Regular Session 2019-2020 House Bill 1993 P.N. 2796

PRINTER'S NO. 2796

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

1993

Session of

2019

INTRODUCED BY ROTHMAN, BARRAR, BERNSTINE, CALTAGIRONE, MIHALEK,

STAATS, KEEFER, O'NEAL, WHEELAND, BURGOS, SAYLOR AND ECKER,

OCTOBER 25, 2019

REFERRED TO COMMITTEE ON LIQUOR CONTROL, OCTOBER 25, 2019

AN ACT

Amending the act of April 12, 1951 (P.L.90, No.21), entitled "An

act relating to alcoholic liquors, alcohol and malt and

brewed beverages; amending, revising, consolidating and

changing the laws relating thereto; regulating and

restricting the manufacture, purchase, sale, possession,

consumption, importation, transportation, furnishing, holding

in bond, holding in storage, traffic in and use of alcoholic

liquors, alcohol and malt and brewed beverages and the

persons engaged or employed therein; defining the powers and

duties of the Pennsylvania Liquor Control Board; providing

for the establishment and operation of State liquor stores,

for the payment of certain license fees to the respective

municipalities and townships, for the abatement of certain

nuisances and, in certain cases, for search and seizure

without warrant; prescribing penalties and forfeitures;

providing for local option, and repealing existing laws," in

licenses and regulations for liquor, alcohol and malt and

brewed beverages, further providing for malt and brewed

beverages manufactures', distributors' and importing

distributors' licenses, for unlawful acts relative to liquor,

alcohol and liquor licensees and for unlawful acts relative

to malt or brewed beverages and licensees; and, in

distilleries, wineries, bonded warehouses, bailees for hire

and transporters for hire, further providing for exemptions.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. Section 431(b) of the act of April 12, 1951

(P.L.90, No.21), known as the Liquor Code, is amended to read:

Section 431. Malt and Brewed Beverages Manufacturers',

Distributors' and Importing Distributors' Licenses.--* * *

(b) The board shall issue to any reputable person who

applies therefor, and pays the license fee hereinafter

prescribed, a distributor's or importing distributor's license

for the place which such person desires to maintain for the sale

of malt or brewed beverages, not for consumption on the premises

where sold, and in quantities of not less than a case or

original containers containing one hundred twenty-eight ounces

or more which may be sold separately as prepared for the market

by the manufacturer at the place of manufacture. In addition, a

distributor license holder may sell malt or brewed beverages in

any amount to a person not licensed by the board for off-

premises consumption[.], except that distributors shall not

deliver frozen or partially frozen malt or brewed beverage

products unless the products are delivered in the original

package as provided by the manufacturer. The sales shall not be

required to be in the package configuration designated by the

manufacturer and may be sold in refillable growlers. The board

shall have the discretion to refuse a license to any person or

to any corporation, partnership or association if such person,

or any officer or director of such corporation, or any member or

partner of such partnership or association shall have been

convicted or found guilty of a felony within a period of five

years immediately preceding the date of application for the said

license: And provided further, That, in the case of any new

license or the transfer of any license to a new location, the

board may, in its discretion, grant or refuse such new license

or transfer if such place proposed to be licensed is within

three hundred feet of any church, hospital, charitable

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institution, school or public playground, or if such new license

or transfer is applied for a place which is within two hundred

feet of any other premises which is licensed by the board: And

provided further, That the board shall refuse any application

for a new license or the transfer of any license to a new

location if, in the board's opinion, such new license or

transfer would be detrimental to the welfare, health, peace and

morals of the inhabitants of the neighborhood within a radius of

five hundred feet of the place proposed to be licensed. The

board shall not license the area where liquid fuels or oil is

sold. No sales of liquid fuels or oil may be made from a

licensee's licensed premises. A licensed premises may not have

an interior connection with a location that sells liquid fuels

or oil unless it first receives permission from the board for

the interior connection. The approval shall be required

regardless of whether the licensee or another party is the

entity selling the liquid fuels or oil. The board may enter into

an agreement with the applicant concerning additional

restrictions on the license in question. If the board and the

applicant enter into such an agreement, such agreement shall be

binding on the applicant. Failure by the applicant to adhere to

the agreement will be sufficient cause to form the basis for a

citation under section 471 and for the nonrenewal of the license

under section 470. If the board enters into an agreement with an

applicant concerning additional restrictions, those restrictions

shall be binding on subsequent holders of the license until the

license is transferred to a new location or until the board

enters into a subsequent agreement removing those restrictions.

