2019 Chaptered Legislation

A summary of 2019 chaptered bills amending the Alcoholic Beverage Control (ABC) Act and the code sections affected by that legislation. The text of these bills can be viewed at the California Legislative Information website.

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Code Section Changes by Bill Number

Assembly Bill No. 205 – (Daly) – Alcoholic beverage licenses: beer.
Amends Section 23006 of the Business and Professions Code, relating to alcoholic beverages (Effective January 1, 2020)
Summary of Code Section Changes – This bill revised the definition of “beer” for purposes of the Alcoholic Beverage Control Act to provide that beer may be produced using honey, fruit, fruit juice, fruit concentrate, herbs, spices, and other food materials, as adjuncts in fermentation.
Assembly Bill No. 436 – (Aguiar-Curry) – Alcoholic beverage: tied-house restrictions: advertising: City of Napa.
Adds Section 25503.32 to the Business and Professions Code, relating to alcoholic beverages (Effective January 1, 2020)
Summary of Code Section Changes – This bill extended an existing tied-house exception in the Alcoholic Beverage Control Act which generally prohibits advertising arrangements between retail, wholesale and manufacturer licensees, to allow beer manufacturers, winegrowers, distilled spirits rectifiers, distilled spirits manufacturers, or distilled spirits manufacturer’s agents to purchase advertising space and time at a performing arts venue and adjacent performance area located in the City of Napa called the Napa Opera House.
Assembly Bill No. 840 – (Dahle) – Alcoholic beverages: licenses: imports.
Amends Section 23661 of, and to add Section 23399.52 to, the Business and Professions Code, relating to alcoholic beverages (Effective January 1, 2020)
Summary of Code Section Changes – This bill authorized the Department of Alcoholic Beverage Control to issue a special on-sale general alcoholic beverage license for the Cal Neva Resort & Casino under specified circumstances. Since this casino is located on the border of California and Nevada, with the majority of the premises located in Nevada, this bill prescribed that all sales are deemed to take place in the state of Nevada. The license was issued to ensure the Department has appropriate enforcement authority for activity that takes place on the California side of the business.
Assembly Bill No. 1133 – (Low) – Beer: premiums, gifts, and free goods.
Adds and repeal Section 25600.05 of the Business and Professions Code, relating to alcoholic beverages (Effective January 1, 2020)
Summary of Code Section Changes – This bill authorized a beer manufacturer to give up to five cases of retail advertising glassware to each on-sale retail licensee and allowed an on-sale retail licensee to accept, up to 10 cases of retail advertising glassware, per year per licensed premises, from any licensed beer manufacturers. This bill did not prescribe a value limit on the provided glassware.
Assembly Bill No. 1265 – (Parks) – Alcoholic beverage licensees: donations.
Amends Section 25503.9 of the Business and Professions Code, relating to alcoholic beverages, and declaring the urgency thereof, to take effect immediately (Effective June 26, 2019)
Summary of Code Section Changes – This bill added distilled spirits wholesalers to the list of licensees that may give or sell beer, wine, or distilled spirits to certain nonprofit organizations and revised the prohibition exemption for a beer and wine wholesaler that also holds an importer’s license to allow that licensee to give or sell beer or wine to a nonprofit.
Assembly Bill No. 1308 – (Cunningham) – Students in hotel management or culinary arts programs: tastings.
Amends Section 25668 of the Business and Professions Code, relating to alcoholic beverages (Effective January 1, 2020)
Summary of Code Section Changes – This bill allowed a student under the age of 21 to taste, but not consume, an alcoholic beverage and exempted the student and the qualified academic institution in which the student is enrolled from criminal prosecution if the qualified academic institution has established an associate degree or a bachelor’s degree program in hotel management or culinary arts, as provided.
Assembly Bill No. 1311– (Ting) -Neighborhood-restricted special on-sale general licenses: transfers.
Amends Section 23826.13 of the Business and Professions Code, relating to alcoholic beverages (Effective January 1, 2020)
Summary of Code Section Changes – This bill authorized the Department of Alcoholic Beverage Control to allow a Type 87 Special Neighborhood alcoholic beverage license, previously created under SB 1285 (Leno), Chapter 790, Statutes of 2016, and AB 471 (Ting), Chapter 442, Statutes of 2017, to be to be transferred within the same neighborhood.
Assembly Bill No. 1370 – (Chiu) – Alcoholic beverage licenses: nonprofit arts foundation.
Amends Section 23039 of, and to add Section 24045.78 to, the Business and Professions Code, relating to alcoholic beverages (Effective January 1, 2020)
Summary of Code Section Changes – This bill authorized the Department of Alcoholic Beverage Control to issue a special on-sale general alcoholic beverage license to Saint Joseph’s Arts Society, a nonprofit organization, operating within Saint Joseph’s Church in San Francisco. The special license allows the sales, service and consumption of beer, wine, and distilled spirits on the premises of Saint Joseph’s Church.
Assembly Bill No. 1825 – (Committee on Governmental Organization.) – Alcoholic beverage control.
Amends Sections 25503.6 and 25607 of the Business and Professions Code, relating to alcoholic beverage control (Effective January 1, 2020)
Summary of Code Section Changes – This bill covered two distinct subjects. First, this bill authorized specified alcoholic beverage licensees that hold more than one kind of license at a single location to store and produce multiple types of alcoholic beverages at that same location. Second, this bill expanded an existing tied-house exception to allow advertising alcohol to be placed in areas within a retail, entertainment, commercial, and mixed-use development which includes the stadium and performance venue, under certain conditions.
Senate Bill No. 21 – (Dodd) – Alcoholic beverages: brewpub-restaurant licenses.
Amends Section 23396.3 of the Business and Professions Code, relating to alcoholic beverages, and declaring the urgency thereof, to take effect immediately (Effective September 27, 2019)
Summary of Code Section Changes – This bill contained an urgency clause and lowered the required minimum brewing production of a brewpub-restaurant license from 200 barrels per year to 100 barrels per year. This bill contained further provisions which restrict a brew-pub restaurant from selling, furnishing, or exchanging alcoholic beverages with beer manufacturers under the common ownership or control of the brew-pub restaurant licensee.
Senate Bill No. 717 – (Jones) – Craft Distillers: Advertising.
Amends Section 25503.6 of the Business and Professions Code, relating to alcoholic beverages (Effective January 1, 2020)
Summary of Code Section Changes – This bill extended an existing tied-house exception prohibiting advertising arrangements between retail, wholesale, and manufacturer licensees to authorize a craft distiller to purchase advertising space from, or on behalf of, an on-sale retail licensee subject to the same conditions as other alcohol manufacturers.
Senate Bill No. 788 (Committee on Governmental Organizations)- Alcoholic beverages: appeals: decision: tied-house restrictions.
Amends Sections 23080, 23090.5, 25503.4, 25503.56, and 25503.57 of the Business and Professions Code, relating to alcoholic beverages, and declaring the urgency thereof, to take effect immediately (Effective September 5, 2019)
Summary of Code Section Changes – This bill was the result of the Department’s 2019 Legislative proposal and revised the definition of “decision” when used in reference to the department to exclude any emergency decision for temporary, interim relief issued by the department. This bill also provided that a superior court shall have jurisdiction to review an emergency decision issued by the department. The bill further provided a technical amendment to provide clarity to legislation signed during 2018 concerning tied-house laws governing alcohol advertising on social-media.

