H0790B2139A02685 JKL:CDM 06/25/13 #90 A02685

 

 

 

 

AMENDMENTS TO HOUSE BILL NO. 790

Sponsor: SENATOR FERLO

Printer's No. 2139

 

1Amend Bill, page 1, lines 1 through 28; page 2, lines 1
2through 60, by striking out all of said lines on said pages and
3inserting

4Amending the act of April 12, 1951 (P.L.90, No.21), entitled, as
5reenacted and amended, "An act relating to alcoholic liquors,
6alcohol and malt and brewed beverages; amending, revising,
7consolidating and changing the laws relating thereto;
8regulating and restricting the manufacture, purchase, sale,
9possession, consumption, importation, transportation,
10furnishing, holding in bond, holding in storage, traffic in
11and use of alcoholic liquors, alcohol and malt and brewed
12beverages and the persons engaged or employed therein;
13defining the powers and duties of the Pennsylvania Liquor
14Control Board; providing for the establishment and operation
15of State liquor stores, for the payment of certain license
16fees to the respective municipalities and townships, for the
17abatement of certain nuisances and, in certain cases, for
18search and seizure without warrant; prescribing penalties and
19forfeitures; providing for local option, and repealing
20existing laws," further providing for definitions, for
21general powers of board, for specific subjects on which board
22may adopt regulations, for board to establish State Liquor
23Stores, for selection of personnel, for when sales may be
24made at Pennsylvania Liquor Stores, for sales by Pennsylvania
25Liquor Stores, for authority to issue liquor licenses to
26hotels, restaurants and clubs, for sale of malt or brewed
27beverages by liquor licensees, for malt and brewed beverages
28manufacturers', distributors' and importing distributors'
29licenses, for shipment of wine and for unlawful acts relative
30to liquor, malt and brewed beverages and licensees.

31Amend Bill, page 191, lines 7 through 30; pages 192 through
32250, lines 1 through 30; page 251, lines 1 through 20, by
33striking out all of said lines on said pages and inserting

34Section 1. The definitions of "distributor" and "importing
35distributor" in section 102 of the act of April 12, 1951
36(P.L.90, No.21), known as the Liquor Code, reenacted and amended
37June 29, 1987 (P.L.32, No.14) and amended May 31, 1996 (P.L.312,
38No.49), are amended and the section is amended by adding

1definitions to read:

2Section 102. Definitions.--The following words or phrases,
3unless the context clearly indicates otherwise, shall have the
4meanings ascribed to them in this section:

5* * *

6"Big-box retail store" shall mean a place which sells a wide
7variety of merchandise, including automotive supplies,
8housewares, electronics, home furnishings, apparel, health and
9beauty supplies and perishable and nonperishable food items, in
10bulk and/or individual quantities, and which has an area under
11one roof of one hundred thousand square feet or more.

12* * *

13"Convenience store" shall mean a place which primarily sells
14food prepared for consumption on and off the premises, and
15nonfood items, and may sell liquid fuels for use in motor
16vehicles, having an area under one roof of more than one
17thousand square feet but less than ten thousand square feet.

18* * *

19"Distributor" shall mean any person licensed by the board to
20engage in the purchase only from Pennsylvania manufacturers and
21from importing distributors and the resale of malt or brewed
22beverages, except to importing distributors and distributors, in
23the original sealed containers as prepared for the market by the
24manufacturer at the place of manufacture, but not for
25consumption on the premises where sold, and in quantities of not
26less than a case or original containers containing one hundred
27twenty-eight ounces or more which may be sold separately, except 
28as otherwise provided for herein.

29* * *

30"Grocery store" shall mean a reputable place operated by a
31person of good repute, which primarily sells food, supplies for
32the table and food products for human consumption off the
33premises and which has an area under one roof of ten thousand
34square feet or more.

35* * *

36"Importing distributor" shall mean any person licensed by the
37board to engage in the purchase from manufacturers and other
38persons located outside this Commonwealth and from persons
39licensed as manufacturers of malt or brewed beverages and
40importing distributors under this act, and the resale of malt or
41brewed beverages in the original sealed containers as prepared
42for the market by the manufacturer at the place of manufacture,
43but not for consumption on the premises where sold, and in
44quantities of not less than a case or original containers
45containing one hundred twenty-eight ounces or more which may be
46sold separately, except as otherwise provided for herein.

47* * *

48"Pharmacy" shall mean any place having an area under one roof
49of at least eight thousand square feet or more that is properly
50issued a permit or license by the State Board of Pharmacy where
51drugs, devices and diagnostic agents for human or animal

1consumption are stored, dispensed or compounded.

