Full Text of HB1084 95th General Assembly
HB1084 95TH GENERAL ASSEMBLY
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95TH GENERAL ASSEMBLY
State of Illinois
2007 and 2008 HB1084
Introduced 2/8/2007, by Rep. Lou Lang SYNOPSIS AS INTRODUCED: |
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815 ILCS 720/1.1 |
from Ch. 43, par. 301.1 |
815 ILCS 720/5 |
from Ch. 43, par. 305 |
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Amends the Beer Industry Fair Dealing Act. Defines "brand extension" as a brand that incorporates all or a substantial part of the features of a pre-existing brand of the same brewer and that relies to a significant extent on the good will associated with the pre-existing brand. Provides that a brewer may not fail to assign brand extensions to a wholesaler who has been granted the territory to the brand from which the brand extension resulted and who agrees to accept the brand extension, but this requirement does not apply if the wholesaler is not in compliance with the agreement at the time the brewer offers the brand extension to the wholesaler. Provides that a brewer who, under an agreement with a wholesaler that does not violate antitrust laws, has designated a sales territory for which the wholesaler is exclusively (rather than primarily) responsible or in which the wholesaler is required to concentrate its efforts, may not enter into an agreement with any other wholesaler to establish an additional wholesaler for the brewer's brand or brand extension in the territory. Provides that a wholesaler who, under an agreement is granted a sales territory for which it is exclusively (rather than primarily) responsible or in which it is required to concentrate its efforts, may not sell or deliver of beer to any retail licensee whose place of business is not within the territory granted to the wholesaler. Effective immediately.
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A BILL FOR
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HB1084 |
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LRB095 09966 LCT 30179 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 Beer Industry Fair Dealing Act is amended by | 5 |
| changing Sections 1.1 and 5 as follows:
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| (815 ILCS 720/1.1) (from Ch. 43, par. 301.1)
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| Sec. 1.1. As used in this Act:
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| (1) "Beer" means a beverage obtained by the alcoholic | 9 |
| fermentation of an
infusion or concoction of barley, or other | 10 |
| grain, malt, and hops in water,
and includes, among other | 11 |
| things, beer, ale, stout, lager beer, porter and
the like.
For | 12 |
| purposes of this Act only, the term "beer" shall also include | 13 |
| malt
beverage products containing less
than one-half of 1% of | 14 |
| alcohol by volume and marketed for adult consumption as
an | 15 |
| alternative beverage to beer.
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| (2) "Agreement" means any contract, agreement, | 17 |
| arrangement,
operating
standards, or amendments to a contract, | 18 |
| agreement, arrangement, or operating
standards, the effect of | 19 |
| which is to substantially change or modify
the existing | 20 |
| contract, agreement, arrangement, or operating standards,
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| whether
expressed or implied, whether oral or written, for a | 22 |
| definite or indefinite
period between a brewer and a wholesaler | 23 |
| pursuant to which a wholesaler
has been granted the right to |
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HB1084 |
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LRB095 09966 LCT 30179 b |
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| purchase, resell, and distribute as
wholesaler or master | 2 |
| distributor
any brand
or brands of beer offered by a brewer. | 3 |
| The agreement between a brewer
and wholesaler shall not be | 4 |
| considered a franchise relationship.
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| (3) "Wholesaler" or "beer wholesaler" means any person, | 6 |
| other than a
manufacturer licensed under The Liquor Control Act | 7 |
| of 1934, who is
engaged in this State in purchasing, storing, | 8 |
| possessing or warehousing any
alcoholic liquors for resale or | 9 |
| reselling at wholesale, whether within or
without this State.
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| (4) "Brewer" means a person who is engaged in the | 11 |
| manufacture of beer,
a master distributor as defined in this
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| Section, a
successor brewer as defined in this Section, a | 13 |
| non-resident dealer under the
provisions of the Liquor Control | 14 |
| Act of 1934, a foreign importer under the
provisions of the | 15 |
| Liquor Control Act of 1934, or a person who owns or controls
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| the trademark, brand, or name of beer.
