Following Governor Newsom’s emergency declarations and stay-at-home orders aimed to battle the spread of the COVID-19 coronavirus, the California Department of Alcoholic Beverage Control has temporarily suspended enforcement of certain legal restrictions on alcohol manufacturers, off-sale stores, and restaurants. California bars and restaurants with a beer, wine, and/or liquor license will now be permitted to sell alcoholic beverages to-go with delivery becoming a possible option.
"The relief provided by this notice is temporary and may be withdrawn by the Department at any time," read the California ABC's Notice of Regulatory Relief published on March 19, 2020. "The Department intends to provide a 10-day notice of the termination of any such relief, although such relief may be withdrawn immediately should the needs of public safety dictate. In addition, licensees are directed to use the relief provided by this notice responsibly without compromising the public’s health, safety, or welfare."
The Notice of Regulatory Relief then lays out 8 changes to pre-existing rules which completely alters the landscape of what alcohol manufacturers, retailers, bars and restaurants can and cannot do. Based on my limited reading comprehension, it appears to allow unprecedented freedoms not seen since the Wild West.
"Until the Department rescinds any of these temporary relief measures, whether as to all licensees or a particular licensee, any licensee adhering to the terms of this notice, and other applicable laws, may rely on this notice to utilize the privileges described without risk of enforcement by the Department against its license for actions taken up until the time of the rescission," continued the state ABC notice.
"Until the Department rescinds any of these temporary relief measures, whether as to all licensees or a particular licensee, any licensee adhering to the terms of this notice, and other applicable laws, may rely on this notice to utilize the privileges described without risk of enforcement by the Department against its license for actions taken up until the time of the rescission," continued the state ABC notice.
Here are my Cliff Notes of the California Department of Alcoholic Beverage Control Notice of Regulatory Relief:
1. Manufacturers or wholesalers of alcoholic beverages may accept returns from retailers although they do not have to. The manufacturer cannot make acceptance of the return contingent upon future purchases or any other exchange of value.
1. Manufacturers or wholesalers of alcoholic beverages may accept returns from retailers although they do not have to. The manufacturer cannot make acceptance of the return contingent upon future purchases or any other exchange of value.
2. Bars and restaurants can sell their surplus to off-sale retailers.
3. The rules about manufacturers, wholesalers, and other suppliers not being permitted to extend credit beyond 30 days are now waived, as are penalty's and restrictions for delinquent accounts.
3. The rules about manufacturers, wholesalers, and other suppliers not being permitted to extend credit beyond 30 days are now waived, as are penalty's and restrictions for delinquent accounts.
4. Restaurants and bars with a qualifying liquor license may sell their alcoholic beverages for off-sale consumption in "manufacturer pre-packaged containers" to the extent of their license, so essentially restaurants with a beer and wine license can sell cans of beer/hard kombucha/cider/etc., bottles, even kegs to the general public. Those with full-alcohol can sell bottles of liquor. We are not sure how this will apply to bars in San Diego, as the city forced them all to close this past Monday, March 16.
5. Restaurants (not bars) with liquor licenses may sell alcoholic beverages to the extent of their license for take-away in conjunction with the sale of food for pick-up or delivery. The beverages must be packaged in a container with a secure lid "designed to prevent consumption without removal of the lid." Any place selling for off sale consumption must post a notice prominently at their establishing that informs purchasers that the pre-packed alcoholic beverages are considered open containers under DUI laws and can only be transported in the trunk of a vehicle or the very back in the case of large SUVs with no trunk. The notice also explains that the beverages cannot be consumed in public. So this opens the door to jarred cocktails, growler fills, etc., at area restaurants. We wonder if 3rd part apps like UberEats, GrubHub and Postmates will facilitate this in the near future.
6. These off-sale alcoholic beverage transactions can be made to a person in a car or outside the confines of the established business, but keep in mind folks, you need to put your jar of booze in the trunk.
