Introduced Version
House Bill 2949 History
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Key: Green = existing Code. Red = new code to be enacted
H. B. 2949
(By Delegate Hunt)
[Introduced March 15, 2013; referred to the
Committee on the Judiciary then Finance.]
A BILL to amend and reenact §60-8-30 of the Code of West Virginia,
1931, as amended, relating to making it illegal for a
manufacturer, winery, farm winery or supplier to deliver wine
to a distributor without having an equitable franchise
agreement; requiring the agreement to contain a written
description of the territory the wine supplier assigns to the
distributor; prohibiting a distributor from selling wine
outside its franchise territory; permitting sales of
convenience between distributors; prohibiting a retailer from
purchasing wine from sellers outside the retailer's assigned
territory; requiring due regard for the equities and just
cause before an agreement between a supplier and distributor
may be canceled; requiring ninety days written notice when
seeking to cancel an agreement; providing exceptions;
requiring sixty days written notice when a distributor desires to sell or transfer ownership; providing that a supplier has
sixty days to respond; requiring a supplier who disapproves of
the transfer to give written justification; and providing that
if no response is received the transfer is approved by
default.
Be it enacted by the Legislature of West Virginia:
That §60-8-30 of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows:
ARTICLE 8. SALE OF WINES.
§60-8-30. Exclusive franchise agreements prohibited.
It shall be is illegal for any manufacturer, winery, farm
winery or supplier to enter into any exclusive franchise agreement
with any distributor whereby any such distributor is given the
exclusive right within this state or in any given territory within
this state to distribute the product or products of such
manufacturer which are to be sold or distributed pursuant to the
provisions of this article. transfer or deliver to a distributor
any wine without first having entered into an equitable franchise
agreement with the distributor. Further, all agreements between a
manufacturer, winery, farm winery or supplier and a distributor
must be in writing and on file with the commissioner and all such
agreements must provide for termination of either party provided
that notice of termination is include a written description showing
the assigned territory by the supplier to the distributor. This requirement does not prohibit a distributor from receiving multiple
territorial assignments. A distributor may not sell, offer for
sale, distribute or deliver any wine outside the territory assigned
to the distributor by the supplier of the wine or sell, offer for
sale, distribute or deliver any wine to any licensed retailer whose
principal place of business or licensed premises is within the
assigned territory of another distributor of wine. However, this
section does not prohibit sales of convenience between distributors
licensed in this state where one distributor sells, transfers or
delivers to another distributor a particular brand or brands for
sale at wholesale. No licensed retailer may purchase wine except
from the duly authorized distributor in whose assigned territory
the licensed retailer is located.
_____Agreements may not be canceled, terminated or rescinded
without due regard for the equities of the supplier or distributor
and without just cause. Notice of the cancellation, termination or
rescission of a franchise agreement by either party must be
provided in writing and by certified mail to the commissioner and
all parties to the agreement ninety days prior to the termination
date. Once the notice has been received by either party, the
distributor shall: (1) Use the ninety-day period to deplete such
the distributor's affected wine inventory; or (2) reach some
agreement with the manufacturer, winery, farm winery or supplier to
return unused salable wine inventory or receive payment for unused salable wine inventory. No new distributor shall be appointed
until the conclusion of the ninety days or as the parties have
otherwise agreed to complete the termination. For the purposes of
this article, "salable" shall mean inventory fit for human
consumption or as otherwise determined by the commissioner.
However, that ninety-day period and the notice of cancellation,
termination or rescission does not apply if the cancellation,
termination or rescission is agreed to in writing by both the
supplier and the distributor involved or, in the event a
distributor desires to sell or transfer his or her franchise, the
distributor shall give to the supplier at least sixty days notice
in writing of the impending sale or transfer and the identity of
the person, firm or corporation to whom the impending sale or
transfer and the identity of the person, firm or corporation to
whom the sale or transfer is to be made and the other information
as the supplier may reasonable request. A copy of the notice of
sale or transfer shall be forwarded to the commissioner. The
supplier shall be given sixty days to approve or disprove of the
sale or transfer. If the supplier neither approves nor disapproves
the sale or transfer within sixty days of the date of receipt of
the notice, the sale or transfer of the franchise shall be deemed
to be approved by the supplier. In the event the supplier
disapproves the sale or transfer to the prospective franchises,
transferee or purchaser, the supplier shall give written notice to the distributor, setting forth the reasons for the disapproval.
NOTE: The purpose of this bill is to make it illegal for a
winery or wine supplier to deliver wine to a distributor without
first having an equitable franchise agreement. The bill requires
the agreement to contain a written description of the assigned
territory; The bill prohibits a distributor from selling wine
outside of its franchise territory. The bill permits sales of
convenience between distributors. The bill prohibits retailers from
purchasing wine from sellers outside its assigned territory. The
bill requires due regard for the equities and just cause before an
agreement between a supplier and distributor may be canceled. The
bill requires ninety days written notice when seeking to cancel an
agreement. The bill provides exceptions. The bill requires sixty
days' written notice when a distributor desires to sell or transfer
ownership. The bill provides a supplier with sixty days to respond.
The bill requires a supplier who disapproves of the transfer to
give written justification. The bill provides that if no response
is received the transfer is approved by default.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
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