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FULL TEXT OF AB 605

BILL NUMBER: AB 605	CHAPTERED
	BILL TEXT

	CHAPTER  230
	FILED WITH SECRETARY OF STATE  SEPTEMBER 24, 2010
	APPROVED BY GOVERNOR  SEPTEMBER 23, 2010
	PASSED THE SENATE  AUGUST 18, 2010
	PASSED THE ASSEMBLY  AUGUST 27, 2010
	AMENDED IN SENATE  AUGUST 2, 2010
	AMENDED IN SENATE  JUNE 28, 2010
	AMENDED IN SENATE  JUNE 7, 2010

INTRODUCED BY   Assembly Member Portantino

                        FEBRUARY 25, 2009

   An act to add Sections 23396.6 and 25503.56 to the Business and
Professions Code, relating to alcoholic beverages.

	LEGISLATIVE COUNSEL'S DIGEST

   AB 605, Portantino. Alcoholic beverages: instructional tasting
events.
   The Alcoholic Beverage Control Act contains various provisions
regulating the application for, the issuance of, the suspension of,
and the conditions imposed upon, alcoholic beverage licenses by the
Department of Alcoholic Beverage Control. Existing law provides for
various annual fees for the issuance of alcoholic beverage licenses
depending upon the type of license issued. The Alcoholic Beverage
Control Act provides that a violation of its provisions is a
misdemeanor, unless otherwise specified.
   This bill would authorize the department to issue to the holder of
any off-sale retail license an instructional tasting license that
would allow the licenseholder to allow an authorized licensee, as
defined, or designated representative of that licensee, to conduct,
on a designated portion of, or contiguous to, an existing licensed
premises, an instructional tasting event at which tastes of alcoholic
beverages may be served to consumers, as provided. The bill would
impose an original fee of $300 and an annual renewal fee of $261 for
the license, which would be deposited in the Alcohol Beverage Control
Fund. Because the violation of a specified provision of the
instructional tasting license by a licensee or by a person under 21
years of age is punishable as a misdemeanor, the bill both creates a
new crime and expands the definition of an existing crime, thereby
creating 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 PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 23396.6 is added to the Business and
Professions Code, to read:
   23396.6.  (a) The department may issue to the holder of an
off-sale retail license an instructional tasting license at the
premises of the off-sale retail license. An instructional tasting
license shall not be issued to any of the following:
   (1) Off-sale licensees at locations where motor vehicle fuel is
sold, unless the licensee operates a fully enclosed off-sale retail
area encompassing at least 10,000 square feet.
   (2) Off-sale licensees at locations with a total of less than
5,000 square feet of interior retail space, unless the calendar
quarterly gross sales of alcoholic beverages at the licensed location
comprise at least 75 percent of the total gross sales of all
products sold at the licensed premises. A licenseholder that is
issued an instructional tasting license pursuant to this paragraph
shall maintain records that separately reflect the gross sales of
alcoholic beverages and the gross sales of all other products sold on
the licensed premises.
   (b) The provisions of Article 2 (commencing with Section 23815) of
Chapter 5 and Section 23958.4 shall not apply to the issuance of an
instructional tasting license, except that the department may
expressly deny the issuance of an instructional tasting license for
any premises located in an area of undue concentration of licenses as
defined in paragraph (1) of subdivision (a) of Section 23958.4.
Notwithstanding paragraph (3) of subdivision (c), the provisions of
Article 2 (commencing with Section 23985) and Article 3 (commencing
with Section 24011) of Chapter 6 shall apply to the issuance of an
instructional tasting license.
   (c) Notwithstanding subdivision (a) of Section 23386 and paragraph
(3) of subdivision (c) of Section 25612.5, an instructional tasting
license authorizes the licenseholder to allow an authorized licensee
or the designated representative of an authorized licensee, to
conduct an instructional tasting event at which tastes of alcoholic
beverages may be served to consumers subject to the following
limitations, and the limitations set forth in Section 25503.56:
   (1) (A) At all times during an instructional tasting event, the
instructional tasting event area shall be separated from the
remainder of the off-sale licensed premises by a wall, rope, cable,
cord, chain, fence, or other permanent or temporary barrier. The
licenseholder shall prominently display signage prohibiting persons
under 21 years of age from entering the instructional tasting event
area.
   (B) A licenseholder that permits a person under 21 years of age to
enter and remain in the instructional tasting event area during an
instructional tasting event is guilty of a misdemeanor. Any person
under 21 years of age who enters and remains in the instructional
tasting event area during an instructional tasting event is guilty of
a misdemeanor and shall be punished by a fine of not less than two
hundred dollars ($200), no part of which shall be suspended.
   (C) The licenseholder shall not permit any consumer to leave the
instructional tasting area with an open container of alcohol.
   (2) The instructional tasting license shall not authorize the
licenseholder to conduct any on-sale retail sales to consumers
attending the instructional tasting event.

