Delaware Code Title 4 Sec. 512C – Microbreweries; license; alternating premises
(a) Upon proper application and subject to the applicable provisions, restrictions, and prohibitions under this title, the Commissioner may grant a license to any of the following:
(1) A person who is the owner or lessee of a microbrewery to manufacture and sell beer, fermented beverages, mead, and cider.
(2) A person who owns a tenant microbrewery under subsection (i) of this section.
Terms Used In Delaware Code Title 4 Sec. 512C
- Beer: means any beverage containing more than 1/2 of 1% of ethyl alcohol by volume, obtained by the alcoholic fermentation of any infusion or decoction of barley malt and hops in water and includes, among other things, ale, porter, stout and other malt or brewed liquors. See Delaware Code Title 4 Sec. 101
- Commissioner: means the person appointed by the Governor and confirmed by the Senate who serves as the Alcoholic Beverage Control Commissioner for the State. See Delaware Code Title 4 Sec. 101
- Establishment: means any place located physically in this State where alcoholic liquor of 1 or more varieties is stored, sold or used by authority of any law of this State, including a hotel, restaurant, tavern, beer garden, or club as defined in this section, or where alcoholic liquor of 1 or more varieties is manufactured by virtue of any law of this State. See Delaware Code Title 4 Sec. 101
- Importer: means the person transporting or ordering, authorizing or arranging the transportation or shipment of alcoholic liquors into this State, whether the person is a resident or citizen of this State or not, said person being permitted to sell said alcoholic liquors only to those persons licensed to resell alcoholic liquors; provided, however, that nothing contained in this definition shall be construed as prohibiting an importer from selling such alcoholic liquors to either an active owner of that business for that person's use and not for resale or to a full-time, bona fide employee of that business for that person's use and not for resale; and provided further, that nothing contained in this definition shall be construed as prohibiting an importer from selling beer in "half-barrel" or "quarter-barrel" containers to the holders of a personal license. See Delaware Code Title 4 Sec. 101
- License: means any license or permit to manufacture, to sell, to purchase, to transport, to import or to possess alcoholic liquor authorized or issued by the Commissioner under the provisions of Chapter 5 of this title. See Delaware Code Title 4 Sec. 101
- Manufacture: means distill, rectify, ferment, brew, make, mix, concoct or process any substance or substances capable of producing a beverage containing more than 1/2 of 1% of alcohol by volume and includes blending, bottling or other preparation for sale. See Delaware Code Title 4 Sec. 101
- Manufacturer: means any person engaged in the manufacture of any alcoholic liquor and among others includes a distiller, a rectifier, a wine maker, a brewer, and includes a bottler or one who prepares alcoholic liquor for sale. See Delaware Code Title 4 Sec. 101
- Mead: means an alcoholic beverage that is naturally fermented (not distilled or frozen) wherein the major source of fermentable sugars comes from honey. See Delaware Code Title 4 Sec. 101
- Person: includes an individual, a partnership, a corporation, a club or any other association of individuals. See Delaware Code Title 4 Sec. 101
- Retailer: means the person permitted to sell alcoholic liquors in a store in the State, not for consumption on the premises. See Delaware Code Title 4 Sec. 101
- Sell: means : solicit or receive an order for; keep or expose for sale; deliver for value or in any other way than purely gratuitously; keep with intent to sell; keep or transport in contravention of this title; traffic in; or for any valuable consideration, promised or obtained, directly or indirectly, or under any pretext or by any means whatsoever, procure or allow to be procured for any other person, to carry alcoholic liquors on one's person or to transport with one and with intent to sell the same, but not in any establishment where the sale thereof is allowed. See Delaware Code Title 4 Sec. 101
- State: means the State of Delaware; and when applied to different parts of the United States, it includes the District of Columbia and the several territories and possessions of the United States. See Delaware Code Title 1 Sec. 302
- Year: means a calendar year, and is equivalent to the words "year of our Lord. See Delaware Code Title 1 Sec. 302
(b) For purposes of this section:
(1) “Alternating premises” means the portion of a microbrewery’s premises that is used at different times by 2 or more microbreweries to manufacture beer, fermented beverages, mead, or cider.
(2) “Host microbrewery” means the microbrewery that owns the brewing equipment in an alternating premises.
(3) “Microbrewery” means a single establishment in which beer, fermented beverages, mead, or cider is manufactured and which is operated by the licensee under this section.
(4) “Tenant microbrewery” means the microbrewery that does not own, but uses, the brewing equipment in an alternating premises.
(c) Notwithstanding any provision of this title to the contrary, a microbrewery license allows the licensee to do all of the following:
(1) To manufacture and sell on the licensed premises beer, fermented beverages, mead, or cider or a combination thereof, but the licensee may not manufacture or sell more than the maximum amount permitted by federal regulations to qualify for a “reduced rate of tax for certain brewers” under 27 C.F.R., Part 25, § 25.152(a)(2).
