Bill Text: IL HB2577 | 2019-2020 | 101st General Assembly | Chaptered


Bill Title: Amends the Liquor Control Act of 1934. Excludes manufacturers and importing distributors that in the preceding year had less than $50,000 of tax liability under the Taxation of Liquor Article from a provision requiring manufacturers and importing distributors to file a specified bond with the Department of Revenue. Effective January 1, 2020.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Passed) 2019-07-03 - Public Act . . . . . . . . . 101-0037 [HB2577 Detail]

Download: Illinois-2019-HB2577-Chaptered.html



Public Act 101-0037
HB2577 EnrolledLRB101 06994 RPS 52027 b
AN ACT concerning liquor.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Liquor Control Act of 1934 is amended by
changing Sections 3-4, 3-12, 8-2, 10-1, and 10-7.1 as follows:
(235 ILCS 5/3-4) (from Ch. 43, par. 100)
Sec. 3-4. Authority to conduct investigations. The State
Commission commission shall obtain, pursuant to the provisions
of the "Personnel Code" enacted by the 69th General Assembly,
such inspectors, clerks, and other employees as may be
necessary to carry out the provisions of this Act, or to
perform the duties and exercise the powers conferred by law
upon the State Commission commission. The inspectors obtained
by the State Commission shall not be peace officers and shall
not exercise any powers of a peace officer.
The State Commission shall have the power to appoint
investigators to conduct investigations, searches, seizures,
arrests, and other duties required to enforce the provisions of
this Act, on behalf of the State Commission, and to ensure the
health, safety, and welfare of the People of the State of
Illinois. The Commission's investigators are peace officers
and have all the powers possessed by police officers in cities
and by sheriffs. State Commission investigators may exercise
these powers throughout the State whenever enforcing the
provisions of this Act, subject to the rules and orders of the
State Commission. No State Commission investigator may have
peace officer status or may exercise police powers unless: (1)
he or she successfully completes the basic police training
course mandated and approved by the Illinois Law Enforcement
Training Standards Board; or (2) the Illinois Law Enforcement
Training Standards Board waives the training requirement by
reason of the investigator's prior law enforcement experience,
training, or both.
The Executive Director must authorize to each investigator
of the State Commission and to any other employee of the
Department exercising the powers of a peace officer a distinct
badge that, on its face: (1) clearly states that the badge is
authorized by the State Commission; and (2) contains a unique
identifying number. No other badge shall be authorized by the
State Commission. Nothing in this Section prohibits the
Executive Director from issuing shields or other distinctive
identification to employees performing security or regulatory
duties who are not peace officers if the Executive Director
determines that a shield or distinctive identification is
needed by the employee to carry out his or her
responsibilities.
(Source: P.A. 82-783.)
(235 ILCS 5/3-12)
Sec. 3-12. Powers and duties of State Commission.
(a) The State Commission shall have the following powers,
functions, and duties:
(1) To receive applications and to issue licenses to
manufacturers, foreign importers, importing distributors,
distributors, non-resident dealers, on premise consumption
retailers, off premise sale retailers, special event
retailer licensees, special use permit licenses, auction
liquor licenses, brew pubs, caterer retailers,
non-beverage users, railroads, including owners and
lessees of sleeping, dining and cafe cars, airplanes,
boats, brokers, and wine maker's premises licensees in
accordance with the provisions of this Act, and to suspend
or revoke such licenses upon the State Commission's
determination, upon notice after hearing, that a licensee
has violated any provision of this Act or any rule or
regulation issued pursuant thereto and in effect for 30
days prior to such violation. Except in the case of an
action taken pursuant to a violation of Section 6-3, 6-5,
or 6-9, any action by the State Commission to suspend or
revoke a licensee's license may be limited to the license
for the specific premises where the violation occurred. An
action for a violation of this Act shall be commenced by
the State Commission within 2 years after the date the
State Commission becomes aware of the violation.
In lieu of suspending or revoking a license, the
commission may impose a fine, upon the State Commission's
determination and notice after hearing, that a licensee has
violated any provision of this Act or any rule or
regulation issued pursuant thereto and in effect for 30
days prior to such violation.
For the purpose of this paragraph (1), when determining
multiple violations for the sale of alcohol to a person
under the age of 21, a second or subsequent violation for
the sale of alcohol to a person under the age of 21 shall
only be considered if it was committed within 5 years after
the date when a prior violation for the sale of alcohol to
a person under the age of 21 was committed.
