Any permit issued pursuant to the authority of any alcoholic beverage control law of the State of Arkansas to manufacture or wholesale controlled beverages may be cancelled, revoked, or suspended by the Director of the Alcoholic Beverage Control Division for any of the following reasons:

1. (1)

   1. (A) Manufacturer or wholesaler to have no interest in retail establishment.
   2. (B) That the manufacturer or wholesaler was interested directly or indirectly in any premises where controlled beverages are sold at retail, or in any business devoted wholly or partially to the sale of controlled beverages at retail, or by stock ownership, interlocking directors, mortgage, or lien on any personal or real property in any premises where controlled beverages are sold at retail.
   3. (C) “Interest”, as used in Arkansas Code § 3-3-212, means such a substantial ownership or financial interest, whether direct or indirect, in the business of any wholesale or retail licensee or in the premises on which said business is conducted as in the judgment of the Alcoholic Beverage Control Division may tend to influence such licensee to purchase beverages from such manufacturer to the exclusion or detriment of alcoholic beverages offered for sale by others.

   4. (D) In determining whether an interest is prohibited by Arkansas Code § 3-3-212, the Alcoholic Beverage Control Division shall consider the following factors:

      1. (i)

         1. (a) (a) Whether the retail licensee is owned directly by the manufacturer or whether the manufacturer and the retailer are merely under common ownership of the same parent company.
         2. (b) (b) In the event a manufacturer and a retail licensee are commonly owned by the same company, the division shall examine the degree to which the management and control of the manufacturing business and the retail business are separate and independent;
      2. (ii) Whether there is a bona fide business reason for owning the retail licensee other than solely to promote the sale of alcoholic beverages;
      3. (iii) Whether a significant portion of the revenues obtained by the manufacturer or its parent company as a result of the interest in a retail business are derived from the sale of alcoholic beverages;
      4. (iv) Whether the retail licensee purchases alcoholic beverages from an independently owned unrelated wholesaler;
      5. (v) Whether more than ten percent (10%) of the total gross annual revenues from the sale of alcoholic beverages by the retail licensee shall be derived from the sale of the alcoholic beverage products of the manufacturer or any entity affiliated with or related to the manufacturer; and

      6. (vi)

         1. (a) (a) Any other factor which the division deems relevant.
         2. (b) (b) Whenever a manufacturer proposes to acquire any interest, to any degree, in a wholesale or retail outlet, such acquisition shall be reviewed by the division.
      7. (c) (c) Such review shall include whatever documentation the division deems necessary to fully define the degree of interest acquired by the manufacturer, in accordance with the above factors.
      8. (d) (d) Upon a finding by the Director of the Alcoholic Beverage Control Division that no “prohibited interest”, as defined herein, exists in the proposed purchase, stock transfer, merger, or other means of acquiring an interest in a wholesale or retail licensee by a manufacturer, an order approving such acquisition will be entered;
2. (2) Manufacturer or wholesaler not to make loan to retailer. That the manufacturer or wholesaler made any loan to any person holding a permit to sell controlled beverages at retail;
3. (3) Exclusive contracts prohibited. That the manufacturer or wholesaler entered into a contract with any person holding a permit to sell controlled beverages at retail whereby such person agreed to confine his or her sales to the products manufactured by one (1) manufacturer or sold by one (1) wholesaler; and

4. (4)

   1. (A) Gifts and services to retailers prohibited.
   2. (B) That the manufacturer or wholesaler gave an article or articles away of any value or use whatsoever or provided any services for the use or benefit of any person holding a permit to sell controlled beverages at retail.
   3. (C) It is specifically provided that the practice of pricing alcoholic beverages for a retail permit holder by a manufacturer or wholesaler is not considered a prohibited service under this section.

