Ga. Comp. R. & Regs. R. 560-2-5-.10 - Changing Brands and Brand Labels Registration, Designation of Wholesalers or Sales Territories

(1) Any Manufacturer, Shipper, Importer, or Broker desiring to change Wholesalers with respect to any Brand or Brand Label or to change the territory of a designated Wholesaler, shall file with the Commissioner, a Notice of Intention containing the following information:

(a) Name of each Brand or Brand Label involved;

(b) Case volume in Georgia for each Brand or Brand Label for the current year and the two previous years;

(c) Name of the Wholesaler currently distributing each such Brand or Brand Label;

(d) Name of the proposed new Wholesaler, the proposed scope of the sales territory, and whether such territory is different from that of the currently designated Wholesaler;

(e) Case volume of all Brands or Brand Labels of the proposed new Wholesaler for the current year and the two preceding years;

(f) Name of all persons, firms or corporations having any financial interest in the proposed new Wholesaler;

(g) If any person, firm or corporation named in subparagraph (f) above has any financial interest in any other business engaged in the sale of Alcoholic Beverages, the Department requires additional information including, but not limited to, the following:

1. Business name and address;

2. Alcohol license number;

3. Ownership interest and/or offices held; and

4. Business relationship or association.

(h) A detailed explanation of the specific business reasons for the request to change Wholesalers or to change the territory of a designated Wholesaler.

(2) Business reasons which may be considered by the Commissioner in determining cause for authorizing a change of Wholesalers or to change the territory of a designated Wholesaler include:

(a) A Wholesaler's bankruptcy or serious financial instability, including its failure consistently to pay its debts timely or its failure to meet or maintain any objective standards of capitalization expressly agreed to between the Wholesaler and the Manufacturer, Shipper, Importer, or Broker, provided such standards are determined by the Commissioner to be reasonable;

(b) A Wholesaler's repeated violation of any provision of federal or state law or regulation whether or not such violation resulted in official action;

(c) A Wholesaler's failure to maintain sales volume of the Brand or Brand Label reasonably consistent with sales volumes of other Wholesalers of that Brand or Brand Label, or a Wholesaler's failure to otherwise promote the product effectively; and

(d) Any other factors relevant to such proposed change that will aid the Commissioner in determining cause.

(3) At the same time that the original Notice of Intention is filed with the Commissioner, a copy shall be served via U.S. certified mail by the Manufacturer, Shipper, Importer, or Broker, upon each Wholesaler who may be affected by the proposed changes and a certificate of such service shall accompany the original Notice of Intention filed with the Commissioner.

(4) Any person, including the Commissioner, may file an objection to the request to change Wholesalers or to change territory designations within thirty (30) days of the date of Notice of Intention. Such written objections shall be filed with the office of the Commissioner. The objecting party shall serve a copy of the objection upon all Wholesalers who may be affected by the proposed change via U.S. certified mail.

(a) Upon the request of any party or upon motion by the Commissioner, the Commissioner shall provide at least sixty (60) days notice via U.S. certified mail to all applicable parties, hold a hearing, for the purpose of determining the truth of any matters of fact alleged by any party and determining whether the proposed changes are based upon sufficient cause and are otherwise consistent with the policies set forth in Rules 560-2-5-.08 and 560-2-5-.09;

(b) Proposed changes will not be approved for the following reasons:

1. Any change that tends to create a monopoly or lessen competition with respect to any type of Alcoholic Beverage. A proposed change or transfer that will place more than 25% of the case volume of all Distilled Spirits sold in Georgia under one Wholesaler or controlled group is presumed to be an attempt to create a monopoly and lessen competition.

2. The failure or refusal of a Wholesaler to comply with any demand or request of a Manufacturer, Shipper, Importer, or Broker which would result in a violation of any provision of federal or state law or regulation.