   (3) Unless otherwise restricted, an instructional tasting event
may take place between the hours of 10 a.m. and 9 p.m.
   (d) Unless the context otherwise requires, the definitions set
forth in Section 25503.56 govern the construction of this section.
   (e) An applicant for an instructional tasting license under this
section shall, at the time of filing the application for the license,
accompany the application with a fee of three hundred dollars
($300). The annual renewal fee for a license issued pursuant to this
section shall be two hundred sixty-one dollars ($261) and shall be
subject to subdivisions (c) and (d) of Section 23320. Fees collected
pursuant to this section shall be deposited in the Alcohol Beverage
Control Fund.
  SEC. 2.  Section 25503.56 is added to the Business and Professions
Code, to read:
   25503.56.  (a) An authorized licensee, or a designated
representative of an authorized licensee acting as an agent of the
authorized licensee, may conduct, on the area specified by paragraph
(1) of subdivision (c) of Section 23396.6, an instructional tasting
event for consumers on the subject of wine, beer, or distilled
spirits, including, but not limited to, the history, nature, values,
and characteristics of wine, beer, or distilled spirits, and the
methods of presenting and serving wine, beer, or distilled spirits.
   (1) (A) Except as provided in subparagraph (B), the instructional
tasting event may include the serving of alcoholic beverages to an
attendee of legal drinking age. An instructional tasting event on the
subject of wine or distilled spirits shall be limited to not more
than three tastings per person per day. A single tasting of distilled
spirits shall not exceed one-fourth of one ounce and a single
tasting of wine shall not exceed one ounce. An instructional tasting
event on the subject of beer shall be limited to not more than the
tasting of eight ounces of beer per person per day. The wine, beer,
or distilled spirits tasted shall be limited to the products that are
authorized to be sold by the authorized licensee and the
licenseholder under its off-sale license.
   (B) A beer and wine wholesaler may conduct an instructional
tasting event but shall not serve tastes of beer unless the beer and
wine wholesaler also holds a beer manufacturer's license, an
out-of-state beer manufacturer's certificate, or more than six
distilled spirits wholesaler's licenses.
   (C) No charge of any sort shall be made for the tastings.Except
for the purposes of Section 23985, the serving of tastings shall not
be deemed a sale of products pursuant to this division.
   (D) A person under 21 years of age shall not serve wine, beer, or
distilled spirits at the instructional tasting event.
   (E) All tastes shall be served by an employee of the authorized
licensee, the designated representative of the authorized licensee,
or by an employee of the designated representative of the authorized
licensee.
   (F) An authorized licensee, or a designated representative of an
authorized licensee, shall either supply the wine or distilled
spirits to be tasted during the instructional tasting event or
purchase the wine or distilled spirits from the licenseholder at the
original invoiced cost. An authorized licensee, or a designated
representative of an authorized licensee, shall purchase beer to be
tasted during the instructional tasting event from the licenseholder
at the original invoiced cost.
   (G) Any unused wine, beer, or distilled spirits remaining from the
tasting shall be removed from the off-sale licensed premises by the
authorized licensee or its designated representative.
   (2) If the instructional tasting event is conducted by a
designated representative of an authorized licensee, the designated
representative shall not be owned, controlled, or employed directly
or indirectly by the licenseholder on whose premises the
instructional tasting event is held.
   (3) An instructional tasting event shall be limited to a single
type of alcoholic beverage. For purposes of this paragraph, "type of
alcoholic beverage" means distilled spirits, wine, or beer.
   (b) For purposes of this section:
   (1) "Authorized licensee" means a winegrower, California
winegrower's agent, beer and wine importer general, beer and wine
wholesaler, wine rectifier, 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, distilled spirits wholesaler, brandy manufacturer, brandy
importer, California brandy wholesaler, beer manufacturer, or an
out-of-state beer manufacturer certificate holder. "Authorized
licensee" shall not include an entity that solely holds a combination
of a beer and wine wholesale license and an off-sale beer and wine
retail license or holds those licences solely in combination with any
license not listed in this paragraph.
   (2) "Licenseholder" means an off-sale retail licensee issued an
instructional tasting license pursuant to Section 23396.6.
   (3) "Location" means the total contiguous area encompassed by the
off-sale and on-sale licenses.
   (c) Notwithstanding subparagraph (E) of paragraph (1) of
subdivision (a), a licenseholder may conduct an instructional tasting
event that includes the serving of tastings only when an authorized
licensee or its designated representative are unable to conduct an
instructional tasting event previously advertised pursuant to this
section and scheduled by the authorized licensee or its designated
representative, provided the licenseholder supplies the wine, beer,
or distilled spirits used in the instructional tasting event and
provides or pays for a person to serve the wine, beer, or distilled
spirits. Instructional tasting events conducted by a licenseholder
pursuant to this subdivision are subject to the provisions of this
