2012 -- H 7941

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2012

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A N A C T

RELATING TO ALCOHOLIC BEVERAGES - LICENSES GENERALLY

     Introduced By: Representatives Carnevale, and DeSimone

     Date Introduced: March 14, 2012

     Referred To: House Corporations

It is enacted by the General Assembly as follows:

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     SECTION 1. Section 3-5-11 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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     3-5-11. Licensing of chain stores. -- (a) Licenses, except retailer's Class E, Class B,

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Class B-H, Class B-L, Class B-M, and Class B-V licenses, authorized by this title shall not be

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granted, issued, or transferred to or for the use of any "chain store organization," which term shall

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consist of any chain of retail or wholesale business or business organizations, and more

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specifically defined herein, including, without limitation, grocery stores, markets, department

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stores, and convenience stores, as well as retailers of alcoholic beverages, and which include

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chains in which one or more stores are located outside of the state. ; provided, however, that such

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term shall not include chains in which one or more stores are located outside of the state.

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      (b) The term "chain store organization" is defined to include, but not limited to:

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      (1) Any group of one or more holders of Class A liquor licenses who engage in one or

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more of the following practices with respect to the business conducted under such licenses, either

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directly or indirectly, or have any direct or indirect beneficial interest in the following practices:

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      (i) Common, group, centralized or coordinated purchases of wholesale merchandise.

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      (ii) Common billing or utilization of the services of the same person or the same entity in

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the management or operation of more than one liquor licensed business.

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      (iii) Participation in a coordinated or common advertisement with one or more liquor

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licensed business in any advertising media.

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      (iv) Coordinated or common planning or implementation of marketing strategies.

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      (v) Participation in agreed upon or common pricing of products.

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      (vi) Any term or name identified as a chain or common entity.

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      (2) Any group of one or more liquor license holders who share any of the following

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common features, either directly or indirectly or acquire any direct or indirect beneficial interest

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in the following practices:

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      (i) The same director of a corporation, member of a LLC, LLP, partner in a general or

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limited partnership, trustee or beneficiary of a trust.

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      (ii) The same individual or corporate owners.

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      (3) Any group of one or more license holders that is found to be a "chain store

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organization" as a factual matter by the department, as a result of an evidentiary hearing in

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connection with any application for the issuance, grant or transfer of a license, or upon the filing

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of a complaint by any member of the public.

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      (4) Upon a finding of violation of this section, the department shall be empowered to set

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a fine up to the amount of ten thousand dollars ($10,000) per violating licensee, revoke the

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license of the violator, or suspend the license of the violator for a period of time to be determined

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by the department. Additionally, the department shall issue a cease and desist order against the

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violating chain store entity(s) and may further order the dissolution of the violating chain store

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entity(s).

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     SECTION 2. This act shall take effect upon passage.

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LC00914

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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 allow a holder of a Rhode Island liquor license to purchase an out-of-state

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liquor licensed business.

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     This act would take effect upon passage.

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LC00914

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