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PA Bulletin, Doc. No. 98-167

PROPOSED RULEMAKING

LIQUOR CONTROL BOARD

[40 PA. CODE CH. 13]

Promotion

[28 Pa.B. 488]

   The Liquor Control Board (Board) under the authority of section 207(i) of the Pennsylvania Liquor Code (act) (47 P. S. § 2-207(i)) proposes to amend §§ 13.1 and 13.51 (relating to definitions; and general prohibition).

Purpose:

   In accordance with Executive Order 1996-1, the Board has reviewed its regulations and determined that the regulations prohibit activities beyond those prohibited by the act and that these proposed amendments would permit Pennsylvania manufacturers and licensees to engage in business practices routinely engaged in by manufacturers and licensees in other states.

Summary of Amendments

   § 13.1.  The term ''routine business entertainment'' is defined.

   § 13.51.  Subsection (c) is proposed to be added setting forth the limitations and conditions concerning routine business entertainment engaged in by manufacturers and licensees.

Affected Parties

   These regulatory amendments would affect in-State and out-of-State manufacturers, licensees of the Board and trade organizations that choose to participate in routine business entertainment.

Paperwork Requirements

   The proposed amendments require that licensees and manufacturers keep complete and accurate records of all expenses incurred and all routine business entertainment received for a period of 2 years.

Fiscal Impact

   The proposed amendments permit the regulated community to voluntarily engage in routine business entertainment, no compulsory spending by the regulated community is required. These proposed amendments will have no fiscal impact on the Commonwealth or local governments.

Effective Date/Sunset Date

   The proposed amendments will become effective upon their publication in final form in the Pennsylvania Bulletin. No sunset date has been assigned.

Public Comment/Contact Person

   Written comments, suggestions or objections will be accepted for 30 days after publication of the proposed amendments in the Pennsylvania Bulletin. Comments should be addressed to Jerry Danyluk, Regulatory Coordinator, Pennsylvania Liquor Control Board, Room 401 Northwest Office Building, Harrisburg, PA 17124-0001.

Regulatory Review

   Under section 5(a) of the Regulatory Review Act (71 P. S. § 745-5(a)), on January 16, 1998, the Board submitted a copy of the proposed rulemaking to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the House Committee on Liquor Control and the Senate Committee on Law and Justice. In addition to submitting the proposed amendments, the Board has provided IRRC and the Committees with a copy of a detailed regulatory analysis form prepared by the Board. A copy of this material is available to the public upon request.

   If the Committees have objections to any portion of the proposed rulemaking, they will notify the Board within 20 days of the close of the public comment period.

   If IRRC has objections to any portion of the proposed amendments, it will notify the Board within 10 days of the close of the Committees' review period. The notification shall specify the regulatory review criteria which have not been met by that portion. The Regulatory Review Act specifies detailed procedures for review by the Board, the Governor and the General Assembly prior to final publication of the regulations.

JOHN E. JONES, III,   
Chairperson

   Fiscal Note:  54-53. No fiscal impact; (8) recommends adoption.

Annex A

TITLE 40.  LIQUOR

PART I.  LIQUOR CONTROL BOARD

CHAPTER 13.  PROMOTION

Subchapter A.  ADVERTISING

GENERAL PROVISIONS

§ 13.1.  Definitions.

   The following words and terms, when used in this subchapter, have the following meanings, unless the context clearly indicates otherwise:

*      *      *      *      *

   Routine business entertainment--Meals, beverages, tickets or passes to concerts, theaters, arts, sporting or charitable events provided to licensees, trade organizations or in-State manufacturers by licensees, trade organizations, in-State manufacturers or out-of-State manufacturers. For purposes of this definition, ''licensee'' includes all entities licensed under the Liquor Code including liquor importer licensees and vendor permitees.

*      *      *      *      *

GIVING AND ACCEPTING THINGS OF VALUE

§ 13.51.  General prohibition.

   (a)  Except as provided in [subsection] subsections (b), (c) and § 13.52 (relating to advertising novelties), no in-State or out-of-State manufacturer, licensee or group of licensees, their servants, agents or employes, may directly or indirectly, in person, individually or through a trade organization, contribute to or accept from another licensee or group of licensees of a different class, their servants, agents or employes or a trade organization of licensees of a different class, anything of value by means of advertisements, contributions, purchase, sale of tickets, donations or by any device, for any purpose.

*      *      *      *      *

   (c)  This section does not prohibit an in-State or out-of-State manufacturer, licensee or trade organization from providing another in-State or out-of-State manufacturer, licensee or trade organization routine business entertainment as defined in § 13.1 (relating to definitions). The routine business entertainment shall be subject to the following conditions:

   (1)  Routine business entertainment shall be provided without a corresponding obligation on the part of the recipient to purchase alcoholic beverages or to provide another benefit to the donor or to exclude or restrict from sale the products of any other licensee or in-State or out-of-State manufacturer.

   (2)  The donor, its servants, agents or employes shall accompany the recipient during routine business entertainment. When items such as tickets are donated by manufacturers to importing distributors for the ultimate use of retailers, the donor is considered to be the importing distributor and it is the importing distributor, or his servants, agents or employes, who shall accompany the retailer.

   (3)  Routine business entertainment that requires or includes overnight stay is prohibited.

   (4)  No more than $200 may be spent per occasion on any recipient. An occasion for purposes of this section is a 24-hour time period that begins when the recipient first receives business entertainment. A recipient's spouse or guest may accompany the recipient, if no more than $200 is spent per occasion on the recipient's spouse or guest.

   (5)  No recipient may be entertained on more than six separate occasions by any licensee, trade organization or manufacturer in a calendar year.

   (6)  Licensees, in-State manufacturers and out-of-State manufacturers shall keep complete and accurate records of all expenses incurred and all routine business entertainment received for a 2 year period. These records shall contain the name of the recipient and donor of the entertainment, the type of routine business entertainment, the date and, in the case of a donor, the amount of expenditure for each occasion.

[Pa.B. Doc. No. 98-167. Filed for public inspection January 30, 1998, 9:00 a.m.]



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