2Section 1.1. Section 207(a), (b), (f) and (h) of the act,
3amended November 30, 2004 (P.L.1727, No.221) and December 8,
42004 (P.L.1810, No.239), are amended and the section is amended
5by adding subsections to read:

6Section 207. General Powers of Board.--Under this act, the
7board shall have the power and its duty shall be:

8(a) To buy, import or have in its possession for sale and
9sell liquor, alcohol, corkscrews, wine and liquor accessories,
10trade publications, gift cards, gift certificates, wine- or
11liquor-scented candles and wine glasses in the manner set forth
12in this act: Provided, however, That all purchases shall be made
13subject to the approval of the State Treasurer, or his
14designated deputy. The board shall buy liquor and alcohol at the
15lowest price and in the greatest variety reasonably obtainable.
16The sales may be to a person or entity that is located either 
17inside or outside this Commonwealth.

18(b) To control the manufacture, possession, sale,
19consumption, importation, use, storage, transportation and
20delivery of liquor, alcohol and malt or brewed beverages in
21accordance with the provisions of this act, and to fix the
22wholesale and retail prices at which liquors and alcohol shall
23be sold at Pennsylvania Liquor Stores. Prices shall be
24[proportional with prices paid by the board to its suppliers and
25shall reflect any advantage obtained through volume purchases by
26the board.] as set forth by the board so long as the price of a 
27particular item is uniform throughout this Commonwealth and that 
28the markup may not be less than twenty-five percent (25%) or 
29more than thirty-five percent (35%). The board may impose 
30logistical fees and round up to the nearest nine-hundredth of a 
31dollar after applying the other taxes and fees. Prices may not 
32be changed on any wine or spirit product more than once in any 
33six-month period. The board may establish a preferential price
34structure for wines produced within this Commonwealth for the
35promotion of such wines, as long as the price structure is
36uniform within each class of wine purchased by the board. The
37board shall require each Pennsylvania manufacturer and each
38nonresident manufacturer of liquors, other than wine, selling
39such liquors to the board, which are not manufactured in this
40Commonwealth, to make application for and be granted a permit by
41the board before such liquors not manufactured in this
42Commonwealth shall be purchased from such manufacturer. Each
43such manufacturer shall pay for such permit a fee which, in the
44case of a manufacturer of this Commonwealth, shall be equal to
45that required to be paid, if any, by a manufacturer or
46wholesaler of the state, territory or country of origin of the
47liquors, for selling liquors manufactured in Pennsylvania, and
48in the case of a nonresident manufacturer, shall be equal to
49that required to be paid, if any, in such state, territory or
50country by Pennsylvania manufacturers doing business in such
51state, territory or country. In the event that any such

1manufacturer shall, in the opinion of the board, sell or attempt
2to sell liquors to the board through another person for the
3purpose of evading this provision relating to permits, the board
4shall require such person, before purchasing liquors from him or
5it, to take out a permit and pay the same fee as hereinbefore
6required to be paid by such manufacturer. All permit fees so
7collected shall be paid into the State Stores Fund. The board
8shall not purchase any alcohol or liquor fermented, distilled,
9rectified, compounded or bottled in any state, territory or
10country, the laws of which result in prohibiting the importation
11therein of alcohol or liquor, fermented, distilled, rectified,
12compounded or bottled in Pennsylvania.

13* * *

14(f) To appoint, fix the compensation and define the powers
15and duties of such managers, officers, inspectors, examiners,
16clerks and other employes as shall be required for the operation
17of this act, subject to the provisions of The Administrative
18Code of 1929 and the Civil Service Act. However, the board may 
19hire a limited number of retail wine specialists on an at-will 
20basis to be employed at up to twenty-five percent (25%) of the 
21total number of Pennsylvania Liquor Stores. Notwithstanding any 
22other provision of law to the contrary, a retail wine specialist 
23shall not be considered a member of the classified service, as 
24that term is defined in the act of August 5, 1941 (P.L.752, 
25No.286), known as the "Civil Service Act," except as set forth 
26in this act. A retail wine specialist shall be considered a 
27State employe for purposes of 71 Pa.C.S. Pt. XXV (relating to 
28retirement for State employees and officers). The board shall 
29establish a system of classification and compensation of its 
30retail wine specialists and they shall not be subject to the 
31provisions of the act of April 9, 1929 (P.L.177, No.175), known 
32as "The Administrative Code of 1929," as to classification and 
33compensation for its employes, and shall conduct its activities 
34consistent with the practices and procedures of Commonwealth 
35agencies. The board shall adhere to the provisions of 51 Pa.C.S. 
36Ch. 71 (relating to veterans' preference), as they relate to 
37noncivil service positions. This subsection may not be construed 
38to alter, remove or bar current or new employees from a 
39collective bargaining agreement. Individuals employed prior to 
40the effective date of subsection (n) shall retain their civil 
41service status.

