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On January 1, 2012, California Business and Professions Code Section 23394.7 goes into effect, which aims to regulate alcohol sales at self-checkout terminals.  The controversial law provides that “no privileges under an off-sale license shall be exercised by the licensee at any customer-operated checkout stand located on the licensee’s physical premises.”  The law has been opposed since its inception by grocery stores with self-checkout and has been supported by retail clerks labor unions, among other entities.

The California Alcoholic Beverage Control issued an Industry Advisory to explain the new law last week, and the California Grocers Association (“CGA”) just filed a petition contesting the terms of the Advisory.  For example, the Industry Advisory provides in part, “it is clear that ‘customer-operated checkout stand’ means a checkout stand or station that is designated for operation by the customer.”  In its petition in the California Third District Court of Appeal, the CGA argues that the ABC overstepped its regulatory authority by defining one of the law’s key provisions in the Advisory, rather than going through the formal rule-making process required by the California Administrative Procedure Act.  The CGA also argues that the definition put forth by the ABC is inconsistent with the statute.  The CGA has asked that the Advisory be set aside, or that its effect at least be delayed until the issue has been resolved.  Check back for updates!

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2011 · All Rights Reserved ·

Paper or plastic, Bordeaux or rosé? Two states, Tennessee and New York, currently have active bills aimed at permitting grocery stores to sell wine. Proponents of the bills argue the change will generate jobs and create new tax revenue by expanding the consumer base. Opponents argue that liquor stores in the states, which are small and locally owned by law, will suffer steep losses in revenue and possibly face layoffs. In Tennessee, it appears that the bill’s opponents have been more persuasive to date, with a vote on the measure postponed until the summer of 2012. The New York Bill has bipartisan support and is possibly up for a vote before the legislative session ends in late June. Similar bills have been defeated in New York by the liquor store lobby in the past. As a preemptive measure, the new bill includes incentives for liquor stores, including the right to own more than one store. Even the title of the bill, “the wine industry and liquor store development act” reflects the hope that the liquor store lobby can be appeased. Given the fiscal climate, one factor that may garner additional emboldened supporters this time around is the “changeover” fees potentially generated by the measure: $346.7 million in new revenue in the first year through franchise and license fees, excise taxes and sales taxes.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010-2011 · All Rights Reserved ·