section and Section 23396.6.
   (d) No more than one authorized licensee, or its designated
representative, may conduct an instructional tasting event that
includes the serving of tastes of wine, beer, or distilled spirits at
any one individual licensed premises of a licenseholder per day.
   (e) A licenseholder that also holds an on-sale beer and wine
license, an on-sale beer and wine eating place license, or an on-sale
general license shall not allow an authorized licensee, or its
designated representative, to conduct an instructional tasting event
on the same day and at the same location as any instructional tasting
event held pursuant to subdivision (b) of Section 23386, Section
25503.4, subdivision (c) of Section 25503.5, or Section 25503.55.
   (f) A licenseholder shall not condition the allowance of an
instructional tasting event upon the use of a particular designated
representative of an authorized licensee.
   (g) (1) In addition to any point of sale advertising or other
advertising items allowed under this division or under rules of the
department, an authorized licensee or its designated representative,
in his or her absolute discretion and with permission of the
licenseholder upon whose premises the instructional tasting event
will be held, may list in an advertisement to the general public the
name and address of the licenseholder, the names of the alcoholic
beverages being featured at the instructional tasting event, and the
time, date, and location of, and other information about, the
instructional tasting event, provided that both of the following
apply:
   (A) The advertisement does not contain the retail price of the
alcoholic beverages.
   (B) The listing of the licenseholder's name and address is the
only reference to the licenseholder in the advertisement.
   (2) Pictures or illustrations of the licenseholder's licensed
premises and laudatory references to the licenseholder in these
advertisements are not authorized. Nothing in this section shall
authorize an authorized licensee or its designated representative to
share in the costs, if any, of the licenseholder.
   (h) A licenseholder may advertise an instructional tasting event
to the general public. The costs of this advertising shall be borne
solely by the licenseholder. Advertising permitted by this
subdivision includes flyers, newspaper ads, Internet communications,
and interior signage.
   (i) Except as otherwise provided in this division or rules of the
department, no premium, gift, free goods, or other thing of value
shall be given away by an authorized licensee or its designated
representative in connection with an instructional tasting event that
includes tastings of an alcoholic beverage.
   (j) The licenseholder or the authorized licensee or its designated
representative are authorized to perform set up and break down of
the instructional tasting event area. The authorized licensee or its
designated representative may provide, free of charge to the
licenseholder, the equipment, materials, and utensils as may be
required for use in connection with the instructional tasting event.
   (k) (1) A licenseholder shall not require, or enter into a
collusive scheme with an authorized licensee or its designated
representative to conduct one or more instructional tasting events as
a condition of the licenseholder carrying or continuing to carry a
brand or brands of the authorized licensee or as a condition for
display or other merchandising plan which is based on an agreement to
provide shelf space. An authorized licensee or its designated
representative shall not require any preferential treatment or
benefit from, or enter into a collusive scheme with, a licenseholder
as a condition of conducting one or more instructional tasting
events, require a licenseholder to carry or continue to carry a brand
or brands of the authorized licensee as a condition of conducting
one or more instructional tasting events, or condition display or
other merchandising plans that are based on agreements for the
provision of shelf space on the conducting of one or more
instructional tasting events. Any agreement, whether written or oral,
entered into by and between a licenseholder and an authorized
licensee or its designated representative that precludes the
conducting of instructional tasting events on the premises of the
licenseholder by any other authorized licensee is prohibited. A
licenseholder or authorized licensee, or its designated
representative, shall not use an instructional tasting event to
circumvent any other requirements of this division.
   (2) In addition to any other remedies available under this
division, upon a finding by the department of a failure to comply
with this subdivision, the department shall suspend the instructional
tasting license of the licenseholder and the privilege of the
authorized licensee to conduct instructional events for not less than
six months but for no more than one year.
   (l) The Legislature finds that it is necessary and proper to
require a separation between manufacturing interests, wholesale
interests, and retail interests in the production and distribution of
alcoholic beverages in order to prevent suppliers from dominating
local markets through vertical integration and to prevent excessive
sales of alcoholic beverages produced by overly aggressive marketing
techniques. The Legislature further finds that the exception
established by this section to the general prohibition against tied
interests must be limited to its express terms so as not to undermine
the general prohibition, and intends that this section be construed
accordingly.
  SEC. 3.  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.