42* * *

43(h) Without in any way limiting or being limited by the
44foregoing, to do all such things and perform all such acts as
45are deemed necessary or advisable for the purpose of carrying
46into effect the provisions of this act and the regulations made
47thereunder. Notwithstanding any other provision of law to the 
48contrary, the board is authorized to purchase all goods and 
49services in its sole discretion which are deemed necessary to 
50perform all such acts. The board is authorized to set policy and 
51promulgate regulations providing for the procurement of such
 

1goods and services.

2* * *

3(l) To establish and implement a customer relations
4marketing program for the purpose of offering incentives, such
5as coupons or discounts on certain products, to customers of the
6board.

7(m) Notwithstanding any other provision of law, to enter
8into agreements with governmental units of this Commonwealth and
9other states for the purchase or sale of goods or services with,
10from or to the governmental units.

11(n) To operate Pennsylvania Liquor Stores by itself or in
12partnership with grocery stores and other private entities that
13are licensed by the board. The board may not make a contract or
14partner with a convenience store, pharmacy or big-box retail
15store.

16Section 2. Sections 208(c), 301 and 302 of the act are
17amended to read:

18Section 208. Specific Subjects on Which Board May Adopt
19Regulations.--Subject to the provisions of this act and without
20limiting the general power conferred by the preceding section,
21the board may make regulations regarding:

22* * *

23(c) The purchase, as provided in this act, of liquor and
24alcohol, and its supply to Pennsylvania Liquor Stores and the 
25procurement of all other goods and services which are deemed 
26necessary by the board, in its sole discretion, to perform all 
27such acts.

28* * *

29Section 301. Board to Establish State Liquor Stores.--(a)
30The board shall, either by itself or in partnership with one or 
31more private entities, establish, operate and maintain at such
32places throughout the Commonwealth as it shall deem essential
33and advisable, stores to be known as "Pennsylvania Liquor
34Stores," for the sale of liquor and alcohol in accordance with
35the provisions of and the regulations made under this act;
36except that no store not so already located shall be located
37within three hundred feet of any elementary or secondary school,
38nor within a dry municipality without there first having been a
39referendum approving such location. When the board shall have
40determined upon the location of a liquor store in any
41municipality, it shall give notice of such location by public
42advertisement in two newspapers of general circulation. In
43cities of the first class, the location shall also be posted for
44a period of at least fifteen days following its determination by
45the board as required in section 403(g) of this act. The notice
46shall be posted in a conspicuous place on the outside of the
47premises in which the proposed store is to operate or, in the
48event that a new structure is to be built in a similarly visible
49location. If, within five days after the appearance of such
50advertisement, or of the last day upon which the notice was
51posted, fifteen or more taxpayers residing within a quarter of a

1mile of such location, or the City Solicitor of the city of the
2first class, shall file a protest with the court of common pleas
3of the county averring that the location is objectionable
4because of its proximity to a church, a school, or to private
5residences, the court shall forthwith hold a hearing affording
6an opportunity to the protestants and to the board to present
7evidence. The court shall render its decision immediately upon
8the conclusion of the testimony and from the decision there
9shall be no appeal. If the court shall determine that the
10proposed location is undesirable for the reasons set forth in
11the protest, the board shall abandon it and find another
12location. The board may establish, operate and maintain such
13establishments for storing and testing liquors as it shall deem
14expedient to carry out its powers and duties under this act.

15(b) The board may lease the necessary premises for such
16stores or establishments, but all such leases shall be made
17through the Department of General Services as agent of the
18board. The board, through the Department of General Services,
19shall have authority to purchase such equipment and appointments
20as may be required in the operation of such stores or
21establishments.

22(c) If the board chooses to establish a Pennsylvania Liquor
23Store in partnership with one or more private entities, it shall
24be subject to the following:

25(1) if the liquor store is located within another business,
26the alcohol purchased at the liquor store must be paid for at
27the Pennsylvania Liquor Store;

28(2) the board and its partner or partners may coordinate
29advertising and promotions;

30(3) the board and its partner or partners may discount the
31price of an item, including alcohol, and may condition the
32discount on the purchase of another item from the board or its
33partner or partners; and

34(4) the board may base its lease payments in whole or in
35part on the amount of alcohol sold at the location.

36Section 302. Selection of Personnel.--Officers and employes
37of the board, except for retail wine specialists and as herein
38otherwise provided, shall be appointed and employed subject to
39the provisions of the Civil Service Act.