2019 Chaptered Bills Amending the ABC Act

Business & Professions Code (BPC) Section	Bill Number (Author)	Subject	Summaries
23006	AB 205 (Daly)	Alcoholic beverage licenses: beer.	Summary
23039, 24045.78	AB 1370 (Chiu)	Alcoholic beverages licenses: nonprofit arts foundation.	Summary
23080, 23090.5, 25503.4, 25503.56, and 25503.57	SB 788 (Senate G.O. Committee)	Alcoholic beverages: appeals: decision: tied-house restrictions.	Summary
23396.3	SB 21 (Dodd)	Alcoholic beverages: brewpub-restaurant licenses.	Summary
23661, 23399.52	AB 840 (Dahle)	Alcoholic beverages: licenses: imports.	Summary
23826.13	AB 1311 (Ting)	Neighborhood-restricted special on-sale general licenses: transfers.	Summary
25503.32	AB 436 (Aguiar-Curry)	Alcoholic beverages: tied-house restrictions: advertising: City of Napa.	Summary
25503.6	SB 717 (Jones)	Craft Distillers: Advertising.	Summary
25503.6, 25607	AB 1825 (Assembly G.O. Committee)	Alcoholic beverage control.	Summary
25503.9	AB 1265 (Parks)	Alcoholic beverage licensees: donations.	Summary
25600.05	AB 1133 (Low)	Beer: premiums, gifts, and free goods.	Summary
25668	AB 1308 (Cunningham)	Students in hotel management or culinary arts programs: tastings.	Summary

Assembly Bill Summaries

B&P Code Section 23006 (Effective January 1, 2020)

Assembly Bill No. 205 – (Daly) – Alcoholic beverage licenses: beer.

An act to amend Section 23006 of the Business and Professions Code, relating to alcoholic beverages.

Summary of Code Section Changes

This bill revised the definition of “beer” for purposes of the Alcoholic Beverage Control Act to provide that beer may be produced using honey, fruit, fruit juice, fruit concentrate, herbs, spices, and other food materials, as adjuncts in fermentation.

SECTION 1

Section 23006 of the Business and Professions Code is amended to read:

23006.

