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  The ILCC Legal Division

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TPP-38:
Distributor Warehousing

I. Policy

It is the policy of the Illinois Liquor Control Commission (ILCC) that licensed Illinois distributors, importing distributors and foreign importers shall only store alcoholic liquors for sale to licensees in this State and to persons without the State, as may be permitted by law, from licensed premises located within the State of Illinois.

II. Background

The following sections of the Liquor Control Act apply:

5/5-1. Licenses issued by Illinois Liquor Control Commission

Licenses issued by the Illinois Liquor Control Commission shall be of the following classes: (b) A distributor's license shall allow the wholesale pur­chase and storage of alcoholic liquors and sale of alcoholic liquors to licensees in this State and to persons without the State, as may be permitted by law.

5/6-8. Record of Alcoholic Liquor B Storage.

Each manufacturer or importing distributor or foreign im­porter shall keep an accurate record of all alcoholic liquors manu­factured, distributed, sold, used, or delivered by him in this State during each month, showing therein to whom sold, and shall furnish a copy thereof or a report thereon to the State Commission, as the State Commission may, request. Each importing distributor or manufacturer to whom alcoholic liquors imported into this State have been consigned shall effect possession and physical control thereof by storing such alcoholic liquors in the premises wherein such importing distributor or manufacturer is licensed to engage in such business as an im­porting distributor or manufacturer and to make such alcoholic liquors together with accompanying invoices, bills of lading and receiving tickets available for inspection by an agent or representative of the Department of Revenue and of the State Commission.

All alcoholic liquor imported into this State must be off-loaded from the common carrier, vehicle, or mode of transportation by which the alcoholic liquor was delivered into this State. The alcoholic liquor shall be stored at the licensed premises of the importing distributor before sale and delivery to licensees in this State. A distributor or importing distributor, upon application to the Commission, may secure a waiver of the provisions of this Section for purposes of delivering beer directly to a licensee holding or otherwise participating in a special event sponsored by a unit of government or a not-for-profit organization.

5/6-9. Registration of trade marks, etc. B Sale within geographical
area B Delivery to authorized persons

The Legislature hereby finds and declares that for purposes of 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 wholesale in the State to those persons selected by the manufacturer, distributor, importing distributor or foreign 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.

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 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 granted the right to sell alcoholic liquor at wholesale. 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. No such registration shall be made by any other person or 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. 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:

  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;
  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, and that the Commission within 30 days of such notification 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;
  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
  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.

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 licensed premises are within the same geographical area as the person who has been granted the right to sell at wholesale. 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.

Sec. 6-9.1. Deliveries to retail establishments.

    1. A distributor of wine or spirits shall deliver to any retailer within any geographic area in which that distributor has been granted by a wholesaler the right to sell its trademark, brand, or name at least once every 2 weeks if: i) in the case of a retailer located in a county with a population of at least 3,000,000 inhabitants or in a county adjacent to a county with at least 3,000,000 inhabitants, the retailer agrees to purchase at least $200 of wine or spirits from the distributor every 2 weeks; or ii) in the case of a retailer located in a county with a population of less than 3,000,000 that is not adjacent to a county with a population of at least 3,000,000 inhabitants, the retailer agrees to purchase at least $50 of wine or spirits from the distributor every 2 weeks.
    2. On January 1, 2002 and every 2 years thereafter, the dollar amount in items (i) and (ii) of subsection (a) shall be increased or decreased by a percentage equal to the percentage increase or decrease in the Consumer Price Index during the previous 2 years according to the most recent available data.

The Peerless changes: 5/6-9

(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.

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 licensed premises are within the same geographical area as the person who has been granted the right to sell at wholesale.

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. (Source: P.A. 90-0596, eff. 6-24-98 )

III. Procedures

  1. All licensed Illinois distributors, importing distributors and foreign importers shall have licensed warehouse facilities within the State of Illinois.
  2. All sales to retailers, located within each distributor, importing
    distributor and foreign importer’s geographic territory, shall be made from the licensed warehouse facilities within the State of Illinois.
  3. All business records, as defined in Sec. 5/6-8 and Regulation 100.130, shall be maintained upon the licensed warehouse facilities within the State of Illinois.
  4. All alcoholic products sold to the licensed Illinois distributors, importing distributors and foreign importers shall be off-loaded at the licensed warehouse facilities within the State of Illinois.
  5. The alcoholic products shall be stored at the licensed warehouse facilities within the State of Illinois before sale and delivery to licensees in this State.
  6. Illinois distributors, importing distributors and foreign importers may warehouse product in public warehouses, registered under Article VIIA of the Liquor Control Act, however, sales of such products may not take place from such warehouse premises.

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