Amends GS 18B-1303 through 18B-1308 and enacts new GS 18B-1309 to provide as the title indicates. Clarifies that a franchise agreement applies to all supplier products under the same brand name and that different categories of products manufactured under a common identifying trade name are considered to be the same brand. Expands the list of acts for which it is unlawful for a supplier or the supplier’s representative to engage in with respect to the supplier’s dealings with a wholesaler. Adds that good cause for the termination, alteration, or failure to renew a franchise agreement does not include (1) the sale or transfer of the rights to manufacture, distribute, or use the trade name of the brand to a successor supplier, whether the sale or transfer is made directly from the original supplier to the successor or goes through a third party; (2) failure of the wholesaler to meet operation or performance standards unilaterally imposed or revised by the supplier without a fair opportunity for the wholesaler to bargain as to the terms; (3) the wholesaler’s establishment of a franchise agreement with another supplier, or the acquisition by the wholesaler of the right to distribute the brand of another supplier; and (4) the desire of a supplier to consolidate its franchises.
Provides that a wholesaler whose franchise agreement is terminated, altered, or not renewed in violation of Article 13 (Beer Franchise Law) of GS Chapter 18B is entitled to recover monetary damages from the supplier in addition to (was, in lieu of) injunctive relief. Provides criteria governing the amount of the monetary damages due the wholesaler. Provides criteria for the transfer or merger of a wholesaler’s business; includes permitting a wholesaler to merge with another wholesaler in the state and transfer the merging wholesaler’s existing franchise rights to the new wholesaler entity. Makes conforming changes regarding the merger of a wholesaler’s business. Provides factors that the supplier may consider in determining whether the proposed transferee or merged wholesaler is a qualified person. Provides that the burden is on the supplier to prove that the proposed transferee or merged wholesaler is not qualified. Provides that a wholesaler may seek injunctive relief to enforce the provisions of this section. Also provides that supplier is liable for any monetary damages suffered by the wholesaler because the supplier unlawfully refused to approve a sale, transfer, or merger resulting in blocking the wholesaler’s ability to complete a sale, transfer, or merger.
Provides criteria for mediation of a dispute between a wholesaler and a supplier under the direction the Alcoholic Beverage Control Commission.
States that the provisions of this act are severable, providing that if any of the proposed provisions or their applications is held to be invalid, the invalidity does not affect other provisions or applications that can be given effect without the invalid provisions or applications.
Effective when the act becomes law and its provisions apply to all existing franchise agreements. Provides that a supplier’s shipment of malt beverages to a wholesaler in North Carolina following the effective date of this act constitutes acceptance by the supplier of the terms of this act, and the acceptance is to be considered as incorporated into the agreement between the supplier and the wholesaler.