Bill Text: CA SB430 | 2023-2024 | Regular Session | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Tied-house exceptions: advertising: common parent company.
Sponsorship: Partisan Bill (Democrat 1)
Status: (Engrossed - Dead) 2023-09-01 - September 1 hearing: Held in committee and under submission. [SB430 Detail]
Download: California-2023-SB430-Introduced.html
Bill Title: Tied-house exceptions: advertising: common parent company.
Sponsorship: Partisan Bill (Democrat 1)
Status: (Engrossed - Dead) 2023-09-01 - September 1 hearing: Held in committee and under submission. [SB430 Detail]
Download: California-2023-SB430-Introduced.html
CALIFORNIA LEGISLATURE—
2023–2024 REGULAR SESSION
Senate Bill
No. 430
| Introduced by Senator Dodd |
February 13, 2023 |
An act to add Section 25503.66 to the Business and Professions Code, relating to alcoholic beverages.
LEGISLATIVE COUNSEL'S DIGEST
SB 430, as introduced, Dodd.
Tied-house exceptions: advertising: common parent company.
Existing law, the Alcoholic Beverage Control Act, which is administered by the Department of Alcoholic Beverage Control, regulates the application, issuance, and suspension of licenses for the manufacture, distribution, and sale of alcoholic beverages. Existing law, known as tied-house restrictions, generally prohibits specified licensees and their agents from paying a retailer for advertising. Existing law creates a variety of exceptions to this general prohibition.
This bill would create a new exception to the tied-house restrictions on advertising. In this regard, the bill would authorize specified licensees to purchase advertising services from an advertising subsidiary that is under common ownership with a retail licensee subsidiary, subject to specified conditions. The bill would make it a misdemeanor for an authorized licensee or a retail
licensee subsidiary to solicit or coerce a wholesaler in connection with the advertising services permitted under these provisions. The bill would define terms for its purposes. By creating a new crime, the bill would impose 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.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: YESBill Text
The people of the State of California do enact as follows:
SECTION 1.
Section 25503.66 is added to the Business and Professions Code, immediately following Section 25503.61, to read:25503.66.
(a) Notwithstanding any other provision of this division, an authorized licensee may purchase advertising services from an advertising subsidiary that is under common ownership with a retail licensee subsidiary, if the following conditions are met:(1) The common parent company of the advertising subsidiary and the retail licensee subsidiary is a publiclytraded company whose shares of stock are sold to the general public on a stock exchange located in the United States.
(2) The advertising services shall be limited to the sale, placement, or dissemination, or any combination thereof, of advertising, including related sponsorships, on video and streaming media services that are
owned by the common parent company of the advertising subsidiary and the retail licensee subsidiary.
(3) The advertising services shall not include advertising that does any of the following:
(A) Appears on the premises of the retail licensee subsidiary.
(B) Appears on the internet website operated by or for the retail licensee subsidiary.
(C) References the retail licensee subsidiary.
(4) The retail licensee subsidiary shall sell other brands of alcoholic beverages in addition to the brands produced or marketed by the authorized licensee.
(5) An agreement for the purchase of advertising services shall not be conditioned
directly or indirectly, explicitly or implicitly, or in any other way, on the purchase, sale, or distribution of any alcoholic beverage manufactured or distributed by the authorized licensee. All decisions regarding the purchase and sale of alcoholic beverages shall be made at the independent and exclusive discretion of the retail licensee subsidiary.
(b) Any authorized licensee who, through coercion or other illegal means, induces, directly or indirectly, a holder of a wholesaler’s license to fulfill those contractual obligations entered into pursuant to subdivision (a) shall be guilty of a misdemeanor and shall be punished by imprisonment in the county jail not exceeding six months, or by a fine in an amount equal to the entire value of the advertising services involved in the contract plus ten thousand dollars ($10,000), or by both imprisonment and fine. The person shall also be subject to license revocation pursuant to Section 24200.
(c) Any retail licensee subsidiary who solicits or coerces, directly or indirectly, a holder of a wholesaler’s license to solicit an authorized licensee to purchase advertising services pursuant to subdivision (a) shall be guilty of a misdemeanor and shall be punished by imprisonment in the county jail not exceeding six months, or by a fine in an amount equal to the entire value of the advertising services involved in the contract plus ten thousand dollars ($10,000), or by both imprisonment and fine. The person shall also be subject to license revocation pursuant to Section 24200.
(d) For purposes of this section, the following definitions apply:
(1) “Advertising subsidiary” means any person that provides advertising services, such as the sale,
placement, or dissemination of advertising.
(2) “Authorized licensee” means a winegrower, California winegrower’s agent, beer and wine importer general, wine rectifier, craft distiller, 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, brandy manufacturer, brandy importer, beer manufacturer, or an out-of-state beer manufacturer certificate holder.
(3) “Common parent company” means a company that wholly owns, directly or indirectly, both an advertising subsidiary and a retail licensee subsidiary.
(4) “Retail licensee subsidiary” means any person that is licensed in this state as an on-sale or off-sale retailer of alcoholic
beverages.