6. These off-sale alcoholic beverage transactions can be made to a person in a car or outside the confines of the established business, but keep in mind folks, you need to put your jar of booze in the trunk.
7. Sales for off premise consumption cannot occur between 2am-6am, but other than that, the ABC is not enforcing license conditions restricting the hours of sales and service.
8. Retailers, craft breweries, wine producers, distillers, etc., are now permitted to deliver their products where that was previously limited or restricted. Producers can even deliver to customers and accept payment from the customer in the form of cash or credit at the point of delivery. Distillers must still adhere to the maximum of 2.25 liters per consumer per day.
Our suggestion for bars and restaurants is to consult with a legal profession in the field of California ABC compliance. Welcome to the Wild West. Wash your hand and read the full California Department of Alcoholic Beverage Control Notice of Regulatory Relief below.
NOTICE OF REGULATORY RELIEF
Pursuant to the Constitution of the State of California, Article XX, section 22, and in furtherance of Governor Newsom’s emergency declarations and orders regarding the spread of the COVID-19 virus, the Department of Alcoholic Beverage Control is temporarily suspending enforcement of specific legal prohibitions identified below. This regulatory relief is designed to support the alcoholic beverage industry in its efforts to assist California in slowing the spread of the virus while assisting the industry in dealing with the economic challenges it is facing as a result.
The Department has carefully considered the public’s health, safety, and welfare in providing this relief, and the Department has concluded that none of these measures, exercised on a temporary basis, will jeopardize the public’s health, safety, or welfare. In lieu of individual requests for relief submitted to the Department, the temporary relief from the regulatory requirements set forth in this notice are applicable to all affected Department licensees and will continue until further notice, as provided below:
The Department’s regulatory relief addresses the following issues:
Returns of alcoholic beverages.
Retail-to-retail transactions.
Extension of credit.
On-sale retailers exercising off-sale privileges.
Sales of alcoholic beverages to go.
Drive-thru windows for off-sale transactions.
Deliveries to consumers.
Hours of operation for on-sale premises.
Limitations on Relief
The relief provided by this notice is temporary and may be withdrawn by the Department at any time. The Department intends to provide a 10-day notice of the termination of any such relief, although such relief may be withdrawn immediately should the needs of public safety dictate. In addition, licensees are directed to use the relief provided by this notice responsibly without compromising the public’s health, safety, or welfare. Notwithstanding any other provision of law, if the Department determines that any licensee is found to be abusing the relief provided by this notice, or if the licensee’s actions jeopardize public health, safety, or welfare, the Department may summarily rescind the relief as to that licensee at any time. Until the Department rescinds any of these temporary relief measures, whether as to all licensees or a particular licensee, any licensee adhering to the terms of this notice, and other applicable laws, may rely on this notice to utilize the privileges described without risk of enforcement by the Department against its license for actions taken up until the time of the rescission.
In addition, this notice does not exempt licensees from local ordinances, zoning restrictions, conditional use permits, and the like, over which the Department has no jurisdiction or control. That said, the Department will not consider any violation of such local controls to constitute a violation of the license issued by the Department.
1. Returns of alcoholic beverages: Notwithstanding any restrictions in Business and Professions Code sections 23104.1 (wine), 23104.2 (beer), and 23104.3 (distilled spirits), manufacturers and wholesalers may accept returns of alcoholic beverages from retailers. This is not intended to require manufacturers or wholesalers to accept returns. Manufacturers and wholesalers may establish their own parameters for accepting returns, except that they may not require retailers to purchase specific products or quantities of products in the future as a condition to the acceptance of a return of alcoholic beverages. This authorization does not allow manufacturers or wholesalers to provide any other things of value to retailers.
