As with most Pennsylvania businesses, the present COVID-19 crisis has been enormously stressful and rapid fire for many restaurants, beer breweries, and other establishments selling alcohol within the Commonwealth. The developments have been constant, and sometimes feel unclear. However, the Pennsylvania Liquor Control Board’s guidance, coupled with recent alcohol law liberalization in the Commonwealth, has cleared a path for home delivery of alcohol to customers during, and after, this crisis. Accordingly, home delivery provides Pennsylvania establishments with flexibility to continue selling its product to customers during the pandemic.
Short Procedural History
On March 6, 2020, Governor Wolf issued a Proclamation of Disaster Emergency pursuant to Subsection 7301(c) of the Emergency Management Services Code due to the coronavirus outbreak. Among other provisions of the Proclamation of Disaster Emergency, Governor Wolf sweepingly proclaimed:
“I hereby suspend the provisions of any regulatory statute prescribing the procedures for conduct of Commonwealth business, or the orders, rules or regulations of any Commonwealth agency, if strict compliance with the provisions of any statute, order, rule or regulation would in any way prevent, hinder, or delay necessary action in coping with this emergency…”
Shortly thereafter on March 14, 2020, Governor Wolf directed all non-essential businesses within certain counties near Philadelphia to close, with the exception that restaurants could remain open for carry-out and delivery. The original March 14th letter also required all bars to close, but directed that beer and wine could still be purchased at grocery stores within the aforesaid counties. Governor Wolf then ordered a complete shutdown of all restaurants within the Commonwealth, with the exception of pick-up and delivery. On March 18, 2020, the Pennsylvania Liquor Control Board, through Advisory Notice No. 26, mandated that all retail licensees, clubs, permittees and producers must cease the sale of food and alcohol for on-premises consumption, subject to certain exceptions as discussed below. Failure to abide by this mandate could subject establishments, including beer breweries and restaurants, to citations by the Pennsylvania State Police, Bureau of Liquor Control Enforcement, or could possibly result in the suspension of operating privileges.
Laws Permitting Home Delivery of Alcohol to Customers
The March 18, 2020 Advisory Notice provided certain exceptions to all licensees, including beer breweries, for the delivery of alcohol as stated below:
- Restaurant, retail dispenser and hotel licensees may not allow the service or consumption of food or alcohol on the licensed premises. Sales to go are still permitted, as are hotel sales of food and alcohol for consumption in a private room.
- Licensees holding wine expanded permits authorizing the sale of wine to go may not allow the service or consumption of food or alcohol on the licensed premises. Sales to go are still permitted, as are the operation of a grocery store, convenience store or gas station next to the licensed premises.
- Airport restaurant license holders may not allow the service or consumption of food or alcohol on the licensed premises. Sales to go are still permitted.
- Clubs and catering clubs may not allow the service or consumption of food or alcohol on the licensed premises, and such licensees are not authorized to sell any alcohol to go. They may continue selling food to go.
- Permittees including special occasion, off-premise catering, exposition and farmers’ markets may not allow the service or consumption of food or alcohol on the licensed premises or at public gatherings.
- Breweries, distilleries/limited distilleries, and limited wineries may not allow the service or consumption of food or alcohol on the licensed premises. Sales of the producer’s own alcohol for off premises consumption is permitted.
- Sacramental wine licensees may not allow food or beverage consumption on premise, but may sell sacramental wine for consumption off premise.
- Additionally, the PLCB also advised that beer distributors were ultimately allowed to supply grocery stores, convenience stores and other retail licensees permitted to sell beer to go, but encouraged these businesses to employ social distancing best practices and avoid public gatherings of 10 or more people.
With dining areas now closed, many beer breweries and restaurants are being forced to reconsider their past business operations in light of the crisis and necessary limitations. Advisory Notice No. 26 permits Pennsylvania beer breweries to continue to sell malt or brewed beverages (beer), which they have produced for “off-premises consumption” only to both licensees and retail customers, subject to the requirements as state above. Consultation with the Office of Chief Counsel for the Pennsylvania Liquor Control Board has made it clear that off-premises consumption allows pick-up and delivery for beer breweries and restaurants, subject to recent alcohol reforms implemented within the Commonwealth.
The Commonwealth began reforming its alcohol laws prior to this crisis; these reforms may offer restaurants and beer breweries some flexibility and relief to navigate these unprecedented circumstances. Alcohol home delivery to customers is permitted as long as sale transactions are fully completed on the licensed premises prior to the time of delivery (whether by internet or by phone). There are three ways in which a beer brewery can deliver its product to customers’ homes (restaurants also have an option for home delivery) during, and after, the current shutdown:
- A beer brewery may personally deliver the beer produced and purchased on site to individuals’ homes as long as the beer brewery utilizes its own properly identified vehicles, subject to 47 P.S. § 4-492(9) and 40 Pa. Code § 9.22.
- A beer brewery, or restaurant, may also utilize a licensed transporter for hire to deliver beer. 47 P.S. § 4-492(8) and 40 Pa. Code § 9.28(a)&(b).
- Out-of-state beer breweries may deliver directly to Pennsylvania residents if they obtain a brewed beverage shipper license subject to 47 P.S. § 4-448(a)&(b).
If beer breweries or restaurants are interested in retaining a transporter-for-hire to mail or deliver its product within the Commonwealth, it can search for potential providers within their county here: https://plcbplus.pa.gov/pub/Default.aspx?PossePresentation=LicenseSearch
Restaurants may also apply for a transporter-for-hire license to deliver alcohol. In whatever manner the alcohol is delivered, the party delivering the alcohol must still check identification to ensure the customer/recipient is over twenty-one (21) years of age so as to not violate §493(1) of the Liquor Code and 47 P.S. §§4-493(1). Parties should also ensure that the sale and/or distribution of beer does not infringe on any territorial rights that have been granted to manufacturers. Thus, if a brewery was granted exclusive distribution rights to an importing distributor or distributor for a particular geographic area, a brewery’s ability to deliver or ship its products directly into certain geographic areas may be limited.
It should also be noted that Pennsylvania wineries are now also permitted to deliver wine to individuals if a carrier possesses a Direct Wine Shipper License (DWS). Finally, while Pennsylvania closed all of its Fine Wine and Spirits stores on March 16, 2020 due to the outbreak, as of April 1, 2020, these stores are now offering limited sales online only.
Accordingly, beer breweries, restaurants, wineries and Pennsylvania consumers still have a myriad of alcohol delivery options during the present shutdown. In fact, many establishments selling alcohol may decide to maintain these practices after the shutdown as the new provisions offer additional options to both producers and consumers.
Please check back for more information on these topics and others. Our attorneys remain available and accessible to handle any immediate and future needs and will continue monitoring for legal updates. If you have any concerns or are need of representation, planning or guidance, please contact me at jdbrown@burnswhite.com.