If the application in question involves a location previously

licensed by the board, then any restrictions imposed by the

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board on the previous license at that location shall be binding

on the applicant unless the board enters into a new agreement

rescinding those restrictions. The board shall require notice to

be posted on the property or premises upon which the licensee or

proposed licensee will engage in sales of malt or brewed

beverages. This notice shall be similar to the notice required

of hotel, restaurant and club liquor licensees.

Except as hereinafter provided, such license shall authorize

the holder thereof to sell or deliver malt or brewed beverages

in quantities above specified anywhere within the Commonwealth

of Pennsylvania, which, in the case of distributors, have been

purchased only from persons licensed under this act as

manufacturers or importing distributors, and in the case of

importing distributors, have been purchased from manufacturers

or persons outside this Commonwealth engaged in the legal sale

of malt or brewed beverages or from manufacturers or importing

distributors licensed under this article. In the case of an

importing distributor, the holder of such a license shall be

authorized to store and repackage malt or brewed beverages owned

by a manufacturer at a segregated portion of a warehouse or

other storage facility authorized by section 441(d) and operated

by the importing distributor within its appointed territory and

deliver such beverages to another importing distributor who has

been granted distribution rights by the manufacturer as provided

herein. The importing distributor shall be permitted to receive

a fee from the manufacturer for any related storage, repackaging

or delivery services. In the case of a bailee for hire hired by

a manufacturer, the holder of such a permit shall be authorized:

to receive, store and repackage malt or brewed beverages

produced by that manufacturer for sale by that manufacturer to

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importing distributors to whom that manufacturer has given

distribution rights pursuant to this subsection or to purchasers

outside this Commonwealth for delivery outside this

Commonwealth; or to ship to that manufacturer's storage

facilities outside this Commonwealth. The bailee for hire shall

be permitted to receive a fee from the manufacturer for any

related storage, repackaging or delivery services. The bailee

for hire shall, as required in Article V of this act, keep

complete and accurate records of all transactions, inventory,

receipts and shipments and make all records and the licensed

areas available for inspection by the board and for the

Pennsylvania State Police, Bureau of Liquor Control Enforcement,

during normal business hours.

Each out of State manufacturer of malt or brewed beverages

whose products are sold and delivered in this Commonwealth shall

give distributing rights for such products in designated

geographical areas to specific importing distributors, and such

importing distributor shall not sell or deliver malt or brewed

beverages manufactured by the out of State manufacturer to any

person issued a license under the provisions of this act whose

licensed premises are not located within the geographical area

for which he has been given distributing rights by such

manufacturer. In addition, the holder of a distributor license

may not sell or deliver malt or brewed beverages to any licensee

whose licensed premises is located within the designated

geographical area granted to an importing distributor other than

the importing distributor that sold the malt or brewed beverages

to the distributor. If the licensee purchasing the malt or

brewed beverages from the distributor license holder holds

multiple licenses or operates at more than one location, then

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the malt or brewed beverages may not be consumed or sold at

licensed premises located within the designated geographical

area granted to an importing distributor other than the

importing distributor that sold the malt or brewed beverages to

the distributor. Should a licensee accept the delivery of malt

or brewed beverages or transfer malt or brewed beverages in

violation of this section, said licensee shall be subject to a

suspension of his license for at least thirty days: Provided,

That the importing distributor holding such distributing rights

for such product shall not sell or deliver the same to another

importing distributor without first having entered into a

written agreement with the said secondary importing distributor

setting forth the terms and conditions under which such products

are to be resold within the territory granted to the primary

importing distributor by the manufacturer.

