September 13, 2012

Liquor 2.0: Liquor Board Proposes Rule That Would Allow Online Liquor Sales and Delivery

Recently, the Washington State Liquor Control Board (Board) proposed rules that, if enacted, would authorize spirit retail licensees, craft distillers and distillers (Retailers) to accept online orders for spirits and to deliver spirits to customers.

The proposed rule includes the following provisions:

  • Eligibility. Existing Retailers must notify the Board prior to beginning internet sales. New Retailers must request internet spirit sales privileges in their application.
  • Website Requirements. The website pages associated with internet spirit sales must display the Retailer’s registered trade name.
  • Orders. Only a Retailer or a Retailer’s direct employee may accept internet orders.
  • Payment. All internet orders and payments must be “fully processed” before a Retailer may transfer ownership of the spirits to the customer or a private carrier. The proposed rule does not define the term “fully processed.”
  • Delivery. Upon full payment, the Retailer or a private carrier may deliver the order. All delivered spirits must be factory-sealed. For deliveries by a private carrier, the outermost surface of the package must state the following: (1) this package contains liquor; (2) the recipient must be twenty-one years of age or older; (3) delivery to intoxicated persons is prohibited. Each delivery sales record must record the following: (1) the name of the purchaser; (2) the name of the person who accepts the delivery; (3) the street address of the purchaser and delivery location; (4) the time and date of purchase and delivery; and (5) if delivery is by a private carrier, the private carrier must obtain the signature of the person who receives the liquor upon delivery.
  • Delivery Location / Hours. Delivery may be made only to a residence or business that has an address recognized by the United States Postal Service. For the purposes of this rule, a residence includes hotel rooms, motel rooms and other similar lodging that temporarily serves as a residence. Spirits may be delivered each day between 6:00 a.m. and 2:00 a.m.
  • Age Requirements. Any person under 21 years of age is prohibited from purchasing, delivering or accepting delivery of alcohol.

The proposed rule also contains potential traps for the unwary. Under the proposed rule, a Retailer may not use a third-party service to solicit customer business on behalf of the Retailer. However, the proposed rule does not define what constitutes a “third-party service.” This provision may create some uncertainty, especially considering that distributors regularly solicit sales for spirits manufactured by craft distillers and distillers. Additionally, the proposed rule solely addresses internet sales and deliveries in Washington State. It will be important to remember that other states may have differing regulations on internet spirit sales and spirit deliveries.

This is a proposed rule that is not effective until action is taken by the Board. The Board is currently accepting comments on the proposed rule through October 24, 2012. Comments may be emailed to rules@liq.wa.gov.

Please contact Jeremy Eckert at 206.447.6284 (or eckej@foster.com) if you have any questions about the proposed internet sales and delivery rule, or any other questions about the recent changes in Washington State liquor law.

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