BILL ANALYSIS
AB 1282
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 1282 (Hall)
As Amended July 6, 2009
2/3 vote. Urgency
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|ASSEMBLY: |72-3 |(May 18, 2009) |SENATE: |35-1 |(August 31, |
| | | | | |2009) |
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Original Committee Reference: G.O.
SUMMARY : Extends to out-of-state domestic and overseas brewers,
as well as importers, the same privileges as California brewers
have with respect to the dollar value of advertising
specialty items that may be given away to adult consumers.
The Senate amendments :
1)Make it explicit that beer manufacturers cannot require beer
wholesalers to fund consumer advertising specialties furnished
by the beer manufacturer.
2)Add an urgency clause.
EXISTING LAW :
1)Establishes the ABC and grants it exclusive authority to
administer the provisions of the ABC Act in accordance with
laws enacted by the Legislature. This involves licensing
individuals and businesses associated with the manufacture,
importation and sale of alcoholic beverages in this state and
the collection of license fees or occupation taxes for this
purpose.
2)Provides no licensee shall, directly or indirectly, give any
premium, gift, or free goods in connection with the sale or
distribution of any alcoholic beverage, except as provided by
rules that shall be adopted by ABC, as defined.
3)Specifies that no rule of ABC may permit a licensee to give
any premium, gift, or free goods of greater than
inconsequential value in connection with the sale or
distribution of beer. With respect to beer, premiums, gifts,
or free goods, including advertising specialties that have no
AB 1282
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significant utilitarian value other than advertising, shall be
deemed to have greater than inconsequential value if they cost
more than $0.25 per unit, or cost more than $15 in the
aggregate for all those items given by a single supplier to a
single retail premises per calendar year.
4)Provides that no rule of ABC may impose a dollar limit for
consumer advertising specialties furnished by a beer
manufacturer to the general public other than $3 per unit
original cost to the beer manufacturer who purchased it. The
consumer advertising specialties furnished by a beer
manufacturer are intended only for adults of legal drinking
age. Coin banks, toys, balloons, magic tricks, miniature
bottles or cans, confections, dolls, or other items that
appeal to minors or underage drinkers may not be used in
connection with the merchandising of beer.
5)States that the "Tied-House" Law, separates the alcoholic
beverage industry into three component parts of manufacturer,
wholesaler, and retailer. The original policy rationale for
this body of law was to prohibit the vertical integration of
the alcohol industry and to protect the public from predatory
marketing practices. Generally, other than exemptions granted
by the Legislature, the holder of one type of license is not
permitted to do business as another type of licensee within
the "three-tier" system.
FISCAL EFFECT : There are no significant costs associated with
this legislation.
AS PASSED BY THE ASSEMBLY , this bill included a holder of a beer
manufacturer's license, a holder of an out-of-state beer
manufacturer's certificate, an out-of-state vendor that holds a
certificate of compliance, or a holder of a beer and wine
importer's general license to the list of those
authorized to give adult consumers promotional advertising items
valued up to $3, as specified.
COMMENTS : According to the author, the intent of this bill is
to fix a drafting error in AB 1245 (Torrico), Chapter 629,
Statutes of 2008, which should have allowed out-of-state
domestic and overseas brewers as well as beer importers the same
privileges as California brewers have with respect to the dollar
value of advertising specialty items that may be given away to
adult consumers. AB 1282 will correct inequities inadvertently
AB 1282
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created by AB 1245 (Torrico) and insure that the new gift limit
law applies to all brewers and importers that sell and market
beer within the state, not just for companies holding a
California beer manufacturer's license.
In support of this measure, Diageo North America states it is
important to note that as AB 1245 (Torrico) was making its way
through the legislative process last year, it was always
intended (and assumed) that out-of-state beer interests, as
defined, were included in the bill. As the bill was awaiting
signature by the Governor last fall, it became apparent that ABC
felt clarification regarding out-of-state beer manufactures was
necessary.
Prior legislation . AB 1245 modified an existing provision of
the Alcoholic Beverage Control Act (ABC Act) to allow beer
manufacturers to give adult consumers promotional advertising
items valued up to $3.
SB 993 (Burton) Chapter 544, Statutes of 1997, among other
things: 1) provided that no rule of ABC may impose a dollar
limit for consumer advertising specialties furnished by a
distilled spirits supplier to a retailer or to the general
public of less than $5 per unit original cost to the supplier
who purchased it; and, 2) authorized a licensed distilled
spirits manufacturer to conduct tastings of distilled spirits on
the licensed premises under specified conditions.
Analysis Prepared by : Eric Johnson / G. O. / (916) 319-2531
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