§ 752. Definitions

As used in this subchapter:

(1) "Barrel" means 31 gallons of malt beverages.

(2) "Certificate of approval holder" means a holder of a certificate of approval issued by the Board of Liquor and Lottery pursuant to section 274 of this title that produces or distributes a total annual volume of not more than 50,000 barrels of malt beverages and whose products comprise three percent or less of a wholesale dealer's total annual sales of malt beverages by volume.

(3) "Compensation" means the cost of a wholesale dealer's laid-in inventory related to a franchise that has been or is about to be terminated plus five times the average annual gross profits earned by the wholesale dealer on the sale of products pursuant to the franchise during the last three calendar years or, if the franchise has not been in existence for three years, the period of time during which the franchise has been in existence. "Gross profits" shall equal the revenue earned by the wholesale dealer on the sale of products pursuant to the franchise minus the cost of those products, including shipping and taxes.

[Subdivision (4) effective until July 1, 2022; see also subdivision (4) effective July 1, 2022.]

(4) "Franchise" means an agreement governing a relationship between a wholesale dealer and a certificate of approval holder or manufacturer that was entered into on or after January 1, 2019 and has existed for at least one year and has one or more of the following characteristics:

(A) the wholesale dealer is granted the right to offer and sell the brands of malt beverages offered by the certificate of approval holder or manufacturer;

(B) the wholesale dealer, as an independent business, constitutes a component of a certificate of approval holder's or manufacturer's distribution system;

(C) the wholesale dealer's business is substantially associated with the certificate of approval holder's or manufacturer's brand, advertising, or other commercial symbol designating the manufacturer;

(D) the wholesale dealer's business is substantially reliant on the certificate of approval holder or manufacturer for the continued supply of malt beverages; or

(E) the certificate of approval holder or manufacturer has granted the wholesale dealer a license to use a trade name, trademark, service mark, or related characteristic, and there is a community of interest in the marketing of goods or services at wholesale, retail, by lease, or otherwise.

[Subdivision (4) effective July 1, 2022; see also subdivision (4) effective until July 1, 2022.]

(4) "Franchise" means a written agreement governing a relationship between a wholesale dealer and a certificate of approval holder or manufacturer that has existed for at least one year and has one or more of the following characteristics:

(A) the wholesale dealer is granted the right to offer and sell the brands of malt beverages offered by the certificate of approval holder or manufacturer;

(B) the wholesale dealer, as an independent business, constitutes a component of a certificate of approval holder's or manufacturer's distribution system;

(C) the wholesale dealer's business is substantially associated with the certificate of approval holder's or manufacturer's brand, advertising, or other commercial symbol designating the manufacturer;

(D) the wholesale dealer's business is substantially reliant on the certificate of approval holder or manufacturer for the continued supply of malt beverages; or

(E) the certificate of approval holder or manufacturer has granted the wholesale dealer a license to use a trade name, trademark, service mark, or related characteristic, and there is a community of interest in the marketing of goods or services at wholesale, retail, by lease, or otherwise.

(5) "Manufacturer" means a manufacturer licensed pursuant to section 271 of this title that produces a total annual volume of not more than 50,000 barrels of malt beverages and whose products comprise three percent or less of a wholesale dealer's total annual sales of malt beverages by volume.

(6) "Total annual sales" means the total volume of all malt beverages sold by a wholesale dealer in the last four completed calendar quarters. A wholesale dealer's total annual sales of malt beverages shall include the worldwide, aggregate amount of all brands of malt beverages that were sold, directly or indirectly, during the last four completed calendar quarters by the wholesale dealer and any entity that controlled, was controlled by, or was under common control with the wholesale dealer.

(7) "Total annual volume" means:

(A) the amount of malt beverages manufactured worldwide during the last four completed calendar quarters, directly or indirectly, by or on behalf of:

(i) the certificate of approval holder or manufacturer;

(ii) any employee, director, or officer of a certificate of approval holder or manufacturer; or

(iii) an affiliate of the certificate of approval holder or manufacturer, regardless of whether the affiliation is corporate, or is by management, direction, or control; or

(B) the amount of malt beverages distributed worldwide during the last four completed calendar quarters directly or indirectly, by or on behalf of:

(i) the certificate of approval holder;

(ii) any employee, director, or officer of a certificate of approval holder; or

(iii) an affiliate of the certificate of approval holder, regardless of whether the affiliation is corporate, or is by management, direction, or control. (Added 2017, No. 145 (Adj. Sess.), § 5, eff. Jan. 1, 2019; amended 2017, No. 145 (Adj. Sess.), § 7, eff. July 1, 2022; 2019, No. 73, § 20.)