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  The ILCC Legal Division

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TPP-3:
Manufacturer, Distributor And Importing Distributor sponsorship of events at retail premises

I. Purpose

To set the policy of the Illinois Liquor Control Commission (ILCC) and establish the procedures whereby manufacturers, distributors and importing distributors may sponsor events at retail premises.

II. Policy

It is the policy of this Commission that manufacturers, non-resident dealers, distributors, and importing distributors or foreign importers may sponsor events at licensed retail premises under the following terms and conditions.

III. Background

Sections 5/6-4, 5/6-5 and 5/6-6 of the Illinois Liquor Control Act (235 ILCS 5/6-4, 5/6-5 & 5/6-6) deal with things “of value” in dealings between manufacturers, non-resident dealers, distributors , and importing distributors, or foreign importers and retailers. This Commission’s Trade Practices concerning things “Of Value” (TPP-1) is incorporated herein by reference.

Section 100.330, titled “Advertising,” provides:

  1. Pursuant to Sections 6-4, 6-5, and 6-5 of the Act (235 ILCS
    5/6-4, 6-5, and 6-6), no retail licensee or entity having more than a 5% interest in a retail licensee shall have any, direct or indirect, interest in or control of any advertising or promotional company which receives funds, directly or indirectly from, or for the account of, any manufacturer, non-resident dealer, broker, distributor, importing distributor or foreign importer of alcoholic beverages; nor shall any manufacturer, non-resident dealer, broker, distributor, importing distributor or foreign importer make any payment, direct or indirect, to any retailer or any other entity which provides advertising, promotional or display services for retailers in consideration of any advertising or promotional efforts of any kind not allowed under the Illinois Liquor Control Act or the rules and regulations of the Commission.
  2. Nothing herein shall prohibit any manufacturer, non-resident dealer, distributor, importing distributor, or foreign importer from sponsoring an event at a venue which sole purpose is to host live entertainment, provided that no indirect or direct payment is made to the retailer and that any reference to the retailer in any advertising is incidental to the event itself.
  3. Subsections (1) and (2) above do not apply to a person holding a special event retailer’s license. (Source: Amended at 20 Ill. Reg. 834, effective January 2, 1996)

IV. Procedure

Manufacturers, non-resident dealers, distributors , and importing distributors or foreign importers may sponsor events on behalf the premises of retailers under the following terms and conditions:

  1. The manufacturer, non-resident dealers, distributor, or importing distributor or foreign importers must provide all advertising and promotional items costs, without cost, or make payment directly to a third-party promoter (e.g., a non-licensed entity participating in the creation of the event.) provided any payment made to a third party promoter shall be solely for advertising and promotional costs. A copy of the signed paid receipt itemizing the advertising and promotional costs shall be maintained by the manufacturer, non-resident dealer, distributor, importing distributor, or foreign importer furnishing such advertising and promotional costs;
  2. Except as limited by Paragraph A above, The manufacturer, non-resident dealer, distributor, or importing distributor, foreign importer or third party promoter shall not give any financial remuneration directly or indirectly to the retailer;
  3. Third-party promoters cannot be affiliated with or under the control of, either directly or indirectly, the retailer, distributor or manufacturer, non-resident dealer, distributor, or importing distributor or foreign importer, in any manner;
  4. The focus of all advertising of the event must give primary emphasis to the event itself, the charitable, philanthropic reason therefore, etc., and therefore any reference to the retailer in any advertising materials must be strictly incidental to the event (e.g., stating the location of the event);
  5. The “sponsoring” retailer may not restrict the availability of any other alcoholic liquor, nor may it exclude or require the sale of any other manufacturer’s, non-resident dealer’s, or distributor’s, importing distributor’s or foreign importer’s product during the event;
  6. Manufacturers, non-resident dealers, distributors, and importing distributors or foreign importers must make all reasonable attempts to conduct events only at retail locations which can accommodate such events (e.g. all venues that are geared to concert presentations must be given equal opportunities to host concerts);
  7. Manufacturers, non-resident dealers, distributors and importing distributors or foreign importers may not repeatedly sponsor events for one retailer or group of retailers to the exclusion of all other retailers;
  8. Manufacturers, distributors and importing distributors must, prior to the event, obtain from the third party promoter a signed affidavit containing the information requested in the form set forth hereafter. Such affidavit shall be filed with the Commission prior to the event and a copy retained by the manufacturer, distributor and importing distributor furnishing the advertising and promotional items in accordance with Section 5/6-10 (235 ILCS 5/6-10). Prior to holding the event, the manufacturer, non-resident dealer, distributor, importing distributor or foreign importer furnishing the advertising or promotional costs or making payment to the Third Party Promoter shall receive from the retailer a sworn statement executed by the Third Party Promoter containing the information in the form provided hereafter. The Commission shall be furnished a copy of the sworn statement by the retailer and the Commission shall receive a copy of the sworn statement at least two (2) business days prior to the event. The retailer may furnish to the Commission a copy of the sworn statement by facsimile, delivery in person the Commission’s Office in Chicago or Springfield or by Certified Mail, postage prepaid.