2. Retail-to-retail transactions: Off-sale retailers may purchase alcoholic beverages from on-sale retailers to the same extent they can purchase such beverages from suppliers authorized to sell to them (e.g., wholesalers, beer manufacturers, and winegrowers). Given that many on-sale retailers may have greater inventories of alcoholic beverages than they can use under the current limitations of their on-sale privileges, and that suppliers may not be willing or able to accept returns, this regulatory relief will provide needed revenue to on-sale retailers and avoid wasteful inventory spoliation.
3. Extension of credit: Business and Professions Code section 25509 prohibits manufacturers, wholesalers, and other specified suppliers from extending credit to retailers beyond 30 days. This section also requires the imposition of statutory penalty charges on delinquent accounts. It further provides that delinquent retailers may purchase additional alcoholic beverages from any unpaid supplier only on a COD basis. The Department will not be enforcing these provisions. It will be up to the parties to determine appropriate credit terms during this time. However, licensees should also consider that when these temporary measures are lifted, the statutory provisions will pre-empt any agreed-upon credit terms.
4. On-sale retailers exercising off-sale privileges: Licensees with on-sale privileges may sell those alcoholic beverages for off-sale consumption in manufacturer pre-packaged containers as to which their license permits on-sale consumption. For example, a Type 47 restaurant may sell beer, wine, and distilled spirits for off-sale consumption, regardless of any condition on its license to the contrary and regardless of the statutory prohibition against on-sale licensees selling distilled spirits for off-sale consumption. Similarly, a Type 41 beer and wine licensed restaurant may sell beer and wine, but not distilled spirits, for consumption off the premises regardless of any conditions on its license that prohibit such sales.
5. Sales of alcoholic beverages to go: In addition to selling manufacturer pre-packaged containers as provided above, bona fide eating places (i.e., restaurants) selling beer, wine, and pre-mixed drinks or cocktails for consumption off the licensed premises may do so when sold in conjunction with meals prepared for pick-up or delivery. Any such alcoholic beverages must be packaged in a container with a secure lid or cap and in a manner designed to prevent consumption without removal of the lid or cap (e.g., no lids with sipping holes or openings for straws). Further, any licensee selling such beverages for off-sale consumption shall prominently post the following warning in a manner that puts consumers on notice of limitations regarding open container laws:
Alcoholic beverages that are packaged by this establishment are open containers and may not be transported in a motor vehicle except in the vehicle’s trunk; or, if there is no trunk, the container may be kept in some other area of the vehicle that is not normally occupied by the driver or passengers (which does not include a utility compartment or glove compartment (Vehicle Code section 23225)). Further, such beverages may not be consumed in public or in any other area where open containers are prohibited by law.
“Post” means to prominently display on the premises, post online, or present in whatever manner is necessary to ensure that the consumer purchasing, or delivery person transporting, such beverages is given notice of this warning.
6. Off-sale transactions through pass-out windows: The Department is suspending any conditions on licenses that prohibit licensees from making sales and deliveries of alcoholic beverages to persons in a motor vehicle or to persons outside the licensed premises through a pass-out window or a slide-out tray to the exterior of the premises.
NOTICE OF REGULATORY RELIEF
Pursuant to the Constitution of the State of California, Article XX, section 22, and in furtherance of Governor Newsom’s emergency declarations and orders regarding the spread of the COVID-19 virus, the Department of Alcoholic Beverage Control is temporarily suspending enforcement of specific legal prohibitions identified below. This regulatory relief is designed to support the alcoholic beverage industry in its efforts to assist California in slowing the spread of the virus while assisting the industry in dealing with the economic challenges it is facing as a result.
The Department has carefully considered the public’s health, safety, and welfare in providing this relief, and the Department has concluded that none of these measures, exercised on a temporary basis, will jeopardize the public’s health, safety, or welfare. In lieu of individual requests for relief submitted to the Department, the temporary relief from the regulatory requirements set forth in this notice are applicable to all affected Department licensees and will continue until further notice, as provided below:
The Department’s regulatory relief addresses the following issues:
Returns of alcoholic beverages.
Retail-to-retail transactions.
