December 10, 2015, Introduced by Senator STAMAS and referred to the Committee on Regulatory Reform.
A bill to amend 1998 PA 58, entitled
"Michigan liquor control code of 1998,"
by amending section 609 (MCL 436.1609), as amended by 2014 PA 353,
and by adding sections 609a and 609b.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 609. (1) Except as provided in this section and sections
605 and 1029, a manufacturer, mixed spirit drink manufacturer,
warehouser, wholesaler, outstate seller of beer, outstate seller of
wine, outstate seller of mixed spirit drink, or vendor of spirits
shall not aid or assist any other vendor by gift, loan of money or
property of any description, or other valuable thing, or by the
giving of premiums or rebates, and a vendor shall not accept the
same. However, if manufacturers of spirits reduce the price of
their products, the manufacturer of spirits may refund the amount
of the price reductions to specially designated distributor
licensees in a manner prescribed by the commission.
(2) A manufacturer, mixed spirit drink manufacturer,
warehouser, wholesaler, outstate seller of beer, outstate seller of
wine, outstate seller of mixed spirit drink, or vendor of spirits
may, in a manner consistent with rules, regulations, and orders
made by the commission, provide another licensee with an
advertising
items item that promote promotes the brands and
prices
of alcoholic liquor produced by the manufacturer; sold by the
outstate seller of beer, the outstate seller of wine, or the
outstate seller of mixed spirit drink; or distributed by the
wholesaler.
Except as otherwise provided allowed
under subsection
(3),
(4), or (5), or (6), the advertising items item shall
not have
any use or value beyond the actual advertising of brands and prices
of the alcoholic liquor.
(3) Except for those orders that were approved for specific
sponsorships or festivals, a manufacturer, mixed spirit drink
manufacturer, warehouser, wholesaler, outstate seller of beer,
outstate seller of wine, outstate seller of mixed spirit drink, or
vendor of spirits may provide goods and services to another
licensee
that were approved by the commission pursuant to under
rules
or orders adopted prior to before
January 1, 2014 and the
following items:
(a) Alcoholic liquor recipes literature.
(b) Calendars and matchbooks.
(c) Removable tap markers or signs.
(d) Table tents.
(e) Shelf talkers.
(f) Bottle neckers.
(g) Cooler stickers.
(h) Buttons, blinking and nonblinking.
(i) Menu clip-ons.
(j) Mirrors.
(k) Napkin holders.
(l) Spirits cold shot tap machines.
(m) Alcoholic liquor drink menus.
(n) Keg couplers that are lent to an on-premises retailer.
(o) Sporting event or entertainment tickets.
(p) Gravity feed racks.
(q) Suction cups.
(r) Cooler door attachments.
(s) Tear pad holders.
(4) A wholesaler may sell brand logoed items to an off-
premises licensee if those brand logoed items are contained within
the packaging of an alcoholic liquor product that is to be sold to
a consumer.
(5) A retailer shall not use or possess, at its licensed
premises, advertising items that have a use or value beyond the
actual advertising of brands and prices of alcoholic liquor except
for
those items allowed in subsections subsection (3), and (4), or
(6), or as otherwise provided in allowed under this subsection. A
retailer may possess and use brand logoed barware that advertises
spirits
as long as those if the items are purchased from a
manufacturer of spirits, vendor of spirits, salesperson, broker, or
barware retailer. A retailer may possess and use brand logoed
barware
that advertises beer or wine as long as those if the items
are purchased from a barware retailer. A retailer shall maintain
the receipts of all purchased brand logoed barware for at least 3
years and shall make those receipts available for inspection by the
commission as provided in section 217. Beginning in the 2015
licensing year, a retailer shall disclose, in a manner as
prescribed by the commission on the application for renewal of an
existing license, if any barware was purchased by the retailer
during the immediately preceding license year.
(6) A manufacturer, outstate seller, or vendor of spirits may
provide brand logoed merchandise to an on-premises retailer and
off-premises retailer to promote its products under R 436.1321(1)
to (3) of the Michigan administrative code if all of the following
conditions are complied with:
(a) Brand logoed merchandise must be used for display purposes
only.
