BILL NUMBER: SB 778	AMENDED
	BILL TEXT

	AMENDED IN SENATE  JANUARY 5, 2012
	AMENDED IN SENATE  JANUARY 4, 2012

INTRODUCED BY   Senator Padilla

                        FEBRUARY 18, 2011

    An act to add Section 25600.1 to the Business and
Professions Code, relating to alcoholic beverages.   An
act to add Section 25600.1 to the Business a   nd
Professions Code, relating to alcoholic beverages. 


	LEGISLATIVE COUNSEL'S DIGEST


   SB 778, as amended, Padilla. Alcoholic beverages licensees:
contests and sweepstakes. 
   The Alcoholic Beverage Control Act prohibits any licensee from
giving any premium, gift, or free goods in connection with the sale
or distribution of any alcoholic beverage, except as provided. 

   This bill would permit an authorized licensee, as defined, to
conduct, sponsor, or participate in a consumer contest or
sweepstakes, as defined, offering the chance to win prizes, if
specified conditions are met.  
   The Alcoholic Beverage Control Act provides that a violation of
any of its provisions for which another penalty or punishment is not
specifically provided is a misdemeanor. This bill would expand
existing crimes by imposing additional duties on a licensee under the
act, thus, the bill would impose a state-mandated local program.
 
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.  
   This bill would provide that no reimbursement is required by this
act for a specified reason.  
   The Alcoholic Beverage Control Act prohibits any licensee from
giving any premium, gift, or free goods in connection with the sale
or distribution of any alcoholic beverage, except as provided.
 
   This bill would permit an authorized licensee to conduct, sponsor,
or participate in a contest or sweepstakes, as defined, offering the
chance to win prizes, if specified conditions are met. 

   The Alcoholic Beverage Control Act provides that a violation of
any of its provisions for which another penalty or punishment is not
specifically provided is a misdemeanor. This bill would expand
existing crimes by imposing additional duties on a licensee under the
act, thus, the bill would impose a state-mandated local program.
 
