S499-2013 Actions

• Jan 9, 2013: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

S499-2013 Memo

BILL NUMBER:S499

TITLE OF BILL:
An act
to amend the alcoholic beverage control law, in relation to amending
schedules which have been filed with the liquor authority

PURPOSE:
This bill will promote competition amongst wholesalers by
allowing wholesalers to amend their prices below that of their
competitors.

SUMMARY OF PROVISIONS:
Section 1. Amends subdivision (4) of section 101-b of the alcoholic
beverage control law as amended by chapter 102 of the laws of 1979 by
allowing a wholesaler of liquor or wine to amend their schedule
within ten days as long as such amended prices are lower and such
amended discounts are greater.

Section 2. Amends paragraph (c) of subdivision 5 of section 101-b of
the alcoholic beverage control law as added by chapter 769 of the
laws of 1986 by allowing a micro-winery, winery, or farm winery to
amend their schedule within ten days as long as such amended prices
are lower and such amended discounts are greater.

Section 3. Effective date.

EXISTING LAW:
Currently, a wholesaler may amend their price schedule, but they are
prohibited from amending their prices below that of a competitor or
amending their discounts to be greater than that of a competitor.

JUSTIFICATION:
The current price posting law allows a wholesaler to amend their
filing schedule but prohibits them from amending their prices below
that of a competitor or amending their discounts to be greater than
that of a competitor. This leads to implicit collusion as each
wholesaler can set an above market price with the assurance that if
their competitors do not follow suit, they will have the opportunity
to lower their price to match their competitors. This bill will
eliminate such perverse incentives by allowing distributors to amend
prices below those of their competitors.
This creates a competitive environment and causes prices to reflect
actual market price.

LEGISLATIVE HISTORY:
New Bill.

FISCAL IMPLICATIONS:
None.

EFFECTIVE DATE:
Immediately.

S499-2013 Text

 S T A T E   O F   N E W   Y O R K
 
 
                                          499
 2013-2014 Regular Sessions
 I N  SENATE
 (PREFILED)
 January 9, 2013
 
 Introduced  by Sen. GALLIVAN -- read twice and ordered printed, and when
 printed to be committed to the Committee on Investigations and Govern
 ment Operations
 

AN ACT to amend the alcoholic  beverage  control  law,  in  relation  to
 amending schedules which have been filed with the liquor authority
 

THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM
 BLY, DO ENACT AS FOLLOWS:

 

Section 1. Subdivision 4 of section 101-b of  the  alcoholic  beverage
 control  law,  as amended by chapter 102 of the laws of 1979, is amended
 to read as follows:

 4. Each such schedule required by paragraph (a) of  subdivision  three
 of this section shall be filed on or before the twenty-fifth day of each
 month and the prices and discounts set forth therein shall become effec
 tive  on the first day of the second succeeding calendar month and shall
 be in effect for such second succeeding calendar month. Each such sched
 ule required by paragraph (b) of subdivision three of this section shall
 be filed on or before the fifth day of each month, and  the  prices  and
 discounts  set  forth therein shall become effective on the first day of
 the calendar month following the filing thereof, and shall be in  effect
 for such calendar month. Within ten days after the filing of such sched
 ule  the  authority shall make them or a composite thereof available for
 inspection  by  licensees.  Within  three  business  days   after   such
 inspection  is  provided  for, a wholesaler may amend his filed schedule
 for sales to retailers [in order to  meet  lower  competing  prices  and
 discounts  for  liquor  or  wine of the same brand or trade name, and of
 like age and quality, filed pursuant to this  section  by  any  licensee
 selling  such  brand],  provided such amended prices are [not] lower and
 SUCH AMENDED discounts are [not] greater [than those to be  met].    Any
 amended schedule so filed shall become effective on the first day of the
 calendar  month  following the filing thereof and shall be in effect for
 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD01984-01-3
 
       S. 499                              2
 such calendar month. All schedules filed  shall  be  subject  to  public
 inspection,  from  the  time that they are required to be made available
 for inspection by licensees, and shall not be  considered  confidential.
 Each  manufacturer  and wholesaler shall retain in his licensed premises
 for inspection by licensees a copy of his filed  schedules  as  then  in
 effect. The liquor authority may make such rules as shall be appropriate
 to carry out the purpose of this section.
 

S  2. Paragraph (c) of subdivision 5 of section 101-b of the alcoholic
 beverage control law, as added by chapter 769 of the laws  of  1986,  is
 amended to read as follows:

 (c)  Within  ten days after the filing of such schedules the authority
 shall make them or a  composite  thereof  available  for  inspection  by
 licensees.  Within three business days after such inspection is provided
 for, a wholesaler may amend his filed schedule for  sales  to  retailers
 [in  order  to meet lower competing prices and discounts for wine of the
 same brand or trade name, and of like age and quality, filed pursuant to
 this section by any licensee selling such brand], provided such  amended
 prices  are  [not]  lower  and  SUCH AMENDED discounts are [not] greater
 [than those to be met]. Any  amended  schedule  so  filed  shall  become
 effective  on  the  first day of the calendar month following the filing
 thereof and shall be in effect until the  effective  date  of  the  next
 filing.
 

S 3. This act shall take effect immediately.

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