The fine imposed under this paragraph may not exceed
$500 for each violation. Each day that the activity, which
gave rise to the original fine, continues is a separate
violation. The maximum fine that may be levied against any
licensee, for the period of the license, shall not exceed
$20,000. The maximum penalty that may be imposed on a
licensee for selling a bottle of alcoholic liquor with a
foreign object in it or serving from a bottle of alcoholic
liquor with a foreign object in it shall be the destruction
of that bottle of alcoholic liquor for the first 10 bottles
so sold or served from by the licensee. For the eleventh
bottle of alcoholic liquor and for each third bottle
thereafter sold or served from by the licensee with a
foreign object in it, the maximum penalty that may be
imposed on the licensee is the destruction of the bottle of
alcoholic liquor and a fine of up to $50.
Any notice issued by the State Commission to a licensee
for a violation of this Act or any notice with respect to
settlement or offer in compromise shall include the field
report, photographs, and any other supporting
documentation necessary to reasonably inform the licensee
of the nature and extent of the violation or the conduct
alleged to have occurred. The failure to include such
required documentation shall result in the dismissal of the
action.
(2) To adopt such rules and regulations consistent with
the provisions of this Act which shall be necessary to
carry on its functions and duties to the end that the
health, safety and welfare of the People of the State of
Illinois shall be protected and temperance in the
consumption of alcoholic liquors shall be fostered and
promoted and to distribute copies of such rules and
regulations to all licensees affected thereby.
(3) To call upon other administrative departments of
the State, county and municipal governments, county and
city police departments and upon prosecuting officers for
such information and assistance as it deems necessary in
the performance of its duties.
(4) To recommend to local commissioners rules and
regulations, not inconsistent with the law, for the
distribution and sale of alcoholic liquors throughout the
State.
(5) To inspect, or cause to be inspected, any premises
in this State where alcoholic liquors are manufactured,
distributed, warehoused, or sold. Nothing in this Act
authorizes an agent of the State Commission Commission to
inspect private areas within the premises without
reasonable suspicion or a warrant during an inspection.
"Private areas" include, but are not limited to, safes,
personal property, and closed desks.
(5.1) Upon receipt of a complaint or upon having
knowledge that any person is engaged in business as a
manufacturer, importing distributor, distributor, or
retailer without a license or valid license, to conduct an
investigation. If, after conducting an investigation, the
State Commission is satisfied that the alleged conduct
occurred or is occurring, it may issue a cease and desist
notice as provided in this Act, impose civil penalties as
provided in this Act, to notify the local liquor authority,
or file a complaint with the State's Attorney's Office of
the county where the incident occurred or the Attorney
General , or initiate an investigation with the appropriate
law enforcement officials.
(5.2) Upon receipt of a complaint or upon having
knowledge that any person is To issue a cease and desist
notice to persons shipping alcoholic liquor into this State
from a point outside of this State if the shipment is in
violation of this Act, to conduct an investigation. If,
after conducting an investigation, the State Commission is
satisfied that the alleged conduct occurred or is
occurring, it may issue a cease and desist notice as
provided in this Act, impose civil penalties as provided in
this Act, notify the foreign jurisdiction, or file a
complaint with the State's Attorney's Office of the county
where the incident occurred or the Attorney General.
(5.3) To receive complaints from licensees, local
officials, law enforcement agencies, organizations, and
persons stating that any licensee has been or is violating
any provision of this Act or the rules and regulations
issued pursuant to this Act. Such complaints shall be in
writing, signed and sworn to by the person making the
complaint, and shall state with specificity the facts in
relation to the alleged violation. If the State Commission
has reasonable grounds to believe that the complaint
substantially alleges a violation of this Act or rules and
regulations adopted pursuant to this Act, it shall conduct
an investigation. If, after conducting an investigation,
the State Commission is satisfied that the alleged
violation did occur, it shall proceed with disciplinary
action against the licensee as provided in this Act.
(5.4) To make arrests and issue notices of civil
violations where necessary for the enforcement of this Act.
(5.5) To investigate any and all unlicensed activity.
(5.6) To impose civil penalties or fines to any person
who, without holding a valid license, engages in conduct
that requires a license pursuant to this Act, in an amount
not to exceed $20,000 for each offense as determined by the
State Commission. A civil penalty shall be assessed by the
State Commission after a hearing is held in accordance with
the provisions set forth in this Act regarding the
provision of a hearing for the revocation or suspension of
a license.
(6) To hear and determine appeals from orders of a
local commission in accordance with the provisions of this
Act, as hereinafter set forth. Hearings under this
subsection shall be held in Springfield or Chicago, at
whichever location is the more convenient for the majority
of persons who are parties to the hearing.