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.  
   This bill would provide that no reimbursement is required by this
act for a specified reason. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 25600.1 is added to the 
 Business and Professions Code   , to read:  
   25600.1.  (a) Notwithstanding any other provision of law, an
authorized licensee may conduct, sponsor, or participate in consumer
contests and sweepstakes, subject to the following conditions:
   (1) A purchase or entry fee shall not be required to enter a
contest or sweepstakes. Entry or extra chances in a contest or
sweepstakes shall not be made available via the purchase of an
alcoholic beverage. Entrance into a contest or sweepstakes shall be
limited to persons 21 years of age or older.
   (2) (A) Caps, cap liners, corks, labels, cartons, cases, or other
material attached to an alcoholic beverage when purchased shall not
be used as an entry to a contest or sweepstakes or as a means of
determining the amount or size of the prize or the winner in a
contest or sweepstakes.
   (B) Neck hangers may carry an entry form only if similar entry
forms are available at the point of sale and are reproduced or an
alternative means of entry is available.
   (3) Scratch-offs, pull tabs, or other means of instant wins in a
contest or sweepstakes shall be not permitted.
   (4) A visit to a retail premises shall not be required to enter a
contest or sweepstakes.
   (5) Alcoholic beverages or anything redeemable for alcoholic
beverages shall not be awarded as a contest or sweepstakes prize.
This paragraph shall not prohibit a contest or sweepstakes in which
the prize is cash or the awarding of cash in lieu of a prize that is
tangible personal property or real property.
   (6) A retail licensee shall not serve as the agent of an
authorized licensee by collecting or forwarding entries or awarding
prizes to a contest or sweepstakes winner. The matching of entries
with numbers or pictures on the point-of-sale materials at retail
licensed premises is permitted only if entrants are also offered the
opportunity to use an alternative means to determine prize-winning
status.
   (7) A licensee that is not an authorized licensee shall not share
in, or contribute to, the costs of a contest or sweepstakes
authorized by this section. A licensee that is not an authorized
licensee shall not serve as the agent of an authorized licensee to
collect or forward entries or to furnish any prize to any contest or
sweepstakes winner.
   (8) (A) Advertising of a contest or sweepstakes shall comply with
the signage and advertising restrictions contained in this chapter,
Chapter 15 (commencing with Section 25500), and any regulations
issued by the department.
   (B) Advertising or promotion of a contest or sweepstakes shall not
identify or refer to any retail licensee.
   (C) A retail licensee shall only advertise or promote a contest or
sweepstakes authorized by this section in the manner specified in
subparagraph (A).
   (D) Advertising or promotion of a contest or sweepstakes shall
only be conducted on the premises of a retail licensee when such
advertisement or promotion involves a minimum of two unaffiliated
retail licensees. For purposes of this subparagraph, "unaffiliated
retail licensees" shall not include any retail licensee owned in
whole or in part by an authorized licensee or any officer, director,
or agent of that licensee.
   (E) Placement of signs or other advertising of a contest or
sweepstakes in a licensed retail premises shall not be conditioned
upon the following:
   (i) Product placement within the licensed premises.
   (ii) The sale of any product produced by an authorized licensee.
   (9) Contest or sweepstakes prizes shall not be awarded to any
retail or wholesale licensee or agent, officer, or family member of
any retail or wholesale licensee. An authorized licensee shall
maintain all records pertaining to a contest or sweepstakes for three
years following the completion of a contest or sweepstakes.
   (b) For purposes of this section:
   (1) "Authorized licensee" means a winegrower, beer and wine
importer general, beer manufacturer, out-of-state beer manufacturer
certificate holder, distilled spirits manufacturer, distilled spirits
manufacturer's agent, distilled spirits importer general, distilled
spirits rectifier, distilled spirits general rectifier, rectifier,
out-of-state distilled spirits shipper's certificate holder, brandy
manufacturer, and brandy importer. An authorized licensee may hold
more than one license issued pursuant to this division.
   (2) "Contest" means a game, contest, puzzle, scheme, plan, or
similar activity that holds out or offers to participants the
opportunity to receive or compete for gifts, prizes, gratuities, or
other things of value as determined by skill, knowledge, or ability
rather than upon random selection. Skill, knowledge, or ability does
not include the consumption or use of alcoholic beverages.
   (3) "Sweepstakes" means a procedure, activity, or event for the
distribution of anything of value by lot, chance, or random selection
where the odds for winning a prize are equal for each entry.
   (c) A prize awarded for a contest or sweepstakes conducted
pursuant to this section shall not be subject to the monetary
limitations imposed by Section 25600 or a regulation issued by the
department.
   (d) Nothing in this section authorizes marketing schemes where
consumers are entitled to an allotment of points based on purchases
made over a period of time that can be redeemed for prizes, things of
value, or additional contest or sweepstakes entries.
   (e) An authorized licensee that violates this section, in addition
to any other penalty imposed by this division, may be prohibited by
the department from offering a contest or sweepstakes to California
residents for a period of 12 months. 
   SEC. 2.   No reimbursement is required by this act
pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.  
  SECTION 1.    Section 25600.1 is added to the
Business and Professions Code, to read:
   25600.1.  (a) Notwithstanding any other provision of law, an
authorized licensee may conduct, sponsor, or participate in contests
and sweepstakes, subject to the following conditions:
   (1) A purchase or entry fee shall not be required to enter a
contest or sweepstakes. Entry or extra chances in a contest or
sweepstakes shall not be made available via the purchase of an
alcoholic beverage. Entrance into a contest or sweepstakes shall be
limited to persons 21 years of age or older.
   (2) (A) Caps, cap liners, corks, labels, cartons, cases, or other
material attached to an alcoholic beverage when purchased shall not
be used as an entry to a contest or sweepstakes or as a means of
determining the amount or size of the prize or the winner in a
contest or sweepstakes.
   (B) Neck hangers may carry an entry form only if similar entry
forms are available at the point of sale and are reproduced or an
alternative means of entry is available.
   (3) Scratch-offs, pull tabs, or other means of instant wins in a
contest or sweepstakes shall be not permitted.
   (4) A visit to a retail premises shall not be required to enter a
contest or sweepstakes.
   (5) Alcoholic beverages or anything redeemable for alcoholic
beverages shall not be awarded as a contest or sweepstakes prize.
This paragraph shall not prohibit a contest or sweepstakes where the
prize is cash or the awarding of cash in lieu of a prize that is
tangible personal property or real property.
   (6) A retail licensee shall not serve as the agent of an
authorized licensee by collecting or forwarding entries or awarding
prizes to a contest or sweepstakes winner. A retail licensee may
match entries with numbers or pictures at the point-of-sale on the
licensed premises only if entrants are also offered the opportunity
to use an alternative means to determine prize-winning status.
   (7) A retail licensee, beer and wine wholesaler, or distilled
spirits wholesaler shall not share in, or contribute to, the costs of
a contest or sweepstakes authorized by this section.
   (8) (A) Advertising of a contest or sweepstakes at an on-sale
retail license location or an off-sale retail license location shall
comply with Section 25611.1 or Section 25503.1, respectively.
   (B) Advertising or promotion of a contest or sweepstakes shall not
identify or refer to any retail licensee.
   (C) Advertising or promotion of a contest or sweepstakes shall not
be conducted exclusively in, by, or through any retail licensee or
chain of retail licensees.
   (D) Placement of signs or other advertising of a contest or
sweepstakes in a licensed retail premises shall not be conditioned
upon product placement with the licensed premises.
   (9) Contest or sweepstakes prizes shall not be awarded to any
retail or wholesale licensee or agent, officer, or family member of
any retail or wholesale licensee. This subdivision shall not apply to
a contest or sweepstakes conducted by an authorized licensee and
wholesaler as part of an incentive program.
   (b) For purposes of this section:
   (1) "Authorized licensee" means a winegrower who may or may not
hold another license or licenses under this division.
   (2) "Contest" means a game, contest, puzzle, scheme, plan, or
similar activity that holds out or offers to participants the
opportunity to receive or compete for gifts, prizes, gratuities, or
other things of value as determined by skill, knowledge, or ability
rather than upon random selection.
   (3) "Sweepstakes" means a procedure, activity, or event for the
distribution of anything of value by lot, chance, or random selection
where the odds for winning a prize are equal for each entry.
   (c) Nothing in this section authorizes marketing schemes where
consumers are entitled to an allotment of points based on purchases
made over a period of time that can be redeemed for prizes, things of
value, or additional contest or sweepstakes entries.
   (d) An authorized licensee that violates this section, in addition
to any other penalty imposed by this division, may be prohibited by
the department from conducting, sponsoring, or participating in a
contest or sweepstakes for California residents for a period of 12
months.  
  SEC. 2.    No reimbursement is required by this
act pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.