When a Pennsylvania manufacturer of malt or brewed beverages

licensed under this article names or constitutes a distributor

or importing distributor as the primary or original supplier of

his product, he shall also designate the specific geographical

area for which the said distributor or importing distributor is

given distributing rights, and such distributor or importing

distributor shall not sell or deliver the products of such

manufacturer to any person issued a license under the provisions

of this act whose licensed premises are not located within the

geographical area for which distributing rights have been given

to the distributor and importing distributor by the said

manufacturer. In addition, the holder of a distributor license

may not sell or deliver malt or brewed beverages to a licensee

whose licensed premises is located within the designated

geographical area granted to an importing distributor other than

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the importing distributor that sold the malt or brewed beverages

to the distributor. If the licensee purchasing the malt or

brewed beverages from the distributor license holder holds

multiple licenses or operates at more than one location, the

malt or brewed beverages may not be consumed or sold at licensed

premises located within the designated geographical area granted

to an importing distributor other than the importing distributor

that sold the malt or brewed beverages to the distributor. If a

licensee accepts the delivery of malt or brewed beverages or

transfers malt or brewed beverages in violation of this section,

the licensee shall be subject to suspension of his license for

at least thirty days: Provided, That the importing distributor

holding such distributing rights for such product shall not sell

or deliver the same to another importing distributor without

first having entered into a written agreement with the said

secondary importing distributor setting forth the terms and

conditions under which such products are to be resold within the

territory granted to the primary importing distributor by the

manufacturer. Nothing herein contained shall be construed to

prevent any manufacturer from authorizing the importing

distributor holding the distributing rights for a designated

geographical area from selling the products of such manufacturer

to another importing distributor also holding distributing

rights from the same manufacturer for another geographical area,

providing such authority be contained in writing and a copy

thereof be given to each of the importing distributors so

affected.

* * *

Section 2. Sections 491(1) and 492(2) and (3) of the act are

amended and the sections are amended by adding clauses to read:

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Section 491. Unlawful Acts Relative to Liquor, Alcohol and

Liquor Licensees.--

It shall be unlawful--

(1) Sales of Liquor. [For] Except as provided under clause

(1.1), for any person, by himself or by an employe or agent, to

expose or keep for sale, or directly or indirectly, or upon any

pretense or upon any device, to sell or offer to sell any liquor

within this Commonwealth, except in accordance with the

provisions of this act and the regulations of the board. This

clause shall not be construed to prohibit hospitals, physicians,

dentists or veterinarians who are licensed and registered under

the laws of this Commonwealth from administering liquor in the

regular course of their professional work and taking into

account the cost of the liquor so administered in making charges

for their professional service, or a pharmacist duly licensed

and registered under the laws of this Commonwealth from

dispensing liquor on a prescription of a duly licensed

physician, dentist or veterinarian, or selling medical

preparations containing alcohol, or using liquor in compounding

prescriptions or medicines and making a charge for the liquor

used in such medicines, or a manufacturing pharmacist or chemist

from using liquor in manufacturing preparations unfit for

beverage purposes and making a charge for the liquor so used.

All such liquors so administered or sold by hospitals,

physicians, dentists, veterinarians, pharmacists or chemists

shall conform to the Pharmacopoeia of the United States, the

National Formulary, or the American Homeopathic Pharmacopoeia.

This clause shall not be construed to prohibit an executor or an

administrator of a decedent's estate from selling privately or

at public auction liquor which was an asset of the decedent.