V. Third-Party Promotion Company Affidavit Statement

All retail liquor licensees utilizing the services of a so-called “third-party
promotion” company, shall file with the Commission, before any services are provided it by the third-party promotion company, an affidavit from the owner of the third-party promotion company and an affidavit from the retailer, in substantially the following formats:

STATE OF ILLINOIS
LIQUOR CONTROL COMMISSION

In the Matter of:

Re: (Nature of sponsored Event or Services provided by Third-Party Company)

Date of event:

Retailer:

Supplier or Wholesaler:

Third-party company:

THIRD-PARTY COMPANY AFFIDAVIT
[RETAILER LICENSEE FORM]

The undersigned, being first duly sworn, on oath deposes and states:

  1. I am the (title/capacity) of the above Retailer licensee, located at (location)
  2. I have full legal capacity to execute this Affidavit on behalf of the retailer licensee.
  3. The retailer licensee presently holds Illinois Retailer Liquor License No. (XX-1A-XXXXXX), which expires on (date).
  4. The retailer has retained the services of the above Third-party company in connection with the above specified sponsored event or services to be conducted on the retailer's licensed premises.
  5. That neither the retailer licensee, nor any officer, director, shareholder, employee or representative of the retail licensee has any interest, direct or indirect, in the third-party company.
  6. That all funds paid to the third-party company shall represent the fair market value of such services rendered by it to or on behalf of the above supplier or wholesaler.
  7. That no funds paid to the third-party company for services rendered to or on behalf of the above supplier or wholesaler will be paid to the retailer liquor licensee or any person affiliated with the retailer liquor licensee, including but not limited to payments for merchandising and promotional services, scan-backs, undocumented coupon redemptions, etc.
  8. Complete the following subparagraphs which are applicable to the specific sponsored event or services:
    1. The following is a detailed description of the "sponsored event" that will be held at the retailer licensee's business premises:
    2. The cost of sponsorship shall be: (Dollars), covering the following expenses: (list of expenses)

    3. I hereby represent that the sole purpose of the venue where the event is to be held is to host live entertainment in conformity with Regulation 100.330(b).
    4. The following is a detailed description of the merchandising and promotional services that will be furnished to or installed on the retailer licensed premises, including the name of the company which retained the third-party company, the cost of each item furnished to the retailer licensee plus the normal and customary cost of labor, erection and installation, and the person to whom the payment shall be made.

Dated:

Affiant:

Title:

State of Illinois )
)ss.
County of Xxxx )

Subscribed and sworn to before me this day of
(insert date)

Notary Public (SEAL)

This completed form shall be filed with the Illinois Liquor Control Commission, 100 West Randolph Street, Suite 7-801, Chicago, IL 60601; fax 312-814-2241.

and:

STATE OF ILLINOIS
LIQUOR CONTROL COMMISSION

In the Matter of:

Re: (Nature of sponsored Event or Services provided by Third-Party Company)

Date of event:

Retailer:

Supplier or Wholesaler:

Third-party company:

THIRD-PARTY COMPANY AFFIDAVIT
[THIRD-PARTY FORM]

The undersigned, being first duly sworn, on oath deposes and states:

  1. I am the (title/capacity) of (name of third-party company) (hereafter referred to as "third-party company").
  2. I have full legal capacity to execute this Affidavit on behalf of the third-party company.
  3. The above referenced retailer has retained the services of the the third-party company in connection with the above specified sponsored event or services to be conducted on the retailer's licensed premises.
  4. That neither the retailer licensee, nor any officer, director, shareholder, employee or representative of the retail licensee has any interest, direct or indirect, in the third-party company.
  5. That all funds paid to the third-party company shall represent the fair market value of such services rendered by it to or on behalf of the above supplier or wholesaler.
  6. That no funds paid to the third-party company for services rendered to or on behalf of the above supplier or wholesaler will be paid to the retailer liquor licensee or any person affiliated with the retailer liquor licensee, including but not limited to payments for merchandising and promotional services, scan-backs, undocumented coupon redemptions, etc.
  7. Complete the following subparagraphs which are applicable to the specific sponsored event or services:
    1. The following is a detailed description of the "sponsored event" that will be held at the retailer licensee's business premises:
    2. The cost of sponsorship shall be: (Dollars), covering the following expenses: (list of expenses)

    3. I hereby represent that the sole purpose of the venue where the event is to be held is to host live entertainment in conformity with Regulation 100.330(b).
    4. The following is a detailed description of the merchandising and promotional services that will be furnished to or installed on the retailer licensed premises, including the name of the company which retained the third-party company, the cost of each item furnished to the retailer licensee plus the normal and customary cost of labor, erection and installation, and the person to whom the payment shall be made.

Dated:

Affiant:

Title:

State of Illinois )
)ss.
County of Xxxx )

Subscribed and sworn to before me this day of
(insert date)

Notary Public (SEAL)

This completed form shall be filed with the Illinois Liquor Control Commission, 100 West Randolph Street, Suite 7-801, Chicago, IL 60601; fax 312-814-2241.


In the event a manufacturer, non-resident dealer, distributor, importing distributor or foreign importer furnishes advertising and promotional costs or makes payment to the Third Party Promoter for such advertising and promotional costs in an amount in excess of $500.00 for each location, such manufacturer, non-resident dealer, distributor, importing distributor or foreign importer shall secure prior approval from the Commission by identifying the proposed advertising and promotional costs, which total costs cannot exceed $2,500.00 for each location associated therewith to be furnished to the Third Party Promoter, such request to the Commission shall be furnished prior to scheduling the event at the location of the retail premises.

VI. Exceptions

The limitations under Section V above do not apply to units of government holding retailer’s liquor licenses; however, such limitation under Paragraph V will apply if the retail license is held in the name of a concessionaire which is not a public body.

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