40Section 3. Section 304(b) of the act, amended December 8, 
412004 (P.L.1810, No.239), is amended to read:

42Section 304. When Sales May Be Made at Pennsylvania Liquor
43Stores.--* * *

44(b) [Certain] Pennsylvania Liquor Stores operated by the 
45board [shall] may be open for Sunday retail sales [between the 
46hours of noon and five o'clock postmeridian], except that no 
47Sunday sales shall occur on Easter Sunday or Christmas day. [The 
48board shall open up to twenty-five per centum of the total 
49number of Pennsylvania Liquor Stores at its discretion for 
50Sunday sales as provided for in this subsection. The board shall 
51submit yearly reports to the Appropriations and the Law and
 

1Justice Committees of the Senate and the Appropriations and the 
2Liquor Control Committees of the House of Representatives 
3summarizing the total dollar value of sales under this section.]

4Section 4. Section 305(a) and (b) of the act, amended May 8,
52003 (P.L.1, No.1) and July 6, 2005 (P.L.135, No.39), are
6amended to read:

7Section 305. Sales by Pennsylvania Liquor Stores.--(a) The
8board shall in its discretion determine where and what classes,
9varieties and brands of liquor and alcohol it shall make
10available to the public and where such liquor and alcohol will
11be sold. Every Pennsylvania Liquor Store shall be authorized to
12sell combination packages. If a person desires to purchase a
13class, variety or brand of liquor or alcohol not currently
14available from the board, he or she may place a special order
15for such item so long as the order is for two or more bottles.
16The board may require a reasonable deposit from the purchaser as
17a condition for accepting the order. The customer shall be
18notified immediately upon the arrival of the goods.

19In computing the retail price of such special orders for
20liquor or alcohol, the board shall not include the cost of
21freight or shipping before applying [the] a mark-up calculated 
22at fifty per centum of the markup under section 207(b) and taxes
23but shall add the freight or shipping charges to the price after
24the mark-up and taxes have been applied.

25Unless the customer pays for and accepts delivery of any such
26special order within ten days after notice of arrival, the store
27may place it in stock for general sale and the customer's
28deposit shall be forfeited.

29(b) Every Pennsylvania Liquor Store shall sell liquors at
30wholesale to hotels, restaurants, clubs, and railroad, pullman
31and steamship companies licensed under this act; and, under the
32regulations of the board, to pharmacists duly licensed and
33registered under the laws of the Commonwealth, and to
34manufacturing pharmacists, and to reputable hospitals approved
35by the board, or chemists. Sales to licensees shall be made at a
36price that includes a discount of [ten] sixteen per centum from
37the retail price. The board may sell to registered pharmacists
38only such liquors as conform to the Pharmacopoeia of the United
39States, the National Formulary, or the American Homeopathic
40Pharmacopoeia. The board may sell at special prices under the
41regulations of the board, to United States Armed Forces
42facilities which are located on United States Armed Forces
43installations and are conducted pursuant to the authority and
44regulations of the United States Armed Forces. All other sales
45by such stores shall be at retail. A person entitled to purchase
46liquor at wholesale prices may purchase the liquor at any
47Pennsylvania Liquor Store upon tendering cash, check or credit
48card for the full amount of the purchase. For this purpose, the
49board shall issue a discount card to each licensee identifying
50such licensee as a person authorized to purchase liquor at
51wholesale prices. Such discount card shall be retained by the

1licensee. The board may contract through the Commonwealth
2bidding process for delivery to wholesale licensees at the
3expense of the licensee receiving the delivery.

4* * *

5Section 5. Section 401(a) of the act, amended December 22, 
62011 (P.L.530, No.113), is amended to read:

7Section 401. Authority to Issue Liquor Licenses to Hotels,
8Restaurants and Clubs.--(a) Subject to the provisions of this 
9act and regulations promulgated under this act, the board shall 
10have authority to issue a retail liquor license for any premises 
11kept or operated by a hotel, restaurant or club and specified in 
12the license entitling the hotel, restaurant or club to purchase 
13liquor from a Pennsylvania Liquor Store and to keep on the 
14premises such liquor and, subject to the provisions of this act 
15and the regulations made thereunder, to sell the same and also 
16malt or brewed beverages to guests, patrons or members for 
17consumption on the hotel, restaurant or club premises. Such 
18licensees with an interior connection to a grocery store, 
19convenience store or big-box retail store, other than clubs, 
20shall be permitted to sell malt or brewed beverages for 
21consumption off the premises where sold in quantities of not 
22more than one hundred ninety-two fluid ounces in a single sale 
23to one person as provided for in section 407. A licensee without 
24an interior connection to a grocery store, convenience store or 
25big-box retail store, other than clubs, selling malt or brewed 
26beverages for consumption off premises may not sell more than 
27three hundred eighty-four ounces in not more than twenty-four 
28original bottles or cans in a single sale to one person as 
29provided for in section 407, Provided, That the licensee may not 
30sell a package as prepared for sale or distribution by the 
31manufacturer containing more than twelve bottles or cans. Such 
32licenses shall be known as hotel liquor licenses, restaurant 
33liquor licenses and club liquor licenses, respectively. No 
34person who holds any public office that involves the duty to 
35enforce any of the penal laws of the United States, this 
36Commonwealth or of any political subdivision of this 
37Commonwealth may have any interest in a hotel or restaurant 
38liquor license. This prohibition applies to anyone with arrest 
39authority, including, but not limited to, United States 
40attorneys, State attorneys general, district attorneys, sheriffs 
41and police officers. This prohibition shall also apply to 
42magisterial district judges, judges or any other individuals who 
43can impose a criminal sentence. This prohibition does not apply 
44to members of the General Assembly, township supervisors, city 
45councilpersons, mayors without arrest authority and any other 
46public official who does not have the ability to arrest or the 
47ability to impose a criminal sentence. This section does not 
48apply if the proposed premises are located outside the 
49jurisdiction of the individual in question.

