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Public Act 096-0482
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| SB1282 Enrolled |
LRB096 08404 KTG 18516 b |
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AN ACT concerning business.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The Liquor Control Act of 1934 is amended by |
changing Section 6-9 as follows:
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(235 ILCS 5/6-9) (from Ch. 43, par. 126)
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Sec. 6-9.
Registration of trade marks; sale within |
geographical area;
delivery to authorized persons. The |
Legislature hereby finds and declares
that for purposes of
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ensuring the preservation and enhancement of interbrand |
competition in
the alcoholic liquor industry within the State, |
ensuring that importation
and distribution of alcoholic liquor |
in the State will be subject to
thorough and inexpensive |
monitoring by the State, reducing the
importation of illicit or |
untaxed alcoholic liquor into the State,
excluding misbranded |
alcoholic liquor products from the State,
providing incentives |
to distributors to service and sell to larger
numbers of retail |
licensees in the geographic area where such
distributors are |
engaged in business, and reducing the amount of
spoiled and |
overaged alcoholic liquor products sold to consumers,
it is |
necessary to restrict the purchase of alcoholic liquors at
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wholesale in the State to those persons selected by the |
manufacturer,
distributor, importing distributor or foreign |
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importer who owns or
controls the trade mark, brand or name of |
the alcoholic liquor
products sold to such persons, and to |
restrict the geographic area
or areas within which such persons |
sell such alcoholic liquor at
wholesale, as provided in this |
Section.
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Each manufacturer, non-resident dealer, distributor, |
importing distributor,
or
foreign importer who owns or controls |
the trade mark, brand or name of
any alcoholic liquor shall |
register with the State Commission, in the Chicago
office, on |
or before the effective date, the name
of each person to whom |
such manufacturer, non-resident dealer, distributor,
importing
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distributor, or foreign importer grants the right to sell at |
wholesale
in this State any such alcoholic liquor, specifying |
the particular trade
mark, brand or name of alcoholic liquor as |
to which such right is
granted, the geographical area or areas |
for which such right is granted
and the period of time for |
which such rights are granted to such person.
Each |
manufacturer,
non-resident dealer, distributor or importing |
distributor, or foreign
importer who is required to register |
under this Section must furnish a copy
of the registration |
statement at the time of appointment to the person who has
been |
granted the right to sell alcoholic liquor at wholesale. |
However, if a
person who has been appointed the right to sell |
alcoholic liquor at wholesale
does not receive a copy of the |
registration statement as required under this
Section, such |
person may file a registration statement with the State
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Commission, provided that the person furnishes a copy of that |
registration
statement to the manufacturer, non-resident |
dealer, distributor, importing
distributor, or foreign |
importer within 30 days of filing the registration
statement. |
The registration statement shall state:
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(1) the name of the person appointed;
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(2) the name of the manufacturer, non-resident dealer, |
distributor,
importing distributor, or foreign importer from |
whom the person received the
right to sell alcoholic liquor;
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(3) the particular trade mark, brand, or name of alcoholic |
liquor
as
to
which the right to sell at wholesale is granted; |
and
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(4) the geographical areas for which the right to sell at
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wholesale
is
granted.
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Such manufacturer, non-resident dealer, distributor, |
importing distributor,
or
foreign
importer may grant the right |
to sell at wholesale any trade mark, brand
or name of any |
alcoholic liquor in any geographical area to more than
one |
person. If the registration is received after the effective |
date, the
Commission shall treat the date the registration was |
received in the Chicago
office as the effective
date. Such |
registration shall be made on a form prescribed by the
State |
Commission and the State Commission may require such |
registration
to be on a form provided by it.
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A non-resident dealer or foreign importer who is not a |
manufacturer shall file the registration statement jointly |
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with the manufacturer identifying the person authorized by the |
manufacturer to sign the registration statement on behalf of |
the manufacturer. |
No such registration shall be made
in any other manner than |
as is provided in this
Section and only those persons |
registered by the manufacturer, non-resident
dealer, |
distributor, importing distributor or foreign importer, shall |
have
the right to sell at wholesale in this State, the brand of |
alcoholic liquor
specified on the registration form.