Extension of credit.
On-sale retailers exercising off-sale privileges.
Sales of alcoholic beverages to go.
Drive-thru windows for off-sale transactions.
Deliveries to consumers.
Hours of operation for on-sale premises.
Limitations on Relief
The relief provided by this notice is temporary and may be withdrawn by the Department at any time. The Department intends to provide a 10-day notice of the termination of any such relief, although such relief may be withdrawn immediately should the needs of public safety dictate. In addition, licensees are directed to use the relief provided by this notice responsibly without compromising the public’s health, safety, or welfare. Notwithstanding any other provision of law, if the Department determines that any licensee is found to be abusing the relief provided by this notice, or if the licensee’s actions jeopardize public health, safety, or welfare, the Department may summarily rescind the relief as to that licensee at any time. Until the Department rescinds any of these temporary relief measures, whether as to all licensees or a particular licensee, any licensee adhering to the terms of this notice, and other applicable laws, may rely on this notice to utilize the privileges described without risk of enforcement by the Department against its license for actions taken up until the time of the rescission.
In addition, this notice does not exempt licensees from local ordinances, zoning restrictions, conditional use permits, and the like, over which the Department has no jurisdiction or control. That said, the Department will not consider any violation of such local controls to constitute a violation of the license issued by the Department.
1. Returns of alcoholic beverages: Notwithstanding any restrictions in Business and Professions Code sections 23104.1 (wine), 23104.2 (beer), and 23104.3 (distilled spirits), manufacturers and wholesalers may accept returns of alcoholic beverages from retailers. This is not intended to require manufacturers or wholesalers to accept returns. Manufacturers and wholesalers may establish their own parameters for accepting returns, except that they may not require retailers to purchase specific products or quantities of products in the future as a condition to the acceptance of a return of alcoholic beverages. This authorization does not allow manufacturers or wholesalers to provide any other things of value to retailers.
2. Retail-to-retail transactions: Off-sale retailers may purchase alcoholic beverages from on-sale retailers to the same extent they can purchase such beverages from suppliers authorized to sell to them (e.g., wholesalers, beer manufacturers, and winegrowers). Given that many on-sale retailers may have greater inventories of alcoholic beverages than they can use under the current limitations of their on-sale privileges, and that suppliers may not be willing or able to accept returns, this regulatory relief will provide needed revenue to on-sale retailers and avoid wasteful inventory spoliation.
3. Extension of credit: Business and Professions Code section 25509 prohibits manufacturers, wholesalers, and other specified suppliers from extending credit to retailers beyond 30 days. This section also requires the imposition of statutory penalty charges on delinquent accounts. It further provides that delinquent retailers may purchase additional alcoholic beverages from any unpaid supplier only on a COD basis. The Department will not be enforcing these provisions. It will be up to the parties to determine appropriate credit terms during this time. However, licensees should also consider that when these temporary measures are lifted, the statutory provisions will pre-empt any agreed-upon credit terms.
4. On-sale retailers exercising off-sale privileges: Licensees with on-sale privileges may sell those alcoholic beverages for off-sale consumption in manufacturer pre-packaged containers as to which their license permits on-sale consumption. For example, a Type 47 restaurant may sell beer, wine, and distilled spirits for off-sale consumption, regardless of any condition on its license to the contrary and regardless of the statutory prohibition against on-sale licensees selling distilled spirits for off-sale consumption. Similarly, a Type 41 beer and wine licensed restaurant may sell beer and wine, but not distilled spirits, for consumption off the premises regardless of any conditions on its license that prohibit such sales.