50* * *

51Section 6. Section 407(a) of the act, amended June 28, 2011
 

1(P.L.55, No.11), is amended to read:

2Section 407. Sale of Malt or Brewed Beverages by Liquor
3Licensees.--(a) Every liquor license issued to a hotel, 
4restaurant, club, or a railroad, pullman or steamship company 
5under this subdivision (A) for the sale of liquor shall 
6authorize the licensee to sell malt or brewed beverages at the 
7same places but subject to the same restrictions and penalties 
8as apply to sales of liquor, except that licensees with an 
9interior connection to a grocery store, convenience store or 
10big-box retail store, other than clubs, may sell malt or brewed 
11beverages for consumption off the premises where sold in 
12quantities of not more than one hundred ninety-two fluid ounces 
13in a single sale to one person. A licensee without an interior 
14connection to a grocery store, convenience store or big-box 
15retail store, other than clubs, selling malt or brewed beverages 
16for consumption off premises may not sell more than three 
17hundred eighty-four ounces in not more than twenty-four original 
18bottles or cans in a single sale to one person, Provided, That 
19the licensee may not sell a package as prepared for sale or 
20distribution by the manufacturer containing more than twelve 
21bottles or cans. The sales may be made in either open or closed 
22containers, Provided, however, That a municipality may adopt an 
23ordinance restricting open containers in public places. No 
24licensee under this subdivision (A) shall at the same time be 
25the holder of any other class of license, except a retail 
26dispenser's license authorizing the sale of malt or brewed 
27beverages only.

28* * * 

29Section 7. Section 431(b) of the act, amended December 8,
302004 (P.L.1810, No.239), is amended and the section is amended
31by adding a subsection to read:

32Section 431. Malt and Brewed Beverages Manufacturers',
33Distributors' and Importing Distributors' Licenses.--* * *

34(b) The board shall issue to any reputable person who
35applies therefor, and pays the license fee hereinafter
36prescribed, a distributor's or importing distributor's license
37for the place which such person desires to maintain for the sale
38of malt or brewed beverages, not for consumption on the premises
39where sold, and except as provided for under subsection (g), in
40quantities of not less than a case or original containers
41containing one hundred twenty-eight ounces or more which may be
42sold separately as prepared for the market by the manufacturer
43at the place of manufacture. The board shall have the discretion
44to refuse a license to any person or to any corporation,
45partnership or association if such person, or any officer or
46director of such corporation, or any member or partner of such
47partnership or association shall have been convicted or found
48guilty of a felony within a period of five years immediately
49preceding the date of application for the said license: And
50provided further, That, in the case of any new license or the
51transfer of any license to a new location, the board may, in its

1discretion, grant or refuse such new license or transfer if such
2place proposed to be licensed is within three hundred feet of
3any church, hospital, charitable institution, school or public
4playground, or if such new license or transfer is applied for a
5place which is within two hundred feet of any other premises
6which is licensed by the board: And provided further, That the
7board shall refuse any application for a new license or the
8transfer of any license to a new location if, in the board's
9opinion, such new license or transfer would be detrimental to
10the welfare, health, peace and morals of the inhabitants of the
11neighborhood within a radius of five hundred feet of the place
12proposed to be licensed. The board shall refuse any application
13for a new license or the transfer of any license to a location
14where the sale of liquid fuels or oil is conducted. The board
15may enter into an agreement with the applicant concerning
16additional restrictions on the license in question. If the board
17and the applicant enter into such an agreement, such agreement
18shall be binding on the applicant. Failure by the applicant to
19adhere to the agreement will be sufficient cause to form the
20basis for a citation under section 471 and for the nonrenewal of
21the license under section 470. If the board enters into an
22agreement with an applicant concerning additional restrictions,
23those restrictions shall be binding on subsequent holders of the
24license until the license is transferred to a new location or
25until the board enters into a subsequent agreement removing
26those restrictions. If the application in question involves a
27location previously licensed by the board, then any restrictions
28imposed by the board on the previous license at that location
29shall be binding on the applicant unless the board enters into a
30new agreement rescinding those restrictions. The board shall
31require notice to be posted on the property or premises upon
32which the licensee or proposed licensee will engage in sales of
33malt or brewed beverages. This notice shall be similar to the
34notice required of hotel, restaurant and club liquor licensees.

