BILL NUMBER: SB 1105AMENDED BILL TEXT AMENDED IN ASSEMBLY AUGUST 19, 2016 INTRODUCED BY Senator Mendoza FEBRUARY 17, 2016 An act torepeal Section 23792 ofamend Sections 25503.6 and 25503.8 of, and to add Article 7 (commencing with Section 23550) to Chapter 3 of Division 9 of, the Business and Professions Code, relating to alcoholic beverages. LEGISLATIVE COUNSEL'S DIGEST SB 1105, as amended, Mendoza. Alcoholic beverage licensees:restrictions.sports entertainment facilities. The Alcoholic Beverage Control Act contains various provisions regulating the application for, the issuance of, the suspension of, and the conditions imposed upon alcoholic beverage licenses by the Department of Alcoholic Beverage Control. Existing law provides for various annual fees for the issuance of alcoholic beverage licenses, depending upon the type of license issued. Existing law additionally authorizes specified alcoholic beverage licensees to purchase advertising space and time from, or on behalf of, an on-sale retail licensee, under certain conditions, if the on-sale retail licensee is the owner, manager, agent of the owner, assignee of the owner's advertising rights, or major tenant of specified facilities. This bill would authorize the Department of Alcoholic Beverage Control to issue an on-sale general for sports entertainment facility bona fide public eating place license (SEF-BFPEP license) that would allow the licensee to sell beer, wine, and distilled spirits at retail for consumption on the premises in a sports entertainment facility, as defined. The bill would impose an original fee and an annual renewal fee for the license, which would be deposited in the Alcohol Beverage Control Fund. The bill would also make the above-described provisions relating to the purchase of advertising time and space inoperative as of December 31, 2022, and instead provide for those purchases with revised parameters, including that the parties submit a declaration to the department relating to the agreement to purchase advertising time and space.The Alcoholic Beverage Control Act contains various provisions regulating the application for, the issuance of, the suspension of, and the conditions imposed upon, alcoholic beverage licenses by the Department of Alcoholic Beverage Control. Existing law prohibits the issuance of a license, other than an on-sale beer license, for premises situated more than one mile outside the limits of an incorporated city and within 2 miles of any camp or establishment of men, numbering 25 or more, engaged upon or in connection with the construction, repair, or operation of any work, improvement, or utility of a public or quasi-public character.This bill would repeal that prohibition, thus authorizing the department to issue any type of license for premises situated in the above-described location.Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Article 7 (commencing with Section 23550) is added to Chapter 3 of Division 9 of the Business and Professions Code , to read: Article 7. Sports Entertainment Facility Bona Fide Public Eating Place License 23550. For purposes of this article: (a) "Agreement" includes any amendment, modification, other revision, or extensions to the agreement if it relates in any manner to the purchase of advertising space and time at the sports entertainment facility from the owner or major tenant of the facility. (b) "Authorized licensee" means a winegrower, rectifier, California winegrower's agent, beer manufacturer, holder of an out-of-state beer manufacturer's certificate, distilled spirits manufacturer, holder of a distilled spirits rectifier's general license, distilled spirits manufacturer's agent, brandy manufacturer, holder of an out-of-state distilled spirits shipper's certificate, holder of a distilled spirits importer's general license, craft distiller, or holder of a beer and wine importer's general license. (c) "On-sale licensee" means a person holding an on-sale general SEF-BFPEP license to serve alcoholic beverages on the premises of a sports entertainment facility. (d) "SEF-BFPEP license" means an on-sale general for sports entertainment facility bona fide public eating place license issued pursuant to this article. (e) "Sports entertainment facility" means a publicly or privately owned stadium, coliseum, motor speedway, or an enclosed arena with a spectator capacity exceeding 10,000 people where sporting or entertainment events are presented for a price of admission. The facility does not have to be used exclusively for sporting or entertainment events. A "sports entertainment facility" also means any facility described in Section 25503.6 or 25503.8 as those sections read on December 31, 2016, even if those sections are later repealed. 