read:

18         561.54  Certain deliveries of beverages prohibited.--

19         (1)  It is unlawful for common or permit carriers,

20  operators of privately owned cars, trucks, buses, or other

21  conveyances or out-of-state manufacturers or suppliers to make

22  delivery from without the state of any alcoholic beverage to

23  any person, association of persons, or corporation within the

24  state, except to qualified manufacturers, distributors, and

25  exporters of such beverages so delivered and to qualified

26  bonded warehouses in this state.

27         (2)  Any licensee aggrieved by a violation of this

28  section may bring an action in any court of competent

29  jurisdiction to recover for the state all moneys obtained by

30  common carriers or permit carriers; obtained by operators of

31  privately owned cars, trucks, buses, or other conveyances; or

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 1  obtained by out-of-state manufacturers or suppliers as a

 2  result of the delivery of alcoholic beverages in violation of

 3  this section, and may obtain a declaratory judgment that an

 4  act or practice violates this section and enjoin any person

 5  from violating this section.  In addition to such relief, the

 6  court may order the confiscation and destruction of any

 7  alcoholic beverages delivered in violation of this section.

 8  In assessing damages, the court shall enter judgment against a

 9  defendant for three times the amount of the delivery charges

10  proved or the fair market value of merchandise unlawfully

11  brought into the state.  Payment or satisfaction of any

12  judgment under this section, other than for costs and

13  attorney's fees, shall be made in its entirety to the state.

14  In any successful action under this section, the court shall

15  award the plaintiff costs and reasonable attorney's fees.

16         (3)  This section does not apply to the shipment of

17  wine by a licensed direct shipper to a person 21 years of age

18  or older in accordance with s. 561.575.

19         Section 4.  Section 561.545, Florida Statutes, is

20  amended to read:

21         561.545  Certain shipments of beverages prohibited;

22  penalties; exceptions.--The Legislature finds that the direct

23  shipment of alcoholic beverages by persons in the business of

24  selling alcoholic beverages to residents of this state in

25  violation of the Beverage Law poses a serious threat to the

26  public health, safety, and welfare; to state revenue

27  collections; and to the economy of the state.  The Legislature

28  further finds that the penalties for illegal direct shipment

29  of alcoholic beverages to residents of this state should be

30  made adequate to ensure compliance with the Beverage Law and

31  that the measures provided for in this section are fully

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 1  consistent with the powers conferred upon the state by the

 2  Twenty-first Amendment to the United States Constitution.

 3         (1)  Any person in the business of selling alcoholic

 4  beverages who knowingly and intentionally ships, or causes to

 5  be shipped, any alcoholic beverage from an out-of-state

 6  location directly to any person in this state who does not

 7  hold a valid manufacturer's or wholesaler's license or

 8  exporter's registration issued by the Division of Alcoholic

 9  Beverages and Tobacco or who is not a state-bonded warehouse

10  is in violation of this section.

11         (2)  Any common carrier or permit carrier or any

12  operator of a privately owned car, truck, bus, or other

13  conveyance who knowingly and intentionally transports any

14  alcoholic beverage from an out-of-state location directly to

15  any person in this state who does not hold a valid

16  manufacturer's or wholesaler's license or exporter's

17  registration or who is not a state-bonded warehouse is in

18  violation of this section.

19         (3)  Any person found by the division to be in

20  violation of subsection (1) shall be issued a notice, by

21  certified mail, to show cause why a cease and desist order

22  should not be issued. Any person who violates subsection (1)

23  within 2 years after receiving a cease and desist order or

24  within 2 years after a prior conviction for violating

25  subsection (1) commits a felony of the third degree,

26  punishable as provided in s. 775.082, s. 775.083, or s.

27  775.084.

28         (4)  Any common carrier or permit carrier, or any

29  operator of a privately owned car, truck, bus, or other

30  conveyance found by the division to be in violation of

31  subsection (2) as a result of a second or subsequent delivery

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 1  from the same source and location, within a 2-year period

 2  after the first delivery shall be issued a notice, by

 3  certified mail, to show cause why a cease and desist order

 4  should not be issued. Any person who violates subsection (2)

 5  within 2 years after receiving the cease and desist order or

 6  within 2 years after a prior conviction for violating

 7  subsection (2) commits a felony of the third degree,

 8  punishable as provided in s. 775.082, s. 775.083, or s.

 9  775.084.

10         (5)  This section does not apply to:

11         (a)  The direct shipment of sacramental alcoholic

12  beverages to bona fide religious organizations as authorized

13  by the division; or to

14         (b)  The possession of alcoholic beverages in

15  accordance with s. 562.15(2); or.

16         (c)  The shipment of wine by a licensed direct shipper

17  to a person 21 years of age or older in accordance with s.

18  561.575.

