BILL ANALYSIS �
Bill No: AB
2203
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Lou Correa, Chair
2013-2014 Regular Session
Staff Analysis
AB 2203 Author: Chesbro
As Introduced: February 20, 2014
Hearing Date: June 24, 2014
Consultant: Art Terzakis
SUBJECT
Alcoholic Beverages: beer labeling
DESCRIPTION
AB 2203 adds "metal kegs" to an existing provision of the
Alcoholic Beverage Control (ABC) Act that prohibits the
obliteration, mutilation, or marking out of a
manufacturer's name on returnable beer containers or
cartons made of wood or fiber board.
EXISTING LAW
The enactment of the 21st Amendment to the U.S.
Constitution in 1933 repealed the 18th Amendment and ended
the era of Prohibition. Accordingly, states were granted
the authority to establish alcoholic beverage laws and
administrative structures to regulate the sale and
distribution of alcoholic beverages.
Existing law establishes the Department of 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 for this purpose.
Existing law provides for specified labeling requirements
for containers of alcoholic beverages sold within this
state, and prohibits the obliteration, mutilation, or
AB 2203 (Chesbro) continued
Page 2
marking out of a manufacturer's name on returnable beer
containers or cartons made of wood or fiber board without
the written consent of the manufacturer whose name, brand,
or printed markings is to be obliterated, mutilated or
marked out.
BACKGROUND
Purpose of AB 2203: The author's office points out that
existing law prohibits the removal of manufacturers' names,
brand names, print, or markings first placed on returnable
beer containers or cartons made of wood or fiber board. AB
2203 simply adds metal kegs to the list of containers for
which removal is prohibited - it is intended to give law
enforcement another legal tool to use against thieves that
are stealing kegs, grinding out the name or any identifying
information and then recycling the kegs for cash. Most
kegs are made from stainless steel which has a high recycle
value. Because the deposit is less than the scrap value of
the keg, some thieves may even buy the beer, pay the
deposit for the keg, drink or empty the keg, and then haul
the empty keg to a scrap yard and sell it for a profit. It
costs brewers as much as $150 to replace a keg. The
author's office notes that beer keg theft is estimated to
cost brewers and importers well over $50 million annually.
PRIOR/RELATED LEGISLATION
AB 2609 (Nestande), 2013-14 Session. Would add a new
provision to the ABC Act that allows nonprofit
organizations established for the purpose of promoting home
brewing to serve beer at fundraising events subject to
specified conditions. (Pending in Senate Appropriations
Committee)
AB 647 (Chesbro), Chapter 686, Statutes of 2013. Among
other things, added clarity to existing provisions of the
ABC Act relative to labeling requirements for the refilling
of off-sale consumer sized beer containers, known as
"growlers," by beer manufacturers.
AB 1425 (Governmental Organization Committee), Chapter 463,
Statutes of 2013. Among other things, allowed beer or wine
made for personal or family use to be donated to a
non-profit organization and used at a fundraising event
AB 2203 (Chesbro) continued
Page 3
conducted solely by and solely for the benefit of the
nonprofit organization and only for consumption on the
premises of the fundraising event, provided that a license
is issued by the ABC.
AB 346 (Beall), Chapter 624, Statutes of 2008. Provided
that any container of beer or alcoholic beverage, other
than sake, that is approved for labeling as a malt beverage
under the Federal Alcohol Administration Act (FAAA), that
derives 0.5% or more of its alcoholic content by volume
from flavors or other ingredients containing distilled
alcohol and that is sold within this state on or after July
1, 2009, shall bear a distinctive, conspicuous, and
prominently displayed label, or firmly affixed sticker, as
defined.
SB 520 (Governmental Organization), Chapter 349, Statutes
of 2007. Among other things, prohibited junk dealers and
recyclers from purchasing or receiving stainless steel or
aluminum alloy beer kegs marked with indicia of ownership,
as defined, from anyone except the indicated owner, unless
specified information is provided to the junk dealer or
recycler.
SUPPORT: As of June 20, 2014:
California Craft Brewers Association
OPPOSE: None on file as of June 20, 2014.
FISCAL COMMITTEE: Senate Appropriations Committee
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