35Except as hereinafter provided, such license shall authorize
36the holder thereof to sell or deliver malt or brewed beverages
37in quantities above specified anywhere within the Commonwealth
38of Pennsylvania, which, in the case of distributors, have been
39purchased only from persons licensed under this act as
40manufacturers or importing distributors, and in the case of
41importing distributors, have been purchased from manufacturers
42or persons outside this Commonwealth engaged in the legal sale
43of malt or brewed beverages or from manufacturers or importing
44distributors licensed under this article. In the case of an
45importing distributor, the holder of such a license shall be
46authorized to store and repackage malt or brewed beverages owned
47by a manufacturer at a segregated portion of a warehouse or
48other storage facility authorized by section 441(d) and operated
49by the importing distributor within its appointed territory and
50deliver such beverages to another importing distributor who has
51been granted distribution rights by the manufacturer as provided

1herein. The importing distributor shall be permitted to receive
2a fee from the manufacturer for any related storage, repackaging
3or delivery services. In the case of a bailee for hire hired by
4a manufacturer, the holder of such a permit shall be authorized:
5to receive, store and repackage malt or brewed beverages
6produced by that manufacturer for sale by that manufacturer to
7importing distributors to whom that manufacturer has given
8distribution rights pursuant to this subsection or to purchasers
9outside this Commonwealth for delivery outside this
10Commonwealth; or to ship to that manufacturer's storage
11facilities outside this Commonwealth. The bailee for hire shall
12be permitted to receive a fee from the manufacturer for any
13related storage, repackaging or delivery services. The bailee
14for hire shall, as required in Article V of this act, keep
15complete and accurate records of all transactions, inventory,
16receipts and shipments and make all records and the licensed
17areas available for inspection by the board and for the
18Pennsylvania State Police, Bureau of Liquor Control Enforcement,
19during normal business hours.

20Each out of State manufacturer of malt or brewed beverages
21whose products are sold and delivered in this Commonwealth shall
22give distributing rights for such products in designated
23geographical areas to specific importing distributors, and such
24importing distributor shall not sell or deliver malt or brewed
25beverages manufactured by the out of State manufacturer to any
26person issued a license under the provisions of this act whose
27licensed premises are not located within the geographical area
28for which he has been given distributing rights by such
29manufacturer. Should a licensee accept the delivery of such malt
30or brewed beverages in violation of this section, said licensee
31shall be subject to a suspension of his license for at least
32thirty days: Provided, That the importing distributor holding
33such distributing rights for such product shall not sell or
34deliver the same to another importing distributor without first
35having entered into a written agreement with the said secondary
36importing distributor setting forth the terms and conditions
37under which such products are to be resold within the territory
38granted to the primary importing distributor by the
39manufacturer.

40When a Pennsylvania manufacturer of malt or brewed beverages
41licensed under this article names or constitutes a distributor
42or importing distributor as the primary or original supplier of
43his product, he shall also designate the specific geographical
44area for which the said distributor or importing distributor is
45given distributing rights, and such distributor or importing
46distributor shall not sell or deliver the products of such
47manufacturer to any person issued a license under the provisions
48of this act whose licensed premises are not located within the
49geographical area for which distributing rights have been given
50to the distributor and importing distributor by the said
51manufacturer: Provided, That the importing distributor holding

1such distributing rights for such product shall not sell or
2deliver the same to another importing distributor without first
3having entered into a written agreement with the said secondary
4importing distributor setting forth the terms and conditions
5under which such products are to be resold within the territory
6granted to the primary importing distributor by the
7manufacturer. Nothing herein contained shall be construed to
8prevent any manufacturer from authorizing the importing
9distributor holding the distributing rights for a designated
10geographical area from selling the products of such manufacturer
11to another importing distributor also holding distributing
12rights from the same manufacturer for another geographical area,
13providing such authority be contained in writing and a copy
14thereof be given to each of the importing distributors so
15affected.

16* * *

17(g) (1) In addition to being able to sell a case as 
18provided for under subsection (b), a distributor or importing
19distributor may break the bulk of a case and sell units of the
20case in quantities not less than forty-two ounces, provided the
21distributor or importing distributor sells a package prepared
22for sale by the manufacturer of no more than twelve units. A 
23distributor or importing distributor may sell the packages in 
24any quantity.

