HB-6644, As Passed House, December 4, 2008
November 12, 2008, Introduced by Reps. Farrah and Ward and referred to the Committee on Regulatory Reform.
A bill to amend 1998 PA 58, entitled
"Michigan liquor control code of 1998,"
by amending section 203 (MCL 436.1203), as amended by 2005 PA 268.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 203. (1) Except as provided in this section and section
301, a sale, delivery, or importation of alcoholic liquor,
including alcoholic liquor for personal use, shall not be made in
this state unless the sale, delivery, or importation is made by the
commission, the commission's authorized agent or distributor, an
authorized distribution agent approved by order of the commission,
a person licensed by the commission, or by prior written order of
the commission.
(2)
For purposes of subsection (1), the sale, delivery, or
importation
of alcoholic liquor, except as otherwise provided in
subsection
(3), includes, but is not limited to, the sale,
delivery,
or importation of alcoholic liquor transacted or caused
to
be transacted by means of any mail order, internet, telephone,
computer,
device, or other electronic means. Subject to subsection
(4),
if a retail sale, delivery, or importation of alcoholic liquor
occurs
by any such means, the retailer must comply with all of the
following:
(a)
Be appropriately licensed under the laws of this state.
(b)
Pay any applicable taxes to the commission or the
department
of treasury.
(c)
Comply with all prohibitions of the laws of this state
including,
but not limited to, sales to minors.
(d)
Verify the age of the individual placing the order by
obtaining
from him or her an affirmation that he or she is of legal
age
to purchase alcoholic liquor. The person receiving and
accepting
the order shall record the name, address, date of birth,
and
telephone number of the person placing the order on the order
form
or other verifiable record of a type and generated in a manner
approved
by the commission.
(e)
Upon request of the commission, make available to the
commission
any document used to verify the age of the individual
ordering
the alcoholic liquor from the retail seller.
(f)
Stamp, print, or label on the outside of the shipping
container
language that clearly establishes in a prominent fashion
that
the package contains alcoholic liquor and that the recipient
at
the time of the delivery is required to provide identification
verifying
his or her age along with a signature.
House Bill No. 6644 as amended December 4, 2008
(g)
Place a label on the top panel of the shipping container
containing
the name and address of the individual placing the order
and
the name of the designated recipient, if any.
(2) Notwithstanding R 436.1011(7)(b) [and R 436.1527] of the
Michigan
administrative code, a retailer shall not deliver alcoholic liquor
to a consumer at the home or business of the consumer or at any
location away from the licensed premises of the retailer. The
purpose of this subsection is to exercise the state of Michigan's
authority under section 2 of amendment XXI of the constitution of
the United States and the inherent police powers to regulate the
transportation and delivery of alcoholic liquor. The regulation
described in this subsection is considered necessary for both of
the following reasons:
(a) To promote the public health, safety, and welfare.
(b) To maintain strong, stable, and effective regulation by
having beer and wine sold by retailers to Michigan consumers by
passing through the 3-tier distribution system established under
this act.
(3) For purposes of subsection (1), the sale, delivery, or
importation of wine, to consumers in this state, by a person who
both produces and bottles the wine or wine that is manufactured by
a wine maker for another wine maker and that is transacted or
caused to be transacted by means of any mail order, internet,
telephone, computer, device, or other electronic means, or sold
directly to a consumer on the winery premises, shall only be done
by a direct shipper. If a retail sale, delivery, or importation of
wine occurs to a consumer by any means described in this
subsection, the direct shipper must comply with all of the
following:
(a) Hold a direct shipper license.
(b) Pay any applicable taxes to the commission and pay any
applicable taxes to the department of treasury as directed by the
department of treasury. Upon the request of the department of
treasury, a direct shipper shall furnish an affidavit to verify
payment.
(c) Comply with all prohibitions of the laws of this state,
including, but not limited to, sales to minors.
(d) Verify the age of the individual placing the order by
obtaining from him or her a copy of a photo identification issued
by this state, another state, or the federal government or by
utilizing an identification verification service. The person
receiving and accepting the order on behalf of the direct shipper
shall record the name, address, date of birth, and telephone number
of the person placing the order on the order form or other
verifiable record of a type and generated in a manner approved by
the commission and provide a duplicate to the commission.
(e) Upon request of the commission, make available to the
commission any document used to verify the age of the individual
ordering or receiving the wine from the direct shipper.
(f) Stamp, print, or label on the outside of the shipping
container that the package "Contains Alcohol. Must be delivered to
a person 21 years of age or older." The recipient at the time of
the delivery is required to provide photo identification verifying
his or her age along with a signature.
(g) Place a label on the top panel of the shipping container
containing the direct shipper license number, the order number, the
name and address of the individual placing the order, and the name
of the designated recipient if different from the name of the
individual placing the order.
(h) Direct ship not more than 1,500 9-liter cases, or 13,500
liters in total, of wine in a calendar year to Michigan consumers.
If a direct shipper, whether located in this state or outside this
state, owns, in whole or in part, or commonly manages 1 or more
direct shippers, it shall not in combination ship to consumers in
this state more than 13,500 liters of wine in the aggregate.
(i) Pay wine taxes quarterly and report to the commission
quarterly the total amount of wine, by type, brand, and price,
shipped to consumers in this state during the preceding calendar
quarter, and the order numbers.
(j) Authorize and allow the commission and the department of
treasury to conduct an audit of the direct shipper's records.