(7) The State Commission commission shall establish
uniform systems of accounts to be kept by all retail
licensees having more than 4 employees, and for this
purpose the State Commission commission may classify all
retail licensees having more than 4 employees and establish
a uniform system of accounts for each class and prescribe
the manner in which such accounts shall be kept. The State
Commission commission may also prescribe the forms of
accounts to be kept by all retail licensees having more
than 4 employees, including but not limited to accounts of
earnings and expenses and any distribution, payment, or
other distribution of earnings or assets, and any other
forms, records and memoranda which in the judgment of the
commission may be necessary or appropriate to carry out any
of the provisions of this Act, including but not limited to
such forms, records and memoranda as will readily and
accurately disclose at all times the beneficial ownership
of such retail licensed business. The accounts, forms,
records and memoranda shall be available at all reasonable
times for inspection by authorized representatives of the
State Commission or by any local liquor control
commissioner or his or her authorized representative. The
commission, may, from time to time, alter, amend or repeal,
in whole or in part, any uniform system of accounts, or the
form and manner of keeping accounts.
(8) In the conduct of any hearing authorized to be held
by the State Commission commission, to appoint, at the
commission's discretion, hearing officers to conduct
hearings involving complex issues or issues that will
require a protracted period of time to resolve, to examine,
or cause to be examined, under oath, any licensee, and to
examine or cause to be examined the books and records of
such licensee; to hear testimony and take proof material
for its information in the discharge of its duties
hereunder; to administer or cause to be administered oaths;
for any such purpose to issue subpoena or subpoenas to
require the attendance of witnesses and the production of
books, which shall be effective in any part of this State,
and to adopt rules to implement its powers under this
paragraph (8).
Any circuit court may by order duly entered, require
the attendance of witnesses and the production of relevant
books subpoenaed by the State Commission and the court may
compel obedience to its order by proceedings for contempt.
(9) To investigate the administration of laws in
relation to alcoholic liquors in this and other states and
any foreign countries, and to recommend from time to time
to the Governor and through him or her to the legislature
of this State, such amendments to this Act, if any, as it
may think desirable and as will serve to further the
general broad purposes contained in Section 1-2 hereof.
(10) To adopt such rules and regulations consistent
with the provisions of this Act which shall be necessary
for the control, sale or disposition of alcoholic liquor
damaged as a result of an accident, wreck, flood, fire or
other similar occurrence.
(11) To develop industry educational programs related
to responsible serving and selling, particularly in the
areas of overserving consumers and illegal underage
purchasing and consumption of alcoholic beverages.
(11.1) To license persons providing education and
training to alcohol beverage sellers and servers for
mandatory and non-mandatory training under the Beverage
Alcohol Sellers and Servers Education and Training
(BASSET) programs and to develop and administer a public
awareness program in Illinois to reduce or eliminate the
illegal purchase and consumption of alcoholic beverage
products by persons under the age of 21. Application for a
license shall be made on forms provided by the State
Commission.
(12) To develop and maintain a repository of license
and regulatory information.
(13) (Blank).
(14) On or before April 30, 2008 and every 2 years
thereafter, the State Commission shall present a written
report to the Governor and the General Assembly that shall
be based on a study of the impact of Public Act 95-634 on
the business of soliciting, selling, and shipping wine from
inside and outside of this State directly to residents of
this State. As part of its report, the State Commission
shall provide all of the following information:
(A) The amount of State excise and sales tax
revenues generated.
(B) The amount of licensing fees received.
(C) The number of cases of wine shipped from inside
and outside of this State directly to residents of this
State.
(D) The number of alcohol compliance operations
conducted.
(E) The number of winery shipper's licenses
issued.
(F) The number of each of the following: reported
violations; cease and desist notices issued by the
Commission; notices of violations issued by the
Commission and to the Department of Revenue; and
notices and complaints of violations to law
enforcement officials, including, without limitation,
the Illinois Attorney General and the U.S. Department
of Treasury's Alcohol and Tobacco Tax and Trade Bureau.
(15) As a means to reduce the underage consumption of
alcoholic liquors, the State Commission shall conduct
alcohol compliance operations to investigate whether
businesses that are soliciting, selling, and shipping wine
from inside or outside of this State directly to residents
of this State are licensed by this State or are selling or
attempting to sell wine to persons under 21 years of age in
violation of this Act.
(16) The State Commission shall, in addition to
notifying any appropriate law enforcement agency, submit
notices of complaints or violations of Sections 6-29 and
6-29.1 by persons who do not hold a winery shipper's
license under this Act to the Illinois Attorney General and
to the U.S. Department of Treasury's Alcohol and Tobacco
Tax and Trade Bureau.
(17)(A) A person licensed to make wine under the laws
of another state who has a winery shipper's license under
this Act and annually produces less than 25,000 gallons of
wine or a person who has a first-class or second-class wine
manufacturer's license, a first-class or second-class
wine-maker's license, or a limited wine manufacturer's
license under this Act and annually produces less than
25,000 gallons of wine may make application to the
Commission for a self-distribution exemption to allow the
sale of not more than 5,000 gallons of the exemption
holder's wine to retail licensees per year.
