Exclusive Sales Territories Required for Beer Distribution in Florida
The Florida Beverage Law and related regulations contain no specific requirements concerning restrictive territories or any other contractual terms concerning wine and distilled spirit products. For beer and malt beverage products, however, the Florida Beverage Law, requires exclusive sales territories for beer and malt beverage products (collectively referred to here as “beer”).
Since 1988, beer may be sold by manufacturers and importers (“suppliers”) to Florida distributors only pursuant to the terms of a written distribution agreement. See Florida Statutes Section 563.022(1). A required aspect of every distribution agreement is designation of the distributor’s exclusive sales territory. A distributor is limited to selling beer products to vendors within its exclusive sales territory. Selling beer to vendors outside the distributor’s exclusive sales territory, as defined in the distribution agreement, is good cause for the supplier to terminate the distribution agreement without compensation to the distributor. See Termination of Florida Beer Distribution Agreements.
Required Elements: Territory and Brands
Each beer distribution agreement must designate the (a) exclusive sales territory, and (b) specific brand or brands for which the territory is granted. See Florida Statutes Section 563.021(1); Fla. Admin. Code R 61A-4.061(1). The exclusive sales territory must be defined as an exact geographic area. The supplier may not provide for the distribution of the same product brands to more than one distributors for all or part of the exclusive sales territory.
The distributor’s exclusive sales territory may be assigned for all of the supplier’s brands or to one or more specific brands. This means that a supplier may have more than one distributor in the same geographic area–such as a specific city or county–but only if written distribution agreements with each of those distributors relate to different beer brands. The distribution agreement may not directly or implied establish or maintain the distributor’s resale price for any brand or brands of beer sold by the distributor.
Notice of Agreement to Florida ABT
Florida distributors are required to file a copy of each distribution agreement with the Florida Division of Alcoholic Beverages & Tobacco (“ABT”). See DBPR Form ABT-3. In addition, distributors are required to file any amendment to a distribution agreement within 30 days of the effective date.
Beer that is sent to a Florida distributor in the absence of a written distribution agreement must be accompanied by the supplier’s invoice bear the note “Not for sale to vendors in the State of Florida.” Before selling the beer to licensed vendors in Florida, the distributor must report to the ABT its receipt of any brand or brands of beer for which no distribution agreement has been filed with the ABT.
The ABT is authorized to pursue administrative remedies against suppliers or distributors who violate the exclusive territory sales territory requirement. Theses measure may include revocation or suspension of the license of either or both industry members and/or the imposition of fines.
Because we’re attorneys: Disclaimer. Originally published July 4, 2022.