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| (4.5) "Brand" means any word, name, group of letters, | 18 |
| symbols, or any combination thereof that is adopted and used by | 19 |
| a brewer to identify a specific beer product and to distinguish | 20 |
| that beer product from another beer product. | 21 |
| (4.7) "Brand extension" means any brand that incorporates | 22 |
| all or a substantial part of the features of a pre-existing | 23 |
| brand of the same brewer and that relies to a significant | 24 |
| extent on the good will associated with the pre-existing brand.
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| (5) "Master Distributor" means a person who, in addition to | 26 |
| being a
wholesaler, acts in the same or
similar capacity as a |
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LRB095 09966 LCT 30179 b |
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| brewer or outside seller of one or more brands of
beer to other | 2 |
| wholesalers on a regular basis in the normal course of
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| business.
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| (6) "Successor Brewer" means any person who in any way
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| obtains the distribution rights that a
brewer or master | 6 |
| distributor once had
to manufacture or distribute a brand or | 7 |
| brands
of beer whether by merger, purchase of corporate shares, | 8 |
| purchase of
assets, or any other arrangement.
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| (7) "Person" means a natural person, partnership, | 10 |
| corporation, trust,
agency, or other form of business | 11 |
| enterprise. Person also includes heirs,
assigns, personal | 12 |
| representatives and guardians.
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| (8) "Territory" or "sales territory" means the geographic | 14 |
| area of primary
sales responsibility designated by an agreement | 15 |
| between a wholesaler and
brewer for any brand or brands of the | 16 |
| brewer.
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| (9) "Good cause" exists if the wholesaler or affected party | 18 |
| has failed
to comply with essential and reasonable requirements | 19 |
| imposed upon the
wholesaler or affected party by the agreement. | 20 |
| The requirements may not be
discriminating either by their | 21 |
| terms or in the methods of their enforcement
as compared with | 22 |
| requirements imposed on other similarly situated
wholesalers | 23 |
| by the brewer. The requirements may not be inconsistent with
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| this Act or in violation of any law or regulation.
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| (10) "Good faith" means honesty in fact and the observance | 26 |
| of reasonable
commercial standards of fair dealing in the trade |
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HB1084 |
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LRB095 09966 LCT 30179 b |
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| as defined and
interpreted under Section 2-103 of the Uniform | 2 |
| Commercial Code.
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| (11) "Reasonable standards and qualifications" means those | 4 |
| criteria
applied by the brewer to similarly situated | 5 |
| wholesalers during a period of
24 months before the proposed | 6 |
| change in manager or successor manager of the
wholesaler's | 7 |
| business.
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| (12) "Affected party" means a wholesaler, brewer, master | 9 |
| distributor,
successor brewer, or any person that is a party to | 10 |
| an agreement.
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| (13) "Signs" means signs described in Section 6-6 of the | 12 |
| Liquor Control
Act of 1934.
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| (14) "Advertising materials" means advertising materials | 14 |
| described in
Section 6-6 of the Liquor Control Act of 1934.
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| (Source: P.A. 90-373, eff. 8-14-97; 91-247, eff. 7-22-99.)
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| (815 ILCS 720/5) (from Ch. 43, par. 305)
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| Sec. 5. Prohibited conduct. No brewer shall:
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| (1) Induce or coerce, or attempt to induce or coerce, | 19 |
| any wholesaler to
engage in any illegal act or
course of | 20 |
| conduct either by threatening to
amend, modify, cancel, | 21 |
| terminate, or refuse to renew any agreement existing
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| between the brewer and the wholesaler, or by any other | 23 |
| means.
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| (2) Require a wholesaler to assent to any unreasonable | 25 |
| requirement,
condition, understanding or term or an |
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LRB095 09966 LCT 30179 b |
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| agreement prohibiting a wholesaler
from selling the | 2 |
| product of any other brewer or brewers.
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| (3) Directly or indirectly fix or maintain
the price at | 4 |
| which a wholesaler may resell beer.
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| (4) Fail to provide to each wholesaler of its brands a | 6 |
| written contract
which embodies the brewer's agreement | 7 |
| with its wholesalers and conforms
to the provisions of this | 8 |
| Act.
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| (5) Require any wholesaler to accept delivery of any | 10 |
| beer, signs,
advertising materials, or any other
item or | 11 |
| commodity which has not been ordered by the wholesaler, or | 12 |
| require
any wholesaler to accept a common carrier for | 13 |
| delivery of beer into this State
unless the wholesaler | 14 |
| consents to the common carrier. In the event
a brewer | 15 |
| adopts a uniform practice of delivering beer into this | 16 |
| State to the
premises of all licensed wholesalers, the | 17 |
| brewer may select the common carrier
in this State.