25(2) Before a distributor or importing distributor breaks the
26bulk of a case for the purpose of selling units, the distributor
27or importing distributor shall inspect the case for damage and
28appropriate production date. When the distributor or importing
29distributor breaks the bulk of a case for the purpose of selling
30units of the case, the distributor or importing distributor
31bears the risk of loss and is responsible for the destruction of
32any malt and brewed beverages that violate the manufacturer's
33specifications relating to sales by a certain date or within a
34number of days of the production date.

35(3) As used in this subsection the term "unit" means an
36undamaged bottle or can from a case.

37Section 8. Section 488 of the act, added February 21, 2002 
38(P.L.103, No.10), is amended to read:

39Section 488. Shipment of Wine [into Commonwealth].--(a) The
40shipment of wine [from out-of-State] to residents of this
41Commonwealth [is prohibited, except as otherwise provided for
42in] shall be governed by this section.

43(b) Notwithstanding any other provision of this act or law
44to the contrary, a person licensed by the board or another state
45as a producer[, supplier, importer, wholesaler, distributor or
46retailer] of wine and who obtains a direct wine shipper license
47as provided for in this section may ship up to [nine] eighteen
48liters per month of any wine [not included on the list provided
49for in subsection (c) on] upon the Internet, telephone or mail
50order of any resident of this Commonwealth who is at least
51twenty-one (21) years of age for such resident's personal use

1and not for resale.

2(c) Each month, the board shall publish on the Internet a
3list of all classes, varieties and brands of wine available for
4sale in the Pennsylvania Liquor Stores. [A person holding a
5direct shipper license may ship only those classes, varieties
6and brands of wine not included on the list at the time an
7Internet order is placed.]

8(c.1) Prior to issuing a direct wine shipper license, the
9board shall require the person seeking the license to:

10(1) File an application with the board.

11(2) Pay a one hundred dollar ($100) registration fee.

12(3) Provide to the board a true copy of its current
13alcoholic beverage license issued by the board or another state,
14if applicable.

15(4) Provide the board with any other information the board
16deems necessary and appropriate.

17(5) Provide documentation which evidences that it has
18obtained a sales tax license from the Department of Revenue.

19(d) [An out-of-State] A direct wine shipper shall:

20(1) Not ship more than [nine] eighteen liters per month [on]
21upon the Internet, telephone or mail order of any person in this
22Commonwealth.

23(2) Report to the board each year the total of wine shipped
24[into] to residents of this Commonwealth in the preceding
25calendar year.

26(3) Permit the board or the Secretary of Revenue, or their
27designated representatives, to perform an audit of the [out-of-
28State] direct wine shipper's records upon request.

29(4) Be deemed to have submitted to the jurisdiction of the
30board, any other State agency and the courts of this
31Commonwealth for purposes of enforcement of this section and any
32related laws, rules or regulations.

33(5) Require proof of age of the recipient in a manner or
34format approved by the board before any wine is shipped to a
35resident of this Commonwealth.

36(6) Ensure that all boxes or exterior containers of wine
37shipped directly to a resident in this Commonwealth are
38conspicuously labeled with the words "CONTAINS ALCOHOL:
39SIGNATURE OF PERSON 21 YEARS OF AGE OR OLDER REQUIRED FOR
40DELIVERY."

41(7) Collect and remit to the Department of Revenue all taxes
42due on sales to residents of this Commonwealth. The amount of
43such taxes shall be calculated as if the sales were in this
44Commonwealth at the locations where delivery is made, including
45the emergency State tax on liquor imposed under the act of June
469, 1936 (1st Sp.Sess., P.L.13, No.4), entitled "An act imposing
47an emergency State tax on liquor, as herein defined, sold by the
48Pennsylvania Liquor Control Board; providing for the collection
49and payment of such tax; and imposing duties upon the Department
50of Revenue and the Pennsylvania Liquor Control Board," the sales
51and use tax imposed under Article II of the act of March 4, 1971

1(P.L.6, No.2), known as the "Tax Reform Code of 1971," the sales
2and use tax imposed under Article XXXI-B of the act of July 28, 
31953 (P.L.723, No.230), known as the "Second Class County Code," 
4the sales and use tax imposed under the act of June 5, 1991 
5(P.L.9, No.6), known as the "Pennsylvania Intergovernmental 
6Cooperation Authority Act for Cities of the First Class," and 
7the sales and use tax imposed under section 1003 of the act of 
8December 18, 1984 (P.L.1005, No.205), known as the "Municipal 
9Pension Plan Funding Standard and Recovery Act."

10(8) Annually renew its license by paying a renewal fee 
11established by the board.