“Beer” means any alcoholic beverage obtained by the fermentation of any infusion or decoction of barley, malt, hops, or any other similar product, or any combination thereof in water, and includes ale, porter, brown, stout, lager beer, small beer, and strong beer, but does not include sake, known as Japanese rice wine. Beer may be produced using the following materials as adjuncts in fermentation: honey, fruit, fruit juice, fruit concentrate, herbs, spices, and other food materials. Beer aged in an empty wooden barrel previously used to contain wine or distilled spirits shall be defined exclusively as “beer” and shall not be considered a dilution or mixture of any other alcoholic beverage.

B&P Code Section 23039, 24045.78 (Effective January 1, 2020)

Assembly Bill No. 1370 – (Chiu) – Alcoholic beverage licensees: nonprofit arts foundation.

An act to amend Section 23039 of, and to add Section 24045.78 to, the Business and Professions Code, relating to alcoholic beverages.

Summary of Code Section Changes

This bill authorized the Department of Alcoholic Beverage Control to issue a special on-sale general alcoholic beverage license to Saint Joseph’s Arts Society, a nonprofit organization, operating within Saint Joseph’s Church in San Francisco. The special license allows the sales, service and consumption of beer, wine, and distilled spirits on the premises of Saint Joseph’s Church

SECTION 1.

Section 23039 of the Business and Professions Code is amended to read:

23039.

(a) “Public premises” means:

(1) Premises licensed with any type of license other than an on-sale beer license, and maintained and operated for the selling or serving of alcoholic beverages to the public for consumption on the premises, and in which food shall not be sold or served to the public as in a bona fide public eating place, but upon which premises food products may be sold or served incidentally to the sale or service of alcoholic beverages, in accordance with rules prescribed by the department.

(2) Premises licensed with an on-sale beer license, in which food shall not be sold or served to the public as in a bona fide public eating place, and in which sandwiches, salads, desserts, and similar short orders shall not be sold and served, in accordance with rules prescribed by the department.

(b) “Public premises” does not include any of the following:

(1) Railroad dining or club cars, passenger ships, airplanes, or bona fide clubs after the clubs have been lawfully operated for not less than one year.

(2) Historic units of the state park system.

(3) Premises being operated under a temporary on-sale beer license other than permitted pursuant to Section 24045.5, or on-sale beer licensed stadia, auditoria, fairgrounds, or racetracks.

(4) Nonprofit theater companies licensed pursuant to Section 24045.7.

(5) Theaters licensed pursuant to Section 24045.75.

(6) Cemeteries licensed pursuant to Section 24045.76.

(7) Winegrowers’ premises.

(8) Licensed premises of a nonprofit arts foundation licensed pursuant to Section 24045.78.

SEC. 2.

Section 24045.78 of the Business and Professions Code is amended to read:

24045.78.

(a) The department may issue a special on-sale general license to a nonprofit arts foundation operating within a former church that is over 100 years old, on the National Register of Historic Places, and is located in designated Landmark No. 120 by the City and County of San Francisco, and is exempt from the payment of income taxes under Section 23701d of the Revenue and Taxation Code and Section 501(c)(3) of the Internal Revenue Code.

(b) The special on-sale general license shall permit sales, service, and consumption of beer, wine, and distilled spirits on the licensed premises. Any special on-sale general license issued pursuant to this section shall not be subject to the limitations provided by Section 23816 and shall not be required to be operated as a bona fide public eating place.

(c) (1) The fee for the original special on-sale general license shall be the same as that specified in Section 23954.5 for an original on-sale general license.

(2) The annual license fee for the special on-sale general license shall be the same of that for an on-sale general license.

SEC. 3.

The Legislature finds and declares that a special statute is necessary and that a general statute cannot be made applicable within the meaning of Section 16 of Article IV of the California Constitution because of the unique nature of the nonprofit arts foundation’s use of the former church and landmark structure to promote the long-term preservation of the premises as a hub of social, cultural, and community activity in the City and County of San Francisco.

SEC. 4.

No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

B&P Code Section 23661, 23399.52 (Effective January 1, 2020)

Assembly Bill No. 840 – (Dahle) – Alcoholic beverages: imports.

An act to amend Section 23661 of, and to add Section 23399.52 to, the Business and Professions Code, relating to alcoholic beverages.

Summary of Code Section Changes

This bill authorized the Department of Alcoholic Beverage Control to issue a special on-sale general alcoholic beverage license for the Cal Neva Resort & Casino under specified circumstances. Since this casino is located on the border of California and Nevada, with the majority of the premises located in Nevada, this bill prescribed that all sales are deemed to take place in the state of Nevada. The license is being issued to ensure the Department has appropriate enforcement authority for activity that takes place on the California side of the business.

SECTION 1.

Section 23399.52 of the Business and Professions Code is amended to read:

23399.52

(a) The department may create and issue a special on-sale general license to a person who owns or operates a facility that is partially located in the County of Placer and partially located in the County of Washoe, State of Nevada, subject to the following:

(1) The licensed premises is located on a single contiguous property of not less than three acres, and not more than seven acres, in the County of Placer and of at least eight acres in the County of Washoe, State of Nevada, where the gross floor area of structures in the County of Placer is no greater than 20 percent of the total gross floor area of all structures located in both counties.

