TITLE 23

ALCOHOLIC BEVERAGES

CHAPTER 11

DISTRIBUTORS AND SUPPLIERS OF BEER

23-1102.  Definitions. Whenever used in this chapter, the following words or phrases, or the plural thereof, unless the context clearly requires otherwise, shall have the meaning ascribed to them in this section:

(1)  "Agreement" means any agreement between a distributor and a supplier, whether oral or written, whereby a distributor is granted the right to purchase a brand, or brands, of beer sold by a supplier and to resell such products within the state of Idaho.

(2)  "Amend," "amendment," or "modify," means any alteration or change in the agreement, which causes a material change in the distributor’s business or relationship with the supplier, and which alteration or change does not apply to all distributors in the state of Idaho who distribute supplier’s products.

(3)  "Ancillary business" means a business owned by a distributor, by a substantial stockholder of a distributor, or by a substantial partner of a distributor, the primary business of which is directly related to the transporting, storing or marketing of the supplier’s products.

(4)  "Designated member" means:

(a)  The spouse, child, grandchild, parent, brother or sister of a deceased individual who owned an interest in a distributor;

(b)  Any person who inherits an ownership interest in a distributor;

(c)  The appointed and qualified personal representative or the testamentary trustee of a deceased individual owning an interest in a distributor;

(d)  The person appointed by a court as the guardian or conservator of the property of an incapacitated individual owning an interest in a distributor; or

(e)  A person who has succeeded to the deceased individual’s ownership interest in the distributor pursuant to a written contract or instrument which has been previously approved, in writing, by a supplier.

(5)  "Distributor" means a business entity, whether sole proprietorship, partnership, corporation, association, syndicate, or any other combination of persons, licensed by the state of Idaho to sell beer to retailers. The term "distributor" shall not include a brewery, brewery branch or subsidiary thereof, which is licensed by the state of Idaho and which license authorizes sales of beer to be made directly to a retailer, whether or not licensed as a distributor by the state of Idaho.

(6)  "Good faith" means honesty in fact in the conduct or transaction involved and the observance of reasonable commercial standards of fair dealing in the trade, as such term and standards are defined in, and interpreted pursuant to, the uniform commercial code, title 28, Idaho Code.

(7)  "Person" means any individual, partnership, corporation, association, syndicate, or any other combination of individuals or corporations.

(8)  "Reasonable standards and/or qualifications" mean those criteria established and consistently applied by a supplier to distributors within the state of Idaho and similarly situated distributors in adjoining states who:

(a)  Have entered into, continued or renewed an agreement with the supplier during a period of twenty-four (24) months prior to the proposed transfer of the distributor’s business; or

(b)  Have changed managers or successor managers during a period of twenty-four (24) months prior to the proposed change in manager or successor manager of the distributor.

(9)  "Retaliatory action" includes the refusal to continue an agreement, or a material part thereof, or a material reduction in the quality of service or quantity of products available to a distributor under an agreement, which refusal or reduction is not made in good faith.

(10) "Similarly situated distributors in adjoining states" mean distributors in adjoining states having an agreement with the supplier who have reasonably comparable business, area and market characteristics to an Idaho distributor of supplier’s products, which business, area and market characteristics may include, but are not limited to, the following: gross sales’ volume concerning supplier’s products, facilities, number of employees, business capitalization, market areas, considering the population and the demographics thereof, and the square miles of area served.

(11) "Substantial stockholder" or "substantial partner" means a person who owns an interest of ten percent (10%) or more of a distributor.

(12) "Supplier" means any person, either within or outside the state of Idaho, who enters into an agreement with a distributor for the sale of beer to such distributor with the intent that such products will be resold by the distributor to retailers within the state of Idaho. The term "supplier" shall also be deemed to include the successor in interest to a supplier’s business generally, or with reference to a specific brand or brands, of beer. The term "supplier" shall not include any person who produces fewer than thirty thousand (30,000) barrels of beer annually and who is licensed by the state of Idaho for such purpose.

(13) "Transfer of distributor’s business" or similar phrase, means the voluntary sale, assignment or other transfer of all or control of the business, or all or substantially all of the assets of the distributor, or all or control of the capital stock of the distributor, including without limitation the sale or other transfer of capital stock or assets by merger, consolidation or dissolution, or of the capital stock of the parent corporation, or of the capital stock or beneficial ownership of any other entity owning or controlling the distributor.

History:

[23-1102, added 1993, ch. 312, sec. 1, p. 1148.]