HB4018 99TH GENERAL ASSEMBLY

LRB099 07839 RPS 27974 b

99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB4018

Introduced , by Rep. Frank J. Mautino and Lou Lang

SYNOPSIS AS INTRODUCED:

235 ILCS 5/1-3.40 new
235 ILCS 5/1-3.41 new
235 ILCS 5/6-6.3 new

Amends the Liquor Control Act of 1934. Provides that specified licensees under the Act may sell non-alcoholic merchandise to retail licensees if certain conditions are met. Provides that nothing in the Act authorizes the Illinois Liquor Control Commission to regulate or exercise jurisdiction over any transaction involving the furnishing, selling, or offering for sale of non-alcoholic merchandise by manufacturers, distributors, or retailers, unless the transaction involves expressed or implied agreements or understandings prohibited by the Act. Provides certain restrictions on transactions involving the sale of non-alcoholic merchandise, including a prohibition on conditioning the sale of alcoholic liquor on the sale of non-alcoholic merchandise. Contains provisions concerning the furnishing of fixtures, equipment, and furnishings related to non-alcoholic merchandise to retail licensees. Defines "manufacturer class license holder" and "non-alcoholic merchandise". Makes other changes. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning liquor.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Liquor Control Act of 1934 is amended by adding Sections 1-3.40, 1-3.41, and 6-6.3 and by changing Section 6-6 as follows:

(235 ILCS 5/1-3.40 new)

Sec. 1-3.40. Manufacturer class license holder. "Manufacturer class license holder" means any holder of a Manufacturer's license as provided in Section 5-1 of this Act. The Manufacturer's licenses are: Distiller; Rectifier; Brewer; First Class Wine Manufacturer; Second Class Wine Manufacturer; First Class Winemaker; Second Class Winemaker; Limited Wine Manufacturer; Craft Distiller; Craft Brewer; and any future Manufacturer's licenses established by law.

(235 ILCS 5/1-3.41 new)

Sec. 1-3.41. Non-alcoholic merchandise. "Non-alcoholic merchandise" means any good or commodity that contains less than 0.5% alcohol by volume. "Non-alcoholic merchandise" does not include trade fixtures, equipment, or furnishings that are used or intended for the limited purpose of storing, servicing, displaying, advertising, furnishing, selling, or aiding in the sale of alcoholic liquor.

(235 ILCS 5/6-6.3 new)

Sec. 6-6.3. Non-alcoholic merchandise.

(a) Nothing in this Act authorizes the State Commission to regulate or exercise jurisdiction over any transaction involving the furnishing, selling, or offering for sale of non-alcoholic merchandise by manufacturers, distributors, or retailers, unless the transaction involves expressed or implied agreements or understandings prohibited by this Act.

(b) Non-alcoholic merchandise may be sold to a retail licensee by a manufacturer class license holder, non-resident dealer, foreign importer, importing distributor, or distributor if:

(1) the manufacturer class license holder, non-resident dealer, foreign importer, importing distributor, or distributor is also in business as a bona fide producer or vendor of other merchandise;

(2) the non-alcoholic merchandise is sold at its fair market value;

(2) the non-alcoholic merchandise is not sold in combination with alcoholic liquor or conditioned on the sale of alcoholic liquor;

(3) the manufacturer class license holder's, non-resident dealer's, foreign importer's, importing distributor's, or distributor's acquisition or production costs of the non-alcoholic merchandise appear on the manufacturer class license holder's, non-resident dealer's, foreign importer's, importing distributor's, or distributor's purchase invoices or other records;

(4) the individual selling prices of the non-alcoholic merchandise and the alcoholic liquors sold in a single transaction can be determined from commercial documents covering the sales transaction if non-alcoholic merchandise is sold in the same transaction as alcoholic liquor; and

(5) the price is collected by the manufacturer class license holder, non-resident dealer, or foreign importer within 30 days of the date of the sale, unless other terms are established by a writing between the parties.

(c) The State Commission may not prohibit the sale of non-alcoholic merchandise if it is sold in the manner in which the non-alcoholic merchandise is sold by a manufacturer or distributor that is not licensed by the State Commission. However, all invoices for non-alcoholic merchandise sold by a manufacturer class license holder, non-resident dealer, foreign importer, importing distributor, or distributor that is also in business as a bona fide producer or vendor of other merchandise must be in compliance with the requirements of 11 Ill. Adm. Code 100.130. If non-alcoholic merchandise is sold on the same invoice as an alcoholic liquor product, the 30-day merchandising credit provisions of Section 6-5 of the Act shall apply to the entire transaction, including the non-alcoholic merchandise.

(d) Except as provided in subsection (f), a manufacturer class license holder, non-resident dealer, foreign importer, importing distributor, or distributor that is also in business as a bona fide producer or vendor of non-alcoholic merchandise shall not condition the sale of its alcoholic liquor on the sale of its non-alcoholic merchandise and shall not combine the sale of its alcoholic liquor with the sale of its non-alcoholic merchandise. A manufacturer class license holder, non-resident dealer, foreign importer, importing distributor, or distributor that is also in business as a bona fide producer or vendor of non-alcoholic merchandise may sell, market, and promote non-alcoholic merchandise in the same manner in which the non-alcoholic merchandise is sold, marketed, or promoted by a manufacturer or distributor that is not licensed by the State Commission.

(e) Notwithstanding the prohibited furnishing or providing of fixtures, equipment, and furnishings to retailers, as provided in Section 6-6 of this Act, the act of a manufacturer class license holder, non-resident dealer, foreign importer, importing distributor, or distributor furnishing or providing retailers with fixtures, equipment, or furnishings for the limited purpose of storing, servicing, displaying, advertising, furnishing, selling, or aiding in the sale of non-alcoholic merchandise is permitted only to the extent allowed by this Section. Such fixtures, equipment, or furnishings shall not be used by the retail licensee to store, service, display, advertise, furnish, sell, or aid in the sale of alcoholic liquors. All such fixtures, equipment, or furnishings shall be identified by the retail licensee as being furnished by a manufacturer class license holder, non-resident dealer, foreign importer, importing distributor, or distributor licensed by the State Commission and, if purchased by the retail licensee and sold on the same invoice as alcoholic liquor, the price must be collected by the manufacturer class license holder, non-resident dealer, foreign importer, importing distributor, or distributor within 30 days of the date of sale.

(f) Notwithstanding any provision of this Act to the contrary, a manufacturer class license holder, non-resident dealer, foreign importer, importing distributor, or distributor may package and distribute alcoholic liquor in combination with non-alcoholic merchandise if the alcoholic liquor and non-alcoholic merchandise was originally packaged together for ultimate sale to consumers by the manufacturer.

Section 99. Effective date. This Act takes effect upon becoming law.