(2) The facility consists of at least a restaurant, casino, conference center, and hotel.

(3) The licensed premises is operated as an integral part of the facility.

(4) The license shall not be transferable except from person to person.

(b) Notwithstanding any other provision of this division, and subject only to Section 25658, the sale, furnishing, or delivery of alcoholic beverages by the licensee within the facility shall be deemed to be a sale in the State of Nevada.

(c) Notwithstanding Section 23661, and any related provision of this division, persons may import alcoholic beverages into California from the State of Nevada only within the facility for personal use and not for resale.

(d) Notwithstanding Section 23402, and any related provision of this division, the licensee shall not be authorized to purchase alcoholic beverages from California licensees.

(e) Notwithstanding Sections 23405, 23405.1, 23405.2, and 25752, and any related provision of this division, the licensee shall not be required to maintain records on the licensed premises. However, records shall be maintained at the facility and the licensee shall provide any such records to the department promptly upon demand.

(f) (1) The licensee shall not be subject to any restrictions set forth in Chapter 15 (commencing with Section 25500), in its entirety, at the facility.

(2) The licensee shall not be subject to any restrictions set forth in Sections 25600, 25600.1, 25600.2, 25600.3, 25600.5, 25611.1, 25611.2, 25611.3, 25612, 25612.5, and 25613, and any related provision of this division, except to the extent the prohibited conduct substantially occurs in California.

(g) The facility shall not be subject to Sections 25631, 25632, and 25633, and any related provision of this division.

(h) In all other respects, the licensee shall comply with and be subject to the provisions of this division.

(i) The fee for a special on-sale general license shall be the same as that specified in Section 23954.5 for an original on-sale general license. The annual fee for the special on-sale general license shall be the same as that for an on-sale general licensee. The special on-sale general license authorized by this section shall not be included in the number of on-sale general licenses available pursuant to, or otherwise subject to the requirements of, Section 23816. All money collected as fees pursuant to this section shall be deposited in the Alcohol Beverage Control Fund as provided in Section 25761.

(j) The Legislature finds and declares that a special statute is necessary and that a general statute cannot be made applicable within the meaning of Section 16 of Article IV of the California Constitution because of the unique circumstances of the premises located in both the County of Placer and the State of Nevada.

SEC. 2.

Section 23661 of the Business and Professions Code is amended to read:

23661.

(a) Except as otherwise provided in this section, alcoholic beverages shall be brought into this state from without this state for delivery or use within the state only by common carriers and only when the alcoholic beverages are consigned to a licensed importer, and only when consigned to the premises of the licensed importer or to a licensed importer or customs broker at the premises of a public warehouse licensed under this division.

(b) The provisions of this chapter are not applicable in the case of alcoholic beverages which are sold and delivered by a licensee in this state to another licensee in this state, and which in the course of delivery are taken without this state through another state without any storage thereof in such other state.

(c) The provisions of subdivision (a) are not applicable in the case of a reasonable amount of alcoholic beverages brought into this state by an adult from without the United States for personal or household use, except that a California resident returning to the United States by a vehicle that is not a common carrier, or any adult entering the United States as a pedestrian, shall be restricted to the amount of alcoholic beverages which are exempt from the payment of duty in accordance with existing provisions of federal law. These alcoholic beverages shall be exempt from state licensing restrictions.

(d) The provisions of subdivision (a) are not applicable to incidental amounts of alcoholic beverages brought into this state by an adult for personal use from a hotel that is jointly located within the jurisdictions of this state and Nevada.

(e) The provisions of subdivision (a) are not applicable in the case of alcoholic beverages shipped into this state from without the United States by an adult member of the Armed Forces of the United States, serving outside the confines of the United States, for their personal or household use within the state in such quantity of alcoholic beverages as is exempt from the payment of duty under existing provisions of the Federal Tariff Act or regulations. These alcoholic beverages may be brought into this state only by common carrier and consigned to the premises of a licensed importer or customs broker, or to a licensed importer or customs broker at the premises of a public warehouse licensed under this division. Notwithstanding any other provisions of this division, the holder of an importer’s license, a customs broker’s license, or a public warehouse license, may make delivery of such alcoholic beverages as may be brought into this state under the provisions of this paragraph directly to the owner thereof upon satisfactory proof of identity. This delivery shall not be deemed to constitute a sale in this state.

(f) A manufacturer of distilled spirits shall transport such distilled spirits into this state in motor vehicles owned by or leased to the manufacturer, and operated by employees of the manufacturer, only if all of the following apply:

(1) The distilled spirits are transported into this state from a place of manufacture within the United States.

(2) The manufacturer holds a California distilled spirits manufacturer’s license.

