Assist Small Beer Manufacturers

Last updated: Jul 3, 2019

Details about this bill
Category: Alcohol / Tobacco / Guns
Status: Passed
Sponsor: Senator Louis Luchini, Senate 7 - Hancock County
Session: 129
Bill #: LD 1761

Position:

Monitoring.

UPDATE 7-2-19: Governor Mills has signed this bill into law.

Summary:

This bill changes the definition of "small brewery" by increasing the amount of malt liquor a small brewery may brew from 50,000 gallons to 30,000 barrels per year. It defines a "small beer manufacturer" as a small brewery or out-of-state brewer that is brewing, lagering and kegging, bottling or packaging its own malt liquor, not to exceed 30,000 barrels per year. If a small beer manufacturer terminates its distribution relationship with a wholesale licensee, unless for good cause, causes a wholesale licensee to resign from an agreement, unless for good cause, or unreasonably withholds its consent to any assignment, transfer or sale of a wholesale licensee's business and that small beer manufacturer's brands make up no more than 3% of the wholesale licensee's business, the bill sets the maximum amount of the termination fee that the wholesale licensee is entitled to receive from that small beer manufacturer in connection with the termination. The bill amends the laws governing certain notice requirements that the small beer manufacturer must satisfy in connection with the termination, provides expedited arbitration proceedings for a small beer manufacturer and a wholesale licensee in connection with a dispute regarding the amount of the termination fee and provides that, regardless of whether the terminated wholesale licensee has received payment of the termination fee from the small beer manufacturer, upon written notice of the termination to the wholesale licensee, the small beer manufacturer may appoint a new wholesale licensee to distribute the relevant products in the terminated wholesale licensee's territory or, if the small beer manufacturer is a small brewery, sell the terminated brand or brands of the small beer manufacturer directly to retail licensees in the terminated wholesale licensee's territory without selling the brand or brands to a wholesale licensee. Lastly, this bill allows a wholesale licensee and a small beer manufacturer to agree upon or limit the amount of a termination fee pursuant to a distribution agreement as long as that termination fee does not exceed the maximum amount of the termination fee, as set forth in the bill.