Amendment SA2-SB268

SB268-SA2,33,24 (d) “Contract production" means a contract, agreement, or business arrangement described in sub. (3) (b) whereby a recipe producer or out-of-state recipe supplier provides consideration to a contract producer for the production, bottling, or labeling of alcohol beverages.

SB268-SA2,34,4 (e) “Guest producer" means a producer who enters into a contract, agreement, or business arrangement with a host producer whereby the producer has use of the host producer's premises and equipment, and may have use of the host producer's personnel, for the production of the guest producer's alcohol beverages.

SB268-SA2,34,8 (f) “Host producer" means a producer who enters into a contract, agreement, or business arrangement with a guest producer whereby the guest producer has use of the producer's premises and equipment, and may have use of the producer's personnel, for the production of the guest producer's alcohol beverages.

SB268-SA2,34,11 (g) “Licensing agreement" means an agreement between a licensor and a producer for the production of alcohol beverages containing the name, symbol, or mark of the licensor.

SB268-SA2,34,13 (h) “Out-of-state recipe supplier” means a person to whom all of the following applies:

SB268-SA2,34,15 1. The person is located in another state and produces alcohol beverages in that state.

SB268-SA2,34,17 2. The person does not hold a permit under this chapter, other than a permit issued under s. 125.30, 125.535, or 125.58.

SB268-SA2,34,20 3. The person purchases alcohol beverages from a producer that are manufactured consistently with a recipe provided by the person or are bottled or labeled for the person.

SB268-SA2,34,24 (i) “Producer" means a brewer holding a permit under s. 125.29, brewpub holding a permit under s. 125.295, winery holding a permit under s. 125.53, manufacturer holding a permit under s. 125.52, or rectifier holding a permit under s. 125.52.

SB268-SA2,35,3 (j) “Recipe producer" means a producer who purchases alcohol beverages from another producer that are manufactured consistently with a recipe provided by the recipe producer or are bottled or labeled for the recipe producer.

SB268-SA2,35,9 (2) Production arrangements authorized; agreements between same producer type. (a) Production arrangements under subs. (3) to (5) are authorized as provided in this section. A permittee that enters into such a production arrangement does not act as an agent for or in the employ of another under s. 125.52 (3) or 125.53 (2), and such a production arrangement is not a prohibited interest under s. 125.20.

SB268-SA2,35,12 (b) Except as provided in sub. (3) (b) 2. and 3., agreements authorized under this section may be entered into only by producers who hold permits issued under the same section of this chapter.

SB268-SA2,35,14 (3) Contract production. (a) An agreement for contract production shall comply with the requirements of this subsection.

SB268-SA2,35,16 (b) An agreement for contract production may be entered into between any of the following:

SB268-SA2,35,17 1. Two producers possessing the same type of permit.

SB268-SA2,35,19 2. A permittee under s. 125.29, as the contract producer, and a permittee under s. 125.295, as the recipe producer.

SB268-SA2,35,20 3. A producer and an out-of-state recipe supplier.

SB268-SA2,35,23 (c) All contract production activities shall occur pursuant to a written agreement between the contract producer and the recipe producer or out-of-state recipe supplier.

SB268-SA2,36,2 (d) 1. Except as provided in subd. 2., alcohol beverages produced under an agreement for contract production between a contract producer and a recipe producer shall count toward the production volume of the recipe producer and shall be considered, for this purpose, as produced on the recipe producer's premises.

SB268-SA2,36,7 2. Alcohol beverages produced under an agreement for contract production between a contract producer and a recipe producer may not be considered in determining production volume for purposes of ss. 125.29 (7), 125.52 (4), and 125.53 (3), but shall be considered as produced by the recipe producer for other purposes under ss. 125.29 (7), 125.52 (4), and 125.53 (3).

SB268-SA2,36,14 (e) The recipe producer shall be considered the producer for purposes of filing reports under s. 139.11 (2) and taxation under ss. 139.02, 139.03, 139.05 (2), and 139.06 (1) and (2), as applicable, and shall include alcohol beverages manufactured under a contract production agreement in the report required under s. 139.11 (2). For alcohol beverages produced under an agreement for contract production between a contract producer and a recipe producer, the contract producer shall exclude the alcohol beverages from reports required under s. 139.11 (2).

SB268-SA2,36,16 (4) Alternating proprietorship. (a) An alternating proprietorship shall comply with the requirements of this subsection.