   4. (D) In addition, the following practices are not prohibited gifts or services under this section:

      1. (i) Manufacturers and wholesalers may provide point-of-sale advertising items and related services to retailers in conformity with current federal regulations as long as the furnished item does not constitute a real or secondary gift to the retailer receiving it;
      2. (ii) Notwithstanding any other rule to the contrary, wholesalers may as a permitted service deliver product, provide keg-tapping and cooling equipment, delivery lines, and keg hook-up service to holders of temporary beer permits and temporary restaurant wine permits on any day such permits are in effect;

      3. (iii)

         1. (a) (a) Wholesalers may provide keg-tapping and cooling equipment, delivery lines, and keg hook-up service to consumers at the request of and as a permitted service to retail permit holders in any area where the sale of alcoholic beverages is legal.
         2. (b) (b) Provided, a wholesaler may not deliver any alcoholic beverages to a consumer, and a wholesaler’s employees may not be involved in any way with the dispensing of alcoholic beverages and serving such beverages to consumers;

      4. (iv)

         1. (a) (a) “Product display” means any alcoholic beverage racks, bins, barrels, casks, shelving, or similar items the primary function of which is to hold and display consumer products.
         2. (b) (b) A wholesaler may give or sell a product display to a retailer so long as:
5. (1) (1) The total value of all product displays provided by the wholesaler does not exceed three hundred dollars ($300) per brand at any one time in any one retail outlet;
6. (2) (2) The display bears conspicuous and substantial advertising matter on the product. The name and address of the retailer may appear on the displays; and

7. (3) (3) The giving or selling may be conditioned upon the purchase of the distilled spirits, wine, or malt beverages advertised on those displays in a quantity necessary for the initial completion of such display.

   1. (c) (c) No other condition can be imposed by the wholesaler on the retailer in order for the retailer to receive or obtain the product display;

      1. (v)

         1. (a) (a) A wholesaler may give or sell the following to a retailer or casino licensee:
8. (1) (1) Point-of-sale advertising materials, which are items designed to be used within a retail establishment to attract consumer attention to the products of the industry member. Such materials include, but are not limited to posters, placards, designs, inside signs (electrical, mechanical, or otherwise), window decorations, trays, coasters, mats, menu cards, foam scrapers, back bar mats, thermometers, clocks, calendars, and alcoholic beverage lists or menus;
9. (2) (2) Beer wholesalers may give, loan, or sell inside signs (electrical, mechanical, or otherwise). Inside signs for spirits, wines, or malt liquors shall not be loaned; and

10. (3) (3) Consumer advertising specialties are items designed to be carried away by the consumer, such as trading stamps, nonalcoholic mixers, pouring racks, ash trays, bottle or can openers, cork screws, shopping bags, matches, printed recipes, pamphlets, cards, leaflets, blotters, post cards, and pencils. Umbrellas, caps, shirts, and visors shall be sold, not given, by the wholesalers to the retailer. The minimum value of umbrellas, caps, shirts, and visors shall be the price paid by the industry member who first acquired the merchandise.

    1. (b)
11. (1) (b)(1) All point-of-sale advertising materials and consumer advertising specialties must bear conspicuous and substantial advertising matter about the product or the industry member which is permanently inscribed or securely affixed.
12. (2) (2) The name, logo, address, and website of the retailer may appear on the point-of-sale advertising material.

13. (3) (3) Any nonpromotional item that the business would buy in the normal course of business must be sold, not given, by a wholesaler to a retailer; and

    1. (vi)

       1. (a) (a) A wholesaler may, without violating the provisions of this section, and subject to approval by the Director of the Alcoholic Beverage Control Division on such form provided by the division, no less than five (5) working days prior to the qualified event, rent for fifty dollars ($50.00) per tap and associated cooling equipment or fair market value, whichever is greater, cooling and keg-tapping equipment, keg hook-up service, and delivery lines to a retail permit holder for a special purpose.

          1. (b) (b) These provisions shall apply only to events outside of the normal course of the retail permit holder’s ordinary course of business, not to exceed ten (10) days in duration.
       2. (c) (c) It is specifically provided that if a manufacturer or wholesaler provides any of the services for a retailer allowable under this section, he or she must provide the same service upon request to any other retailer who purchases the product.

Codification Notes: Subdivision (1) as promulgated prior to codification into the Code of Arkansas Rules provided as follows: "(Amended 12-15-89)" This section as promulgated prior to codification into the Code of Arkansas Rules provided as follows: "(Amended 8-16-11)"