Florida Senate - 2018                       CS for CS for SB 822
       
       
        
       By the Committees on Commerce and Tourism; and Regulated
       Industries; and Senator Hutson
       
       
       
       
       577-02900-18                                           2018822c2
    1                        A bill to be entitled                      
    2         An act relating to the Beverage Law; amending s.
    3         561.42, F.S.; prohibiting certain entities and persons
    4         from directly or indirectly assisting any vendor in
    5         certain ways; prohibiting a licensed vendor from
    6         accepting certain items and services; authorizing the
    7         Division of Alcoholic Beverages and Tobacco to impose
    8         administrative sanctions for a violation of certain
    9         limitations established in the Beverage Law;
   10         prohibiting a vendor from displaying certain signs in
   11         the window or windows of his or her licensed premises;
   12         authorizing certain entities and persons to give,
   13         lend, furnish, or sell certain advertising material to
   14         certain vendors; defining the term “decalcomania”;
   15         providing exemptions relating to tied house evil for
   16         certain sales and purchases of merchandise; providing
   17         conditions for the exemptions; defining the term
   18         “merchandise”; prohibiting a manufacturer or importer
   19         of malt beverages from soliciting or receiving any
   20         portion of certain payments from its distributors;
   21         defining the term “negotiated at arm’s length”;
   22         specifying that a brand-naming rights agreement does
   23         not obligate or place responsibility upon a
   24         distributor; providing civil penalties for violations
   25         by manufacturers or importers of malt beverages or
   26         vendors; providing applicability; requiring the
   27         division to consider the comparative financial value
   28         of a brand-naming rights agreement when determining
   29         the amount of a civil penalty; providing an effective
   30         date.
   31          
   32  Be It Enacted by the Legislature of the State of Florida:
   33  
   34         Section 1. Present subsection (13) of section 561.42,
   35  Florida Statutes, is redesignated as subsection (14),
   36  subsections (1), (8), (11), and (12) and paragraph (b) of
   37  present subsection (14) of that section are amended, and a new
   38  subsection (13) and subsection (16) are added to that section,
   39  to read:
   40         561.42 Tied house evil; financial aid and assistance to
   41  vendor by manufacturer, distributor, importer, primary American
   42  source of supply, brand owner or registrant, or any broker,
   43  sales agent, or sales person thereof, prohibited; procedure for
   44  enforcement; exception.—
   45         (1) A No manufacturer, distributor, importer, primary
   46  American source of supply, or brand owner or registrant of any
   47  of the beverages herein referred to, whether licensed or
   48  operating in this state or out-of-state, nor any broker, sales
   49  agent, or sales person thereof, may not shall have any financial
   50  interest, directly or indirectly, in the establishment or
   51  business of any vendor licensed under the Beverage Law; nor may
   52  shall such manufacturer, distributor, importer, primary American
   53  source of supply, brand owner or brand registrant, or any
   54  broker, sales agent, or sales person thereof, directly or
   55  indirectly assist any vendor by furnishing, supplying, selling,
   56  renting, lending, buying for, or giving to any vendor any
   57  vehicles, equipment, furniture, fixtures, signs, supplies,
   58  credit, fees, slotting fees of any kind, advertising or
   59  cooperative advertising, services, any gifts or loans of money
   60  or property of any description, or by the giving of any rebates
   61  of any kind whatsoever. A No licensed vendor may not shall
   62  accept, directly or indirectly, any vehicles, equipment,
   63  furniture, fixtures, signs, supplies, credit, fees, slotting
   64  fees of any kind, advertising or cooperative advertising,
   65  services, gifts any gift or loans loan of money or property of
   66  any description, or any rebates of any kind whatsoever from any
   67  such manufacturer, distributor, importer, primary American
   68  source of supply, brand owner or brand registrant, or any
   69  broker, sales agent, or sales person thereof; provided, however,
   70  that this does not apply to any bottles, barrels, or other
   71  containers necessary for the legitimate transportation of such
   72  beverages or to advertising materials and does not apply to the
   73  extension of credit, for liquors sold, made strictly in
   74  compliance with the provisions of this section. A brand owner is
   75  a person who is not a manufacturer, distributor, importer,
   76  primary American source of supply, brand registrant, or broker,
   77  sales agent, or sales person thereof, but who directly or
   78  indirectly owns or controls any brand, brand name, or label of
   79  alcoholic beverage. Nothing in this section shall prohibit the
   80  ownership by vendors of any brand, brand name, or label of
   81  alcoholic beverage.