(B) In the application, which shall be sworn under
penalty of perjury, such person shall state (1) the date it
was established; (2) its volume of production and sales for
each year since its establishment; (3) its efforts to
establish distributor relationships; (4) that a
self-distribution exemption is necessary to facilitate the
marketing of its wine; and (5) that it will comply with the
liquor and revenue laws of the United States, this State,
and any other state where it is licensed.
(C) The State Commission shall approve the application
for a self-distribution exemption if such person: (1) is in
compliance with State revenue and liquor laws; (2) is not a
member of any affiliated group that produces more than
25,000 gallons of wine per annum or produces any other
alcoholic liquor; (3) will not annually produce for sale
more than 25,000 gallons of wine; and (4) will not annually
sell more than 5,000 gallons of its wine to retail
licensees.
(D) A self-distribution exemption holder shall
annually certify to the State Commission its production of
wine in the previous 12 months and its anticipated
production and sales for the next 12 months. The State
Commission may fine, suspend, or revoke a
self-distribution exemption after a hearing if it finds
that the exemption holder has made a material
misrepresentation in its application, violated a revenue
or liquor law of Illinois, exceeded production of 25,000
gallons of wine in any calendar year, or become part of an
affiliated group producing more than 25,000 gallons of wine
or any other alcoholic liquor.
(E) Except in hearings for violations of this Act or
Public Act 95-634 or a bona fide investigation by duly
sworn law enforcement officials, the State Commission, or
its agents, the State Commission shall maintain the
production and sales information of a self-distribution
exemption holder as confidential and shall not release such
information to any person.
(F) The State Commission shall issue regulations
governing self-distribution exemptions consistent with
this Section and this Act.
(G) Nothing in this paragraph subsection (17) shall
prohibit a self-distribution exemption holder from
entering into or simultaneously having a distribution
agreement with a licensed Illinois distributor.
(H) It is the intent of this paragraph subsection (17)
to promote and continue orderly markets. The General
Assembly finds that in order to preserve Illinois'
regulatory distribution system it is necessary to create an
exception for smaller makers of wine as their wines are
frequently adjusted in varietals, mixes, vintages, and
taste to find and create market niches sometimes too small
for distributor or importing distributor business
strategies. Limited self-distribution rights will afford
and allow smaller makers of wine access to the marketplace
in order to develop a customer base without impairing the
integrity of the 3-tier system.
(18)(A) A class 1 brewer licensee, who must also be
either a licensed brewer or licensed non-resident dealer
and annually manufacture less than 930,000 gallons of beer,
may make application to the State Commission for a
self-distribution exemption to allow the sale of not more
than 232,500 gallons of the exemption holder's beer per
year to retail licensees and to brewers, class 1 brewers,
and class 2 brewers that, pursuant to subsection (e) of
Section 6-4 of this Act, sell beer, cider, or both beer and
cider to non-licensees at their breweries.
(B) In the application, which shall be sworn under
penalty of perjury, the class 1 brewer licensee shall state
(1) the date it was established; (2) its volume of beer
manufactured and sold for each year since its
establishment; (3) its efforts to establish distributor
relationships; (4) that a self-distribution exemption is
necessary to facilitate the marketing of its beer; and (5)
that it will comply with the alcoholic beverage and revenue
laws of the United States, this State, and any other state
where it is licensed.
(C) Any application submitted shall be posted on the
State Commission's website at least 45 days prior to action
by the State Commission. The State Commission shall approve
the application for a self-distribution exemption if the
class 1 brewer licensee: (1) is in compliance with the
State, revenue, and alcoholic beverage laws; (2) is not a
member of any affiliated group that manufactures more than
930,000 gallons of beer per annum or produces any other
alcoholic beverages; (3) shall not annually manufacture
for sale more than 930,000 gallons of beer; (4) shall not
annually sell more than 232,500 gallons of its beer to
retail licensees or to brewers, class 1 brewers, and class
2 brewers that, pursuant to subsection (e) of Section 6-4
of this Act, sell beer, cider, or both beer and cider to
non-licensees at their breweries; and (5) has relinquished
any brew pub license held by the licensee, including any
ownership interest it held in the licensed brew pub.
(D) A self-distribution exemption holder shall
annually certify to the State Commission its manufacture of
beer during the previous 12 months and its anticipated
manufacture and sales of beer for the next 12 months. The
State Commission may fine, suspend, or revoke a
self-distribution exemption after a hearing if it finds
that the exemption holder has made a material
misrepresentation in its application, violated a revenue
or alcoholic beverage law of Illinois, exceeded the
manufacture of 930,000 gallons of beer in any calendar year
or became part of an affiliated group manufacturing more
than 930,000 gallons of beer or any other alcoholic
beverage.