(b) Brand logoed merchandise may only provide brand
advertising when used in a display.
(c) Brand logoed merchandise must be returned to the alcoholic
beverage supplier or wholesaler on completion of the display.
(d) Brand logoed merchandise shall not be given to the retail
licensee or the retail licensee's staff or any other person for
their personal use.
(e) The value of the brand logoed merchandise on display may
not exceed $200.00 per item.
(f) Brand logoed merchandise that a licensee could use in the
daily operation of the licensee's business is prohibited.
(g) Brand logoed merchandise must be unilluminated.
(h) Brand logoed merchandise may not be more than 3,500 square
inches in dimension.
(i) Brand logoed merchandise must be owned by the manufacturer
or supplier. The ownership of brand logoed merchandise may not be
transferred to the retail licensee, the retail licensee's employee,
or any other person.
(j) A wholesaler may deliver and install a display using brand
logoed merchandise provided without charge by a manufacturer,
outstate seller of beer, outstate seller of wine, or outstate
seller of mixed drink.
(7) (6)
In addition to the penalties
provided under section
903, a manufacturer of beer or wine, mixed spirit drink
manufacturer, warehouser, wholesaler, outstate seller of beer,
outstate seller of wine, or outstate seller of mixed spirit drink
that provides or sells barware and is not authorized to provide or
sell barware is subject to a fine in an amount of up to $2,500.00
as determined by the commission. Multiple violations resulting from
the same incident may be treated as a single violation for purposes
of issuance of any penalty imposed under this act.
(8) (7)
An on-premises retailer that hosts
an on-premises
brand promotional event conducted by a wholesaler or supplier has
14 days after the event to remove from the premises any brand
logoed merchandise from the event to maintain compliance with this
section.
(9) (8)
This act and rules promulgated
under this act do not
prevent a retailer that holds an off-premises license only from
purchasing brand logoed inventory and selling that inventory to its
customers.
(10) (9)
Beginning after September 25, 2015,
the commission
may, by rule, add an item to or remove an item from the definition
of barware. The commission shall not add or remove more than 1 item
per rule and shall not promulgate more than 1 rule at a time on the
definition of barware. The commission shall not issue a rule that
adds refrigerator systems, draft systems, or furniture to the
definition of barware. A rule, regulation, or order adopted after
January 1, 2014 that is not adopted in accordance with this
subsection and that is not consistent with this section or is in
conflict with this section is void and unenforceable.
(11) (10)
As used in this section:
(a) "Barware" means the following brand logoed items:
(i) Trays.
(ii) Coasters.
(iii) Napkins.
(iv) Shirts.
(v) Hats.
(vi) Pitchers.
(vii) Drinkware that is intended to be reused.
(viii) Bar mats.
(ix) Buckets.
(x) Bottle openers.
(xi) Stir rods.
(xii) Patio umbrellas.
(xiii) Any packaging used to hold and deliver the alcoholic
liquor purchased by the retailer.
(xiv) Any other items that have been added by the commission
pursuant
to under subsection (9).(10).
(b) "Barware retailer" means a person that offers brand logoed
barware for sale to retailers, whether or not it is in their
ordinary course of business, and that is not licensed as, or
directly or indirectly affiliated with, a manufacturer of beer or
wine, mixed spirit drink manufacturer, warehouser, wholesaler,
outstate seller of beer, outstate seller of wine, or outstate
seller of mixed spirit drink. For purposes of this subdivision, a
licensing
agreement that authorizes use of a brand logo does is not
constitute
a direct or indirect affiliation.
(c) "Broker" means a person, other than an individual, that is
licensed by the commission and that is employed or otherwise
retained by a manufacturer of spirits or a vendor of spirits to
sell, promote, or otherwise assist in the sale or promotion of
spirits.
(d) "Indirectly affiliated" means, for purposes of this
section only, that a person owns 5% or more of the voting interest
of another person.
