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SENATE BILL 6601
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Passed Legislature - 2002 Regular Session
State of
Washington 57th Legislature 2002 Regular Session
By
Read first time 01/23/2002. Referred to
Committee on Labor, Commerce & Financial Institutions.
Allowing a licensed
distiller, domestic brewery, microbrewery, or domestic winery to sell liquor at
a spirits, beer, and wine restaurant located on contiguous property that is
leased by that licensed distiller, domestic brewery, microbrewery, or domestic
winery.
AN ACT Relating to
allowing a licensed distiller, domestic brewery, microbrewery, or domestic
winery to sell liquor at a spirits, beer, and wine restaurant located on
contiguous property that is leased by that licensed distiller, domestic
brewery, microbrewery, or domestic winery; and amending RCW 66.28.010.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF
WASHINGTON:
Sec. 1. RCW 66.28.010 and 2000 c
177 s 1 are each amended to read as follows:
(1)(a) No manufacturer,
importer, or distributor, or person financially interested, directly or
indirectly, in such business; whether resident or nonresident, shall have any
financial interest, direct or indirect, in any licensed retail business, unless
the retail business is owned by a corporation in which a manufacturer or
importer has no direct stock ownership and there are no interlocking officers
and directors, the retail license is held by a corporation that is not owned
directly or indirectly by a manufacturer or importer, the sales of liquor are
incidental to the primary activity of operating the property as a hotel,
alcoholic beverages produced by the manufacturer or importer or their
subsidiaries are not sold at the licensed premises, and the board reviews the
ownership and proposed method of operation of all involved entities and
determines that there will not be an unacceptable level of control or undue
influence over the operation or the retail licensee; nor shall any
manufacturer, importer, or distributor own any of the property upon which such
licensed persons conduct their business; nor shall any such licensed person,
under any arrangement whatsoever, conduct his or her business upon property in
which any manufacturer, importer, or distributor has any interest unless title
to that property is owned by a corporation in which a manufacturer has no
direct stock ownership and there are no interlocking officers or directors, the
retail license is held by a corporation that is not owned directly or indirectly
by the manufacturer, the sales of liquor are incidental to the primary activity
of operating the property either as a hotel or as an amphitheater offering live
musical and similar live entertainment activities to the public, alcoholic
beverages produced by the manufacturer or any of its subsidiaries are not sold
at the licensed premises, and the board reviews the ownership and proposed
method of operation of all involved entities and determines that there will not
be an unacceptable level of control or undue influence over the operation of
the retail licensee. Except as provided in subsection (3) of this section, no
manufacturer, importer, or distributor shall advance moneys or moneys' worth to
a licensed person under an arrangement, nor shall such licensed person receive,
under an arrangement, an advance of moneys or moneys' worth.
"Person" as used in this section only shall not include those state
or federally chartered banks, state or federally chartered savings and loan
associations, state or federally chartered mutual savings banks, or
institutional investors which are not controlled directly or indirectly by a
manufacturer, importer, or distributor as long as the bank, savings and loan
association, or institutional investor does not influence or attempt to
influence the purchasing practices of the retailer with respect to alcoholic
beverages. Except as otherwise provided in this section, no manufacturer,
importer, or distributor shall be eligible to receive or hold a retail license
under this title, nor shall such manufacturer, importer, or distributor sell at
retail any liquor as herein defined. A corporation granted an exemption under
this subsection may use debt instruments issued in connection with financing
construction or operations of its facilities.
(b) Nothing in this
section shall prohibit a licensed domestic brewery or microbrewery from being
licensed as a retailer pursuant to chapter 66.24 RCW for the purpose of selling
beer or wine at retail on the brewery premises and nothing in this section
shall prohibit a domestic winery from being licensed as a retailer pursuant to
chapter 66.24 RCW for the purpose of selling beer or wine at retail on the
winery premises. Such beer and wine so sold at retail shall be subject to the
taxes imposed by RCW 66.24.290 and 66.24.210 and to reporting and bonding
requirements as prescribed by regulations adopted by the board pursuant to
chapter 34.05 RCW, and beer and wine that is not produced by the brewery or
winery shall be purchased from a licensed beer or wine distributor.
(c) Nothing in this
section shall prohibit a licensed distiller, domestic brewery, microbrewery,
domestic winery, or a lessee of a licensed domestic brewer, microbrewery, or
domestic winery, from being licensed as a spirits, beer, and wine restaurant
pursuant to chapter 66.24 RCW for the purpose of selling liquor at a spirits,
beer, and wine restaurant premises on the property on which the primary
manufacturing facility of the licensed distiller, domestic brewer,
microbrewery, or domestic winery is located or on contiguous property owned or
leased by the licensed distiller, domestic brewer, microbrewery, or
domestic winery as prescribed by rules adopted by the board pursuant to chapter
34.05 RCW.
(2) Financial interest,
direct or indirect, as used in this section, shall include any interest,
whether by stock ownership, mortgage, lien, or through interlocking directors,
or otherwise. Pursuant to rules promulgated by the board in accordance with
chapter 34.05 RCW manufacturers, distributors, and importers may perform, and
retailers may accept the service of building, rotating and restocking case
displays and stock room inventories; rotating and rearranging can and bottle
displays of their own products; provide point of sale material and brand signs;
price case goods of their own brands; and perform such similar normal business
services as the board may by regulation prescribe.
(3)(a) This section
does not prohibit a manufacturer, importer, or distributor from providing
services to a special occasion licensee for: (i) Installation of draft beer
dispensing equipment or advertising, (ii) advertising, pouring, or dispensing
of beer or wine at a beer or wine tasting exhibition or judging event, or (iii)
a special occasion licensee from receiving any such services as may be provided
by a manufacturer, importer, or distributor. Nothing in this section shall
prohibit a retail licensee, or any person financially interested, directly or
indirectly, in such a retail licensee from having a financial interest, direct
or indirect, in a business which provides, for a compensation commensurate in
value to the services provided, bottling, canning or other services to a
manufacturer, so long as the retail licensee or person interested therein has
no direct financial interest in or control of said manufacturer.
(b) A person holding
contractual rights to payment from selling a liquor distributor's business and
transferring the license shall not be deemed to have a financial interest under
this section if the person (i) lacks any ownership in or control of the
distributor, (ii) is not employed by the distributor, and (iii) does not
influence or attempt to influence liquor purchases by retail liquor licensees
from the distributor.
(c) The board shall
adopt such rules as are deemed necessary to carry out the purposes and
provisions of subsection (3)(a) of this section in accordance with the
administrative procedure act, chapter 34.05 RCW.
(4) A license issued
under RCW 66.24.395 does not constitute a retail license for the purposes of
this section.
(5) A
public house license issued under RCW 66.24.580 does not violate the provisions
of this section as to a retailer having an interest directly or indirectly in a
liquor-licensed manufacturer.
