The good folks at the ILCC officially (this has been in the works for some time, but the process of getting a regulation approved in Illinois takes a while) adopted an updated regulation on the transfer of alcohol between retailers. You can find the new regulation Ill. Admin. Code tit 11 § 100.25 “Transfer of Alcohol” here.
In brief, the new regulation explicates the process and justifications for retailers to transfer alcohol between each other. The old regulation just prohibited the practice absent Commission approval which didn’t give much guidance and, frankly, didn’t help regulators in determining what circumstances justified that approval.
The new reg is a welcome panoply of descriptions and circumstances for understanding when, how, and what steps to take to get permission to transfer alcohol to other retailers (when events occur like bankruptcy of a retailer, acts of god, loss of a license, or even in the purchase of an existing bar).
For those of you interested in the actual changes made to the old regulation and who want to appreciate the clarity brought by this updated version, here is a redline of the old/new versions [green is added, strikethrough is gone]:
Section 100.250 Transfer of Alcohol
- a) The holder of a retail license is prohibited from selling, giving, or transferring alcoholic products subject to the jurisdiction of the Act to another retail license holder unless permitted by the Act, this Part, or an express authorization by the Commission
for the privilege of selling alcoholic liquors at retail on the premises specified in the license, for use or consumption, is hereby restricted to such sale from the licensed premises only and is not permitted to sell to, purchase from or transfer such alcoholic liquor to any other retail licensee or licensed premises. - b) The holder of a retail license is prohibited from purchasing, receiving, or accepting alcoholic products subject to the jurisdiction of the Act from another retail license holder unless permitted by the Act, this Part, or an express authorization by the Commission.
- c) Unless otherwise permitted by the Act, this Part, or
underthe expressapprovalauthorization of the Commission, a retail licensee shall purchase all alcoholic products subject to the jurisdiction of the Actis strictly limited to purchasing alcoholic liquorfrom an Illinois licensedadistributor or a licenseepersonholding a self-distribution exemption in which there is a bona fide transfer of title. - d) Transfer of Alcohol Approval Process
- 1) The Commission may authorize the holder of a retail license to sell, give, transfer, purchase, receive or accept alcoholic products subject to the Act, to or from another holder of a retail license.
- 2) The Commission may delegate to Commission staff the review, approval, or denial of the request to transfer alcohol.
- 3) The request must be approved by the Commission prior to the transfer.
- 4) The request shall be submitted on forms provided by the Commission. Forms must be completed in their entirety prior to review or approval by the Commission.
- 5) In normal circumstances, a request must be submitted and approved by the Commission prior to the transfer. In the case of an imminent act of god, the request must be received prior to the transfer.
- 6) The Commission will review each request based on the information provided in the request and other factors known to the Commission.
- 7) Each request will be reviewed independently of any other licenses held by the owners.
- 8) The authorization may be subject to conditions imposed by the Commission at the time of the approval.
- 9) Upon approval by the Commission, the licensee must maintain a copy of the authorization at its premises for a period of 90 days following approval or until all transferred products have been sold by the licensee, whichever is later.
- e) In reviewing a transfer request, the Commission may utilize the following factors:
- 1) Acts of god (such as, but not limited to, fires, explosions, tornadoes, earthquakes, drought, and floods);
- 2) Federal, State, or local law change;
- 3) Other unforeseeable circumstances beyond the control of the licensee, such as circumstances:
- A) the licensee cannot reasonably take precautions to prevent; and
- B) in which the only reasonable method of dispossessing of the alcoholic liquor products would be through a transfer to another licensee;
- 4) Bankruptcy;
- 5) Permanent or temporary closure of the licensee; or
- 6) A new licensee opens a business at the same location where the prior licensee conducted business, when the new licensee takes possession of the inventory of the immediately prior licensee.
- f) This Section shall not apply to transfers made under Section 100.150 (Salvaged Alcoholic Liquors).
- g) For the purposes of this Section, “retail license” shall include the following licenses: retailer, caterer retailer, Special Event Retailer’s (not-for-profit), railroad, boat, wine maker’s premises, airplane, brew pub, and distiller pub licenses (Section 5-1 of the Act).
(Source: Amended at 44 Ill. Reg. 16811, effective September 29, 2020)