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| (6) Require a wholesaler without the wholesaler's | 19 |
| approval to
participate in an arrangement for the payment | 20 |
| or crediting by an electronic
fund transfer transaction for | 21 |
| any item or commodity other than beer or to
access a | 22 |
| wholesaler's account for any item or commodity other than | 23 |
| beer.
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| (7) Require a wholesaler to assent to any requirement
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| prohibiting the wholesaler from disposing, after notice to | 26 |
| the brewer,
of a product which has been deemed salvageable |
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LRB095 09966 LCT 30179 b |
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| by a local or State health
authority. Nothing herein shall | 2 |
| prohibit the brewer from having the first
right to purchase | 3 |
| the salvageable product from the wholesaler at a price
not | 4 |
| to exceed the original cost of the product or to | 5 |
| subsequently
repurchase the product from the insurance | 6 |
| company or salvage company.
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| (8) Refuse to approve or require a wholesaler to | 8 |
| terminate a manager
or successor manager without good | 9 |
| cause. A brewer has good cause only if
the person | 10 |
| designated as manager or successor manager by the | 11 |
| wholesaler
fails to meet reasonable standards and | 12 |
| qualifications.
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| (9) Present an agreement to a wholesaler that attempts | 14 |
| to waive
compliance with any provision of this Act or that | 15 |
| requires the wholesaler to
waive compliance with any | 16 |
| provision of this Act.
No brewer shall induce or coerce, or | 17 |
| attempt to induce or coerce, any
wholesaler to assent to | 18 |
| any agreement, amendment, renewal, or replacement
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| agreement that does not comply with this Act and
the laws | 20 |
| of this State.
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| (10) Terminate or attempt to terminate an agreement on | 22 |
| the basis that
the wholesaler refuses to purchase signs or | 23 |
| advertising materials or any
quantity or types thereof.
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| (11) Discriminate against a wholesaler who has entered | 25 |
| into a contract
relative to signs or advertising materials | 26 |
| by not making signs or advertising
materials or any |
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LRB095 09966 LCT 30179 b |
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| quantity or types thereof available to the wholesaler when | 2 |
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brewer makes available such signs or advertising | 3 |
| materials to other similarly
situated wholesalers in this | 4 |
| State.
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| (12) Present an agreement requiring the wholesaler to | 6 |
| arbitrate all
disputes without offering the wholesaler in | 7 |
| writing the opportunity to reject
arbitration and elect to | 8 |
| resolve all disputes by maintaining a civil suit in
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| accordance with this Act.
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| (13) Fail to assign brand extensions to a wholesaler | 11 |
| who has been granted the territory to the brand from which | 12 |
| the brand extension resulted and agrees to accept the brand | 13 |
| extension; however, this requirement does not apply if the | 14 |
| wholesaler is not in compliance with the agreement at the | 15 |
| time the brewer offers the brand extension to the | 16 |
| wholesaler.
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| No brewer who, pursuant to an agreement with a wholesaler | 18 |
| which does not
violate antitrust laws, has designated a sales | 19 |
| territory for which the
wholesaler is exclusively
primarily | 20 |
| responsible or in which the wholesaler is required
to | 21 |
| concentrate its efforts, shall enter into an agreement with any | 22 |
| other
wholesaler for the purpose of establishing an additional | 23 |
| wholesaler for the
brewer's brand ,
or brands , or brand | 24 |
| extension in the territory.
in all or part of the same | 25 |
| territory.
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| No wholesaler who, pursuant to an agreement is granted a |
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HB1084 |
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LRB095 09966 LCT 30179 b |
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| sales territory
for which it shall be exclusively
primarily | 2 |
| responsible or in which it is required to
concentrate its | 3 |
| efforts, shall make any sale or delivery of beer to any
retail | 4 |
| licensee whose place of business is not within the territory | 5 |
| granted
to the wholesaler.
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| (Source: P.A. 90-373, eff. 8-14-97; 91-247, eff. 7-22-99.)
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| Section 99. Effective date. This Act takes effect upon | 8 |
| becoming law.
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