SB268-SA2,36,18 (b) All alternating proprietorships shall occur pursuant to a written agreement between the host producer and guest producer.

SB268-SA2,36,23 (c) The agreement under par. (b) shall provide that the guest producer retains the right to control the production of the alcohol beverages. If the agreement provides that the host producer and host producer's personnel are agents of the guest producer or acting under the direction of the guest producer, the agreement shall specify the terms and compensation for the use of the host producer's personnel.

SB268-SA2,37,4 (d) The guest producer shall be considered the producer for purposes of filing reports under s. 139.11 (2) and taxation under ss. 139.02, 139.03, 139.05 (2), and 139.06 (1) and (2), as applicable, and shall include alcohol beverages manufactured under an alternating proprietorship in the report required under s. 139.11 (2). The host producer shall exclude alcohol beverages manufactured in an alternating proprietorship from reports required under s. 139.11 (2).

SB268-SA2,37,7 (e) Alcohol beverages produced under an alternating proprietorship shall count toward the production volume of the guest producer and shall be considered, for this purpose, as produced on the guest producer's premises.

SB268-SA2,37,10 (5) Licensing agreements. (a) A producer may enter into a licensing agreement or contract with a licensor authorizing the producer-licensee to use the licensor's trademark or name if all of the following requirements are satisfied:

SB268-SA2,37,11 1. The licensing agreement or contract is in writing.

SB268-SA2,37,13 2. The producer-licensee is entirely responsible for producing the alcohol beverages and for all related processing steps and regulatory requirements.

SB268-SA2,37,16 (b) Alcohol beverages produced under the licensing agreement shall count toward the production volume of the producer-licensee and shall be considered, for this purpose, as produced on the producer-licensee's premises.

SB268-SA2,26aq Section 26aq. 125.22 of the statutes is created to read:

SB268-SA2,37,24 125.22 Common carrier permit; shipments into state. (1) Permit. (a) No common carrier may transport into or deliver within this state any alcohol beverages unless the common carrier first obtains a permit from the division under this section. This subsection does not apply to the transportation into this state for delivery to, or delivery within this state to, a person that holds a license or permit issued under this chapter that authorizes the licensee or permittee to receive the alcohol beverages.

SB268-SA2,38,3 (b) A permit under this section authorizes only the transport into or delivery within this state of wine on behalf of a person holding a direct wine shipper's permit under s. 125.535 or a fulfillment house permit under s. 125.23.

SB268-SA2,38,7 (c) An applicant for a permit under this section shall provide all information required by the division. The division shall require the applicant to submit information, as determined to be appropriate by the division, that is similar to the information required of an applicant for a permit under s. 125.58.

SB268-SA2,38,9 (d) A permit under this section may be issued only to a person who holds a valid certificate issued under s. 73.03 (50).

SB268-SA2,38,10 (e) A permittee under this section shall pay an annual fee of $1,000.

SB268-SA2,38,14 (2) Reports. (a) No later than the 15th day of each month, a common carrier holding a permit under this section shall submit a verified report to the division, in the form and manner prescribed by the division, that includes all of the following information for each shipment of alcohol beverages during the preceding month:

SB268-SA2,38,16 1. The name and address of the person that manufactured the alcohol beverages.

SB268-SA2,38,18 2. The name and address of the consignor of the shipment, if different from the person that manufactured the alcohol beverages.

SB268-SA2,38,19 3. The name and address of the consignee of the shipment.

SB268-SA2,38,20 4. The date of the shipment.

SB268-SA2,38,22 5. The type and quantity of alcohol beverages shipped to the consignee, as reported to the common carrier by the consignor.

SB268-SA2,38,24 6. The parcel tracking number, waybill number, or other identifying number for the shipment.

SB268-SA2,39,6 (b) The division and the department shall keep confidential the information under par. (a) 3. and 6., and this information is not subject to public copying or inspection under s. 19.35 (1), but all other information included in a report under par. (a) is subject to public copying and inspection under s. 19.35 (1) and may not be treated by the division or the department as confidential under any provision of s. 71.78, 71.83, or 139.11 (4).

SB268-SA2,39,12 (c) Nothing in this section alters the requirement that a person shipping alcohol beverages into this state obtain all required permits under this chapter prior to shipment, including any permit under s. 125.535. Nothing in this section grants a manufacturer, rectifier, or shipper of alcohol beverages, including a winery, authority to ship alcohol beverages into this state. Nothing in this section alters the face-to-face sales requirement in ss. 125.272 and 125.51 (6).

