RELATES TO:
KRS
243.020,
243.030,
243.040,
243.090,
243.430
NECESSITY, FUNCTION, AND CONFORMITY: Since Kentucky operates
under a quota system for the number of distilled spirits licenses available,
and since many quotas are filled and no new licenses are available, it would be
unfair to those desiring a license to be precluded from obtaining a license
because some licenses were issued but not being used by the licensee.
Therefore, it is necessary that a licensee actually conduct the business
authorized by the license or else the license will become dormant. Realizing
that a licensee, like any other business, may have his business interrupted by
situations not under his control, various exceptions to the dormancy rule have
been included in the administrative regulation.
Section 1.
(1) Any wholesale, distributor, or retail
license under which no business is transacted during a period of ninety (90)
days shall be revoked by the Alcoholic Beverage Control Board or
surrendered.
(2) The provisions of
subsection (1) of this section shall not apply to any licensee who is unable to
continue in business at the licensed premises due to an act of God, casualty,
the acquisition of the premises by any federal, state, city or other
governmental agency under power of eminent domain, acquisition by any private
corporation through its power of eminent domain granted to it, whether such
acquisition is voluntary or involuntary, loss of lease through failure of
landlord to renew existing lease, court action or other verifiable business
reason. The licensee shall apply to place the license in dormancy by furnishing
to the Department of Alcoholic Beverage Control a verified statement setting
forth the fact that the licensee is unable to continue in business at his
licensed premises, for any of the reasons set forth herein prior to the
discontinuance of business. The license shall continue to remain in effect
during the license period or until it is transferred to another premises or
person. No license shall be considered valid unless business is conducted
thereunder within twelve (12) months from date of first notice to the board.
The board may extend this dormancy period for up to an additional twelve (12)
months for good cause shown.
(3)
Licenses placed in dormancy shall be renewed and renewal fees paid in the same
manner as active licenses.
(4)
(a) If negotiations for a buy-out of a
license privilege issued under
KRS
243.030 or
243.040(3)
may extend thirty (30) days beyond the date of expiration of the seller's
license or licenses, then the distilled spirits administrator or the malt
beverage administrator shall be notified in writing of the transaction or
negotiations not less than ten (10) days prior to the expiration date of the
license or licenses involved. The appropriate administrator may then extend the
time for filing a renewal or application for the license or licenses for a
reasonable length of time not to exceed sixty (60) days.
(b) If a buy-out of an existing license
privilege under
KRS
243.030 or
243.040(3)
extends over the renewal period and the license or licenses have not been
renewed by the seller, the purchaser shall pay the annual license fee for the
whole fiscal year or from the expiration date of the license privilege sought
to be purchased, whichever is greater.
(c) If a license privilege under
KRS
243.030 or
243.040(3)
qualifies under Section 2 of this administrative regulation, the purchaser of
the privilege may place the license in dormancy in the manner provided by this
administrative regulation.
Section 2. All licenses carried in a dormant
status in the records of the Department of Alcoholic Beverage Control on the
date this administrative regulation becomes effective shall be subject to the
provisions of this administrative regulation. The time periods contained in
this administrative regulation shall be calculated from the effective date of
this administrative regulation for these licensees.
The records of the board granting a license dormant status
shall be prima facie evidence that the license is
valid.