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This clause shall not be construed to prohibit the practice by a

bed and breakfast homestead or inn of providing one bottle of

wine to its paying guests at check-in while in an overnight

status so long as that wine is produced by a licensed limited

winery as provided for under section 505.2. For purposes of this

paragraph, a "bed and breakfast homestead or inn" shall mean a

private residence that contains ten or fewer bedrooms used for

providing overnight accommodations to the public and in which

breakfast is the only meal served and is included in the charge

for the room. This clause shall not be construed to prohibit the

practice of a business which is principally engaged in the sale

of gift baskets within this Commonwealth to sell a gift basket

containing nonliquor items and no more than one bottle of wine

which has been lawfully purchased from the board, so long as

that wine is produced by a licensed limited winery as provided

for under section 505.2 and provided that delivery of the gift

basket shall be by a licensed transporter for hire, which shall

keep records as required under section 512 pertaining to the

direct shipment of wine, and provided that the business complies

with the provisions of section 488 relative to requiring proof

of age and labeling advising that the package contains alcohol.

The board shall establish regulations to ensure that State taxes

from the sales will be paid by the estate from the proceeds of

the sale. The board may not prohibit a sale of liquor for the

reason that it was not lawfully acquired prior to January 1,

1934 or has not been purchased from a Pennsylvania Liquor Store

or in compliance with Pennsylvania law.

(1.1) It shall not be a violation of clause (1) if a person,

not located on licensed premises, operates a telephonic, web-

based or other electronic ordering system by which the person

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facilitates orders and deliveries of wine on behalf of a

licensee. Delivery under this section may be made by an

independent contractor of the person and shall only be made to

recipients who are at least 21 years of age. The recipient's age

shall be verified prior to the recipient taking possession of

the wine. The person may provide telephonic, web-based or other

electronic ordering systems on behalf of multiple licensees.

Wine sold through orders taken by the person: (i) shall be

lawfully obtained by the licensee, and (ii) shall come from

inventory located on the licensee's premises. The person

coordinating the sales shall transfer or transmit the

purchaser's payment for the purchase of wine prior to the

licensee releasing the wine for delivery, and the licensee shall

be considered the seller of the wine. A licensee, its agents and

employees, may deliver and carry to the vehicles of the

licensee's customers, located outdoors in an area immediately

adjacent to and designated for the deliveries, alcohol lawfully

purchased by the customer while the customer is either

physically present and located on the licensed premises or

places an order via a telephonic, web-based or other electronic

ordering system. A licensee shall verify the age of the

recipient prior to placing any alcoholic beverage in the

purchaser's vehicle.

* * *

Section 492. Unlawful Acts Relative to Malt or Brewed

Beverages and Licensees.--

It shall be unlawful--

* * *

(2) Sales of Malt or Brewed Beverages for Consumption on the

Premises. [For] Except as provided under clause (2.1), for any

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person, to sell to another for consumption upon the premises

where sold or to permit another to consume upon the premises

where sold, any malt or brewed beverages, unless such person

holds a valid retail dispenser license or a valid liquor license

issued by the board authorizing the sale of malt or brewed

beverages for consumption upon such premises.

(2.1) It shall not be a violation of clause (2) if a person,

not located on licensed premises, operates a telephonic, web-

based or other electronic ordering system by which the person

facilitates orders and deliveries of malt or brewed beverages on

behalf of a licensee. Delivery under this section may be made by

an independent contractor of the person and shall only be made

to recipients who are at least 21 years of age. The recipient's

age shall be verified prior to the recipients taking possession

of the malt or brewed beverage. The person may provide

telephonic, web-based or other electronic ordering system on

behalf of multiple licensees. Malt or brewed beverages sold

through orders taken by the person: (i) shall be lawfully

obtained by the licensee, and (ii) shall come from inventory

located on the licensee's premises. The person shall transfer or

transmit the purchaser's payment for the purchase of malt or

brewed beverages prior to the licensee releasing the malt or

brewed beverages for delivery, and the licensee shall be

considered the seller of the malt or brewed beverages. A

licensee, its agents and employees, may deliver and carry to the

vehicles of the licensee's customers, located outdoors in an

area immediately adjacent to and designated for the deliveries,

alcohol lawfully purchased by the customer while the customer is

either physically present and located on the licensed premises

or places its order via a telephonic, web-based or other

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electronic ordering system. A licensee shall verify the age of

the recipient prior to placing any alcoholic beverage in the

recipient's vehicle.

