§ 16-3-510 — Winery Or Wine Importer Prohibitions -- Illegal Acts By Brewers Or Beer Importers

16-3-510 . Winery or wine importer prohibitions -- illegal acts by brewers or beer importers. (1) A winery or wine importer or an officer, agent or representative of a winery or wine importer may not:
(a) coerce, induce, or attempt to coerce or induce a distributor to engage in an illegal act or course of conduct;
(b) require a distributor to accept delivery of a product or other item or commodity that was not ordered by the distributor; or
(c) fix or maintain the price at which a distributor shall resell table wine.
(2) A brewer or beer importer or an officer, agent, or representative of a brewer or beer importer may not:
(a) coerce, attempt to coerce, or persuade any person licensed to sell beer as a distributor to enter into any agreement or to take any action that would violate or tend to violate any of the laws of this state or any rules promulgated by the department;
(b) sell its products in the state without a written contract that conforms to the provisions of this part with each appointed licensed distributor;
(c) designate or allow more than one distributor to sell or distribute a specific brand of the brewer's or beer importer's products to retail licensees in the same area, provided that nothing in this part prohibits the brewer or beer importer from designating more than one distributor to sell or distribute different brands of the same manufacturer to retail licensees in the same area;
(d) fix or maintain the price at which a distributor resells the brewer's or beer importer's products. Without limitation, it is a violation of this section if:
(i) after a distributor has exceeded a resale price increase recommended by a brewer or beer importer, the brewer or beer importer raises the price that it charges the distributor for those products within 60 days;
(ii) after a distributor has exceeded a resale price increase recommended by a brewer or beer importer, the brewer or beer importer raises the price that it charges the distributor in an amount proportionately larger than the amount that it raised the distributor's prices initially when compared to the increase in the resale price that it recommended to the distributor; or
(iii) the brewer or beer importer links or ties its participation in promotional discounts to the distributor's compliance with any recommended resale price.
(e) cancel, terminate, discontinue, or fail to renew, except for just cause and in accordance with the current terms and standards established by the brewer or beer importer then equally applicable to all distributors, any agreement or contract, written or oral, or the franchise of any wholesaler existing on January 1, 1974, or entered into after that date to sell beer manufactured by the brewer or imported by the beer importer. A brewer or beer importer may, notwithstanding the preceding sentence, make reasonable classifications among distributors. If a brewer or beer importer cancels or terminates a distributor's franchise, the brewer or beer importer has the burden of proving that the classification was reasonable and not arbitrary. The provisions of this part must be a part of any franchise, contract, agreement, or understanding, whether written or oral, between any distributor of beer licensed to do business in this state and any manufacturer or beer importer doing business with the licensed distributor just as though the provisions had been specifically agreed upon between the distributor and the manufacturer or beer importer. A distributor of beer licensed to conduct business in the state may not waive any of the protections or agree to any provision contrary to this part by any conduct, including but not limited to the signing of any contract or agreement with terms contrary to those provisions.
(3) (a) Just cause as used in subsection (2)(e) means that the distributor failed to comply with the reasonable requirements placed on the distributor by the brewer or beer importer as a part of any written franchise, contract, or agreement between the parties.
(b) The sale or purchase or other restructuring of the brewer or beer importer by a successor in the manufacturing tier of the beer industry does not constitute just cause as that term is used in subsection (2)(e).
(c) For the purposes of this subsection (3), a successor means a person or entity that replaces a brewer or beer importer with regard to the right to manufacture, sell, distribute, or import a brand or brands of beer regardless of the character or form of the succession. A successor is obligated to all of the terms and conditions of any franchise, contract, agreement, or understanding, whether written or oral, in effect on the date of succession. A successor has the right to contractually require its distributor to comply with operational standards of performance if the standards are uniformly established for all of the successor's distributors and conform to the requirements of this section.

Legislative History

En. Sec. 10, Ch. 637, L. 2025.