W. Va. Code R. § 175-10-3

Current through Register Vol. XLI, No. 50, December 13, 2024

Section 175-10-3 - Bailment Policy and Procedures - Actual Bailment and Constructive Bailment

3.1. The Commissioner must take actual or constructive possession through bailment of all alcoholic liquor manufactured for sale by every distillery, mini-distillery, or micro-distillery located in the state of West Virginia. The distillery, mini-distillery, or micro-distillery must follow the requirements for listing alcoholic liquors with the Commissioner as a part of the West Virginia Product list, as specified in the West Virginia Code and in 175 CSR 1, 175 CSR 5, and 175 CSR 6.

3.2. Actual bailment must be utilized for all bailment orders and purchases to retail outlets for a distillery's, mini-distillery's, or micro-distillery's liquor products.

3.2.a. Actual bailment shall apply the wholesale markup fee set by the Commissioner and all applicable bailment, delivery, handling, and other associated fees and taxes to the distillery, mini-distillery, or micro-distillery's liquor products as set forth in the West Virginia Code and 175 CSR 1, 175 CSR 5, and 175 CSR 6.

3.2.b. Actual bailment shall require the distillery, mini-distillery, or micro-distillery to comply with all applicable requirements in the West Virginia Code and West Virginia Code of State Rules.

3.3. Constructive bailment may be utilized by distilleries, mini-distilleries, and micro-distilleries located in the state of West Virginia whereby their alcoholic liquor products actually stay at the licensed premises of the distillery, mini-distillery, or micro-distillery and various forms are completed to account for production, volume, retail sales, sample bottle retail purchases, markups, fees, taxes, and any other information required by the Commissioner. Alcoholic liquors maintained in constructive bailment at the licensed distillery, mini-distillery, or micro-distillery may only be used for serving free complimentary samples of its alcoholic liquor products for on-premise consumption and for retail sales for off-premise personal consumption.

3.3.a. Alcoholic liquor products manufactured at a distillery, mini-distillery, or micro-distillery used for serving on-premises free complimentary samples of its alcoholic liquor products must be reported on a form provided by the Commissioner which will be used to calculate the amount paid by the distillery, mini-distillery, or micro-distillery for purchasing the alcoholic liquor product used for free complimentary sampling through constructive bailment. The amount paid to the Commissioner for cases/bottles used by a distillery, mini-distillery, or micro-distillery shall be the same as paid by a retail outlet with the wholesale markup fee set by the Commissioner, bailment fees and delivery fees included.

3.3.b. Alcoholic liquor products manufactured at a distillery, mini-distillery, or micro-distillery used for retail sales of its alcoholic liquors at the licensed distillery, mini-distillery, or micro-distillery's premises for off-premises personal consumption only must be reported monthly on a form provided by the Commissioner which will be used to calculate the amount paid by the distillery, mini-distillery, or micro-distillery for purchasing the alcoholic liquor product used for these retail sales through constructive bailment. The amount paid to the Commissioner for cases/bottles used by a distillery, mini-distillery, or micro-distillery for retail sales to consumers for off-premises consumption shall include a 5% wholesale markup fee and a $.80 per case bailment fee.

3.3.c. A distillery, mini-distillery, or micro-distillery's alcoholic liquors used for sampling at the distillery, mini-distillery, or micro-distillery's licensed premises and used for retail sales of its alcoholic liquors at the licensed distillery, mini-distillery, or micro-distillery's premises for off-premises personal consumption only must be purchased from the Commissioner but may be constructively delivered to the Commissioner and remain on the distillery, mini-distillery, or micro-distillery's licensed premises without actual delivery to the Commissioner.

3.3.d. A distillery, mini-distillery, or micro-distillery electing to use constructive bailment shall report all production to the Commissioner, identifying, the amount of alcoholic liquor to remain on premises for purchase by the distillery, mini-distillery, or micro-distillery for on-premises free complimentary sampling and also purchased for retail sales to consumers for off-premises consumption. Note, barrel sales by a distillery, mini-distillery, or micro-distillery may not be conducted through constrictive bailment and must follow the ABCA Private Barrel Selection Policy.

W. Va. Code R. § 175-10-3