SB268-SA2,39,15 (3) Penalties. (a) Any common carrier that fails to obtain a permit required under sub. (1) prior to commencing delivery of alcohol beverages in this state is subject to a fine of not more than $10,000.

SB268-SA2,39,22 (b) Any common carrier that ships alcohol beverages other than wine obtained from a direct wine shipper permittee under s. 125.535 or from a fulfillment house permittee under s. 125.23 is subject to a forfeiture of not more than $2,000. The division shall revoke the permit of any common carrier that violates this prohibition in more than one month during a calendar year. Except as provided in this paragraph, s. 125.12 (5) shall apply with respect to the division's revocation of the permit.

SB268-SA2,39,24 (c) If a common carrier fails to submit a report required under sub. (2), the common carrier is subject to a forfeiture of not more than $2,000.

SB268-SA2,26ar Section 26ar. 125.23 of the statutes is created to read:

SB268-SA2,40,5 125.23 Fulfillment houses. (1) Permit. (a) Before making any shipment to, or causing any shipment to be made to, any individual in this state, a person operating a fulfillment house shall obtain from the division a fulfillment house permit for each location that is involved in the process of shipping wine to residents of this state.

SB268-SA2,40,9 (b) A person holding a permit under this section may provide services only for the warehousing, packaging, order fulfillment, and shipment of alcohol beverages produced by and belonging to a person holding a direct wine shipper's permit under s. 125.535.

SB268-SA2,40,12 (c) An applicant for a permit under this section shall pay an annual fee of $100 for each permit. The permit may be issued for a period of one year and may be renewed annually.

SB268-SA2,40,14 (d) A permit under this section may be issued only to a person who holds a valid certificate issued under s. 73.03 (50).

SB268-SA2,40,16 (2) Permit application. (a) An applicant for a permit under this section shall provide all of the following information as part of the permit application:

SB268-SA2,40,18 1. All locations from which alcohol beverages are to be shipped under the permit.

SB268-SA2,40,22 2. Any other information required by the division. The division shall require the applicant to submit information, as determined to be appropriate by the division, that is similar to the information required of an applicant for a permit under s. 125.58.

SB268-SA2,41,6 (b) Notwithstanding s. 125.04 (5) (a), natural persons obtaining fulfillment house permits are not required to be residents of this state. Notwithstanding s. 125.04 (5) (a) 5., a person is not required to complete a responsible beverage server training course to be eligible for a permit under this section. Corporations and limited liability companies obtaining fulfillment house permits are subject to s. 125.04 (6) and any other person, including any natural person or cooperative, obtaining a fulfillment house permit shall appoint an agent, and be subject to all provisions of s. 125.04 (6), in the same manner applicable to corporations and limited liability companies.

SB268-SA2,41,9 (3) Package labeling. A person holding a permit under this section shall ensure all containers of wine shipped directly to an individual in this state are labeled with all of the following information:

SB268-SA2,41,12 (a) The following words, appearing in capital letters and in a conspicuous location: “CONTAINS ALCOHOL: SIGNATURE OF PERSON AGE 21 OR OLDER REQUIRED FOR DELIVERY."

SB268-SA2,41,14 (b) The name, address, and permit number of the fulfillment house permittee and the name, address, and permit number of the direct wine shipper.

SB268-SA2,41,16 (4) Shipment. (a) A fulfillment house permittee may not ship into this state wine from any person not holding a direct wine shipper's permit under s. 125.535.

SB268-SA2,41,20 (b) A fulfillment house permittee may not ship wine into this state through a common carrier that does not hold a permit under s. 125.22. All containers of wine shipped directly to an individual in this state shall be shipped using a common carrier holding a permit issued under s. 125.22.

SB268-SA2,41,23 (c) Prior to shipping wine to an individual in this state, a fulfillment house permittee shall verify the validity of the permit of each direct wine shipper and of each common carrier associated with the shipment.

SB268-SA2,42,2 (5) Reports. (a) No later than the 15th day of each month, a fulfillment house holding a permit under this section shall submit a verified report to the division, in the form and manner prescribed by the division, that includes all of the following information for each shipment of alcohol beverages during the preceding month:

SB268-SA2,42,4 1. The name and address of the person that manufactured the alcohol beverages.