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However, a licensed Illinois distributor who has not been |
registered to
sell a brand of alcoholic liquor, but for a |
period of 2 years prior
to
November 8, 1979 has been engaged in |
the purchase of a brand for resale
from a licensed Illinois |
distributor who has the right to sell that brand
at wholesale, |
may continue to purchase and resell the brand at wholesale,
and |
may purchase from the same distributor and resell at wholesale |
any
new brands of the same manufacturer, provided that:
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(1) Within 60 days after November 8, 1979 he identifies |
the brand which
he so purchased to the State Commission and |
the Commission within 30 days
thereafter verifies that the |
purchases have occurred;
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(2) Thereafter, he notifies the State Commission in |
writing of any brands
of the same manufacturer which he |
wishes to purchase from the same distributor
that were not |
available for distribution on or before November 8, 1979,
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and that the Commission within 30 days of such notification |
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verifies
that the brand is a new brand of the same |
manufacturer, and that the same
licensed Illinois |
distributor has the right to sell the new brand at |
wholesale;
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(3) His licensed business address is within the |
geographical area for
which the licensed Illinois |
distributor from whom the purchases are made
has the right |
to sell said brand or brands of alcoholic liquor; and
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(4) His sales are made within the geographical area for |
which the licensed
Illinois distributor from whom the |
purchases are made has the right to sell
the brand or |
brands of alcoholic liquor and only to retail licensees |
whose
licensed premises are located within the |
aforementioned geographical area.
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No person to whom such right is granted shall sell at |
wholesale in
this State any alcoholic liquor bearing such trade |
mark, brand or name
outside of the geographical area for which |
such person holds such
selling right, as registered with the |
State Commission, nor shall he
sell such alcoholic liquor |
within such geographical area to a retail
licensee if the |
premises specified in such retailer's license are
located |
outside such geographical area.
Any licensed Illinois |
distributor who has not been granted the right to sell
any |
alcoholic liquor at wholesale and is purchasing alcoholic |
liquor from a
person who has been granted the right to sell at |
wholesale may sell and deliver
only to retail licensees whose |
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licensed premises are within the same
geographical area as the |
person who has been granted the right to sell at
wholesale.
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No manufacturer, importing distributor, distributor, |
non-resident dealer,
or foreign
importer shall sell or deliver |
any package containing alcoholic liquor
manufactured or |
distributed by him for resale, unless the person to whom
such |
package is sold or delivered is authorized to receive such |
package
in accordance with the provisions of this Act.
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(Source: P.A. 92-105, eff. 1-1-02.)
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Section 10. The Beer Industry Fair Dealing Act is amended |
by changing Section 7 as follows:
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(815 ILCS 720/7) (from Ch. 43, par. 307)
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Sec. 7. Reasonable compensation.
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(1) Subject to the right of any party to an agreement to |
pursue any remedy provided in Section 9, any Any brewer that |
cancels, terminates or fails to renew any agreement,
or |
unlawfully denies approval of, or unreasonably withholds |
consent, to any
assignment, transfer or sale of a wholesaler's |
business assets or voting
stock or other equity securities, |
except as provided in this Act, shall pay
the wholesaler with |
which it has an agreement pursuant to this Act
reasonable |
compensation for the fair market value of the wholesaler's
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business with relation to the affected brand or brands. The |
fair market
value of the wholesaler's business shall include, |
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but not be limited to,
its goodwill, if any.
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(1.5) The provisions of this subsection (1.5) shall only |
apply if the brewer agrees to pay reasonable compensation as |
defined in subsection (1) and when
the total annual volume of |
all beer products supplied by a brewer to a
wholesaler pursuant |
to agreements between such brewer and wholesaler represents 15%
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20% or less of the total annual volume of the wholesaler's |
business for all
beer products supplied by all brewers. For |
purposes of this subsection (1.5)
only, "annual volume"
means |
the volume of beer products sold by the wholesaler in the |
12-month period
immediately preceding receipt of the brewer's |
written offer pursuant to this
subsection (1.5).
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If a brewer is required to pay reasonable compensation as |
described
in subsection (1) and the question of reasonable |
compensation is the only issue
between the parties,
the brewer |
shall, in good faith, make a written offer to
pay reasonable |
compensation. The wholesaler shall have 30 days from receipt of
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the written offer to accept or reject the
brewer's offer. |
Failure to respond, in writing, to the written offer shall
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constitute rejection of the offer to pay reasonable |
compensation. If the
wholesaler, in writing, accepts the |
written offer, the wholesaler shall
surrender the affected |
brand or brands to the brewer at the time payment is
received |
from
the brewer. If the wholesaler does not, in writing, accept |
the brewer's
written offer, either party
may elect to submit |
the determination of reasonable compensation to expedited
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binding arbitration. If one party notifies the other party in |
writing that it
elects expedited binding arbitration, the other |
party has 10 days from receipt
of the notification to elect |
expedited binding arbitration or to
reject the arbitration in |
writing.
Failure to elect arbitration shall constitute
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rejection of the offer to arbitrate.
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(A) If the parties agree to expedited binding |
arbitration, the arbitration
shall
be subject to the |
expedited process under the commercial rules of the |
American
Arbitration Association.
