HB437 Alabama 2021 Session

Summary

Primary Sponsor

Terri CollinsRepresentative

Republican

Co-Sponsors

Alan BakerMike BallK.L. BrownJim CarnsMerika ColemanCorley EllisDavid FaulknerJoe FaustLynn GreerRolanda HollisGil IsbellNathaniel LedbetterJoe LovvornSteve McMillanCharlotte MeadowsBecky NordgrenPhillip PettusNeil RaffertyRex ReynoldsProncey RobertsonChris SellsHarry ShiverMatt SimpsonJeff SorrellsShane StringerTim WadsworthMargie WilcoxDebbie Wood

Session

Regular Session 2021

Title

Wine, authorizing common carriers to make delivery of alcoholic beverages to residents over 21, to create a wine direct shipper permit to allow wine manufacturers to ship their table wine directly to residents, Sec. 28-3A-6.1 added; Sec. 28-1-4 am'd.

Summary

HB437 creates a direct wine shipping program and adds extensive wine franchise regulations, allowing licensed manufacturers to ship limited wine directly to Alabama residents 21+ while strengthening state control over wine distribution.

What This Bill Does

It authorizes a direct wine shipper license for manufacturers with a federal permit to ship up to 12 cases per Alabama resident per year, with age verification, signature required at delivery, labeling, quarterly shipment reporting, and tax remittance; noncompliance can result in fines and license suspension. It establishes wine fulfillment centers to handle logistics for direct shippers, including contracts, compliance programs, labeling, quarterly reporting, and licensing fees. It amends existing law to allow common carriers to deliver wine under the direct shipper system with age verification, signature collection, and record-keeping requirements. It adds Chapter 8A to regulate wine supplier–wholesaler relationships, including exclusive territories, prohibited practices, transfer rules, compensation for diminished value, an arbitration process, and strong enforcement provisions, with rules to be set by the ABC Board; the act becomes effective August 1, 2021.

Who It Affects

• Group 1: Alabama residents age 21 and older who may receive direct shipments of wine under license, subject to quantity limits, delivery restrictions, and the need to provide age verification and signatures.
• Group 2: Wine manufacturers, common or permit carriers, wine fulfillment centers, wholesalers/suppliers, and state regulators (ABC Board and Department of Revenue), who gain new licensing, reporting, enforcement, and franchise-regulation requirements.

Key Provisions

• 28-3A-6.1 Direct shipment by a manufacturer: licensed producers may ship up to 12 cases per resident per year (each case up to 9 liters) of wine produced by the licensee or under specific contracts; shipments must be to residents 21+ for personal use; shipments may occur from licensed premises or via a wine fulfillment center; labeling must include a 21+ delivery statement; quarterly shipment reporting to the board with recipient, signature, carrier, date, tracking number, and quantity; annual renewal fee of $150; compliance audits and age attestations required.
• 28-3A-6.2 Wine fulfillment centers: licenses issued per premises; fees of $500 per center plus $100 for additional premises; centers may provide warehousing, packaging, order fulfillment, and shipment for direct shippers; must maintain compliance programs and verify direct shipper licenses; labeling and quarterly reporting requirements; three-year record retention; penalties for violations.
• 28-1-4 amendments: authorizes direct wine shipper shipments by common or permit carriers under the new direct shipper framework; requires age verification, signature on delivery, and quarterly reporting; failure to comply may suspend the carrier’s license and trigger penalties.
• Penalties and enforcement: shipments to unlicensed parties are Class C misdemeanors; civil penalties for violations escalate from $500 to $3,000 to $6,000 for subsequent violations; fines support regulatory duties and board enforcement.
• Franchise regulation (Chapter 8A): establishes definitions (agreement, wholesaler, supplier, territory, etc.), requires territorial exclusivity and fair dealing, prohibits certain coercive or anti-competitive practices, and governs transfers of wholesaler business and franchise relations.
• Transfers and disputes: supplier must follow notice and good-faith requirements for modifications to agreements; provisions for compensation if a supplier disrupts a wholesaler’s business; arbitration processes available for disputes over compensation, with costs shared and panels appointed through AAA if needed.
• Standards and remedies: permits civil actions for damages by either side for prohibited conduct; allows injunctive relief; nonexclusive remedies; jurisdiction for disputes in Alabama courts where the supplier and wholesaler have a territorial agreement.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Alcoholic Beverage Control Board