32B-4-703 (Effective 07/01/11) - Exclusive outlets.
32B-4-703 (Effective 07/01/11). Exclusive outlets.
(1) It is unlawful for an industry member, directly or indirectly, or through an affiliate, torequire, by agreement or otherwise, that the department or a retailer purchase a product from theindustry member or the department to the exclusion in whole or in part of a product that is soldor offered for sale by another person.
(2) (a) Subsection (1) applies only to a transaction between:
(i) one or more industry members; and
(ii) (A) the department; or
(B) one or more retailers.
(b) Subsection (1) does not apply to a transaction between two or more industrymembers, including between a manufacturer and a wholesaler.
(3) Subsection (1) includes purchases coerced by an industry member through an act orthreat of physical or economic harm, as well as through a voluntary industry member-retailerpurchase agreement.
(4) (a) Subsection (1) includes a contract or agreement, written or unwritten, that has theeffect of requiring the department or retailer to purchase an alcoholic product from the industrymember beyond a single sales transaction.
(b) Examples of a contract or agreement described in Subsection (4)(a) include:
(i) an advertising contract between an industry member and a retailer with the express orimplied requirement of the purchase of the advertiser's product; or
(ii) a sales contract awarded on a competitive bid basis that has the effect of prohibitingthe department or retailer from purchasing from another industry member by:
(A) requiring that the retailer purchase a product or line of products exclusively from theindustry member for the period of the agreement; or
(B) requiring that the retailer purchase a specific or minimum quantity during the periodof the agreement.
(5) (a) Subsection (1) includes a contract, agreement, or other arrangement between anindustry member and a third party nonretailer that requires the department or a retailer topurchase the industry member's product to the exclusion in whole or in part of a product sold oroffered for sale by another person.
(b) This Subsection (5) applies whether a contract, agreement, or other arrangementoriginates with the industry member or the third party.
(c) Examples of a contract, agreement, or other arrangement described in this Subsection(5) include:
(i) a contract, agreement, or arrangement:
(A) with a third party, such as a ball club or municipal or private corporation, that is not aretailer;
(B) under which the third party leases the concession rights and is able to control thepurchasing decisions of a retailer; and
(C) that requires the retailer to purchase the industry member's product to the exclusionin whole or in part of a product sold or offered for sale by another person; or
(ii) a contract, agreement, or arrangement with a third party nonretailer that requires aretailer to purchase the industry member's product to the exclusion in whole or in part of aproduct sold or offered for sale by another person in return for which the third party provides aservice or other thing of value such as:
(A) sponsoring radio or television broadcasting;
(B) paying for advertising; or
(C) providing other services or things of value.
Enacted by Chapter 276, 2010 General Session