(c) During the thirty (30) day period as provided in paragraph (4) above, and until the proposed changes have been finally approved by the Commissioner, the party proposing the change shall continue to supply the designated Wholesaler, upon commercially reasonable terms, such reasonable quantities of the Brands or Brand Labels involved as the Wholesaler may require.

(5) If no objection is filed to the Notice of Intention as provided in this Rule, the proposed changes shall stand automatically approved by the Commissioner at the expiration of such thirty (30) day period.

(6) Any Manufacturer, Shipper, Importer, or Broker who obtains or acquires in any manner, the right to sell, ship, or distribute any Brand or Brand Label shall for the purpose of these regulations stand in the place of, and be subject to, all of the rights, privileges, duties and obligations of its predecessor or its predecessors from whom such Brands or Brand Labels were obtained or acquired.

(7) When a Brand or Brand Label is voluntarily released by a Georgia Wholesaler from distribution in Georgia, the Wholesaler must mail a letter of release to the Manufacturer, Shipper, Importer, or Broker on company letterhead. Wholesaler shall provide a copy of the letter of release to the Alcohol and Tobacco Division of the Department within thirty (30) days of the date of the letter of release.

(a) The date of the letter of release will be considered the date upon which the Brand was withdrawn from distribution;

(b) Letters of release received by the Department after the thirty (30) day requirement will not be considered valid, and a new letter of release must be provided pursuant to the requirements in this Rule;

(c) Any inventory of the released Brand or Brand Label may no longer be distributed by the Wholesaler as of the date of the letter of release.

(8) When a Brand or Brand Label is voluntarily withdrawn from distribution in Georgia, the Manufacturer, Shipper, Importer, or Broker must mail a letter of withdrawal to the Wholesaler on company letterhead. The Manufacturer, Shipper, Importer, or Broker shall provide a copy of the letter of withdrawal to the Alcohol and Tobacco Division of the Department within thirty (30) days of the date of the letter of withdrawal.

(a) The date of the letter of withdrawal will be considered the date upon which the Brand or Brand Label is withdrawn from distribution;

(b) Letters of withdrawal received after the thirty (30) day requirement will not be considered valid, and a new letter of withdrawal must be provided pursuant to the requirements in this Rule;

(c) Any inventory of the withdrawn Brand or Brand Label may still be distributed after receipt of the letter of withdrawal by the Wholesaler.

Notes

Ga. Comp. R. & Regs. R. 560-2-5-.10

O.C.G.A. §§ 3-2-2, 3-4-152, 3-5-31, 3-6-22, 48-2-12.

Original Rule entitled "Restriction to Retailers: Business Hours" was filed and effective on June 30, 1965. Amended: Filed August 18, 1965; effective September 6, 1965. Amended: Rule repealed and a new Rule of the same title adopted. Filed June 29, 1972; effective July 19, 1972. Amended: Rule repealed and a new Rule of the same title adopted. Filed April 4, 1973; effective April 24, 1973. (This amendment was not printed because a new Rule repealing said amendment was filed a day prior to the effective date of said amendment). Amended: Rule repealed and a new Rule o the same title adopted. Filed April 23, 1973; effective May 13, 1973. Amended. Rule repealed and a new Rule entitled "Restriction to Retailer Business Hours: Exception: Restrictions on Other Mercantile Establishments: Manner of Operation" adopted. Filed May 25, 1977; effective June 14, 1977. Amended: Rule repealed. Filed May 5, 1982; effective May 25, 1982. Amended: Rule entitled "Farm Winery as Wholesaler" adopted. Filed September 19, 1983; effective October 9, 1983. Repealed: New Rule entitled "Changing Brand or Territory Designations" adopted. F. Oct. 1, 2010; eff. Oct. 21, 2010. Amended: New title, "Changing Brands and Brand Labels Registration, Designation of Wholesalers or Sales Territories." F. May 31, 2023; eff. June 20, 2023. Amended: F. Oct. 5, 2023; eff. Oct. 25, 2023.