Amend Regulation 47-322 Unfair Trade Practice&Competition
July 12, 2010
Attention: Colorado Alcohol Beverage Suppliers:
The Liquor Enforcement Division is in the process of amending regulations related to trade practices:
Amend Regulation 47-322 – Unfair Trade Practices and Competition
(C), Sponsored Events: Should a supplier have the ability to pay a retailer for the use of advertising space, when such payment is inconsistent with other statutory and regulatory provisions? Current regulatory language is “During these events, a supplier may pay a retailer up to the normal market rates for the use of space and provide advertising for a sponsored event.” Revisiting past position statements and regulatory hearings, we cannot identify the specific scenario that would justify a supplier’s direct or indirect payment to a retailer for this purpose. Moreover, the regulation lacks clarity as to what constitutes “normal market rates.” The only justification that we can identify would be those events involving or related to non-profit or charitable organizations. Regulatory changes made in 2009 authorize suppliers providing non-profit organizations with sponsorship money.
(D) Retailer Entertainment: Consistent application is needed here, and clarification about what types of entertainment should be permitted. Does it make sense to allow a supplier to give a retailer box seats to a sporting or concert event, valued in the hundreds of dollars, but not to allow suppliers to provide customary and acceptable business entertainment within reasonable dollar limits?
(G) Equipment Rentals: Prohibit rental of equipment that is not dispensing equipment. Suppliers are unable to establish uniform rental rates for various types of non-dispensing equipment, and suppliers rent items that have little, if no, depreciable life (umbrellas). Permitting only the rental of dispensing equipment offers retailers affordable access to otherwise expensive equipment.
(I) Value of Labor: clarify the restrictions of a supplier or their employees providing labor to retailers.
Amend Regulation 47-414 – Purchases by Wholesalers: To better clarify:
Those conditions under which a supplier may trade out, or issue a credit for, return of product.
What qualifies as “defective” product, and therefore eligible for return to a supplier.
Restriction related to a supplier granting credit or replacement product for un-saleable product due to retailer-caused “breakage”.
If you would like to be kept apprised of the status of the rulemaking process, please go to our website (http://www.colorado.gov/revenue/), click on Enforcement_Liquor, and select “News and Announcements.” Existing regulations can be found at the same site in the section entitled “Law and Regulations.”
You are welcome to send written comments to nhamby@spike.dor.state.co.us