Florida Guidelines for Third-Party Marketing of Alcoholic Beverages
In Florida, the Division of Alcoholic Beverages and Tobacco (ABT) is concerned about violations of the Tied House Evil Law, which aims to prevent unfair practices in the alcoholic beverage industry. This law prohibits manufacturers, distributors, and suppliers from controlling local markets through payments to alcohol retailers and other unfair marketing techniques. The ABT has established guidelines for third-party marketing agreements to address potential violations. In this blog post, we will explore the law and the ABT’s guidelines to ensure compliance in the industry.
The Tied House Evil Law
Florida’s Tied House Evil Law , stated in Section 561.42, Florida Statutes, aims to prevent alcoholic beverage manufacturers, distributors, and suppliers from gaining control over local markets through unfair practices. These practices include making payments to alcohol retailers (known as “payola”) and engaging in other marketing techniques that manipulate sales or harm competition. It is important to note that these actions are prohibited whether carried out directly by the alcohol supplier or indirectly through a third-party marketing company acting on behalf of the supplier.
The ABT’s Focus and Guidelines
The ABT has expressed its growing concern about potential tied house evil violations facilitated by third-party marketing agreements. To address this issue, the ABT has approved a set of guidelines that, if followed, create a presumption that the use of third-party marketing companies by suppliers does not violate Florida’s Tied House Evil Law. These guidelines serve as a reference for the industry to ensure fair practices and compliance with the law.
The ABT’s Approved Guidelines
The following guidelines have been approved by the ABT:
- Payments: A distributor, manufacturer, or marketing company must not pay a retail vendor to feature their brands in the retail vendor’s business.
- Acceptance of Payments: A retail vendor or marketing company must not accept any payment from a distributor, manufacturer, or their agents for the purchase of their brands.
- Provision of Value: A marketing company cannot provide any services or benefits to a retail vendor that are paid for by the distributor or manufacturer if those services cannot be legally performed by the distributor.
- Ownership Interest: A marketing company must declare that it has no ownership interest in any retail vendor licensed to sell alcoholic beverages in Florida.
Compliance and Certifications
Suppliers are advised to ensure that third-party marketing companies adhere to these guidelines by requiring them to provide compliance certifications. These certifications serve as proof that the marketing company follows the approved guidelines before providing any marketing or promotional services.
In the alcoholic beverage industry, it is crucial for both suppliers and retail vendors to comply with all Florida Beverage Laws, including the Tied House Evil Law and the ABT’s rules implementing those laws. By understanding and adhering to these guidelines, businesses can maintain fair competition and promote responsible practices in the market. Compliance with these laws is essential for a thriving and ethical industry.
Because we’re attorneys: Disclaimer. Published 07/14/2023.