BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  AB 636
                                                                  Page  1

          Date of Hearing:   May 1, 2013

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                  Mike Gatto, Chair

                  AB 636 (Hall) - As Introduced:  February 20, 2013 

          Policy Committee:                              Governmental  
          Organization Vote:                            16 - 0 

          Urgency:     No                   State Mandated Local Program:  
          Yes    Reimbursable:              No

           SUMMARY  

          This bill expands a current tied-house exception by allowing,  
          until January 1, 2015, the appearance of a person for the  
          purpose of providing autographs at an instructional event for  
          consumers that a winegrower, winegrower's agent, importer, or  
          other specified party conducts, or participates in at a  
          retailer's premises. 

           FISCAL EFFECT  

          Costs associated with this legislation would be minor and  
          absorbable within existing resources. 

           COMMENTS  

           1)Purpose of bill  :  This bill is an extension of AB 2184 (Hall),  
            Statutes of 2012. This bill provides an opportunity for a  
            consumer to obtain an autograph on a bottle of wine at an  
            instructional winemaker dinner.

            According to the author's office, under current law wineries  
            and other suppliers of wine, beer, and spirits, are permitted  
            to autograph bottles for consumers at promotional events held  
            at an off-sale retailer such as Beverages And More or Costco.   
            However, a supplier or their representative may not sign  
            autographs at any other venue.  AB 636 would amend current law  
            to include autographs at on-sale restaurants where a winery is  
            conducting a winemaker dinner.

           2)Tied-House Laws  . California's tied-house laws separate the  
            alcoholic beverage industry into three component parts or  








                                                                  AB 636
                                                                  Page  2

            tiers of manufacturers (including breweries, wineries, and  
            distilleries), wholesalers, and retailers (both on-sale and  
            off-sale).  These laws restrict certain ownership structures  
            and business relationships within the alcoholic beverage  
            industry, and create a public policy model for the following  
            purposes:

                 To promote the State's interest in an orderly market.
                 To prohibit vertical integration and dominance by a  
               single producer.
                 To prohibit commercial bribery and protect the public  
               from predatory marketing practices.
                 To discourage or prevent the intemperate use of  
               alcoholic beverages.

            The Legislature has generally prohibited forms of  
            cross-ownership between manufacturers and retailers, and  
            discouraged manufacturers from providing anything of value -  
            free goods, services, or advertising - to distributors or  
            retailers. Numerous exceptions to these restrictions have been  
            enacted over the years in instances where the Legislature  
            determined that the public's interests are protected.

           1)Related Legislation  . AB 2184 (Hall), Statutes of 2012,  
            permits, until January 1, 2015, the appearance of a person  
            employed or engaged by an authorized licensee, as defined, at  
            a promotional event held at the premises of an off-sale retail  
            licensee for the purpose of providing autographs under  
            specified conditions.


           Analysis Prepared by  :    Julie Salley-Gray / APPR. / (916)  
          319-2081