(3) Delivery is made to the licensed premises of such distilled spirits manufacturer.

SEC. 3.

B&P Code Section 23826.13 (Effective January 1, 2020)

Assembly Bill No. 1311 – (Ting) – Neighborhood-restricted special on-sale general licenses: transfers.

An act to amend Section 23826.13 of the Business and Professions Code, relating to alcoholic beverages.

Summary of Code Section Changes

This bill authorized the Department of Alcoholic Beverage Control to allow a Type 87 Special Neighborhood alcoholic beverage license, previously created under SB 1285 (Leno), Chapter 790, Statutes of 2016, and AB 471 (Ting), Chapter 442, Statutes of 2017, to be to be transferred within the same neighborhood.

SECTION 1.

Section 23826.13 of the Business and Professions Code, as amended by Section 42 of Chapter 29 of the Statutes of 2019, is amended to read:

23826.13.

(a) Notwithstanding any other provision of this chapter, in any county of the sixth class, the department may issue no more than a total of five new original neighborhood-restricted special on-sale general licenses to premises located in any of the census tracts listed in subdivision (b) per year beginning on January 1, 2017, until a total of 30 new licenses authorized by this section are issued.

(b) To qualify for a license issued pursuant to this section, the premises for which the license would apply shall be located within one of the following United States Bureau of Census census tracts located within the City and County of San Francisco, subject to the following limitations:

(1) United States Bureau of the Census census tract 612000, 232000, 234000, 233000, or 230030. No more than a total of five neighborhood-restricted special on-sale general licenses shall be concurrently held at premises located within all of these tracts.

(2) United States Bureau of the Census census tract 258000 or 257020. No more than a total of four neighborhood-restricted special on-sale general licenses shall be concurrently held at premises located within all of these tracts.

(3) United States Bureau of the Census census tract 264030. No more than a total of two neighborhood-restricted special on-sale general licenses shall be concurrently held at premises located within this tract.

(4) United States Bureau of the Census census tract 255000, 256000, 260020, 260010, 260040, 261000, or 263010. No more than a total of five neighborhood-restricted special on-sale general licenses shall be concurrently held at premises located within all of these tracts.

(5) United States Bureau of the Census census tract 309000, 310000, or 312010. No more than a total of four neighborhood-restricted special on-sale general licenses shall be concurrently held at premises located within all of these tracts.

(6) United States Bureau of the Census census tract 330000, 329010, 328010, 353000, or 354000. No more than a total of five neighborhood-restricted special on-sale general licenses shall be concurrently held at premises located within all of these tracts.

(7) United States Bureau of the Census census tract 328020, 329020, 351000, or 352010. No more than a total of five neighborhood-restricted special on-sale general licenses shall be concurrently held at premises located within all of these tracts.

(c) In issuing the licenses pursuant to this section, the department shall follow the procedure set forth in Section 23961. A license shall not be issued pursuant to this section to an applicant until any existing on-sale licenses issued to the applicant for the same premises are canceled.

(d) (1) A person who currently holds an on-sale general license for a premises, who currently holds any interest in an on-sale general license for a premises, who has held an on-sale general license for a premises within the 12 months prior to the date of the drawing required by Section 23961, or who has held any interest in an on-sale general license for a premises within the 12 months prior to the date of the drawing required by Section 23961, shall not apply for a license issued pursuant to this section for that licensed premises.

(2) In addition to the other requirements of this section, an application for a neighborhood-restricted on-sale general license shall be subject to all the requirements that apply to an on-sale general license for a bona fide eating place.

(3) Prior to submitting an application for a license issued pursuant to this section, the applicant shall conduct a minimum of one preapplication meeting to discuss the application with neighbors and members of the community within the census tract in which the premises are located.

(A) The applicant shall hold the meeting either on the premises or at an alternate location within a one-mile radius of the premises.

(B) The applicant shall mail notification of the preapplication meeting to all of the following individuals and organizations at least 14 calendar days before the meeting:

(i) Each resident within a 500-foot radius of the premises for which the license is to be issued.

(ii) Any relevant neighborhood associations for the neighborhood in which the premises is located, as identified on a list maintained by the Planning Department of the City and County of San Francisco.

(iii) The Chief of Police for the San Francisco Police Department.

(C) Applicants for a neighborhood-restricted special on-sale general license shall submit, on a form provided by the department, signed verification by the local governing body of the area in which the applicant premises are located, or its designated subordinated officer or body, that states the applicant has completed the preapplication meeting pursuant to this section.

(e) (1) A license issued pursuant to this section shall not be transferred between counties.

(2) Except as provided in paragraphs (3) and (4), a license issued pursuant to this section shall not be transferred to any other premises.

(3) Paragraph (2) shall not apply to any licensee whose premises have been destroyed as a result of fire or any act of God or other force beyond the control of the licensee, for whom the provisions of Section 24081 shall apply.