19         Section 5.  Subsections (1) and (6) of section 561.57,

20  Florida Statutes, are amended to read:

21         561.57  Deliveries by licensees.--

22         (1)  Vendors shall be permitted to make deliveries away

23  from their places of business of sales actually made at the

24  licensed place of business; provided, telephone, Internet, or

25  mail orders received at vendor's licensed place of business

26  shall be construed as a sale actually made at the vendor's

27  licensed place of business.

28         (6)  Common carriers are not required to have vehicle

29  permits to transport alcoholic beverages. This section does

30  not prohibit any common carrier or any licensee from using a

31  common carrier to deliver alcoholic beverages within the

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 1  state. Deliveries of alcoholic beverages by common carriers,

 2  licensees, or their employees or agents are exempt from the

 3  reporting requirements in s. 562.20. Each common carrier

 4  acting as a designated agent for delivery shall verify that

 5  any person receiving alcoholic beverages is at least 21 years

 6  of age upon the delivery of such alcoholic beverages, as

 7  prescribed in division rules. Compliance with the prescribed

 8  age-verification requirements gives the common carrier and the

 9  licensee, or their employees or agents, a complete defense to

10  selling, giving, or serving alcoholic beverages to any person

11  younger than 21 years of age.

12         Section 6.  This act shall take effect upon becoming a

13  law.

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 1          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
 2                         Senate Bill 282

 3                                 

 4  The CS creates an alcoholic beverage license classification
    for direct shippers, and to prohibit vendors from purchasing
 5  or acquiring wine from a direct shipper for the purpose of
    resale, unless also licensed as a distributor.
 6  
    The CS deletes the provision that only licensed manufacturers,
 7  licensed wholesalers, registered exporters, state-bonded
    warehouses, and licensed direct-shippers may knowingly and
 8  intentionally ship, or cause to be shipped, an alcoholic
    beverage from an out-of-state or in-state location directly to
 9  a person in this state.

10  The CS requires that direct shippers obtain and maintain a
    current license as a Primary American Source of Supply,
11  maintain all current state and federal licenses, and comply
    with container size requirements.
12  
    The CS provides an exemption from fingerprinting and license
13  investigation requirements and directs the Division of
    Alcoholic Beverage and Tobacco to specify by rule the
14  procedures for determining whether an applicant qualifies for
    this exemption.
15  
    The CS deletes the age verification provision that requires
16  direct shippers to verify the identity of the person to whom
    each container of wine is intended to be shipped.
17  
    The CS lists the information that must be contained on a
18  container of wine shipped from a direct shipper.  It deletes
    the specific wording requirement for the label.
19  
    The CS requires that a direct shipper must require that the
20  common carrier use the age verification requirements in the
    bill if a common carrier is used to make the delivery.  It
21  also requires that direct shippers use the common carrier's
    age verification procedure which complies with the bill's
22  requirements.  For the purpose of age verification, the bill
    specifies acceptable forms of identification for persons who
23  are physically handicapped.

24  The CS provides a good faith defense to any civil action,
    except for an administrative action by the division, to direct
25  shipper licensees and common carriers who sell alcoholic
    beverages to a minor under specified conditions.
26  
    The CS requires that direct shippers collect and remit sales
27  taxes to the Department of Revenue (DOR).  It also provides
    for the calculation of the sales tax.
28  
    The CS requires the reporting to the division of brands
29  shipped in place of the types of wines shipped.  It also
    requires the reporting to the division of the amount of sales
30  taxes paid to the DOR.

31  The CS deletes the exemption from the reporting requirement
    for Florida Farm Wineries and exempts direct shippers who file
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 1  a report under s. 561.55, F.S., that contains all the
    information required by the CS.  It also grants the division
 2  rule making authority to prescribe format or submissions to
    avoid duplicative filings.
 3  
    The CS assigns the cost of the audit to a direct shipper if a
 4  material violation is found.  It also requires that direct
    shippers pay all attorney's fees and costs in an action to
 5  collect unpaid taxes and requires that a direct shipper submit
    to an audit by the DOR.
 6  
    The CS deletes the reference to the division's authority to
 7  enforce the provisions of this section pursuant to ch. 120,
    F.S.  It also decreases the amount of the fine from $5,000 to
 8  $2,500.

 9  The CS deletes the provision relating to cease and desist
    orders for violations of this section. The bill provides third
10  degree felony violations for direct shipper licensees that
    knowingly and intentionally ship wine to a minor.  The CS
11  decreases the criminal penalty for a common carrier who
    delivers wine to a minor from a third degree felony to a
12  second degree misdemeanor.

13  The CS includes Internet sales as a sale actually made at the
    vendor's place of business.It also deletes duplicative
14  language in this subsection.

15  The CS replaces the term "or other person using a common
    carrier as his or her agent" with the term "their employees or
16  agents" for the exemption from certain reporting requirements.
    It replaces the term "other person hiring the common carrier"
17  with the term "their employees or agents" in the context of
    providing a complete defense to selling, serving alcoholic
18  beverages  to minors.  It also corrects a typographical error
    by replacing the term "of" with "or".
19  

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                                  16

CODING: Words stricken are deletions; words underlined are additions.