12(e) A direct shipper may ship wine [on] upon the Internet, 
13telephone or mail order of a resident into this Commonwealth
14provided that the wine [is shipped to a Pennsylvania Liquor
15Store selected by the resident. The wine will be subject to
16taxes in the same manner as wine sold directly by the board. The
17wine will not be released by the State store until all moneys
18due, including all taxes and fees, have been paid by the
19resident.] will be subject to all taxes due on sales to 
20residents of this Commonwealth with the amount of such taxes to 
21be calculated as if the sale were in this Commonwealth at the 
22location where delivery is made.

23(f) [A person shall sign an affidavit provided by the
24Pennsylvania Liquor Store where the wine was delivered to
25stating that the wine will only be used for the person's
26personal use.] Any person who resells wine obtained under this
27section commits a misdemeanor of the second degree.

28(g) The board may promulgate such rules and regulations as
29are necessary to implement and enforce the provisions of this
30section. [The board may charge the resident a fee to cover the
31cost associated with processing the Internet order.]

32(h) The board shall submit [monthly] annual reports to the
33Appropriations Committee and the Law and Justice Committee of
34the Senate and to the Appropriations Committee and the Liquor
35Control Committee of the House of Representatives summarizing
36the number of direct shipper licenses issued by the board[,] and
37the quantity of wine sold by direct wine shippers pursuant to
38this section [and the total dollar value of sales under this
39section].

40(i) The term "wine" as used in this section shall mean
41liquor which is fermented from grapes and other fruits, having
42alcoholic content of twenty-four per centum or less. The term
43"wine" shall not include malt or brewed beverages nor shall wine
44include any products containing alcohol derived from malt,
45grain, cereal, molasses or cactus.

46(j) The term "direct wine shipper" as used in this section
47shall mean a wine producer who holds a direct wine shipper
48license as provided in this section and includes a limited
49winery.

50Section 9. Section 493(24) of the act, amended November 29,
512006 (P.L.1421, No.155), is amended to read:

1Section 493. Unlawful Acts Relative to Liquor, Malt and
2Brewed Beverages and Licensees.--The term "licensee," when used
3in this section, shall mean those persons licensed under the
4provisions of Article IV, unless the context clearly indicates
5otherwise.

6It shall be unlawful--

7* * *

8(24) (i) Things of Value Offered as Inducement. Except as
9provided in subclause (ii), for any licensee under the
10provisions of this article, or the board or any manufacturer, or
11any employe or agent of a manufacturer, licensee or of the
12board, to offer to give anything of value or to solicit or
13receive anything of value as a premium for the return of caps,
14stoppers, corks, stamps or labels taken from any bottle, case,
15barrel or package containing liquor or malt or brewed beverage,
16or to offer or give or solicit or receive anything of value as a
17premium or present to induce directly the purchase of liquor or
18malt or brewed beverage, or for any licensee, manufacturer or
19other person to offer or give to trade or consumer buyers any
20prize, premium, gift or other inducement to purchase liquor or
21malt or brewed beverages, except advertising novelties of
22nominal value which the board shall define. This section shall
23not prevent any manufacturer or any agent of a manufacturer from
24offering and honoring coupons which offer monetary rebates on
25purchases of wines and spirits through State Liquor Stores or
26purchases of malt or brewed beverages through distributors and
27importing distributors in accordance with conditions or
28regulations established by the board. The board may redeem
29coupons offered by a manufacturer or an agent of a manufacturer
30at the time of purchase. Coupons offered by a manufacturer or an
31agent of a manufacturer shall not be redeemed without proof of
32purchase. This section shall not apply to the return of any
33monies specifically deposited for the return of the original
34container to the owners thereof.

35(ii) Notwithstanding subclause (i) or any other provision of 
36law, a holder of a restaurant license that is also approved to 
37hold a slot machine license or a conditional slot machine 
38license under 4 Pa.C.S. Part II (relating to gaming) may give 
39liquor and malt or brewed beverages free of charge to any person 
40actively engaged in playing a slot machine.

41(iii) Notwithstanding subclause (i) or any other provision 
42of law, the board may establish and implement a customer 
43relations marketing program for the purpose of offering 
44incentives, such as coupons or discounts on certain products 
45that may be conditioned upon the purchase of liquor, to 
46customers of the board.

47(iv) Notwithstanding subclause (i) or any other provision of
48law, nothing may prevent the board, in its discretion and while
49in partnership with one or more private entities as permitted
50under section 207(n), from offering coupons or discounts that
51are conditioned on the purchase of liquor products or other

1items by customers in order to promote the liquor products or
2other items.

3* * *

4(35) Sale of wine received by direct shipment. For any
5licensee to sell or offer to sell any wine purchased or acquired
6from a direct wine shipper under the authority of section 488.

7Section 10. This act shall take effect in 60 days.