The arbitration shall be |
concluded within 90 days after the parties agree to
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expedited binding arbitration under this Section, unless |
extended by the
arbitrator or one of the parties. The |
wholesaler shall retain the affected
brand or brands during |
the period of arbitration,
at the conclusion of which
the |
wholesaler shall surrender the affected brand or brands to |
the
brewer upon payment of the amount determined to be |
reasonable compensation,
provided the wholesaler shall |
transfer the affected brand or brands to the
brewer
after |
90 days if the arbitration proceedings are extended beyond |
the 90 day
limit at the request of the wholesaler. |
Arbitration costs shall be paid
one-half by the wholesaler |
and
one-half by the brewer. The award of the arbitrator |
shall be final and binding
on the parties.
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(B) If the brewer elects expedited binding arbitration |
but the wholesaler
rejects the offer to arbitrate:
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(i) The wholesaler may accept, in writing, any |
written offer previously
made by the
brewer. If the |
wholesaler selects this option, the wholesaler must |
surrender
the affected brand or brands to the brewer at |
the time payment is received. If
the
wholesaler |
believes that the amount paid by the brewer is less |
than reasonable
compensation under subsection (1), the |
wholesaler may bring a proceeding under
subsection (2) |
for the difference, but may not proceed under |
subsection (3) of
Section 9; or
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(ii) The
wholesaler may proceed against the brewer |
under Section 9, provided
the wholesaler must
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surrender the affected brand or brands to the brewer if |
a proceeding under
Section 9 has not been initiated |
within 90 days after the wholesaler rejects
the offer |
to arbitrate.
Upon determination of reasonable |
compensation pursuant to Section 9, the brewer
shall
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pay the wholesaler the amount so determined.
Until |
receiving payment from the
brewer of the amount so |
determined, the wholesaler shall retain the
affected |
brand or brands.
If (a) the wholesaler retains the |
affected brand or brands for a period of 2
years after |
the wholesaler rejects the offer to arbitrate,
(b) the |
amount of reasonable compensation has not been
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determined, and (c) an injunction has not been issued, |
the brewer shall, in
good
faith, make a payment of |
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reasonable compensation to the wholesaler. If, |
however, the brewer fails to ship or make available |
brands ordered by the wholesaler prior to the brewer |
making any payment (including a good faith payment as |
provided in this subsection) to the wholesaler, the |
wholesaler shall be entitled to injunctive relief and |
attorneys' fees and shall subject the brewer to |
punitive damages. Upon
receipt of this
payment, the |
wholesaler must surrender the affected brand or brands |
to the
brewer, provided that such surrender shall not |
affect the brewer's obligation
to pay all amounts |
ultimately determined due to the wholesaler under this |
Act.
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(C) If the wholesaler elects expedited binding |
arbitration but the brewer
rejects, the brewer may proceed |
under Section 9 for
the
purpose of
determining reasonable |
compensation.
Upon determination of reasonable |
compensation pursuant to Section 9, the brewer
shall
pay |
the wholesaler the amount so determined.
Until receiving |
payment from the
brewer of the amount so determined, the |
wholesaler shall retain the
affected brand or brands.
If |
(a) the brewer initiates a proceeding under Section 9 |
within 90 days after
the wholesaler rejects the offer to |
arbitrate, (b) the wholesaler retains the
affected brand or |
brands for a period of 2 years from the date the wholesaler
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rejects the offer to arbitrate, (c) the amount
of |
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reasonable compensation has not been
determined, and (d) an |
injunction has not been issued, the brewer shall, in
good
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faith, make a payment of reasonable compensation to the |
wholesaler. If, however, the brewer fails to ship or make |
available brands ordered by the wholesaler prior to the |
brewer making any payment (including a good faith payment |
as provided in this subsection) to the wholesaler, the |
wholesaler shall be entitled to injunctive relief and |
attorneys' fees and shall subject the brewer to punitive |
damages. Upon
receipt of this
payment, the wholesaler must |
surrender the affected brand or brands to the
brewer, |
provided that such surrender shall not affect the brewer's |
obligation
to pay all amounts ultimately determined due to |
the wholesaler under this Act.
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(2) Except as otherwise provided in subsection (1.5), in |
the event that
the brewer and the beer wholesaler are unable to
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mutually agree on the reasonable compensation to be paid for |
the value of
the wholesaler's business, as defined in this Act, |
either
party may maintain a civil suit as provided in Section 9 |
or the matter
may, by mutual agreement of the parties, be |
submitted to a neutral
arbitrator to be selected by the parties |
and the claim settled in
accordance with the rules provided by |
the American Arbitration Association.
Arbitration costs shall |
be paid one-half by the wholesaler and one-half by
the brewer. |
The award of the arbitrator shall be final and binding on the
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parties.
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