   82         (8) The division may adopt rules and require reports to
   83  enforce, and may impose administrative sanctions for any
   84  violation of, the limitations established under the Beverage Law
   85  on vehicles, equipment, furniture, fixtures, signs, supplies,
   86  credit, fees, advertising or cooperative advertising, services,
   87  gifts or loans of money or property in this section on credits,
   88  coupons, and other forms of assistance.
   89         (11) A vendor may display in the interior of his or her
   90  licensed premises, including the window or windows thereof,
   91  neon, electric, or other signs, including window painting and
   92  decalcomanias applied to the surface of the interior or exterior
   93  of such windows; signs that require a power source;, and
   94  posters, placards, and other advertising material advertising
   95  the brand or brands of alcoholic beverages sold by him or her,
   96  whether visible or not from the outside of the licensed
   97  premises, but a no vendor may not shall display in the window or
   98  windows of his or her licensed premises more than one neon,
   99  electric, or similar sign that requires a power source,
  100  advertising the product of any one brand of alcoholic beverage
  101  manufacturer.
  102         (12) Any manufacturer, distributor, importer, primary
  103  American source of supply, or brand owner or registrant, or any
  104  broker, sales agent, or sales person thereof, may give, lend,
  105  furnish, or sell to a vendor who sells the products of such
  106  manufacturer, distributor, importer, primary American source of
  107  supply, or brand owner or registrant any of the following: neon,
  108  or electric, or similar signs requiring a power source; signs,
  109  window painting and decalcomanias applied to the surface of the
  110  interior or exterior of windows; or, posters, placards, and
  111  other advertising material herein authorized to be used or
  112  displayed by the vendor in the interior of his or her licensed
  113  premises. As used in subsection (11) and this subsection, the
  114  term “decalcomania” means a picture, design, print, engraving,
  115  or label made to be transferred onto a glass surface.
  116         (13) Any manufacturer, distributor, importer, primary
  117  American source of supply, or brand owner or registrant, or any
  118  broker, sales agent, or sales person thereof, who regularly
  119  sells merchandise to vendors, or any vendor who purchases
  120  merchandise from such a manufacturer, distributor, importer,
  121  primary American source of supply, or brand owner or registrant,
  122  or any broker, sales agent, or sales person thereof, does not
  123  violate subsection (1) if:
  124         (a) Such sale or purchase is not less than the fair market
  125  value of the merchandise;
  126         (b) Such sale or purchase is not combined with any sale or
  127  purchase of alcoholic beverages;
  128         (c) Such sale or purchase is separately itemized from the
  129  sale or purchase of alcoholic beverages; and
  130         (d) Both the seller and purchaser maintain records of any
  131  such sale or purchase, including the price and any conditions
  132  associated with such sale or purchase of the merchandise.
  133  
  134  For purposes of this subsection, the term “merchandise” means
  135  commodities, supplies, fixtures, furniture, or equipment. The
  136  term does not include alcoholic beverages or a motor vehicle or
  137  trailer requiring registration under chapter 320.
