Halloween is almost here and many bars, nightclubs and other licensed establishments are getting creative with their events and marketing of alcoholic beverages.
If you’re having a costume contest at your establishment, be careful what you give away as prizes. I just read about a winery whose Halloween bash includes a “frightfully exciting” costume contest, with the winner receiving a bottle of wine.
Things could get more frightening than they planned if the ABC finds out. While retailers are allowed to sponsor contests at their premises and give prizes to contestants, there are some restrictions:
First, the prizes can’t be alcoholic beverages.
Second, the contest can’t be conditioned on the purchase, sale or consumption of alcoholic beverages.
Third, the contest does not involve the consumption of alcoholic beverages (e.g., beer pong).
Any one of these three issues would be a violation of Rule 106(l)(1) of the Business and Professions Code and could result in the ABC taking disciplinary action against the licensee.
As to drink specials, an establishment cannot offer complimentary or free alcoholic beverages, but may offer packages that include alcoholic beverages, provided the total charge to the customer covers their cost of acquisition (to prevent a free goods violation).
Nor can they offer alcoholic beverages at “two for the price of one, ““buy one, get one free, or in any other manner where a patron is required to buy more than one drink at a time in order to received a reduced price.
As far as “all you can drink” promotions go, although technically it is legal, it is not a good idea because it can increase your risk of patrons becoming intoxicated and someone who is drunk getting served.
Stay safe and legal at Halloween and always.
Jon,
Retail licensees, such as yourself, are allowed to sponsor contests at their licensed establishment, by providing prizes to contestants provided:
(1) The prizes are NOT alcoholic beverages (or a gift certificate to be redeemed, in whole or in part, for alcoholic beverages)
(2) Participation in the contest is not conditioned upon on the purchase, sale or consumption of alcoholic beverages
(3) The contest does not involve the consumption of alcoholic beverages
These restrictions are per Rule 106(i)(l) of the California Code of Regulations. Thanks for your question and for expressing appreciation for the blog! Lauren
Thanks for the great blog. Can a wine shop with a Type 42 license hold any marketing contests involving tastings with a prize of a gift certificate to the store?
You’re welcome, Rick. Both the Type 68-Portable Bar and the Type 58-Caterer’s Permit are for businesses that have an existing restaurant or bar with an on-sale general (full liquor) license. The portable bar license is for an additional fixed counter or service bar within that licensed premises. The Type 58-Caterer’s Permit allows that licensee to cater alcoholic beverages anywhere in the state.
Now, a caterer may qualify for an on-sale general license without having an existing restaurant or bar operation. However, the law permitting this has quite a few requirements. Here it is:
“24045.17. Caterers. Notwithstanding any other provision of law, the department may issue a general on-sale license to a person who does not operate a bona fide eating place or other public premises who meets all of the following:
(a) Has operated a catering business for not less than five years.
(b) Has operated or owned for not less than one year a bona fide eating place that had a general on-sale license.
(c) Caters over 500 events annually.
(d) Serves alcoholic beverages at no more than 25 percent of the events catered annually and has revenues from the sale of alcoholic beverages which do not constitute more than 25 percent of his or her total annual revenues.
(e) Obtains an annual permit to serve alcoholic beverages at events and obtains an authorization for each event, as specified in Section 23399.
History.—Stats. 2007, Ch. 349, SB 520, in effect January 1, 2008, renumbered to above from section 24015.12.”
Hello !
Your site is very informative and a joy to read thank you for the service.
I would like to open a beverage catering company, what licenses are required? From my research all i have found is 68/Portable Bar and 58 Catering?
Thanks Again!