California CodesBusiness and Professions Code - BPCDivision 9 — Alcoholic BeveragesChapter 15 — Tied-House RestrictionsSection 25503.19

(a) Nothing in this division shall prohibit the issuance or transfer of any retail on-sale general license to any person with respect to passenger cruise ships or lines owned by, or operated by or on behalf of, the licensee, notwithstanding that a manufacturer, winegrower, manfacturer’s agent, California winegrower’s agent, rectifier, distiller, bottler, importer, or wholesaler holds the ownership of any interest, directly or indirectly, in the cruise ships or lines or in the retail licensee, subject to the following conditions:

(1) Not more than 10 percent of the total gross annual revenues of the cruise ships or lines is derived from the sale of alcoholic beverages.

(2) The manufacturer, winegrower, manufacturer’s agent, California winegrower’s agent, rectifier, distiller, bottler, importer, or wholesaler shall not influence or attempt to influence decisions concerning the purchase and sale of alcoholic beverages by the retail licensee and those decisions are made solely by the retail licensee.

(3) The retail licensee is not required, by agreement or otherwise, to exclude from sale on board its vessels competitive alcoholic beverage products.

(4) The retail licensee shall purchase no beer, wine, or distilled spirits for sale in this state other than from a wholesale licensee, and the retail licensee shall purchase no alcoholic beverages for sale in this state from any wholesale licensee holding the ownership of any interest, directly or indirectly, in the cruise ships or lines or in the retail licensee.

(b) The Legislature finds that it is necessary and proper to require a separation between manufacturing interests, wholesale interests, and retail interests in the production and distribution of alcoholic beverages in order to prevent suppliers from dominating local markets through verticle integration and to prevent excessive sales of alcoholic beverages produced by overly aggressive marketing techniques. The Legislature further finds that the exception established by this section to the general prohibition against tied interests must be limited to its express terms so as not to undermine the general prohibition, and intends that this section be construed accordingly.