(3) Sales of Malt or Brewed Beverages Not for Consumption on

the Premises. [For] Except as provided under clause (3.1), for

any person, to sell to another any malt or brewed beverages not

for consumption upon the premises where sold, unless such person

holds a valid license permitting such sale.

(3.1) It shall not be a violation of clause (3) if a person,

not located on the licensed premises operates a telephonic, web-

based or other electronic ordering system by which the person

facilitates orders and deliveries of malt or brewed beverages on

behalf of an importing distributor or distributor licensee.

Delivery under this section may be made by an independent

contractor of the person and shall only be made to recipients

who are at least 21 years of age. The recipient's age shall be

verified prior to the recipient taking possession of the malt or

brewed beverages. The person may provide telephonic, web-based

or other electronic ordering systems on behalf of multiple

licensees. Malt and brewed beverages sold through orders taken

by the person: (i) shall be lawfully obtained by the importing

distributor or distributor, and (ii) shall come from inventory

located on the importing distributor's or distributor's licensed

premises. The person coordinating the sales shall transfer or

transmit the purchaser's payment for the purchase of malt or

brewed beverages prior to the importing distributor or

distributor releasing malt or brewed beverages for delivery, and

the importing distributor or distributor shall be considered the

seller of the malt or brewed beverages. An importing distributor

or distributor, its agents and employees, may deliver and carry

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to the vehicles of the importing distributor's or distributor's

customers, located outdoors in an area immediately adjacent to

and designated for the deliveries, malt or brewed beverages

lawfully purchased by the customer while the customer is either

physically present and located on the licensed premises, or

places its order via a telephonic, web-based or other electronic

ordering system. The importing distributor or distributor shall

verify the age of the recipient prior to placing any malt or

brewed beverage in the recipient's vehicle.

* * *

Section 3. Section 502 of the act is amended to read:

Section 502. Exemptions.--(a) No license hereunder shall be

required from any registered pharmacist; or a physician licensed

by the State Board of Medicine; or any person who makes and

sells vinegar, nonalcoholic cider and fruit juices; or any

person who manufactures, stores, sells or transports methanol,

propanol, butanol and amanol; or any person who conducts a

wholesale drug business; or any person who manufactures

alcoholic preparations not fit for use as a beverage, other than

denatured alcohol or for beverage purposes; any person engaged

in the manufacture; possession or sale of patent, patented or

proprietary medicines, toilet, medicinal or antiseptic

preparations unfit for beverage purposes, or solutions or

flavoring extracts or syrups unfit for beverage purposes; or any

person who manufactures or sells paints, varnishes, enamels,

lacquers, stains or paint, or varnish removing or reducing

compounds, or wood fillers; or any person who manufactures any

substance where the alcohol or any liquor is changed into other

chemical substances and does not appear in the finished product

as alcohol or liquor; or any common carrier by railroad which is

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subject to regulation by the Pennsylvania Public Utility

Commission of the Commonwealth of Pennsylvania, or scheduled

common carriers by air of mail and passengers; or any person who

sells, stores or transports alcohol or liquor completely

denatured, as specified by the board; or any person licensed

under Article IV for malt and brewed beverages who manufactures,

distills or otherwise produces alcohol as a byproduct of the

manufacture of any reduced alcohol or nonalcohol malt or brewed

beverage if the byproduct is not intended nor used as a beverage

for human consumption except as part of the malt or brewed

beverage.

(b) Notwithstanding any other provision of this act, a

transporter-for-hire may deliver wine, sold by the licensee in

the licensee's licensed premises or by a telephonic, web-based

or other electronic ordering system transaction. Sales under

this subsection shall not be subject to section 415(a)(4), (8)

or (9), if, on behalf of the licensee, the transporter-for-hire

verifies the recipient's age at the time of delivery. A licensee

shall be considered the seller of the wine delivered for the

licensee by a transporter-for-hire.

Section 4. This act shall take effect in 60 days.

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