23552. (a) In addition to the licenses specified in Section 23320, the department may issue an SEF-BFPEP license to sell beer, wine, and distilled spirits at retail for consumption upon the premises only. (b) The SEF-BFPEP license may be issued to the person providing alcoholic beverage and food service at the sports entertainment facility. Except as provided in this section, only licensees with an SEF-BFPEP license are authorized to sell beer, wine, and distilled spirits at retail for consumption upon the premises of the sports entertainment facility. The license shall only be transferable from person to person at the same premises. An SEF-BFPEP license shall not be transferred for a purchase price or consideration in excess of the original fee paid for that license. (c) The original fee for an SEF-BFPEP license shall be thirteen thousand eight hundred dollars ($13,800) to cover the reasonable administrative costs of the department. The annual license fee shall be consistent with the on-sale general bona fide public eating place license and shall be adjusted pursuant to subdivisions (b) and (c) of Section 23320. (d) (1) Issuance of the license shall be subject to the provisions of Section 23958.4. (2) Issuance of the license shall not be subject to the provisions of Section 23816. (e) (1) Any person providing alcoholic beverage and food service at a sports entertainment facility pursuant to another type of on-sale license as of the effective date of this section shall obtain an SEF-BFPEP license within 12 months of the effective date of this section if that person provides alcoholic beverage and food service at the facility on or after January 1, 2017. The person may elect to surrender that existing license in exchange for an SEF-BFPEP license or may transfer that license pursuant to applicable law. If, after a license surrender and exchange, the on-sale licensee that surrendered and exchanged its license for an SEF-BFPEP license no longer provides alcoholic beverage and food service at that facility, the on-sale licensee may surrender and exchange the SEF-BFPEP license for the licensee's original license, subject to any applicable provisions of this division. (2) The department may modify its rules regarding the surrender of licenses to implement this subdivision. 23553. The SEF-BFPEP license is subject to all of the following conditions: (a) Except as otherwise provided in this chapter, a person holding an SEF-BFPEP license shall not enter into any agreement with any authorized licensee for the purchase of advertising space and time at the sports entertainment facility, including the premises of the on-sale licensee. (b) (1) For any sports entertainment facility at which an authorized licensee has entered into an agreement with the owner or major tenant of the facility for the purchase of advertising space and time at the facility, any on-sale licensee shall serve other brands of beer distributed by a competing wholesaler that are not the brands of beer sold, manufactured, or marketed by an authorized licensee, other brands of wine distributed by a competing wholesaler that are not the brands of wine sold, manufactured, or marketed by an authorized licensee, and other brands of distilled spirits distributed by a competing wholesaler that are not the brands sold, manufactured, or marketed by an authorized licensee that purchased the advertising space and time. An on-sale licensee may also serve brands of beer that are manufactured and provided by an unaffiliated, competing licensed beer manufacturer that are not the brands of beer sold, manufactured, or marketed by an authorized licensee that purchased the advertising space and time. (2) For the purpose of this subdivision, brands of an authorized licensee purchasing the advertising space and time shall mean brands of beer, wine, or distilled spirits that are sold, manufactured, or marketed by the authorized licensee or sold, manufactured, or marketed by any subsidiary or other business entity of the authorized licensee that the authorized licensee owns, manages, or controls. (c) (1) An owner or major tenant of any sports entertainment facility described in Section 25503.6 or 25503.8, as those sections read on December 31, 2016, that is also the retail licensee for that facility as of December 31, 2016, is exempt from subdivisions (a) and (b) and Section 23554, but shall be subject to the provisions of Section 25503.6 or 25503.8 as they read on December 31, 2016, regardless if either or both of those sections are repealed, if there is an agreement existing on December 31, 2016, for the purchase of advertising space and time at the facility. An owner or major tenant that continues as the retail licensee for the facility on or after the effective date of this section shall comply with subdivision (e) of Section 23552. (2) When an agreement existing on December 31, 2016, for the purchase of advertising space and time at the facility is modified, renewed, or extended, or a new agreement is entered into, on or after the effective date of this section, the owner or major tenant shall be subject to subdivisions (a) and (b), and to the provisions of subdivisions (a) to (f), inclusive, of Section 23554. (3) A sports entertainment facility owner or major tenant which is also the retail licensee for that facility as of December 31, 