5. Sales of alcoholic beverages to go: In addition to selling manufacturer pre-packaged containers as provided above, bona fide eating places (i.e., restaurants) selling beer, wine, and pre-mixed drinks or cocktails for consumption off the licensed premises may do so when sold in conjunction with meals prepared for pick-up or delivery. Any such alcoholic beverages must be packaged in a container with a secure lid or cap and in a manner designed to prevent consumption without removal of the lid or cap (e.g., no lids with sipping holes or openings for straws). Further, any licensee selling such beverages for off-sale consumption shall prominently post the following warning in a manner that puts consumers on notice of limitations regarding open container laws:
Alcoholic beverages that are packaged by this establishment are open containers and may not be transported in a motor vehicle except in the vehicle’s trunk; or, if there is no trunk, the container may be kept in some other area of the vehicle that is not normally occupied by the driver or passengers (which does not include a utility compartment or glove compartment (Vehicle Code section 23225)). Further, such beverages may not be consumed in public or in any other area where open containers are prohibited by law.
“Post” means to prominently display on the premises, post online, or present in whatever manner is necessary to ensure that the consumer purchasing, or delivery person transporting, such beverages is given notice of this warning.
6. Off-sale transactions through pass-out windows: The Department is suspending any conditions on licenses that prohibit licensees from making sales and deliveries of alcoholic beverages to persons in a motor vehicle or to persons outside the licensed premises through a pass-out window or a slide-out tray to the exterior of the premises.
7. Hours of operation for retail sales: State law prohibits retailers from exercising retail privileges between the hours of 2:00 a.m. and 6:00 a.m., and many licensees have conditions on their licenses that further restrict the hours of sales and service that require them to close before 2:00 a.m. or open after 6:00 a.m. The Department suspends enforcement of any license condition restricting the hours of sales and service for licensees exercising off-sale privileges consistent with this Notice of Relief. The Department will continue to enforce the 2:00 a.m. to 6:00 a.m. prohibition.
8. Deliveries to consumers: Existing law allows licensees who are permitted to sell off-sale to also deliver such alcoholic beverages to consumers. The sales transaction, other than delivery, must occur on the licensed premises. This means that the order must be received, and the payment processed, at the licensed premises (i.e., no payment at time of delivery away from the licensed premises). In addition, craft distillers may only exercise their off-sale privileges at the licensed premises (limited to 2.25 liters of distilled spirits per consumer per day) and are not authorized to deliver to consumers away from the licensed premises. The Department is suspending enforcement of these restrictions. As such, licensees who are authorized to sell alcoholic beverages to consumers for consumption off the licensed premises may therefore accept payment, including cash, at the point of delivery. In addition, craft distillers may also deliver to consumers away from the licensed premises (however, they must still adhere to the maximum of 2.25 liters per consumer per day). For clarification, existing statutory delivery authority does not specify the location at which the delivery must occur. As such, delivery to consumers immediately outside the licensed premises (often known as “curbside delivery”) is acceptable.
8. Deliveries to consumers: Existing law allows licensees who are permitted to sell off-sale to also deliver such alcoholic beverages to consumers. The sales transaction, other than delivery, must occur on the licensed premises. This means that the order must be received, and the payment processed, at the licensed premises (i.e., no payment at time of delivery away from the licensed premises). In addition, craft distillers may only exercise their off-sale privileges at the licensed premises (limited to 2.25 liters of distilled spirits per consumer per day) and are not authorized to deliver to consumers away from the licensed premises. The Department is suspending enforcement of these restrictions. As such, licensees who are authorized to sell alcoholic beverages to consumers for consumption off the licensed premises may therefore accept payment, including cash, at the point of delivery. In addition, craft distillers may also deliver to consumers away from the licensed premises (however, they must still adhere to the maximum of 2.25 liters per consumer per day). For clarification, existing statutory delivery authority does not specify the location at which the delivery must occur. As such, delivery to consumers immediately outside the licensed premises (often known as “curbside delivery”) is acceptable.
We encourage all licensees to sign up with the Department for email notices regarding this and other issues. This is easily done by clicking Subscribe. If you have any questions, please contact the Department.
This is a developing story: We will update this post as we learn more.
This is a developing story: We will update this post as we learn more.
