Md. Code Regs. 14.23.04.11

Current through Register Vol. 51, No. 24, December 2, 2024

Section 14.23.04.11 - Services to Retailers

A. In General.

(1) Except as provided in COMAR 14.23.01 or this chapter, a brand owner, supplier, nonresident dealer permittee, or licensed wholesaler may not provide something of value to a licensed retailer as prohibited by provisions of Alcoholic Beverages Article, Annotated Code of Maryland.

(2) A brand owner, supplier, nonresident dealer permittee, or licensed wholesaler may not provide a service or item of utilitarian value which would relieve a licensed retailer of an ordinary business expense.

(3) A supplier or licensed wholesaler may not move, stock, rotate, dust, or otherwise alter or disturb a competitor's products on a licensed retailer's premises.

B. Shelf Management.

(1) A brand owner, supplier, nonresident dealer permittee, or licensed wholesaler may discuss in general and specific terms with a licensed retailer shelf-management concepts and programs which benefit the licensed retailer in marketing all of the licensed retailer's alcoholic beverage products.

(2) A supplier or licensed wholesaler may provide, publish, and generally make available data on market sales and analysis.

(3) A brand owner, supplier, nonresident dealer permittee, or licensed wholesaler may provide and suggest shelf-management plans or schematics which are personalized for a specific licensed retailer or group of licensed retailers.

(4) Implementation of a suggested shelf-management plan shall be done solely by the licensed retailer.

(5) A supplier or licensed wholesaler representative may not participate in stocking or rearranging shelves in connection with a shelf-management plan.

C. Shelf Stocking and Product Rotation.

(1) A supplier or licensed wholesaler may not stock shelves, price items, or arrange any products including its own, for a licensed retailer except as provided in this chapter.

(2) A supplier or licensed wholesaler may rotate products, when rotation is performed to ensure product freshness and to take advantage of limited shelf life products.

(3) Limited rotation does not include any of the following activities:

(a) Opening of cases;

(b) Placement of individual bottles on shelves or in coolers;

(c) Movement of products from one shelf location to another location;

(d) Rearrangement of alcoholic beverages in a storage or sales area in less than case lots; or

(e) Shelf management.

(4) Beer, malt beverage products, wine coolers, and spirit coolers differ somewhat from other alcoholic beverages due to limited shelf life. A driver or salesperson may rotate a licensed wholesaler's own product that is meant to be accessible by the consumer so that the current delivery is placed in the position of being "first in, first out".

(5) A supplier or licensed wholesaler that distributes nonalcoholic beverage products, for example, sodas, teas, bottled water, juices, and other items, may stock shelves at a retail licensed premises with those products. This shelf stocking of nonalcoholic beverage products may not include nonalcohol beer or nonalcohol wine products.

D. A supplier or licensed wholesaler may dust alcoholic beverage products, but the dusting may not be used as a subterfuge for shelf stocking or impermissible rotation.

E. A supplier or licensed wholesaler may not enter into an agreement, financial or otherwise, with a licensed retailer to assure a certain allocation or positioning of shelf space, including a slotting allowance, for the licensed wholesaler's or supplier's product.

F. A supplier or licensed wholesaler representative may set up advertising displays on a licensed retailer's premises consistent with the provision of Regulation .10 of this chapter.

G. Draft Equipment.

(1) A licensed wholesaler may furnish at no charge to a licensed retailer minimum services to beer or wine draft systems, such as cleaning lines and minor repairs and parts such as washers, nuts, or clamps, and may provide the necessary equipment to take beer from the keg to the stanchion station if the parts and equipment are minimal in cost.

(2) A licensed wholesaler may provide items such as:

(a) Nitrogen, CO2, spigots, faucets, coil cooler boxes, drip trays, and similar items for beer draft systems at cost or above; and

(b) Nitrogen, pumps, mounts, gauges, regulators, standards, and similar items for wine draft systems at cost or above.

(3) A licensed wholesaler may not give any refrigeration or draft equipment to a licensed retailer. A licensed wholesaler may rent or lease refrigeration or draft equipment to a licensed retailer at fair market value or higher.

(4) A licensed wholesaler may perform the labor service part of draft system installation or alterations and may repair equipment such as refrigerators or compressors if the licensed wholesaler charges at least fair market value, or higher, for labor and parts.

(5) A licensed wholesaler representative may be present at a special event where alcoholic beverages are dispensed from rented refrigerated trucks, but may not dispense or provide other assistance before, during, or after the event except to:

(a) Ensure protection of the licensed wholesaler's equipment; and

(b) Set up tapes and train licensed retailer's representatives in their use.

H. Inventories and Deliveries.

(1) A salesperson may take inventory of the salesperson's company's products for purposes of recommending a purchase order. Orders may not be taken for products not in the licensed wholesaler's inventory.

(2) A salesperson may not place a licensed retailer's inventory in or on a licensed retailer's computer or other records of the licensed retailer, and a salesperson may not develop a customized product or price list for a particular licensed retailer or group of licensed retailers but may provide a generic diskette which shall be made available to any licensed retailer who requests a generic diskette.

(3) Locations of Deliveries.

(a) Except as provided in §H(3)(b) and (c) of this regulation, deliveries of alcoholic beverages shall be made to a central point at a licensed retailer's establishment whether the central point is in the sales area or a particular area designated for storage.

(b) Deliveries of beer and malt beverage products may be made to multiple locations within the licensed retail establishment.

(c) Deliveries of alcoholic beverage products may be made to multiple locations within the arena and stadium licensed premises.

(4) Deliveries shall be made on the invoice date or the next delivery date to that area. If the delivery is not made, the order shall be canceled and a new order prepared with the appropriate price and conditions of sale for the date of the most recent order.

Md. Code Regs. 14.23.04.11

Regulation .11 amended and recodified from 03.02.05.11 effective 49:26 Md. R. 1080, eff. 12/26/2022