(4) The department may allow a license issued pursuant to this section to be transferred within the same neighborhood, as described in paragraphs (1) to (7), inclusive, of subdivision (b).

(5) A license issued pursuant to this section shall not be transferred to any person, partnership, limited partnership, limited liability company, or corporation. This provision shall not apply to licenses transferred under Section 24071, 24071.1, or 24071.2.

(f) Following the cancellation or revocation of a license issued pursuant to this section, the department may issue one additional new original neighborhood-restricted special on-sale general license following the procedure set forth in Section 23961 and the provisions of this section.

(g) A person that holds a neighborhood-restricted special on-sale general license issued pursuant to this section shall not exchange that license for an on-sale license for public premises.

(h) Except as specified herein, a neighborhood-restricted special on-sale general license may exercise all of the privileges, and is subject to all the restrictions, of an on-sale general license for a bona fide eating place.

(i) A neighborhood-restricted special on-sale general license issued pursuant to this section shall not, with respect to beer and wine, authorize the exercise of the rights and privileges granted by an off-sale beer and wine license.

(j) The department shall adopt rules and regulations to enforce the provisions of this section.

B&P Code Section 25503.32 (Effective January 1, 2020)

Assembly Bill No. 436– (Aguiar-Curry) -Alcoholic beverages: tied-house restrictions: advertising: City of Napa

An act to add Section 25503.32 to the Business and Professions Code, relating to alcoholic beverages.

Summary of Code Section Changes

This bill extended an existing tied-house exception in the Alcoholic Beverage Control Act which generally prohibits advertising arrangements between retail, wholesale and manufacturer licensees, to allow beer manufacturers, winegrowers, distilled spirits rectifiers, distilled spirits manufacturers, or distilled spirits manufacturer’s agents to purchase advertising space and time at a performing arts venue and adjacent performance area located in the City of Napa called the Napa Opera House.

SECTION 1.

Section 25503.32 of the Business and Professions Code is amended to read:

25503.32.

(a) Notwithstanding Sections 25500 and 25503, a beer manufacturer, winegrower, rectifier, distilled spirits manufacturer, craft distiller, or a distilled spirits manufacturer’s agent may purchase advertising space and time in connection with an on-sale retail licensed premises, if all the following conditions are met:

(1) The on-sale retail licensed premises is operated as an integral part of an opera house that was constructed in 1880, is listed in the National Register of Historic Places, and is located in the City of Napa.

(2) The administrator of the opera house is a nonprofit charitable corporation or association that is exempt from the payment of income taxes under the Internal Revenue Code of the United States and Chapter 4 (commencing with Section 23701) of Part 11 of Division 2 of the Revenue and Taxation Code.

(3) The advertising space and time is purchased only in connection with specific events that are conducted by and for the benefit of the nonprofit charitable corporation or association that administers the opera house and that are open to the public.

(4) All payments for the purchase of advertising space and time shall be made to the nonprofit charitable corporation or association that administers the opera house. Payments shall not be made, directly or indirectly, to the on-sale retail licensee.

(5) (A) Except as provided in subparagraph (B), purchased advertising space and time shall not promote or be for the benefit of the on-sale retail licensee.

(B) Purchased advertising space and time may identify the on-sale retail licensed premises for purposes of identifying the venue at which the event is being held. This identification shall be relatively inconspicuous in connection with the advertisement as a whole.

(6) An agreement to purchase advertising space and time shall not require, directly or indirectly, the purchase or sale of the advertiser’s products by the on-sale retail licensee. The on-sale retail licensee shall offer for sale, in a bona fide manner, alcoholic beverages manufactured, produced, or distributed by competing licensed beer manufacturers, winegrowers, rectifiers, distilled spirits manufacturers, craft distillers, or distilled manufacturer’s agents.

(b) Advertising space and time purchased pursuant to this section may be included in printed programs for the specific event and in announcements made during the event, as well as any internet, social media, or other media promotion of the event. The advertising may also be placed on or in the on-sale retail licensed premises, or on or in unlicensed areas within the opera house operated by the on-sale retail licensee, only during the time the specific event is taking place.

(c) The Legislature finds that it is necessary and proper to require a separation between manufacturing interests, wholesale interests, and retail interests in the production and distribution of alcoholic beverages in order to prevent suppliers from dominating local markets through vertical integration and to prevent excessive sales of alcoholic beverages produced by overly aggressive marketing techniques. The Legislature further finds that the exceptions established by this section to the general prohibition against tied interests must be limited to their express terms so as not to undermine the general prohibition, and intends that this section be construed accordingly.

SEC. 2.

B&P Code Section 25503.6, 25607 (Effective January 1, 2020)

Assembly Bill No. 1825 – (Committee on Governmental Organization) – Alcoholic beverage control.

An act to amend Sections 25503.6 and 25607 of the Business and Professions Code, relating to alcoholic beverage control.