(E) The State Commission shall issue rules and
regulations governing self-distribution exemptions
consistent with this Act.
(F) Nothing in this paragraph (18) shall prohibit a
self-distribution exemption holder from entering into or
simultaneously having a distribution agreement with a
licensed Illinois importing distributor or a distributor.
If a self-distribution exemption holder enters into a
distribution agreement and has assigned distribution
rights to an importing distributor or distributor, then the
self-distribution exemption holder's distribution rights
in the assigned territories shall cease in a reasonable
time not to exceed 60 days.
(G) It is the intent of this paragraph (18) to promote
and continue orderly markets. The General Assembly finds
that in order to preserve Illinois' regulatory
distribution system, it is necessary to create an exception
for smaller manufacturers in order to afford and allow such
smaller manufacturers of beer access to the marketplace in
order to develop a customer base without impairing the
integrity of the 3-tier system.
(b) On or before April 30, 1999, the Commission shall
present a written report to the Governor and the General
Assembly that shall be based on a study of the impact of Public
Act 90-739 on the business of soliciting, selling, and shipping
alcoholic liquor from outside of this State directly to
residents of this State.
As part of its report, the Commission shall provide the
following information:
(i) the amount of State excise and sales tax revenues
generated as a result of Public Act 90-739;
(ii) the amount of licensing fees received as a result
of Public Act 90-739;
(iii) the number of reported violations, the number of
cease and desist notices issued by the Commission, the
number of notices of violations issued to the Department of
Revenue, and the number of notices and complaints of
violations to law enforcement officials.
(Source: P.A. 99-78, eff. 7-20-15; 99-448, eff. 8-24-15;
100-134, eff. 8-18-17; 100-201, eff. 8-18-17; 100-816, eff.
8-13-18; 100-1012, eff. 8-21-18; 100-1050, eff. 8-23-18;
revised 10-24-18.)
(235 ILCS 5/8-2) (from Ch. 43, par. 159)
Sec. 8-2. Payments; reports. It is the duty of each
manufacturer with respect to alcoholic liquor produced or
imported by such manufacturer, or purchased tax-free by such
manufacturer from another manufacturer or importing
distributor, and of each importing distributor as to alcoholic
liquor purchased by such importing distributor from foreign
importers or from anyone from any point in the United States
outside of this State or purchased tax-free from another
manufacturer or importing distributor, to pay the tax imposed
by Section 8-1 to the Department of Revenue on or before the
15th day of the calendar month following the calendar month in
which such alcoholic liquor is sold or used by such
manufacturer or by such importing distributor other than in an
authorized tax-free manner or to pay that tax electronically as
provided in this Section.
Each manufacturer and each importing distributor shall
make payment under one of the following methods: (1) on or
before the 15th day of each calendar month, file in person or
by United States first-class mail, postage pre-paid, with the
Department of Revenue, on forms prescribed and furnished by the
Department, a report in writing in such form as may be required
by the Department in order to compute, and assure the accuracy
of, the tax due on all taxable sales and uses of alcoholic
liquor occurring during the preceding month. Payment of the tax
in the amount disclosed by the report shall accompany the
report or, (2) on or before the 15th day of each calendar
month, electronically file with the Department of Revenue, on
forms prescribed and furnished by the Department, an electronic
report in such form as may be required by the Department in
order to compute, and assure the accuracy of, the tax due on
all taxable sales and uses of alcoholic liquor occurring during
the preceding month. An electronic payment of the tax in the
amount disclosed by the report shall accompany the report. A
manufacturer or distributor who files an electronic report and
electronically pays the tax imposed pursuant to Section 8-1 to
the Department of Revenue on or before the 15th day of the
calendar month following the calendar month in which such
alcoholic liquor is sold or used by that manufacturer or
importing distributor other than in an authorized tax-free
manner shall pay to the Department the amount of the tax
imposed pursuant to Section 8-1, less a discount which is
allowed to reimburse the manufacturer or importing distributor
for the expenses incurred in keeping and maintaining records,
preparing and filing the electronic returns, remitting the tax,
and supplying data to the Department upon request.
The discount shall be in an amount as follows:
(1) For original returns due on or after January 1,
2003 through September 30, 2003, the discount shall be
1.75% or $1,250 per return, whichever is less;
(2) For original returns due on or after October 1,
2003 through September 30, 2004, the discount shall be 2%
or $3,000 per return, whichever is less; and
(3) For original returns due on or after October 1,
2004, the discount shall be 2% or $2,000 per return,
whichever is less.
