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January 18, 2017
ABCC Decision - Selling Alcohol Below
Cost Can Lead to Severe Penalties
FROM THE DESK OF THE EXECUTIVE DIRECTOR - Frank Anzalotti
I'm sending you this Member Alert to make you aware of the penalties that can be imposed by violating any Massachusetts Liquor Laws. On December 7th, 2016 the commission held a hearing to review alleged illegal retail pricing Total Wine & More in Natick and Everett. Regulation 204 CMR 2.04(1) states the following "No holder of a license issued under MGL c. 138, sec. 15 shall sell or offer to sell any alcoholic beverages at a price less than invoiced cost. Cost is defined as net cost appearing on the invoice for said alcoholic beverages." The testimony at the hearing lead to the decision that was handed down on January 18, 2017 that the licensee was advertising the sale of products based upon discounts yet to be given to them. General laws and ABCC regulations indicate that this cannot be done. The licensee in question received two notices of suspension for their Natick store and one notice of suspension for their Everett store. The suspensions included either two or three day closings along with 8 additional days held in abeyance for two years. The licensee has three options: 1.) Close these operations for two or three days as prescribed in the notices. 2.) Pay a fine for each suspension as a compromise in lieu of the closings. 3.) Appeal these decisions to Superior Court. An appeal to Superior Court waves the licensees rights to paying the fines. If they should lose in a court, they will have no other choice but to serve the suspensions. It is important that you understand how the ABCC defines invoice cost as quoted in the above bold sentence. All of you should be extremely careful of how you price sale items in your store.
Frank Anzalotti, Executive Director
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