Summary of Code Section Changes

This bill covered two distinct subjects. First, this bill authorized specified alcoholic beverage licensees that hold more than one kind of license at a single location to store and produce multiple types of alcoholic beverages at that same location. Second, this bill expanded an existing tied-house exception to allow advertising alcohol to be placed in areas within a retail, entertainment, commercial, and mixed-use development which includes the stadium and performance venue, under certain conditions.

SECTION 1.

Section 25503.6 is added to the Business and Professions Code, to read:

25503.6

(a) Notwithstanding any other provision of this chapter, a beer manufacturer, the holder of a winegrower’s license, a rectifier, a distilled spirits manufacturer, or distilled spirits manufacturer’s agent may purchase advertising space and time from, or on behalf of, an on-sale retail licensee subject to all of the following conditions:

(1) The on-sale licensee is the owner, manager, agent of the owner, assignee of the owner’s advertising rights, or the major tenant of the owner of any of the following:

(A) An outdoor stadium or a fully enclosed arena with a fixed seating capacity in excess of 10,000 seats located in Sacramento County or Alameda County.

(B) (i) A fully enclosed arena with a fixed seating capacity in excess of 18,000 seats located in Orange County or Los Angeles County.

(ii) An outdoor stadium of at least 70,000 seats located in Los Angeles County operated by a joint powers authority.

(C) An outdoor stadium or fully enclosed arena with a fixed seating capacity in excess of 8,500 seats located in Kern County.

(D) An exposition park of not less than 50 acres that includes an outdoor stadium with a fixed seating capacity in excess of 8,000 seats and a fully enclosed arena with an attendance capacity in excess of 4,500 people, located in San Bernardino County.

(E) An outdoor stadium with a fixed seating capacity in excess of 10,000 seats located in Yolo County.

(F) An outdoor stadium and a fully enclosed arena with fixed seating capacities in excess of 10,000 seats located in Fresno County.

(G) An athletic and entertainment complex of not less than 50 acres that includes within its boundaries an outdoor stadium with a fixed seating capacity of at least 8,000 seats and a second outdoor stadium with a fixed seating capacity of at least 3,500 seats located in Riverside County.

(H) An outdoor stadium with a fixed seating capacity in excess of 1,500 seats located in Tulare County.

(I) A motorsports entertainment complex of not less than 50 acres that includes within its boundaries an outdoor speedway with a fixed seating capacity of at least 50,000 seats, located in San Bernardino County.

(J) An exposition park, owned or operated by a bona fide nonprofit organization, of not less than 400 acres with facilities including a grandstand with a seating capacity of at least 8,000 people, at least one exhibition hall greater than 100,000 square feet, and at least four exhibition halls, each greater than 30,000 square feet, located in the City of Pomona or the City of La Verne in Los Angeles County.

(K) An outdoor soccer stadium with a fixed seating capacity of at least 25,000 seats, an outdoor tennis stadium with a fixed seating capacity of at least 7,000 seats, an outdoor track and field facility with a fixed seating capacity of at least 7,000 seats, and an indoor velodrome with a fixed seating capacity of at least 2,000 seats, all located within a sports and athletic complex built before January 1, 2005, in the City of Carson in Los Angeles County.

(L) An outdoor professional sports facility with a fixed seating capacity of at least 4,200 seats located in San Joaquin County.

(M) A fully enclosed arena with a fixed seating capacity in excess of 13,000 seats located in the City of Inglewood.

(N) (i) An outdoor stadium with a fixed seating capacity of at least 68,000 seats located in the City of Santa Clara.

(ii) A beer manufacturer, the holder of a winegrower’s license, a rectifier, a distilled spirits manufacturer, or distilled spirits manufacturer’s agent may purchase advertising space and time from, or on behalf of, a major tenant of an outdoor stadium described in clause (i), provided the major tenant does not hold a retail license, and the advertising may include the placement of advertising in an on-sale licensed premises operated at the outdoor stadium.

(O) A complex of not more than 50 acres located on the campus of, and owned by, Sonoma State University dedicated to presenting live artistic, musical, sports, food, beverage, culinary, lifestyle, or other cultural and entertainment events and performances with venues that include a concert hall with a seating capacity of approximately 1,500 seats, a second concert hall with a seating capacity of up to 300 seats, an outdoor area with a seating capacity of up to 5,000 seats, and a further outdoor area with a seating capacity of up to 10,000 seats. With respect to this complex, advertising space and time may also be purchased from or on behalf of the owner of the complex, a long-term tenant or licensee of the venue, whether or not the owner, long-term tenant, or licensee holds an on-sale license.

(P) A fairgrounds with a horse racetrack and equestrian and sports facilities located in San Diego County.

(Q) (i) A stadium with a fixed seating capacity of at least 70,000 seats located in the City of Inglewood and a performance venue with a seating capacity of at least 5,000 seats adjacent to the stadium.