2016, that seeks an exemption pursuant to this subdivision shall submit to the department, by January 31, 2017, a declaration stating that the sports entertainment facility is subject to an agreement for the purchase of advertising space and time at the facility that was in effect on December 31, 2016, and continues in effect on or after January 1, 2017. The declaration shall further state the name and address of the sports entertainment facility, the names of the parties to the agreement, and the time period that agreement will continue in effect. The licensee shall notify the department within 15 days of any amendment, extension, modification, or renewal of that agreement, or of any new agreement, entered into on or after the effective date of this section. The declaration shall not be under penalty of perjury. (d) A violation of any provision of this section or the filing of a false declaration shall be subject to license suspension by the department. 23554. Notwithstanding any other provision of this division, and except as provided in subdivision (f), an authorized licensee may purchase advertising space and time at a sports entertainment facility from the owner or major tenant of the facility who is not a licensee under this article, subject to the following conditions: (a) The purchase of advertising space and time shall be conducted pursuant to a written agreement entered into by the authorized licensee and the owner or major tenant of the facility containing all the terms and conditions of such purchase. (b) (1) The authorized licensee shall submit to the department within 15 days of execution of the agreement a declaration stating that the authorized licensee has entered into a written agreement for the purchase of advertising space and time at a sports entertainment facility pursuant to and in compliance with the provisions of this section, along with a fee of two thousand five hundred dollars ($2,500) to cover the reasonable administrative costs of the department. The declaration shall further state the name and address of the sports entertainment facility, the names of the parties to the agreement, and the time period that agreement will continue in effect. The authorized licensee shall notify the department within 15 days of any amendment, extension, modification, or renewal of that agreement or of any new agreement. (2) The declaration shall also state that there is no financial arrangement or agreement, written or oral, between the authorized licensee and the owner or major tenant of the facility or with any on-sale licensee that provides for the on-sale licensee to receive a share of the revenues, or anything of value, directly or indirectly, from the advertising agreement. (3) The declaration required by this subdivision shall not be under penalty of perjury. Failure to comply with this subdivision or the filing of a false declaration shall be subject to license suspension by the department. (c) The agreement shall not contain any of the following terms or conditions: (1) The agreement is conditioned on the purchase or sale of the authorized licensee's brands of alcoholic beverages by the on-sale licensee or limits the purchase and sale of competing brands of alcoholic beverages manufactured, distributed, sold, or marketed by other authorized licensees at the facility by the on-sale licensee. (2) The agreement provides for anything of value to be furnished, directly or indirectly, to the on-sale licensee. (3) Any term or condition that violates any provision of this division. (d) In monitoring the impacts of any agreements authorized by this article, the department may conduct audits to determine compliance with this section. Audits may include, but are not limited to, brand selection at the sports entertainment facility, purchase patterns of the on-sale licensee, and review of any agreement or amendments to an agreement or any other contractual or financial arrangement, written or oral, between or among the parties to the agreement and the on-sale licensee, including any affiliated business of the on-sale licensee or any affiliated business of the authorized licensee. (e) The department shall penalize a violation of any provision of this section by the suspension of the authorized licensee's license or by a fine equal to the contract value of the agreement for advertising. (f) (1) Any sports entertainment facility described in Section 25503.6 or 25503.8 as those sections read on December 31, 2016, shall be exempt from the provisions of this section if there is an agreement existing on December 31, 2016, for the purchase of advertising space and time at the facility, but shall for the duration of its exemption be subject to the provisions in those sections as they read on December 31, 2016, regardless if the section is later repealed. When an agreement existing on December 31, 2016, for the purchase of advertising space and time at the facility is modified, renewed, or extended, or a new agreement entered into, on or after the effective date of this section, the facility shall be subject to this section. (2) An authorized licensee seeking an exemption pursuant to this subdivision shall submit to the department by January 31, 2017, a declaration stating the sports entertainment facility is subject to an agreement for the purchase of advertising space and time at the facility that was in effect on December 31, 2016, and continues in effect on or after January 1, 2017. That declaration shall further state the name of the sports entertainment facility, the names of the parties to the agreement, and the time period the agreement will continue in effect. The authorized licensee shall notify the department within 15 days of any amendment, extension, modification, or renewal of that agreement, or any new agreement, entered into on or after the effective date of this section. The declaration shall not be under penalty of perjury. Failure to comply with this paragraph or the filing of a false declaration shall be subject to license suspension by the department. 23555. The Legislature finds and declares all of the following: (a) Statutes to implement a three-tier system, which requires a separation between manufacturing interests, wholesale interests, and retail interests in the production, distribution, and sale of alcoholic beverages, are as proper and necessary to the public welfare in the 21st Century as they were when first enacted following the enactment of the 21st Amendment to the United States Constitution and the repeal of prohibition; that the three-tier system by requiring economic separation between the tiers contributes to a fair, open, and competitive market resulting in interbrand and other competition within each tier, thereby broadening consumer choices; and that it also prevents disorderly market conditions arising from the domination of local markets through vertical integration leading to excessive sales of alcoholic beverages and consumption produced by overly aggressive marketing techniques, including, but not limited to, the domination of local markets and the undue economic influence of one tier over another. The Legislature further affirms that temperance is achieved, consistent with the structural regulation that promotes a competitive and orderly market, by controlled access to, and responsible use and consumption of, alcoholic beverages by persons of legal drinking age. (b) The enactment of tied-house restrictions are necessary economic regulations that serve important public interests, and the restrictions prohibiting a manufacturer or wholesaler from furnishing, giving, or lending any money or other thing of value to a retail licensee, or from paying or compensating a retailer for advertising as provided in Section 25503, are necessary to promote and maintain an orderly competitive market that is open and accessible to all brands and to prevent manufacturers from dominating local markets through payment of incentives and compensation to retailers. The Legislature further finds and declares that limited exceptions have been made to this general prohibition to promote an identifiable public purpose and interest for the exception, which have been limited to the express terms of the exception so as to not undermine the general prohibition. (c) Because this system of prohibition with limited, specific exceptions may be incorrectly construed to undermine the general prohibition despite legislative directives to the contrary, this section is necessary to clarify and reenforce the general prohibition as provided in Section 25503. (d) There may be instances where the community public interest and welfare would benefit from the sports entertainment facility owner or its major tenant being able to receive revenue for the advertisement of alcoholic beverages on the premises of the facility. Therefore, this article is enacted to authorize manufacturers of alcoholic beverages to enter into agreements with the owner or major tenant of a sports entertainment facility for the placement of brand advertisements upon the premises of the facility where the alcoholic beverage sales on the facility premises are conducted by a separate, independent entity who is the on-sale general licensee and does not share in the advertising revenue. (e) The provisions of this article and other exceptions in this division to the general prohibition against tied interests must be narrowly construed and limited to the express terms of the exception so as not to undermine the general prohibition. The Legislature expressly intends that this article and division be construed in accordance with these findings. SEC. 2. Section 25503.6 of the Business and Professions Code is amended to read: 25503.6. (a) Notwithstanding any other provision of this chapter, a beer manufacturer, the holder of a winegrower's license, a distilled spirits rectifier, a distilled spirits manufacturer, or distilled spirits manufacturer's agent may purchase advertising space and time from, or on behalf of, an on-sale retail licensee subject to all of the following conditions: (1) The on-sale licensee is the owner, manager, agent of the owner, assignee of the owner's advertising rights, or the major tenant of the owner of any of the following: (A) An outdoor stadium or a fully enclosed arena with a fixed seating capacity in excess of 10,000 seats located in Sacramento County or Alameda County. (B) A fully enclosed arena with a fixed seating capacity in excess of 18,000 seats located in Orange County or Los Angeles County. (C) An outdoor stadium or fully enclosed arena with a fixed seating capacity in excess of 8,500 seats located in Kern County. (D) An exposition park of not less than 50 acres that includes an outdoor stadium with a fixed seating capacity in excess of 8,000 seats and a fully enclosed arena with an attendance capacity in excess of 4,500 people, located in San Bernardino County. (E) An outdoor stadium with a fixed seating capacity in excess of 10,000 seats located in Yolo County. (F) An outdoor stadium and a fully enclosed arena with fixed seating capacities in excess of 10,000 seats located in Fresno County. (G) An athletic and entertainment complex of not less than 50 acres that includes within its boundaries an outdoor stadium with a fixed seating capacity of at least 8,000 seats and a second outdoor stadium with a fixed seating capacity of at least 3,500 seats located in Riverside County. (H) An outdoor stadium with a fixed seating capacity in excess of 1,500 seats located in Tulare County. (I) A motorsports entertainment complex of not less than 50 acres that includes within its boundaries an outdoor speedway with a fixed seating capacity of at least 50,000 seats, located in San Bernardino County. (J) An exposition park, owned or operated by a bona fide nonprofit organization, of not less than 400 acres with facilities including a grandstand with a seating capacity of at least 8,000 people, at least one exhibition hall greater than 100,000 square feet, and at least four exhibition halls, each greater than 30,000 square feet, located in the City of Pomona or the City of La Verne in Los Angeles County. (K) An outdoor soccer stadium with a fixed seating capacity of at least 25,000 seats, an outdoor tennis stadium with a fixed capacity of at least 7,000 seats, an outdoor track and field facility with a fixed seating capacity of at least 7,000 seats, and an indoor velodrome with a fixed seating capacity of at least 2,000 seats, all located within a sports and athletic complex built before January 1, 2005, in the City of Carson in Los Angeles County. (L) An outdoor professional sports facility with a fixed seating capacity of at least 4,200 seats located in San Joaquin County. (M) A fully enclosed arena with a fixed seating capacity in excess of 13,000 seats in the City of Inglewood. (N) (i) An outdoor stadium with a fixed seating capacity of at least 68,000 seats located in the City of Santa Clara. (ii) A beer manufacturer, the holder of a winegrower's license, a distilled spirits rectifier, a distilled spirits manufacturer, or distilled spirits manufacturer's agent may purchase advertising space and time from, or on behalf of, a major tenant of an outdoor stadium described in clause (i), provided the major tenant does not hold a retail license, and the advertising may include the placement of advertising in an on-sale licensed premises operated at the outdoor stadium. (O) A complex of not more than 50 acres located on the campus of, and owned by, Sonoma State University dedicated to presenting live artistic, musical, sports, food, beverage, culinary, lifestyle, or other cultural and entertainment events and performances with venues that include a concert hall with a seating capacity of approximately 1,500 seats, a second concert hall with a seating capacity of up to 300 seats, an outdoor area with a seating capacity of up to 5,000 seats, and a further outdoor area with a seating capacity of up to 10,000 seats. With respect to this complex, advertising space and time may also be purchased from or on behalf of the owner of the complex, a long-term tenant or licensee of the venue, whether or not the owner, long-term tenant, or licensee holds an on-sale license. (P) A fairgrounds with a horse racetrack and equestrian and sports facilities located in San Diego County. (2) The outdoor stadium or fully enclosed arena described in paragraph (1) is not owned by a community college district. (3) The advertising space or time is purchased only in connection with the events to be held on the premises of the exposition park, stadium, or arena owned by the on-sale licensee. With respect to an exposition park as described in subparagraph (J) of paragraph (1) that includes at least one hotel, the advertising space or time shall not be displayed on or in any hotel located in the exposition park, or purchased in connection with the operation of any hotel located in the exposition park. With respect to the complex described in subparagraph (O) of paragraph (1), the advertising space or time shall be purchased only in connection with live artistic, musical, sports, food, beverage, culinary, lifestyle, or other cultural and entertainment events and performances to be held on the premises of the complex. (4) The on-sale licensee serves other brands of beer distributed by a competing beer wholesaler in addition to the brand manufactured or marketed by the beer manufacturer, other brands of wine distributed by a competing wine wholesaler in addition to the brand produced by the winegrower, and other brands of distilled spirits distributed by a competing distilled spirits wholesaler in addition to the brand manufactured or marketed by the distilled spirits rectifier, the distilled spirits manufacturer, or the distilled spirits manufacturer's agent that purchased the advertising space or time. (b) Any purchase of advertising space or time pursuant to subdivision (a) shall be conducted pursuant to a written contract entered into by the beer manufacturer, the holder of the winegrower's license, the distilled spirits rectifier, the distilled spirits manufacturer, or the distilled spirits manufacturer's agent and any of the following: (1) The on-sale licensee. (2) With respect to clause (ii) of subparagraph (N) of paragraph (1) of subdivision (a), the major tenant of the outdoor stadium. (3) With respect to subparagraph (O) of paragraph (1) of subdivision (a), the owner, a long-term tenant of the complex, or licensee of the complex, whether or not the owner, long-term tenant, or licensee holds an on-sale license. (c) Any beer manufacturer or holder of a winegrower's license, any distilled spirits rectifier, any distilled spirits manufacturer, or any distilled spirits manufacturer's agent who, through coercion or other illegal means, induces, directly or indirectly, a holder of a wholesaler's license to fulfill all or part of those contractual obligations entered into pursuant to subdivision (a) or (b) shall be guilty of a misdemeanor and shall be punished by imprisonment in the county jail not exceeding six months, or by a fine in an amount equal to the entire value of the advertising space, time, or costs involved in the contract, whichever is greater, plus ten thousand dollars ($10,000), or by both imprisonment and fine. The person shall also be subject to license revocation pursuant to Section 24200. (d) Any on-sale retail licensee, as described in subdivision (a), who, directly or indirectly, solicits or coerces a holder of a wholesaler's license to solicit a beer manufacturer, a holder of a winegrower's license, a distilled spirits rectifier, a distilled spirits manufacturer, or a distilled spirits manufacturer's agent to purchase advertising space or time pursuant to subdivision (a) or (b) shall be guilty of a misdemeanor and shall be punished by imprisonment in the county jail not exceeding six months, or by a fine in an amount equal to the entire value of the advertising space or time involved in the contract, whichever is greater, plus ten thousand dollars ($10,000), or by both imprisonment and fine. The person shall also be subject to license revocation pursuant to Section 24200. (e) For the purposes of this section, "beer manufacturer" includes any holder of a beer manufacturer's license, any holder of an out-of-state beer manufacturer's certificate, or any holder of a beer and wine importer's general license. (f) The Legislature finds that it is necessary and proper to require a separation among manufacturing interests, wholesale interests, and retail interests in the production and distribution of alcoholic beverages in order to prevent suppliers from dominating local markets through vertical integration and to prevent excessive sales of alcoholic beverages produced by overly aggressive marketing techniques. The Legislature further finds that the exceptions established by this section to the general prohibition against tied interests shall be limited to their express terms so as not to undermine the general prohibition and intends that this section be construed accordingly. (g) This section shall become inoperative on December 31, 2022. SEC. 3. Section 25503.8 of the Business and Professions Code is amended to read: 25503.8. (a) Notwithstanding any other provision of this chapter, a beer manufacturer, the holder of a winegrower's license, a California winegrower's agent, a distilled spirits rectifier, a distilled spirits manufacturer, or a distilled spirits manufacturer's agent may purchase advertising space and time from, or on behalf of, an on-sale retail licensee if all of the following conditions are met: (1) The on-sale licensee is the owner of any of the following: (A) A fully enclosed auditorium or theater with a fixed seating capacity in excess of 6,000 seats, at least 60 percent of the use of which is for plays or musical concerts, not including sporting events. (B) A motion picture studio facility at which public tours are conducted for at least four million people per year. (C) A retail, entertainment development adjacent to, and under common ownership with, a theme park, amphitheater, and motion picture production