  138         (15)(14) The division shall adopt reasonable rules
  139  governing promotional displays and advertising, which rules
  140  shall not conflict with or be more stringent than the federal
  141  regulations pertaining to such promotional displays and
  142  advertising furnished to vendors by distributors, manufacturers,
  143  importers, primary American sources of supply, or brand owners
  144  or registrants, or any sales agent or sales person thereof;
  145  however:
  146         (b) Without limitation in total dollar value of such items
  147  provided to a vendor, a manufacturer, distributor, importer,
  148  brand owner, or brand registrant of malt beverage, or any sales
  149  agent or sales person thereof, may rent, loan without charge for
  150  an indefinite duration, or sell durable retailer advertising
  151  specialties such as clocks, pool table lights, and the like,
  152  which bear advertising matter. If sold, such items may not be
  153  sold at a price less than the actual cost to the industry member
  154  who initially purchased the items.
  155         (16)(a) Notwithstanding any other provision of this
  156  section, a manufacturer or importer of malt beverages and a
  157  vendor may enter into a written agreement for brand-naming
  158  rights and associated cooperative advertising, negotiated at
  159  arm’s length for no more than fair market value if:
  160         1.The vendor operates places of business where consumption
  161  on the premises is permitted, the premises are located within a
  162  theme park complex consisting of at least 25 contiguous acres
  163  owned and controlled by the same business entity, and the
  164  complex contains permanent exhibitions and a variety of
  165  recreational activities and has a minimum of 1 million visitors
  166  annually through a controlled entrance to and exit from the
  167  theme park complex;
  168         2. Such agreement does not involve, either in whole or in
  169  part, the sale or distribution of malt beverages between the
  170  manufacturer or importer, or the manufacturer’s or importer’s
  171  distributor, and a vendor;
  172         3.The vendor, as a result of such agreement, does not give
  173  preferential treatment to the alcoholic beverage brand or brands
  174  of the manufacturer or importer with whom the vendor has entered
  175  into such agreement;
  176         4.Such agreement does not limit, either directly or
  177  indirectly, the sale of alcoholic beverages of another
  178  manufacturer or importer, or distributor; and
  179         5.Within 10 days after execution of such agreement, the
  180  vendor files with the division a description of the agreement
  181  which includes the location, dates, and the name of the
  182  manufacturer or importer that entered into the agreement.
  183  
  184  As used in this paragraph, the term “negotiated at arm’s length
  185  means the negotiation of a business transaction by independent
  186  parties acting in each partys own individual self-interest and
  187  conducted as if the parties were strangers, so that no conflict
  188  of interest may arise.
  189         (b) A manufacturer or importer of malt beverages which is a
  190  party to a brand-naming rights agreement may not, either
  191  directly or indirectly, solicit or receive from any of its
  192  distributors any portion of the payment due from the
  193  manufacturer or importer of malt beverages to the vendor
  194  pursuant to such agreement. Such agreement exists solely between
  195  the manufacturer and the vendor and does not, directly or
  196  indirectly, in any way obligate or place responsibility,
  197  financial or otherwise, upon a distributor.
  198         (c)Notwithstanding s. 561.29(3) and (4), a manufacturer of
  199  malt beverages, an importer of malt beverages, or a vendor who
  200  violates this subsection is subject to:
  201         1.A civil penalty of at least $5,000, but not more than
  202  $25,000, for a first violation.
  203         2.A civil penalty of at least $25,000, but not more than
  204  $50,000, for a second violation occurring within 36 months after
  205  the date of the first violation.
  206         3.A civil penalty of at least $50,000, but not more than
  207  $100,000, for a third or subsequent violation occurring within
  208  36 months after the date of the first violation.
  209         4.At the discretion of the division, in lieu of or in
  210  addition to a civil penalty imposed under subparagraph 3.,
  211  suspension or revocation of the alcoholic beverage license for a
  212  fourth or subsequent violation occurring within 36 months after
  213  the date of the first violation.
  214  
  215  A violation occurring more than 36 months after a first
  216  violation is deemed a first violation under this paragraph. When
  217  imposing a civil penalty within the ranges provided in
  218  subparagraphs 1.-3., the division shall consider the comparative
  219  financial value of the brand-naming rights agreement as a factor
  220  in assigning the amount of the civil penalty.
  221         Section 2. This act shall take effect July 1, 2018.