The Department may, if it deems it necessary in order to
insure the payment of the tax imposed by this Article, require
returns to be made more frequently than and covering periods of
less than a month. Such return shall contain such further
information as the Department may reasonably require.
It shall be presumed that all alcoholic liquors acquired or
made by any importing distributor or manufacturer have been
sold or used by him in this State and are the basis for the tax
imposed by this Article unless proven, to the satisfaction of
the Department, that such alcoholic liquors are (1) still in
the possession of such importing distributor or manufacturer,
or (2) prior to the termination of possession have been lost by
theft or through unintentional destruction, or (3) that such
alcoholic liquors are otherwise exempt from taxation under this
Act.
If any payment provided for in this Section exceeds the
manufacturer's or importing distributor's liabilities under
this Act, as shown on an original report, the manufacturer or
importing distributor may credit such excess payment against
liability subsequently to be remitted to the Department under
this Act, in accordance with reasonable rules adopted by the
Department. If the Department subsequently determines that all
or any part of the credit taken was not actually due to the
manufacturer or importing distributor, the manufacturer's or
importing distributor's discount shall be reduced by an amount
equal to the difference between the discount as applied to the
credit taken and that actually due, and the manufacturer or
importing distributor shall be liable for penalties and
interest on such difference.
The Department may require any foreign importer to file
monthly information returns, by the 15th day of the month
following the month which any such return covers, if the
Department determines this to be necessary to the proper
performance of the Department's functions and duties under this
Act. Such return shall contain such information as the
Department may reasonably require.
Every manufacturer and importing distributor, except for a
manufacturer or importing distributor that in the preceding
year had less than $50,000 of tax liability under this Article,
shall also file, with the Department, a bond in an amount not
less than $1,000 and not to exceed $100,000 on a form to be
approved by, and with a surety or sureties satisfactory to, the
Department. Such bond shall be conditioned upon the
manufacturer or importing distributor paying to the Department
all monies becoming due from such manufacturer or importing
distributor under this Article. The Department shall fix the
penalty of such bond in each case, taking into consideration
the amount of alcoholic liquor expected to be sold and used by
such manufacturer or importing distributor, and the penalty
fixed by the Department shall be sufficient, in the
Department's opinion, to protect the State of Illinois against
failure to pay any amount due under this Article, but the
amount of the penalty fixed by the Department shall not exceed
twice the amount of tax liability of a monthly return, nor
shall the amount of such penalty be less than $1,000. The
Department shall notify the State Commission of the
Department's approval or disapproval of any such
manufacturer's or importing distributor's bond, or of the
termination or cancellation of any such bond, or of the
Department's direction to a manufacturer or importing
distributor that he must file additional bond in order to
comply with this Section. The Commission shall not issue a
license to any applicant for a manufacturer's or importing
distributor's license unless the Commission has received a
notification from the Department showing that such applicant
has filed a satisfactory bond with the Department hereunder and
that such bond has been approved by the Department. Failure by
any licensed manufacturer or importing distributor to keep a
satisfactory bond in effect with the Department or to furnish
additional bond to the Department, when required hereunder by
the Department to do so, shall be grounds for the revocation or
suspension of such manufacturer's or importing distributor's
license by the Commission. If a manufacturer or importing
distributor fails to pay any amount due under this Article, his
bond with the Department shall be deemed forfeited, and the
Department may institute a suit in its own name on such bond.
After notice and opportunity for a hearing the State
Commission may revoke or suspend the license of any
manufacturer or importing distributor who fails to comply with
the provisions of this Section. Notice of such hearing and the
time and place thereof shall be in writing and shall contain a
statement of the charges against the licensee. Such notice may
be given by United States registered or certified mail with
return receipt requested, addressed to the person concerned at
his last known address and shall be given not less than 7 days
prior to the date fixed for the hearing. An order revoking or
suspending a license under the provisions of this Section may
be reviewed in the manner provided in Section 7-10 of this Act.
No new license shall be granted to a person whose license has
been revoked for a violation of this Section or, in case of
suspension, shall such suspension be terminated until he has
paid to the Department all taxes and penalties which he owes
the State under the provisions of this Act.
Every manufacturer or importing distributor who has, as
verified by the Department, continuously complied with the
conditions of the bond under this Act for a period of 2 years
shall be considered to be a prior continuous compliance
taxpayer. In determining the consecutive period of time for
qualification as a prior continuous compliance taxpayer, any
consecutive period of time of qualifying compliance
immediately prior to the effective date of this amendatory Act
of 1987 shall be credited to any manufacturer or importing
distributor.
A manufacturer or importing distributor that is a prior
continuous compliance taxpayer under this Section and becomes a
successor as the result of an acquisition, merger, or
consolidation of a manufacturer or importing distributor shall
be deemed to be a prior continuous compliance taxpayer with
respect to the acquired, merged, or consolidated entity.
