2013 -- S 0953

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LC02517

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2013

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A N A C T

RELATING TO ALCOHOLIC BEVERAGES - LICENSES GENERALLY

     Introduced By: Senator Ryan W. Pearson

     Date Introduced: May 16, 2013

     Referred To: Senate Special Legislation and Veterans Affairs

It is enacted by the General Assembly as follows:

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     SECTION 1. Section 3-5-10 of the General Laws in Chapter 3-5 entitled "Licenses

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Generally" is hereby amended to read as follows:

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     3-5-10. Residence of licensees and qualifications of persons and corporations as

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licensee. -- (a) (1) Except as otherwise provided, licenses are issued only to citizens who are

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residents of this state. It is not required that dining car companies, sleeping car companies,

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railroad companies operating in this state, or companies operating passenger-carrying marine

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vessels in this state be citizens of this state in order to be eligible to receive retailers' Class G

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licenses. Retailer's licenses may, however, be issued to corporations incorporated in any other of

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the United States which are authorized by the secretary of state to transact business in this state.

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      (2) Notwithstanding the provisions of subsection (a)(1) of this section, no license shall

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be issued, granted, renewed, or transferred to any trust or trustee or to any corporation of which

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any share or shares of stock or other indicia of ownership or control are owned or held by any

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trust, or trustee, business organization, or other entity or person other than a natural person or

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corporation authorized by the secretary of state to transact business in this state; provided,

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however, that this subsection shall not affect any grant, renewal, or transfer of a license which

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occured prior to the effective date of this subsection [June 15, 2000].

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      (b) (1) In applications for beverage licenses by corporations except those having more

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than twenty-five (25) stockholders, the names and addresses of all officers and members of the

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board of directors and of all stockholders shall be filed with the board, body, or official to whom

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application is made. No beverage license shall be issued to the corporation unless each officer,

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director or stockholder is a suitable person to hold a license within the discretion of the board,

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body or official to whom application is made.

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      (2) All those corporations holding beverage licenses shall report to the board, body or

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official who issued the licenses the name of any newly elected officer or director and the

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acquisition by any person of more than ten percent (10%) of any class of corporate stock, within

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thirty (30) days after the election or acquisition. Thereupon, the board, body or official may call a

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hearing, at its discretion, to determine whether the new officer, director or stockholder is a

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suitable person under this section and the board, body or official may revoke or suspend the

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license if the new officer or director or stockholder is not a suitable person to hold a license.

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      (3) No person shall acquire fifty percent (50%) or more of any class of the stock of any

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corporation licensed under this section, except corporations having more than twenty-five (25)

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stockholders, unless permission for the acquisition is first given by the board, body or official

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who issued the license. Application for permission to acquire stock is subject to the provisions of

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section 3-5-19 relating to the transfer of a license to another person except that it shall not be

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necessary that a new bond be given. Unless the board, body or official determines that the person

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seeking permission to acquire fifty per cent (50%) or more of the corporation's stock is a suitable

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person to hold a license, the permission shall not be given.

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      (4) The beverage license of a corporation is subject to suspension or revocation for

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failure to comply with any of the provisions of this section or for any fraud or misrepresentation

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in connection with the beverage license.

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      (c) Applicants for beverage licenses shall make full disclosure in their applications for a

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license of any interest, whether direct or indirect, by any other person, firm or corporation in the

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license applied for, and failure to do so or any misrepresentation by the applicant may be cause

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for denial of the application or revocation of the license if granted by the board, body or official

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issuing the license.

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      (d) The board, body or official issuing beverage licenses may also deny applications of

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persons who have criminal records, or who have records of repeated violations of this title;

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provided, however, that the provisions contained in this subsection relating to criminal records

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shall not apply to license holders pursuant to section 3-6-1.1 relating to farmer-winery licenses.

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     SECTION 2. Sections 3-6-1 and 3-6-13 of the General Laws in Chapter 3-6 entitled

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"Manufacturing and Wholesale Licenses" are hereby amended to read as follows:

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     3-6-1. Manufacturer's license. -- (a) A manufacturer's license authorizes the holder to

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establish and operate a brewery, distillery, or winery at the place described in the license for the

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manufacture of beverages within this state. The license does not authorize more than one of the

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activities of operator of a brewery or distillery or winery and a separate license shall be required

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for each plant.

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      (b) The license also authorizes the sale at wholesale at the licensed place by the

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manufacturer of the product of the licensed plant to another license holder and the transportation

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and delivery from the place of sale to a licensed place or to a common carrier for that delivery.

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The license does not authorize the sale of beverages for consumption on premises where sold.

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The license does not authorize the sale of beverages in this state for delivery outside this state in

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violation of the law of the place of delivery.

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      (c) The annual fee for the license is three thousand dollars ($3,000) for a distillery, and

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five hundred dollars ($500) for a brewery, and one thousand five hundred dollars ($1,500) for a

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winery producing more than fifty thousand (50,000) gallons per year and five hundred dollars

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($500) per year for a winery producing less than fifty thousand (50,000) gallons per year. Farmer-

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wineries as set forth in section 3-6-1.1 shall pay a fee of five hundred dollars ($500) anytime the

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ownership interest in the farmer-winery is changed, or transferred to another person, corporation

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or other entity. All those fees are prorated to the year ending December 1 in every calendar year

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and shall be paid to the division of taxation and be turned over to the general treasurer for the use

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of the state.

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     3-6-13. License bonds to state. -- As conditions precedent to the issuance by the

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department of any manufacturer's license, rectifier's license, wholesaler's Class A license,

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wholesaler's Class B license, and wholesaler's Class C license under the provisions of this

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chapter, the person applying for a license shall give bond to the general treasurer of the state in a

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penal sum in the amount that the department of business regulation requests with at least two (2)

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resident sureties satisfactory to the department of business regulation, or a surety company

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authorized to do business in this state as surety, which bond shall be on condition that the licensee

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will not violate or suffer to be violated on any licensed premises under his or her control any of

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the provisions of this chapter or of chapter 5 of this title or of chapters 10, 34, 40 or 45 of title 11

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or sections 11-2-1, 11-9-13, 11-9-15, 11-11-5, 11-11-6, 11-18-2 -- 11-18-4, 11-20-1, 11-20-2, 11-

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23-4, 11-31-1 or 11-37-2 -- 11-37-4 and on condition that the licensee will pay all costs and

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damages incurred by any violation of any of those chapters or sections, and shall also pay to the

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division of taxation the license fee required by this chapter; provided, however, that any farmer-

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winery licensed pursuant to section 3-6-1.1 which has a tax liability of five thousand dollars

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($5,000) or less shall be exempt from the provisions of this section.

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     SECTION 3. This act shall take effect upon passage.

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LC02517

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO ALCOHOLIC BEVERAGES - LICENSES GENERALLY

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     This act would amend several sections of the general laws relating to wineries.

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     This act would take effect upon passage.

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LC02517

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