(2) To manufacture on the licensed premises beer, fermented beverages, mead, or cider for persons, other than the licensee, licensed under this title or for persons outside this State.
(3) To sell beer, fermented beverages, mead, and cider manufactured on the licensed premises in labeled barrels, bottles, or other closed containers to importers licensed under this title for delivery by them to persons inside or outside the State.
(4) To sell at the licensed premises beer, fermented beverages, mead, and cider manufactured on the licensed premises for consumption on or off the licensed premises. The amount of beer, fermented beverages, mead, and cider sold for off-premises consumption is limited to a maximum of 5 cases per day to each retail customer.
(5) To purchase and store product from a Delaware licensed importer or retailer licensed under § 516 of this title, and sell the product to its retail customers for consumption on the premises where sold so long as the product is manufactured by an entity that holds a Delaware license under § 512A, § 512B, § 512C, or § 512E of this title or the manufacturer, as determined by the Commissioner, would qualify for a license under 1 or more of these sections if the manufacturer were physically located in the State.
(6) The provisions of § 506 of this title to the contrary notwithstanding, to be permitted to have an interest in, be affiliated with, operate, or own another supplier or manufacturer located outside the State and have an interest in a farm winery, brewery-pub, or craft distillery licensed under this chapter and actually located in this State, provided that the total domestic sales of beer of all affiliated suppliers or manufacturers does not exceed 6 million barrels in a calendar year.
(d) It is unlawful for a person to operate a microbrewery if any of the following apply:
(1) The license is denied, canceled, suspended, or revoked for any of the grounds under § 543 or § 561 of this title.
(2) The establishment is moved to a location other than the licensed premises.
(3) The licensee owns, operates, or is affiliated with any importer of alcoholic liquor either in or without this State.
(e) A microbrewery licensee is exempt from the distance requirements for establishments licensed or to be licensed under § 543(d) of this title, and such requirements may not affect the granting of a microbrewery license.
(f) All beer, fermented beverages, mead, and cider sold by a microbrewery licensee for off-premise consumption must be in containers that are securely sealed and have an attached label setting forth the information required under this title, Commissioner rules, and laws of the State.
(g) Any microbrewery or brewery licensed by the Commissioner to manufacture beer, fermented beverages, mead, or cider in this State may provide samples of the beer, fermented beverages, mead, or cider manufactured at the licensed premises in a manner approved by the Commissioner.
(h) Notwithstanding § 546 of this title, a microbrewery may sell a product that the microbrewery manufactures for off-premises consumption at a licensee licensed under this section and at up to 2 brewery-pubs licensed under § 512B of this title that are all owned or controlled by the same person.
(i) (1) The requirements to grant a license to a tenant microbrewery must include all of the following:
a. An agreement with a host microbrewery that allows the tenant microbrewery to use the host microbrewery’s brewing equipment for specified periods of time to manufacture beer, fermented beverages, mead, or cider. The compensation to the host microbrewery under an agreement may not be based upon the profit of the tenant microbrewery and is subject to the approval of the Commissioner.
b. The host microbrewery and the tenant microbrewery must have the approval of the Federal Trade and Tax Bureau (“TTB”), or its successor, to operate as an alternating premises.
c. The tenant microbrewery must retain title to all of the tenant microbrewery’s raw materials, except for water.
d. The tenant microbrewery must act as the brewer of the beer, fermented beverages, mead, or cider.
e. Upon completion of the manufacturing process, the tenant microbrewery shall remove all product from the alternating premises and transport the product to a location approved by the Commissioner for the tenant microbrewery to store and sell for on or off premises consumption. A tenant microbrewery may satisfy the requirement under this paragraph (i)(1)e. by leasing space from the host microbrewery but the tenant microbrewery may only store the tenant microbrewery’s brands in the leased space.
(2) The Commissioner may suspend or revoke the license of the tenant microbrewery upon the termination of the agreement between the host microbrewery and the tenant microbrewery.
(3) The Commissioner may suspend all licenses at the alternating premises if the TTB suspends the approval of the host or tenant microbrewery, The Commissioner must provide reasons for and conditions of a suspension under this paragraph (i)(3).
69 Del. Laws, c. 361, § ?1; 71 Del. Laws, c. 211, §§ ?1-3; 72 Del. Laws, c. 486, § ?9; 76 Del. Laws, c. 32, §§ ?1-5; 77 Del. Laws, c. 432, §§ ?1-3; 79 Del. Laws, c. 157, § ?1; 81 Del. Laws, c. 261, § 1; 82 Del. Laws, c. 22, § 1; 82 Del. Laws, c. 141, § 3; 83 Del. Laws, c. 36, § 3; 83 Del. Laws, c. 168, § 1; 83 Del. Laws, c. 283, § 5;