(ii) Advertising authorized by this subparagraph may be placed in areas within the retail, entertainment, commercial, and mixed-use development which includes the stadium and performance venue, provided that the advertising shall not be placed on or in, or otherwise promote, any permanently licensed retail premises other than the stadium or performance venue.

(R) An outdoor stadium with a fixed seating capacity of at least 40,000 seats located in the City and County of San Francisco.

(S) An indoor arena with a fixed seating capacity of at least 13,000 seats located in the City and County of San Francisco.

(T) An outdoor stadium with a fixed seating capacity in excess of 20,000 seats located in the City of Los Angeles.

(U) An outdoor stadium with a fixed seating capacity of at least 43,000 seats located in the City of San Diego.

(V) An outdoor professional sports stadium with a fixed seating capacity of at least 3,000 seats located in the City of San Jose.

(W) An outdoor professional sports stadium with a fixed seating capacity of at least 15,000 seats located in the City of San Jose.

(X) A fully enclosed arena with a fixed seating capacity in excess of 15,000 seats located in the City of San Jose.

(2) The outdoor stadium or fully enclosed arena described in paragraph (1) is not owned by a community college district.

(3) The advertising space or time is purchased only in connection with the events to be held on the premises of the exposition park, stadium, or arena owned by the on-sale licensee. With respect to an exposition park as described in subparagraph (J) of paragraph (1) that includes at least one hotel, the advertising space or time shall not be displayed on or in any hotel located in the exposition park, or purchased in connection with the operation of any hotel located in the exposition park. With respect to the complex described in subparagraph (O) of paragraph (1), the advertising space or time shall be purchased only in connection with live artistic, musical, sports, food, beverage, culinary, lifestyle, or other cultural and entertainment events and performances to be held on the premises of the complex. With respect to a fully enclosed arena described in subparagraph (X) of paragraph (1), advertising space or time shall be purchased only for interior advertising in connection with events conducted within the arena.

(4) The on-sale licensee serves other brands of beer distributed by a competing beer wholesaler in addition to the brand manufactured or marketed by the beer manufacturer, other brands of wine distributed by a competing wine wholesaler in addition to the brand produced by the winegrower, and other brands of distilled spirits distributed by a competing distilled spirits wholesaler in addition to the brand manufactured or marketed by the rectifier, the distilled spirits manufacturer, or the distilled spirits manufacturer’s agent that purchased the advertising space or time.

(b) Any purchase of advertising space or time pursuant to subdivision (a) shall be conducted pursuant to a written contract entered into by the beer manufacturer, the holder of the winegrower’s license, the rectifier, the distilled spirits manufacturer, or the distilled spirits manufacturer’s agent and any of the following:

(1) The on-sale licensee.

(2) With respect to clause (ii) of subparagraph (N) of paragraph (1) of subdivision (a), the major tenant of the outdoor stadium.

(3) With respect to subparagraphs (O), (Q), (R), and (T) of paragraph (1) of subdivision (a), the owner, a long-term tenant of the complex, or licensee of the complex, whether or not the owner, long-term tenant, or licensee holds an on-sale license.

(c) Any beer manufacturer or holder of a winegrower’s license, any rectifier, any distilled spirits manufacturer, or any distilled spirits manufacturer’s agent who, through coercion or other illegal means, induces, directly or indirectly, a holder of a wholesaler’s license to fulfill all or part of those contractual obligations entered into pursuant to subdivision (a) or (b) 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 space, time, or costs involved in the contract, whichever is greater, 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) Any on-sale retail licensee, as described in subdivision (a), who, directly or indirectly, solicits or coerces a holder of a wholesaler’s license to solicit a beer manufacturer, a holder of a winegrower’s license, a rectifier, a distilled spirits manufacturer, or a distilled spirits manufacturer’s agent to purchase advertising space or time pursuant to subdivision (a) or (b) 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 space or time involved in the contract, whichever is greater, 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.

(e) For the purposes of this section, “beer manufacturer” includes any holder of a beer manufacturer’s license, any holder of an out-of-state beer manufacturer’s certificate, or any holder of a beer and wine importer’s general license.

(f) The Legislature finds that it is necessary and proper to require a separation among manufacturing interests, wholesale interests, and retail interests in the production and distribution of alcoholic beverages in order to prevent suppliers from dominating local markets through vertical integration and to prevent excessive sales of alcoholic beverages produced by overly aggressive marketing techniques. The Legislature further finds that the exceptions established by this section to the general prohibition against tied interests shall be limited to their express terms so as not to undermine the general prohibition and intends that this section be construed accordingly.

SEC. 1.5.

Section 25503.6 is added to the Business and Professions Code, to read:

25503.6.

(a) Notwithstanding any other provision of this chapter, a beer manufacturer, the holder of a winegrower’s license, a rectifier, a craft distiller, a distilled spirits manufacturer, or distilled spirits manufacturer’s agent may purchase advertising space and time from, or on behalf of, an on-sale retail licensee subject to all of the following conditions: