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ENGROSSED HOUSE
BILL NO. 3641 By: Dempsey, Humphrey and Strom
of the House
and
Coleman of the Senate
[ alcoholic beverages - providing that a holder of a
small farm winery, winemaker, or small brewer
license may serve free samples and sell o ther items
- allowing holders of a distiller's license to open
satellite locations - effective date ]
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOM A:
SECTION 1. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 2-162 of Title 37A, unless there
is created a duplication in numbering, reads as follows:
A holder of a small farm winery , winemaker, or small brewer
license, which serves wine or beer for on-premises or off-premises
consumption, shall be allowed to serve fre e samples, or sell
Oklahoma-manufactured beer, wine, mulled wine, or spiced wine, mixe d
with nonalcoholic beverages, or food items such as water, sugar,
fruits, and vegetables, at any temperature. Wine or beer produced
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by a holder of a small farm winery, winemaker, or small brewer
license may be served at any public events including, but not
limited to, festival s, trade shows, boat shows, RV shows, home and
garden shows, fairs, car shows, swap meets, city events, county
events, or state events for either on-premises or off-premises
consumption. This includes any public events that are held at
premises which hold a retail beer license, retail spirits license,
mixed beverage license, beer and wine license, caterer's license,
special event license, public event license, winemaker license,
charitable auction license, or brewpub license. At public events,
the location within the event occupied by the small farm winery ,
winemaker, or small brewer licensee becomes a licensed premi ses and
extension of the licensed small farm winery , winemaker, or small
brewer. The licensee shall set up and define an area contiguous to
its booth space as a serving ar ea where the wine or beer is
dispensed. The licensee may only serve the wine or beer in the
serving area. In the event that multiple winemakers or brewers are
at the same public event, they may combine their serving areas into
one larger area as long as they are c ontiguous to the winemakers' or
brewers' booths. A small farm winery, winemaker, or small brewer
licensee shall not be required to secure or control the public event
premises once the Oklahoma-manufactured beer, wine, mulled wine , or
spiced wine, mixed with nonalcoholic beverages, or food items such
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as water, sugar, fruits , and vegetables, at any temperature, is
served.
SECTION 2. AMENDATORY 37A O.S . 2021, Section 1-103, is
amended to read as follows:
Section 1-103. As used in the Oklahoma Alcoholic Beverage
Control Act:
1. "ABLE Commission" or "Commission" means the Alcoholic
Beverage Laws Enforcement Commission;
2. "Alcohol" means and includes h ydrated oxide of ethyl, ethyl
alcohol, ethanol or spirits of wine, from whatever sour ce or by
whatever process produced. It does not include wood alcohol or
alcohol which has been denatured or produced as denatured in
accordance with Acts of Congress and regulations promulgated
thereunder;
3. "Alcoholic beverage" means alcohol, spirits, beer and wine
as those terms are defined herein and also includes every li quid or
solid, patented or not, containing alcohol, spirits, wine or beer
and capable of being co nsumed as a beverage by human beings;
4. "Applicant" means any individual, legal or commercial
business entity, or any individual involved in any legal or
commercial business entity allowed to hold any license issued in
accordance with the Oklahoma Alcoho lic Beverage Control Act;
5. "Beer" means any beverage of alcohol by volume and obta ined
by the alcoholic fermentation of an infusion or decoction of barley,
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or other grain, malt or similar products. "Beer" may or may not
contain hops or other vegetable products. "Beer" includes, among
other things, beer, ale, stout, lager beer, porter and other malt or
brewed liquors, but does not include sake, known as Japa nese rice
wine;
6. "Beer keg" means any brewer-sealed, single container tha t
contains not less than four (4) gallons of beer;
7. "Beer distributor" means and includes any person li censed to
distribute beer for retail sale in the state, but does not inclu de a
holder of a small brewer self-distribution license or brewpub self -
distribution license. Th e term "distributor", as used in the
Oklahoma Alcoholic Beverage Control Act, shall b e construed to refer
to a beer distributor;
8. "Bottle club" means any establishment in a county which has
not authorized the retail sale of alcoholi c beverages by the
individual drink, which is required to be licensed to keep, mix and
serve alcoholic beverages belonging to club members on club
premises;
9. "Bottle service" means the sale and provision of spirits in
their original packages by a mixed beverage licensee to be consumed
in that mixed beverage licensee's club suite;
10. "Brand" means any word, name, group of letters, symbol or
combination thereof, that is adopted a nd used by a licensed brewer
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to identify a specific beer, wine or spirit and to distinguish that
product from another beer, wine or spirit;
11. "Brand extension" means:
a. after October 1, 2018, any brand of beer or cider
introduced by a manufacturer in t his state which
either:
(1) incorporates all or a substantial part of the
unique features of a pr eexisting brand of the
same licensed brewer, or
(2) relies to a significant extent on the goodwill
associated with the preexisting brand, or
b. any brand of beer that a brewer, the majority of whose
total volume of all brands of beer d istributed in this
state by such brewer on January 1, 2016, was
distributed as low-point beer, desires to sell,
introduces, begins selling or theretofore has sold and
desires to continue selling a strong beer in this
state which either:
(1) incorporates or incorporated all or a substantial
part of the unique features of a preexisting low -
point beer brand of th e same licensed brewer, or
(2) relies or relied to a significant extent on the
goodwill associated with a preexisting low -point
beer brand;
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12. "Brewer" means and includes any person who manufactures for
human consumption by the use of raw materials or ot her ingredients
any beer or cider upon which a license fee and a tax are i mposed by
any law of this state;
13. "Brewpub" means a licensed establishme nt operated on the
premises of, or on premises located contiguous to, a small brewer,
that prepares and se rves food and beverages, including alcoholic
beverages, for on-premises consumption;
14. "Cider" means any alcoholic beverage obtained by the
alcoholic fermentation of fr uit juice, including but not limited to
flavored, sparkling or carbonated cider. For the purposes of the
manufacture of this product, cider may be manufacture d by either
manufacturers or brewers. For the purposes of the distribution of
this product, cider may be distributed by either wine and spirits
wholesalers or beer distributors;
15. "Club suite" means a designated area within the premises of
a mixed beverage licensee designed to provide an exclusive space
which is limited to a p atron or patrons spec ifically granted access
by a mixed beverage licensee and is not accessible to other p atrons
of the mixed beverage licensee or the public. A club suite must
have a clearly designated point of access for a patron or patrons
specifically granted access by th e mixed beverage licensee to ensure
that persons present in the suite are limited to patrons
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specifically granted access by the mixed beverage licensee and
employees providing services to the club suite;
16. "Convenience store" means any person primarily engaged in
retailing a limited range of general household items and groceries,
with extended hours of operation, whether or not engaged in retail
sales of automotive fuels in combination with such sales;
17. "Convicted" and "conviction" mean and include a finding of
guilt resulting from a plea of guilty or nolo contendere, the
decision of a court or magistrate or the verdict of a jury,
irrespective of the prono uncement of judgment or the suspension
thereof;
18. "Designated products" means the brands of wi ne or spirits
offered for sale by a manufacturer that the manufacturer has
assigned to a designated wholesaler for exclusive distribution;
19. "Designated wholesaler" means a wine and spirits wholesaler
who has been selected by a manu facturer as a wholesa ler appointed to
distribute designated products;
20. "Director" means the Director o f the ABLE Commission;
21. "Distiller" means any person who produces spir its from any
source or substance, or any person who brews or makes mash, wor t or
wash, fit for distillation or for the production of spirits (except
a person making or using such mat erial in the authorized production
of wine or beer, or the production of v inegar by fermentation), or
any person who by any process separates alcoholi c spirits from any
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fermented substance, or any person who, making or keeping mash, wort
or wash, has also in his or her possession or use a still;
22. "Distributor agreement " means the written agreement between
the distributor and brewer as set forth in S ection 3-108 of this
title;
23. "Drug store" means a person primarily engaged in retailing
prescription and nonprescription drugs and medicines;
24. "Dual-strength beer" means a brand of beer that,
immediately prior to April 15, 2017, was being sold and distributed
in this state:
a. as a low-point beer pursuant to the Low -Point Beer
Distribution Act in effec t immediately prior to
October 1, 2018, and
b. as strong beer pursuant to the Alcoholic Beverage
Control Act in effect immediately prior to October 1,
2018,
and continues to be sold and distributed as such on October 1, 2018.
Dual-strength beer does not i nclude a brand of beer that arose as a
result of a brand extension as defi ned in this section;
25. "Fair market value" means the value in the subject
territory covered by the written agreement with the distributor or
wholesaler that would be determined in an arm's length transaction
entered into without duress or threat of term ination of the
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distributor's or wholesaler's rights and shall include all el ements
of value, including goodwill and going -concern value;
26. "Good cause" means:
a. failure by the distributor to comply with the material
and reasonable provisions of a writt en agreement or
understanding with the brewer, or
b. failure by the distribu tor to comply with th e duty of
good faith;
27. "Good faith" means the duty of each party to any
distributor agreement and all officers, employees or agents thereof
to act with honesty in fact and within reasonable standards of fair
dealing in the trade;
28. "Grocery store" means a person primarily engaged in
retailing a general line of food, such as canned o r frozen foods,
fresh fruits and vegetables, and fresh and prepared meats, fish and
poultry;
29. "Hotel" or "motel" means an establishment which is l icensed
to sell alcoholic beverages by the individual drink and which
contains guestroom accommodations wi th respect to which the
predominant relationship existing between the occu pants thereof and
the owner or operator of the establishment is that of innk eeper and
guest. For purposes of this section, the existence of other legal
relationships as between some occupants and the owner or operator
thereof shall be immaterial;
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30. "Legal newspaper" means a newspaper meeting the requisites
of a newspaper for p ublication of legal n otices as prescribed in
Sections 101 through 114 of Title 25 of the Oklahoma Statutes ;
31. "Licensee" means any person holding a license under the
Oklahoma Alcoholic Beverage Control Act, and any agent, servant or
employee of such lic ensee while in the pe rformance of any act or
duty in connection with the licensed business or on the licen sed
premises;
32. "Low-point beer" shall mean any beverages containing mo re
than one-half of one percent (1/2 of 1%) alcohol by volume, and not
more than three and two-tenths percent (3.2%) alcohol by weight,
including, but not limited to, beer or cereal malt beverages
obtained by the alcoholic fermentation of an infusion by ba rley or
other grain, malt or similar products;
33. "Manufacturer" means a distiller, winemaker, r ectifier or
bottler of any alcoholic beverage (other than beer) and its
subsidiaries, affiliates and parent companies;
34. "Manufacturer's agent " means a salaried or commissioned
salesperson who is the agent authorized to act on behal f of the
manufacturer or nonresident seller in the state;
35. "Meals" means foods commonly ordered at lu nch or dinner and
at least part of which is cooked on the licensed premise s and
requires the use of dining implements for consumption. Provided,
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that the service of only f ood such as appetizers, sandwiches, salads
or desserts shall not be considered "meals";
36. "Mini-bar" means a closed container, either refrigerated in
whole or in part, or nonrefrigerated, and access to the interior of
which is:
a. restricted by means of a locking device which requires
the use of a key, magnetic card or similar device, or
b. controlled at all times by the licensee;
37. "Mixed beverage cooler " means any beverage, by whatever
name designated, consisting of an alcoholic beverage and fruit o r
vegetable juice, fruit or vegetable flavorings, dairy products or
carbonated water containing more than one-half of one percent (1/2
of 1%) of alcohol measu red by volume but not more than seven percent
(7%) alcohol by volume at sixty (60) degrees Fahrenh eit and which is
packaged in a container not larger than three hundred seventy -five
(375) milliliters. Such term shall include but not be limited to
the beverage popularly known as a "wine cooler";
38. "Mixed beverages" means one or more servings of a be verage
composed in whole or part of an alcoholic beverage in a sealed or
unsealed container of any legal size for consumption on the premises
where served or sold by the holder of a mixed beverage, beer and
wine, caterer, public event, charitable event or special event
license;
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39. "Motion picture theater " means an establishment which is
licensed by Section 2-110 of this title to sell alcoholic beverages
by the individual drink and where motion pictures are exhibited, and
to which the general public is adm itted;
40. "Nondesignated products " means the brands of wine or
spirits offered for sale by a manufacturer that have not been
assigned to a designated wholes aler;
41. "Nonresident seller" means any person licensed pursuant to
Section 2-135 of this title;
42. "Retail salesperson" means a salesperson soliciting orders
from and calling upon retail alcoholic beverage stores with regard
to his or her product;
43. "Occupation" as used in connection with "occupation tax"
means the sites occupied as the places of business of the
manufacturers, brewers, wholesalers, beer distributors, retailers ,
mixed beverage licensees, on-premises beer and wine licensees,
bottle clubs, caterers, public event and special event licensees;
44. "Original package" means any container of alcoholic
beverage filled and stamped or sealed by the manufacturer or brewer;
45. "Package store" means any sole proprietor or partnership
that qualifies to sell wine, beer and/or spirits for off-premises
consumption and that i s not a grocery store , convenience store or
drug store, or other retail outlet that is not permitted to s ell
wine or beer for off-premises consumption;
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46. "Patron" means any person, customer or visitor who is not
employed by a licensee or who is not a li censee;
47. "Person" means an individual, any type of partnership,
corporation, association, limited lia bility company or any
individual involved in the legal structure of any su ch business
entity;
48. "Premises" means the grounds and all buildings and
appurtenances pertaini ng to the grounds including any adjacent
premises if under the direct or indirect co ntrol of the licensee and
the rooms and equipment under the control of the licensee and used
in connection with or in furtherance of the business cover ed by a
license. Provided that the ABLE Commission shall have the authority
to designate areas to be exc luded from the licensed premises solely
for the purpose of:
a. allowing the presence and consumption of alcoholic
beverages by private parties which ar e closed to the
general public, or
b. allowing the services of a caterer serving alcoholic
beverages provided by a private party.
This exception shall in no way limit the licensee 's concurrent
responsibility for any violations of the Oklahoma Alcoholic Bev erage
Control Act occurring on the licensed premises;
49. "Private event" means a social gathering or ev ent attended
by invited guests who share a common cause, membership, busin ess or
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task and have a prior established relationship. For purposes of
this definition, advertise ment for general public attendance or
sales of tickets to the general public shall n ot constitute a
private event;
50. "Public event" means any event that ca n be attended by the
general public;
51. "Rectifier" means any person who re ctifies, purifies or
refines spirits or wines by any process (other than by original and
continuous distillation, or original and continuous processing, from
mash, wort, wash or o ther substance, through continuous closed
vessels and pipes, until the produc tion thereof is compl ete), and
any person who, without rectifying, purifying or refining spirits,
shall by mixing (except for immediate consumption on the premises
where mixed) such spirits, wine or other liquor with any material,
manufactures any spurious , imitation or compou nd liquors for sale,
under the name of whiskey, brandy, rum, gin, wine, spirits, cor dials
or any other name;
52. "Regulation" or "rule" means a formal rule o f general
application promulgated by the ABLE Commission as herein required;
53. "Restaurant" means an establishment that is licensed to
sell alcoholic beverages by the individual d rink for on-premises
consumption and where food is prepared and sold for i mmediate
consumption on the premises;
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54. "Retail container for spirits and wines" means an original
package of any capacity approved by the United States Bureau of
Alcohol, Tobacco and Firearms;
55. "Retailer" means a package store, grocery store,
convenience store or drug store licensed to sell alcoholic beverages
for off-premises consumption pursu ant to a Retail Spirits License,
Retail Wine License or Retail Beer License;
56. "Sale" means any transfer, exchange or barter in any manner
or by any means whatsoever, and includes and means all sales made by
any person, whether as p rincipal, proprietor or as an agent, servant
or employee. The term "sale" is also declared to be and inc lude the
use or consumption in this state of any alcoholic beverage obtain ed
within or imported from without this state, upon which the excise
tax levied by the Oklahoma Al coholic Beverage Control Act has not
been paid or exempted;
57. "Short-order food" means food other than full meals
including but not limited to sandwiches, soups and salads. Provided
that popcorn, chips and other similar snack food shall not be
considered "short-order food";
58. "Small brewer" means a brewer who manufactures less than
sixty-five thousand barrels of beer annually pursuant to a validly
issued Small Brewer License hereunder;
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59. "Small farm wine" means a wine that is produced by a small
farm winery with seventy -five percent (75%) or more Oklahoma -grown
grapes, berries, other fruits, honey or vegetables;
60. "Small farm winery" means a wine-making establishment that
does not annually produce for sale more than fifteen thousand
(15,000) gallons of wine as reported on the United States Department
of the Treasury, Alcohol an d Tobacco Tax and Trade Bureau, Report of
Wine Premises Operations (TTB Fo rm 5120.17);
61. "Sparkling wine" means champagne or any artificially
carbonated wine;
62. "Special event" means an entertainment, recreation or
marketing event that occurs at a si ngle location on an irregular
basis and at which alcoholic beverages are s old;
63. "Spirits" means any beverage other than wine or beer, which
contains more than one-half of one percent (1/2 of 1%) alcohol
measured by volume, and obtained by distillation, whether or not
mixed with other substances in solution and includes those products
known as whiskey, brandy, rum, gin, vodka, liqueurs, cordials and
fortified wines and si milar compounds, but shall not include any
alcohol liquid completely denatured in ac cordance with the Acts of
Congress and regulations pursuant thereto;
64. "Strong beer" means beer which, prior to October 1, 2018,
was distributed pursuant to the Oklahoma Alcoholic Beverage Control
Act, Section 501 et seq. of Title 37 of the Oklahoma Sta tutes;
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65. "Successor brewer" means a primary source of supply, a
brewer, a cider manufacturer or an importer that acquires rights to
a beer or cider brand from a predeces sor brewer;
66. "Tax Commission" means the Oklahoma Tax Commission;
67. "Territory" means a geographic region with a specified
boundary;
68. "Wine and spirits wholesaler" or "wine and spirits
distributor" means and includes any sole proprietorship or
partnership licensed to distribute wine and spirits in the state.
The term "wholesaler", as used in the Oklahoma Alcoholic Beverage
Control Act, shall be const rued to refer to a wine and spirits
wholesaler;
69. "Wine" means and includes any beverage contai ning more than
one-half of one percent (1/2 of 1%) alcohol by volume and not more
than twenty-four percent (24%) alcohol by volume at sixty (60)
degrees Fahrenheit obtained by the fermentation of the natural
contents of fruits, vegetab les, honey, milk or o ther products
containing sugar, whether or not other ingredients are added, and
includes vermouth and sake, known as Japanese rice wine;
70. "Winemaker" means and includes any person or establishment
who manufactures for human consump tion any wine upon wh ich a license
fee and a tax are imposed by any law of this state; and
71. "Satellite tasting room" means a licensed establishment
operated off the licensed p remises of the holder of a small farm
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winery, or winemaker, or small brewer license, which serves wine or
beer for on-premises or off-premises consumption.
Words in the plural include the singular, and vice versa, and
words imparting the masculine gender include the feminine, as well
as persons and licensees as defined in t his section.
SECTION 3. AMENDATORY 37A O.S. 2 021, Section 2-103, is
amended to read as follows:
Section 2-103. A. A distiller license shall authorize t he
holder thereof:
1. To manufacture, bottle, package and store spirits on
licensed premises;
2. To sell spirits in this state to licensed wholesa lers and
manufacturers only;
3. To sell spirits out of this state to qualified persons ;, to
purchase from licensed distillers and rectifiers in this state, and
import spirits from without this state for manufacturing purposes in
accordance with federal la ws and regulations;
4. To serve free samples of spirits produced only by the
licensee to visitors twenty -one (21) years of age and older. For
purposes of this section, no visitor may samp le more than a total of
three (3) fluid ounces of spirits per day. The distiller shall
restrict the distribution and consumption of spirits samples to an
area within the lice nsed premises designated by the distiller. A
current floor plan that includes th e designated sampling area shall
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be on file with the ABLE Commissio n. No visitor under twenty -one
(21) years of age shall be permitted to enter the designated
sampling area when samples are being distributed and consumed.
Samples of spirits served by a d istiller under this section shall
not be considered a sale of spiri ts within the meaning of Article
XXVIII-A of the Oklahoma Constitution or Section 1 -103 of this
title; provided, such samples of spirits shall be considered removed
or withdrawn from the di stillery for use or consumption within the
meaning of Section 5 -110 of this title for excise tax dete rmination
and reporting requirements;
5. To sell spirits produced by the licensee for either on-
premises or off-premises consumption to consumers on the l icensed
distillery premises or in an area controlled by the license e located
contiguous to the licens ed distillery premises. Product offered for
sale by the Oklahoma -licensed distiller will have been sold to and
shipped to an Oklahoma -licensed wine and sp irits wholesaler and then
made available for purchase by the Oklaho ma-licensed distiller for
sale to sell; and
6. To sell spirits at public events such as trade shows or
festivals. Products offered for sale by the Oklahoma -licensed
distiller will have been so ld to and shipped to an Oklahoma -licensed
wine and spirits wholesal er and then made available for pur chase by
the Oklahoma-licensed distiller; and
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7. To establish distiller's satellite locations, which shall be
considered extensions of the distiller's lic ensed premises, where
the distiller's products may be tasted, sampl ed, and served for on -
premises consumption and the holder of a distiller's license is
permitted to sell the distiller's products in sealed containers,
provided that the distiller's license is active and in good standing
and the product offered for sale by the Oklahoma-licensed distiller
will have first been sold to and shipped to an Oklahoma -licensed
wine and spirt wholesaler and then made available for purchase by
the Oklahoma-licensed distiller to sell. The spirits sold at a
satellite tasting room must h ave been produced and manufactured by
the holder of the distiller license .
B. Spirits sold pursuant to para graphs 5 and, 6, and 7 of
subsection A of this section shall not exceed fifteen t housand
(15,000) gallons per calendar year in combination.
SECTION 4. AMENDATORY 37A O.S. 2021, Section 2-160, is
amended to read as follows:
Section 2-160. A satellite tasting room license shall authorize
the holder of a small farm winery license, or winemaker license, or
small brewer license to operate no more than two satellite locations
in addition to his or her their licensed premises for the purpose of
providing tastings, samples and retail sales for on -premises or off-
premises consumption to consumers over twenty -one (21) years of age;
provided the wine or beer tasted, sampled or sold shall have been
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produced/manufactured by the holder of a small farm winery or,
winemaker, or small brewer license and shall have all manufacturing
taxes paid.
The holder of a small farm winer y license or, winemaker license,
or small brewer license must obtain approval for each satellite
location from the city, town or muni cipality before submitting the
application to the ABLE Commission. The fee for licensing each
satellite location will be One Hundred D ollars ($100.00) annually.
The small farm winery licensee or, winemaker licensee, or small
brewer licensee operating a satellite tasting room must keep such
license in good standing and is liable for any violati on committed
on the premises of its satellite tasting rooms. Employees and
managers of the satellite tasting room must be trained in alcohol
handling, laws and regul ations and hold a current alcohol servers
license and must be over twenty -one (21) years of age.
For purposes of this section, the term "tasting or tastings"
means the serving of free samples of the winemaker's products not to
exceed more than a total of s ix (6) fluid ounces of wine per person
aged twenty-one (21) years or older per day, or the serving of the
winemaker's products by individual drink purchased by the consumer
for on-premises consumption, or the retail sale of the winemaker's
products in sealed containers to an on-premises customer for off -
premises consumption, or any combination thereof.
SECTION 5. This act shall become effective November 1, 2022.
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Passed the House of Representatives the 23rd day of March, 2022.
Presiding Officer of the House
of Representatives
Passed the Senate the ___ day of __________, 2022.
Presiding Officer of the Senate