Session Law

2006

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Chapter 33 AN ACT AUTHORIZING THE DIRECT SHIPMENT OF WINE.

Whereas , The deferred operation of this act would tend to defeat its purpose, which is to authorize forthwith the direct shipment of wine, therefore it is hereby declared to be an emergency law, necessary for the immediate preservation of the public convenience.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

SECTION 1. Section 24I of chapter 90 of the General Laws, as appearing in the 2004 Official Edition, is hereby amended by inserting after the word "consumed", in line 5, the following words:- ; provided, however, that a bottle resealed pursuant to section 12 of chapter 138 shall not be considered an open container.

SECTION 2. Section 1 of chapter 138 of the General Laws, as so appearing, is hereby amended by inserting after the definition of "Winegrower" the following definition:-

"Winery", a plant or premise where wine is produced, rectified, blended or fortified from fruits, flowers, herbs or vegetables, or where wine is bottled or packaged.

SECTION 3. Section 12 of said chapter 138, as so appearing, is hereby amended by inserting after the word "writing", in line 14, the following words:- ; and provided further, that the limitations relative to service and consumption in a restaurant or hotel only in the dining rooms and such other public rooms or areas deemed reasonable and proper by the local licensing authority shall not be deemed to preclude the restaurant or hotel from allowing a patron to retain and take off the premises only so much as may remain of a bottled wine purchased by the patron in conjunction with a meal and not totally consumed by the patron during such meal; provided further, that the bottle shall be resealed in accordance with regulations promulgated by the commission.

SECTION 4. Section 18 of said chapter 138, as so appearing, is hereby amended by inserting after the word "section", in lines 80 and 81, the following words:- and section 19F.

SECTION 5. Section 19B of said chapter 138, as so appearing, is hereby amended by striking out subsection (g) and inserting in place thereof the following subsection:-

(g) A winegrower may sell wine or winery products:

(1) at wholesale to any person holding a valid wholesaler's and importer's license under section 18;

(2) at retail by the bottle to consumers, for consumption off the winery premises in accordance with a license issued under section 19F;

(3) at retail or wholesale to a person in a state or territory in which the importation and sale of wine is not prohibited by law; and

(4) at wholesale to a person in any foreign country.

SECTION 6. Said chapter 138 is hereby further amended by inserting after section 19E the following section:-

Section 19F. (a) The commission may issue to an applicant, who: (1) operates a winery whose total annual production, including that of its affiliates, franchises and subsidiaries, is 30,000 gallons of wine or more; provided, however, any wine or wine product fermented from other than grapes shall not be included in the aforementioned 30,000 gallon figure; and (2) is authorized by the appropriate licensing authority to manufacture, export and sell wine, a large winery shipment license to sell and ship wine or winery products produced by the winery directly to consumers; provided that the winery has not contracted with or has not been represented by a wholesaler licensed under section 18 for the preceding 6 months.

(b) The commission may issue to an applicant who: (1) operates a winery whose total annual production, including that of its affiliates, franchises and subsidiaries, is less than 30,000 gallons of wine; provided, however, any wine or wine product fermented from other than grapes shall not be included in the aforementioned 30,000 gallon figure; and (2) is authorized by the appropriate licensing authority to manufacture, export and sell wine, a small winery shipment license to sell and ship wine or winery products produced by the winery: (i) at retail directly to consumers; (ii) at wholesale in kegs, casks, barrels or bottles to a person licensed under section 12, 13 or 14; (iii) at wholesale for the sole purpose of resale in containers in which wine was delivered to any person licensed under section 15; provided, that all direct deliveries of wine from a winery to a section 15 licensee shall not exceed 250 cases of wine annually; (iv) at wholesale to a person licensed under section 18, 19 or 19B; (v) at wholesale to churches and religious societies, educational institutions, incorporated hospitals, homes for the aged, manufacturers of food products and manufacturers of drugs and chemicals under section 28; or (vi) at wholesale to a registered pharmacist holding a certificate of fitness under section 30.

(c) The annual license fee for a license issued under this section shall be $100 per winery; provided, however, that an affiliate, franchise or subsidiary thereof shall require a separate license. The applicant shall provide the commission and the department of revenue with a true copy of the applicable alcoholic beverage licenses to manufacture, export and sell its wine as issued by the appropriate licensing authority. A copy of the wine shipment license, obtained under this section, shall be sent by the commission to the department of revenue to be kept on file.

(d) A person licensed under this section may ship wine in accordance with section 22.

(e) A household shall not receive delivery of more than 240 liters of wine per year from licensees under this section.

(f) A person licensed under this section shall: (i) report monthly to the commission and the department of revenue the total number of gallons of wine shipped into the commonwealth for the preceding month; (ii) pay to the department of revenue, under the department's rules and regulations, all taxes due, the amount of such taxes to be calculated as if the sale were at the location where the delivery is made; provided, however, that the licensee shall pay, for each shipment of wine, the excise levied on importations of wine calculated under section 21; and (iii) upon request, allow the commission or the department of revenue to perform an audit of the licensee's records.