SB268-SA2,42,6 2. The name and address of the consignor of the shipment, if different from the person that manufactured the alcohol beverages.

SB268-SA2,42,7 3. The name and address of the consignee of the shipment.

SB268-SA2,42,8 4. The date of the shipment.

SB268-SA2,42,9 5. The type and quantity of alcohol beverages shipped to the consignee.

SB268-SA2,42,11 6. The parcel tracking number, waybill number, or other identifying number for the shipment.

SB268-SA2,42,17 (b) The division and the department shall keep confidential the information under par. (a) 3. and 6., and this information is not subject to public copying or inspection under s. 19.35 (1), but all other information included in a report under par. (a) is subject to public copying and inspection under s. 19.35 (1) and may not be treated by the division or the department as confidential under any provision of s. 71.78, 71.83, or 139.11 (4).

SB268-SA2,42,19 (6) Penalties. (a) Any fulfillment house that fails to obtain a permit under this section in violation of sub. (1) is subject to a fine of not more than $10,000.

SB268-SA2,42,25 (b) Any permittee under this section that ships alcohol beverages other than wine obtained from a direct wine shipper holding a permit under s. 125.535 is subject to a forfeiture of not more than $2,000. The division shall revoke the permit of any permittee that violates this prohibition in more than one month during a calendar year. Except as provided in this paragraph, s. 125.12 (5) shall apply with respect to the division's revocation of the permit.

SB268-SA2,43,2 (c) If a fulfillment house fails to submit a report required under sub. (5), the fulfillment house is subject to a forfeiture of not more than $2,000.

SB268-SA2,26at Section 26at. 125.24 of the statutes is created to read:

SB268-SA2,43,8 125.24 No-sale event venue permit. (1) Permit issuance. (a) Except as otherwise provided in this section, the division may issue to property owners no-sale event venue permits that authorize the permittee to rent or lease real property for use as an event venue at which fermented malt beverages and wine are consumed if all requirements under this section are satisfied.

SB268-SA2,43,12 (b) A no-sale event venue permit may be issued only to a person who holds a valid certificate issued under s. 73.03 (50) and is qualified under s. 125.04 (5), except that a person is not required to complete a responsible beverage server training course to be eligible for a permit under this section.

SB268-SA2,43,14 (c) A no-sale event venue permit may not be issued unless all of the following are satisfied:

SB268-SA2,43,16 1. The applicant certifies in the permit application how many events were held at the venue in the 12-month period immediately preceding the application.

SB268-SA2,43,18 2. The applicant identifies with specificity in the permit application the property that is the event venue covered by the permit.

SB268-SA2,43,23 (d) Subject to sub. (2) (c) 3., a permit may not be issued under this section for premises that are covered by any other license or permit under this chapter, but a caterer holding Class “B” and “Class B” licenses may deliver fermented malt beverages and wine to the event venue if all requirements under sub. (2) are satisfied.

SB268-SA2,43,25 (e) The division shall establish an annual fee, calculated to cover the division's administrative costs under this section, for a permit issued under this section.

SB268-SA2,44,4 (2) Activities authorized under permit. (a) A no-sale event venue permit authorizes the permittee to rent or lease real property for use as an event venue at which fermented malt beverages and wine are consumed on no more than 6 days per calendar year and no more than one day per month.

SB268-SA2,44,8 (b) 1. A no-sale event venue permittee may not sell or otherwise provide alcohol beverages to the renter or lessee of the event venue or to any guest or attendee of an event on the event venue, including charging admission for an event on the event venue at which any alcohol beverages are served.

SB268-SA2,44,11 2. A no-sale event venue permittee may not allow any person to possess distilled spirits on the event venue when the event venue is being used by a renter or lessee.

SB268-SA2,44,13 (c) Subject to pars. (d) and (e), a no-sale event venue permit authorizes the permittee to do any of the following:

SB268-SA2,44,16 1. Allow the renter or lessee of the event venue to bring the renter's or lessee's own fermented malt beverages and wine onto the event venue and serve it to guests without charge.

SB268-SA2,44,18 2. Allow the guests of the renter or lessee to bring fermented malt beverages and wine onto the event venue to be consumed by the guests without charge.

SB268-SA2,44,21 3. Allow the renter or lessee to obtain temporary Class “B” and “Class B” licenses for an event held on the event venue and sell fermented malt beverages and wine under the temporary Class “B” and “Class B” licenses on the event venue.