(e)
"Other valuable thing" means any goods, services, a good,
service,
or intangible goods good that
are is given, loaned,
leased,
or sold to another licensee that have has value regardless
of whether the value is nominal and includes, but is not limited
to,
goods, services, a good,
service, or intangible goods good that
provided
any a benefit, regardless of how nominal, to the licensee
other than advertising the brands and prices of alcoholic liquor
produced
by the manufacturer; , sold
by the outstate seller of
beer, the outstate seller of wine, or the outstate seller of mixed
spirit
drink; , or
distributed by the wholesaler, except for
consumable goods and those goods, services, or intangible goods
approved
by rule or order of the commission prior to before January
1, 2014.
(f) "Salesperson" means, for purposes of this subsection only,
a person who is employed by a vendor of spirits or a broker and who
is licensed by the commission to sell, deliver, or promote, or
otherwise assist in the sale of, spirits in this state.
Sec. 609a. (1) A manufacturer or wholesaler shall file with
the commission a schedule of net cash prices to the retail licensee
for all brands of case and keg beer for its market area.
(2) A manufacturer or wholesaler shall file with the
commission a beer package price reduction for its market area. The
manufacturer or wholesaler shall file the price reduction before
its effective date. A price reduction under this subsection must
continue for at least 90 days after the effective date.
(3) The beer package price for a market area may be increased
during the 90-day period described in subsection (2) for any of the
following reasons:
(a) To reflect a tax increase in the market area.
(b) To reflect a general industry price increase in the market
area.
(4) The beer package price for a market area may be decreased
during the 90-day period described in subsection (2) if both of the
following conditions are met:
(a) The price reduction is not greater on a cents-per-case
basis than the price reduction filed by the competition.
(b) The price reduction continues for the balance of the 90
days filed by the competition.
(5) A manufacturer or wholesaler shall not sell beer at a
quantity discount.
(6) A net cash price filed under subsection (1) and a price
reduction filed under subsection (2) are exempt from disclosure
under section 13 of the freedom of information act, 1976 PA 442,
MCL 15.243, until 1 year after the net cash price or price
reduction is filed, as applicable.
(7) The commission shall periodically compare a manufacturer's
or wholesaler's filing under subsection (1) or (2) with the
manufacturer's or wholesaler's tax filing under section 409.
(8) The regulation described in this section is necessary for
both of the following reasons:
(a) To promote temperance and the public health and welfare.
(b) To promote a stable 3-tier distribution system with
orderly markets for wine and malt beverage products in which there
is no price discrimination by a wholesaler in its sales to
retailers within the wholesaler's sales territory.
Sec. 609b. (1) A vendor representative and salesperson of a
vendor of spirits, manufacturer of beer, manufacturer of wine,
outstate seller of beer, outstate seller of wine, or wholesaler
shall maintain accurate records of expenditures for each call on a
retail licensee. The records must be maintained for 4 years and
must be made available for commission inspection.
(2) A vendor representative or salesperson of spirits or wine,
for promotional purposes, may purchase 1 drink for each customer of
an on-premises licensee. A drink purchased under this subsection
must be of the brand represented by the vendor representative or
salesperson.
(3) A vendor representative or salesperson of a manufacturer
of beer, a wholesaler of beer, or an outstate seller of beer, for
promotional purposes, may purchase 1 drink for each customer of an
on-premises retail licensee subject to a total spending limit of
$100.00 per day. A drink purchased under this subsection must be of
the brand represented by the vendor representative or salesperson.
(4) A vendor representative or salesperson of a manufacturer
of beer, a wholesaler of beer, or an outstate seller of beer shall
not purchase a drink under subsection (3) more than twice per month
at the same on-premises retail licensed location.
(5) A licensee employed to deliver alcoholic liquor shall not
purchase a drink of alcoholic liquor for a retail licensee while on
duty or in the course of employment.
Enacting section 1. This amendatory act takes effect 90 days
after the date it is enacted into law.