(g) The commission shall enforce the requirements of this section, by administrative proceedings, against a licensee who ships wine in violation of this section, as follows:-

(i) for a first violation, by a fine of $100;

(ii) for a second violation, by a suspension of the winery's direct shipment license for not more than 1 year, a fine of $500, or both;

(iii) for a third violation, by prohibition of the winery from making any shipments of wine under this section or through a wholesaler or importer under section 18, by a fine of up to $5,000, or both; provided, however, that after 1 year, the winery may apply for the authority to ship wine through a wholesaler or importer under said section 18; and

(iv) if a violation of this section involves a sale or delivery to a person under 21 years of age, a first offense may be punished by suspension of the winery's direct shipment license for not more than 1 year; and a second offense may be punished by a prohibition of the winery from making any shipments of wine under this section or through a wholesaler or importer under section 18; provided, however, that after 1 year the winery may apply for the authority to ship wine through a wholesaler or importer under section 18; provided, however, that nothing in this clause shall preclude punishment under section 34.

(h) No person shall direct ship wine to consumers without a license to sell and ship wine. A person who manufactures, transports, imports, exports or receives wine in violation of this chapter shall be deemed to have engaged in a deceptive act or practice under chapter 93A; provided, however, that a common carrier acting in the ordinary course of business shall be exempt from this subsection.

(i) The commission may promulgate rules and regulations necessary to effectuate its alcohol oversight, licensing and enforcement purposes under this chapter as they relate to this section, including rules and regulations for reporting violations of this section and the requirement of sufficient documentation of a winery's annual wine production. The department of revenue may promulgate rules and regulations necessary to effectuate the tax oversight, collection and enforcement provisions of the General Laws as they relate to this section. The rules and regulations shall be submitted to the joint committee on state administration and regulatory oversight and the joint committee on consumer protection and professional licensure before promulgating such rules and regulations.

(j) The commission shall issue an annual report to the house and senate committees on ways and means and the joint committee on consumer protection and professional licensure, which shall include, but not limited to, a determination of licenses issued, a review of violations and enforcement measures under this section and an analysis of the need for changes in the laws and regulations relative thereto.

SECTION 7. The ninth paragraph of section 22 of said chapter 138, as so appearing, is hereby amended by striking out the second sentence and inserting in place thereof the following sentence:- There shall be a fee for such permit, and persons operating a vehicle when engaged in such transportation or delivery shall be required to carry such permit or certified copy thereof.

SECTION 8. Said section 22 of said chapter 138, as so appearing, is hereby amended by striking out, in lines 57 and 58, the words "farmer-winery licensees under section nineteen B" and inserting in place thereof the following words:- licensees under section 19F.

SECTION 9. Said section 22 of said chapter 138, as so appearing, is hereby further amended by striking out, in lines 63 to 65, inclusive, the words "as containing alcoholic beverages and requiring the signatures of, and delivery to, a person legally authorized to consume alcoholic beverages in the commonwealth" and inserting in place thereof the following words:- with the words "CONTAINS ALCOHOL: REQUIRES SIGNATURE OF AND PERSONAL DELIVERY TO A PERSON LEGALLY AUTHORIZED TO CONSUME ALCOHOLIC BEVERAGES IN THE COMMONWEALTH" and with a seal of licensure attached thereto as provided by the commission. Receipts for delivery of such parcels shall contain a check box next to the recipient's signature where he shall certify that he is not under 21 years of age and a check box where the delivery person shall certify that valid identification showing that the recipient is not under 21 years of age was presented by the recipient upon delivery. Notwithstanding the foregoing, a delivery company may use an electronic device to receive the signature of a person accepting delivery of a parcel under this section and to certify that the person has displayed a valid identification as so required.

SECTION 10. Section 23 of said chapter 138, as so appearing, is hereby amended by striking out, in lines 28 and 33, the words "nineteen B" and inserting in place thereof, in each instance, the following figure:- 19F.

SECTION 11. Said section 23 of said chapter 138, as so appearing, is hereby further amended by inserting after the word "eighteen", in line 39, the following words:- or 19F.

House of Representatives, February 15, 2006.

This Bill having been returned by His Excellency the Governor with his objections thereto in writing (see House 4498) has been passed by the House of Representatives, notwithstanding said objections, two-thirds of the House (124 yeas to 26 nays) having agreed to pass the same.

Sent to the Senate for its action.
Thomas Petrolati, Acting Speaker.
Steven T. James, Clerk.

Senate, February 15, 2006.

Passed by the Senate, notwithstanding the objections of His Excellency the Governor, two-thirds of the members present (26 yeas to 9 nays) having approved the same.

Robert E. Travaglini, President.
William F. Welch, Clerk.

February 27, 2006.