(k) Consent and submit to the jurisdiction of the commission,
the department of treasury, and the courts of this state concerning
enforcement of this section and any related laws, rules, and
regulations.
(4)
Notwithstanding subsection (2) or (3), in the case of a
retail
sale, delivery, or importation of
alcoholic liquor occurring
by
any means described in subsection (2) or (3), a person taking
the
order on behalf of the retailer direct
shipper must comply with
subsection
(2)(c) through (g) and subsection
(3)(c) through (g).
(5)
The person who delivers the alcoholic liquor wine shall
verify that the individual accepting delivery is of legal age and
is the individual who placed the order or the designated recipient,
is an individual of legal age currently occupying or present at the
address, or is an individual otherwise authorized through a rule
promulgated under this act by the commission to receive alcoholic
liquor under this section. If the delivery person, after a diligent
inquiry, determines that the purchaser or designated recipient is
not
of legal age, the delivery person shall return the alcoholic
liquor
wine to the retailer or direct shipper. A delivery
person
who
returns alcoholic liquor wine
to the retailer or direct
shipper
due to inability to obtain the purchaser's or designated
recipient's legal age is not liable for any damages suffered by the
purchaser ,
retailer, or direct shipper.
(6) All spirits for sale, use, storage, or distribution in
this state, shall originally be purchased by and imported into the
state by the commission, or by prior written authority of the
commission.
(7) This section does not apply in the case of an alcoholic
liquor brought into this state for personal or household use in an
amount permitted by federal law by a person of legal age to
purchase alcoholic liquor at the time of reentry into this state
from without the territorial limits of the United States if the
person has been outside the territorial limits of the United States
for more than 48 hours and has not brought alcoholic liquor into
the United States during the preceding 30 days.
(8) A person who is of legal age to purchase alcoholic liquor
may do either of the following in relation to alcoholic liquor that
contains less than 21% alcohol by volume:
(a) Personally transport from another state, once in a 24-hour
period, not more than 312 ounces of alcoholic liquor for that
person's personal use, notwithstanding subsection (1).
(b) Ship or import from another state alcoholic liquor for
that person's personal use so long as that personal importation is
done in compliance with subsection (1).
(9) A direct shipper shall not engage in the sale, delivery,
or importation of wine to a consumer unless it applies for and is
granted a direct shipper license from the commission. This
subsection does not prohibit wine tasting or the selling at retail
by a wine maker of wines he or she produced and bottled or wine
manufactured for that wine maker by another wine maker, if done in
compliance with this act. Only the following persons qualify for
the issuance of a direct shipper license:
(a) A licensed wine maker.
(b) A wine producer and bottler located inside this country
but outside of this state holding both a federal basic permit
issued by the alcohol and tobacco tax and trade bureau and a
license to manufacture wine in its state of domicile.
(10) An applicant for a direct shipper license shall submit an
application to the commission in a written or electronic format
provided by the commission and accompanied by an application and
initial license fee of $100.00. The application shall be
accompanied by a copy or other evidence of the existing federal
basic permit or license, or both, held by the applicant. The direct
shipper may renew its license annually by submission of a license
renewal fee of $100.00 and a completed renewal application. The
commission shall use the fees collected under this section to
conduct investigations and audits of direct shippers. The failure
to renew, or the revocation or suspension of, the applicant's
existing Michigan license, federal basic permit, or license to
manufacture wine in its state of domicile is grounds for revocation
or denial of the direct shipper license. If a direct shipper is
found guilty of violating this act or a rule promulgated by the
commission, the commission shall notify both the alcoholic liquor
control agency in the direct shipper's state of domicile and the
alcohol and tobacco tax and trade bureau of the United States
department of treasury of the violation.
(11) As used in this section:
(a) "Computer" means any connected, directly interoperable or
interactive device, equipment, or facility that uses a computer
program or other instructions to perform specific operations
including logical, arithmetic, or memory functions with or on
computer data or a computer program and that can store, retrieve,
alter, or communicate the results of the operations to a person,
computer program, computer, computer system, or computer network.
(b) "Computer network" means the interconnection of hardwire
or wireless communication lines with a computer through remote
terminals, or a complex consisting of 2 or more interconnected
computers.
(c) "Computer program" means a series of internal or external
instructions communicated in a form acceptable to a computer that
directs the functioning of a computer, computer system, or computer
network in a manner designed to provide or produce products or
results from the computer, computer system, or computer network.
(d) "Computer system" means a set of related, connected or
unconnected, computer equipment, devices, software, or hardware.
(e) "Consumer" means an individual who purchases wine for
personal consumption and not for resale.
(f) "Device" includes, but is not limited to, an electronic,
magnetic, electrochemical, biochemical, hydraulic, optical, or
organic object that performs input, output, or storage functions by
the manipulation of electronic, magnetic, or other impulses.
(g) "Diligent inquiry" means a diligent good faith effort to
determine the age of a person, which includes at least an
examination of an official Michigan operator's or chauffeur's
license, an official Michigan personal identification card, or any
other bona fide picture identification that establishes the
identity and age of the person.
(h) "Direct shipper" means a person who engages in the sale,
delivery, or importation of wine, to consumers in this state, that
he or she produces and bottles or wine that is manufactured by a
wine maker for another wine maker and that is transacted or caused
to be transacted through the use of any mail order, internet,
telephone, computer, device, or other electronic means, or sells
directly to consumers on the winery premises.
(i) "Identification verification service" means any internet-
based service approved by the commission specializing in age and
identity verification.