studio. (D) A theme or amusement park and the adjacent retail, dining, and entertainment area located in the City of Los Angeles, Los Angeles County, or Orange County. (E) A fully enclosed theater, with box office sales and attendance by the public on a ticketed basis only, with a fixed seating capacity in excess of 6,000 seats, located in Los Angeles County within the area subject to the Los Angeles Sports and Entertainment District Specific Plan adopted by the City of Los Angeles pursuant to ordinance number 174225, as approved on September 6, 2001. (F) A fully enclosed arena with a fixed seating capacity in excess of 15,000 seats located in Santa Clara County. With respect to the arena described in this subparagraph, advertising space may also be purchased from, or on behalf of, a lessee or manager of the arena. (2) The advertising space or time is purchased only in connection with one of the following: (A) In the case of a fully enclosed auditorium or theater, in connection with sponsorship of plays or musical concerts to be held on the premises of the auditorium or theater owned by the on-sale licensee. (B) In the case of a motion picture studio facility, in connection with sponsorship of the public tours or special events conducted at the studio facility. (C) In the case of a retail, entertainment development, in connection with sponsorship of public tours or special events conducted at the development. (D) In the case of a theme or amusement park and the adjacent retail, dining, and entertainment area, located in the City of Los Angeles, Los Angeles County, or Orange County, in connection with daily activities and events at the theme or amusement park and the adjacent retail, dining, and entertainment area. (E) In the case of the fully enclosed theater described in subparagraph (E) of paragraph (1) of subdivision (a), in connection with events conducted at the theater. (F) In the case of a fully enclosed arena described in subparagraph (F) of paragraph (1) of subdivision (a), interior advertising in connection with events conducted within the arena. (3) The on-sale licensee serves other brands of beer distributed by a competing beer wholesaler in addition to the brand manufactured or marketed by the beer manufacturer, other brands of wine distributed by a competing wine wholesaler in addition to the brand produced or marketed by the winegrower or California winegrower's agent, and other brands of distilled spirits distributed by a competing distilled spirits wholesaler in addition to the brand manufactured or marketed by the distilled spirits manufacturer or distilled spirits manufacturer's agent purchasing the advertising space or time. (b) Any purchase of advertising space or time conducted pursuant to subdivision (a) shall be conducted pursuant to a written contract entered into by the beer manufacturer, the holder of the winegrower's license, the California winegrower's agent, the distilled spirits manufacturer, or the distilled spirits manufacturer's agent, and the on-sale licensee, which contract shall not in any way involve the holder of a wholesaler's license. (c) Any beer manufacturer, distilled spirits manufacturer, distilled spirits manufacturer's agent, holder of a winegrower's license, or California winegrower's agent, who, through coercion or other illegal means, induces, directly or indirectly, a holder of a wholesaler's license to fulfill those contractual obligations entered into pursuant to subdivision (a) or (b) shall be guilty of a misdemeanor and shall be punished by imprisonment in the county jail not exceeding six months, or by a fine in an amount equal to the entire value of the advertising space or time involved in the contract, whichever is greater, plus ten thousand dollars ($10,000), or by both imprisonment and fine. The person shall also be subject to license revocation pursuant to Section 24200. (d) Any on-sale retail licensee, as described in subdivision (a), who solicits or coerces, directly or indirectly, a holder of a wholesaler's license to solicit a beer manufacturer, distilled spirits manufacturer, or distilled spirits manufacturer's agent, holder of a winegrower's license, or California winegrower's agent to purchase advertising space or time pursuant to subdivision (a) or (b) shall be guilty of a misdemeanor and shall be punished by imprisonment in the county jail not exceeding six months, or by a fine in an amount equal to the entire value of the advertising space or time involved in the contract, whichever is greater, plus ten thousand dollars ($10,000), or by both imprisonment and fine. The person shall also be subject to license revocation pursuant to Section 24200. (e) For the purposes of this section, "beer manufacturer" includes any holder of a beer manufacturer's license, any holder of an out-of-state beer manufacturer's certificate, or any holder of a beer and wine importer's general license. (f) This section shall become inoperative on December 31, 2022.SECTION 1.Section 23792 of the Business and Professions Code is repealed.