Every prior continuous compliance taxpayer shall be exempt
from the bond requirements of this Act until the Department has
determined the taxpayer to be delinquent in the filing of any
return or deficient in the payment of any tax under this Act.
Any taxpayer who fails to pay an admitted or established
liability under this Act may also be required to post bond or
other acceptable security with the Department guaranteeing the
payment of such admitted or established liability.
The Department shall discharge any surety and shall release
and return any bond or security deposit assigned, pledged or
otherwise provided to it by a taxpayer under this Section
within 30 days after: (1) such taxpayer becomes a prior
continuous compliance taxpayer; or (2) such taxpayer has ceased
to collect receipts on which he is required to remit tax to the
Department, has filed a final tax return, and has paid to the
Department an amount sufficient to discharge his remaining tax
liability as determined by the Department under this Act.
(Source: P.A. 100-1171, eff. 1-4-19.)
(235 ILCS 5/10-1) (from Ch. 43, par. 183)
Sec. 10-1. Violations; penalties. Whereas a substantial
threat to the sound and careful control, regulation, and
taxation of the manufacture, sale, and distribution of
alcoholic liquors exists by virtue of individuals who
manufacture, import, distribute, or sell alcoholic liquors
within the State without having first obtained a valid license
to do so, and whereas such threat is especially serious along
the borders of this State, and whereas such threat requires
immediate correction by this Act, by active investigation and
prosecution by the State Commission, law enforcement
officials, and prosecutors, and by prompt and strict
enforcement through the courts of this State to punish
violators and to deter such conduct in the future:
(a) Any person who manufactures, imports for distribution
or use, transports from outside this State into this State, or
distributes or sells 108 liters (28.53 gallons) or more of
wine, 45 liters (11.88 gallons) or more of distilled spirits,
or 118 liters (31.17 gallons) or more of beer at any place
within the State without having first obtained a valid license
to do so under the provisions of this Act shall be guilty of a
Class 4 felony for each offense. However, any person who was
duly licensed under this Act and whose license expired within
30 days prior to a violation shall be guilty of a business
offense and fined not more than $1,000 for the first such
offense and shall be guilty of a Class 4 felony for each
subsequent offense.
Any person who manufactures, imports for distribution,
transports from outside this State into this State for sale or
resale in this State, or distributes or sells less than 108
liters (28.53 gallons) of wine, less than 45 liters (11.88
gallons) of distilled spirits, or less than 118 liters (31.17
gallons) of beer at any place within the State without having
first obtained a valid license to do so under the provisions of
this Act shall be guilty of a business offense and fined not
more than $1,000 for the first such offense and shall be guilty
of a Class 4 felony for each subsequent offense. This
subsection does not apply to a motor carrier or freight
forwarder, as defined in Section 13102 of Title 49 of the
United States Code, an air carrier, as defined in Section 40102
of Title 49 of the United States Code, or a rail carrier, as
defined in Section 10102 of Title 49 of the United States Code.
Any person who: (1) both has been issued an initial cease
and desist notice from the State Commission; and (2) for
compensation, does any of the following: (i) ships alcoholic
liquor into this State without a license authorized by Section
5-1 issued by the State Commission or in violation of that
license; or (ii) manufactures, imports for distribution,
transports from outside this State into this State for sale or
resale in this State, or distributes or sells alcoholic liquors
at any place without having first obtained a valid license to
do so is guilty of a Class 4 felony for each offense.
(b) (1) Any retailer, caterer retailer, brew pub, special
event retailer, special use permit holder, homebrewer special
event permit holder, or craft distiller tasting permit holder
who knowingly causes alcoholic liquors to be imported directly
into the State of Illinois from outside of the State for the
purpose of furnishing, giving, or selling to another, except
when having received the product from a duly licensed
distributor or importing distributor, licensed in this State,
who knowingly causes to furnish, give, sell, or otherwise being
within the State, any alcoholic liquor destined to be used,
distributed, consumed or sold in another state, unless such
alcoholic liquor was received in this State by a duly licensed
distributor, or importing distributors shall have his license
suspended for 30 7 days for the first offense and for the
second offense, shall have his license revoked by the
Commission.
(2) In the event the State Commission receives a certified
copy of a final order from a foreign jurisdiction that an
Illinois retail licensee has been found to have violated that
foreign jurisdiction's laws, rules, or regulations concerning
the importation of alcoholic liquor into that foreign
jurisdiction, the violation may be grounds for the State
Commission to revoke, suspend, or refuse to issue or renew a
license, to impose a fine, or to take any additional action
provided by this Act with respect to the Illinois retail
license or licensee. Any such action on the part of the State
Commission shall be in accordance with this Act and
implementing rules.
For the purposes of paragraph (2): (i) "foreign
jurisdiction" means a state, territory, or possession of the
United States, the District of Columbia, or the Commonwealth of
Puerto Rico, and (ii) "final order" means an order or judgment
of a court or administrative body that determines the rights of
the parties respecting the subject matter of the proceeding,
that remains in full force and effect, and from which no appeal
can be taken.
(c) Any person who shall make any false statement or
otherwise violates any of the provisions of this Act in
obtaining any license hereunder, or who having obtained a
license hereunder shall violate any of the provisions of this
Act with respect to the manufacture, possession, distribution
or sale of alcoholic liquor, or with respect to the maintenance
of the licensed premises, or shall violate any other provision
of this Act, shall for a first offense be guilty of a petty
offense and fined not more than $500, and for a second or
subsequent offense shall be guilty of a Class B misdemeanor.
(c-5) Any owner of an establishment that serves alcohol on
its premises, if more than 50% of the establishment's gross
receipts within the prior 3 months is from the sale of alcohol,
who knowingly fails to prohibit concealed firearms on its
premises or who knowingly makes a false statement or record to
avoid the prohibition of concealed firearms on its premises
under the Firearm Concealed Carry Act shall be guilty of a
business offense with a fine up to $5,000.
(d) Each day any person engages in business as a
manufacturer, foreign importer, importing distributor,
distributor or retailer in violation of the provisions of this
Act shall constitute a separate offense.
(e) Any person, under the age of 21 years who, for the
purpose of buying, accepting or receiving alcoholic liquor from
a licensee, represents that he is 21 years of age or over shall
be guilty of a Class A misdemeanor.
(f) In addition to the penalties herein provided, any
person licensed as a wine-maker in either class who
manufactures more wine than authorized by his license shall be
guilty of a business offense and shall be fined $1 for each
gallon so manufactured.
(g) A person shall be exempt from prosecution for a
violation of this Act if he is a peace officer in the
enforcement of the criminal laws and such activity is approved
in writing by one of the following:
(1) In all counties, the respective State's Attorney;
(2) The Director of State Police under Section 2605-10,
2605-15, 2605-75, 2605-100, 2605-105, 2605-110, 2605-115,
2605-120, 2605-130, 2605-140, 2605-190, 2605-200,
2605-205, 2605-210, 2605-215, 2605-250, 2605-275,
2605-300, 2605-305, 2605-315, 2605-325, 2605-335,
2605-340, 2605-350, 2605-355, 2605-360, 2605-365,
2605-375, 2605-390, 2605-400, 2605-405, 2605-420,
2605-430, 2605-435, 2605-500, 2605-525, or 2605-550 of the
Department of State Police Law (20 ILCS 2605/2605-10,
2605/2605-15, 2605/2605-75, 2605/2605-100, 2605/2605-105,
2605/2605-110, 2605/2605-115, 2605/2605-120,
2605/2605-130, 2605/2605-140, 2605/2605-190,
2605/2605-200, 2605/2605-205, 2605/2605-210,
2605/2605-215, 2605/2605-250, 2605/2605-275,
2605/2605-300, 2605/2605-305, 2605/2605-315,
2605/2605-325, 2605/2605-335, 2605/2605-340,
2605/2605-350, 2605/2605-355, 2605/2605-360,
2605/2605-365, 2605/2605-375, 2605/2605-390,
2605/2605-400, 2605/2605-405, 2605/2605-420,
2605/2605-430, 2605/2605-435, 2605/2605-500,
2605/2605-525, or 2605/2605-550); or
(3) In cities over 1,000,000, the Superintendent of
Police.
(Source: P.A. 98-63, eff. 7-9-13; 99-904, eff. 1-1-17.)
(235 ILCS 5/10-7.1) (from Ch. 43, par. 189.1)
Sec. 10-7.1. The State Commission, upon receipt of a
complaint or upon having knowledge that any person is engaged
in the business as a manufacturer, importing distributor,
distributor, or retailer without a license or valid license,
shall conduct an investigation. If, after conducting an
investigation, the State Commission is satisfied that the
alleged conduct occurred or is occurring, it may issue a cease
and desist notice as provided in this Act, issue civil
penalties as provided in this Act, notify the Department of
Revenue and the local liquor authority, or and file a complaint
with the State's Attorney's Office of the County where the
incident occurred or with the Attorney General initiate an
investigation with the appropriate law enforcement officials.
(Source: P.A. 90-739, eff. 8-13-98.)
Section 99. Effective date. This Act takes effect upon
becoming law, except that the changes to Section 8-2 of the
Liquor Control Act of 1934 take effect
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