Code of the District of Columbia

§ 25–303. Restrictions on holding a conflicting interest.

(a) Before issuing, transferring to a new owner, or renewing a license, the Board shall determine that the applicant is not disqualified because of a conflicting interest in another license, as follows:

(1) No licensee under a wholesaler’s license shall hold a license of any other class or kind.

(1A) No holder of a manufacturer's license shall hold a license of any other kind; provided, that a licensee under a manufacturer's license shall be permitted to hold another manufacturer's license of the same or a different class.

(2) No licensee under an on-premises retailer’s license, class C or D, shall hold any other license except an on-premises retailer’s license, class C or D, a pub crawl license, as defined by regulation, or a caterer's license.

(3) No licensee under an off-premises retailer’s license, class A or B, shall hold an interest in any other license.

(4) No licensee under an off-premises retailer's license, class AI or BI, shall hold an interest in any other license.

(b) The Board shall not reject, solely on the basis of this section, the application of a franchisee who controls, or will control, the entire interest in the receipts, profits, inventory, purchases, pricing, and sales of beverages under the license, if the franchisee held a license, or had an application for a license pending, on June 22, 1982.

(c) The requirements of this section shall not apply to an applicant for an off-premises retailer’s license, class B, for the sale of alcoholic beverages in an establishment if:

(1) The primary business and purpose is the sale of a full range of fresh, canned, and frozen food items, and the sale of alcoholic beverages is incidental to the primary purpose;

(2) The sale of alcoholic beverages constitutes no more than 15% of the total volume of gross receipts on an annual basis;

(3) The establishment is located in a C-1, C-2, C-3, C-4, or C-5 zone or, if located within the Southeast Federal Center, in the SEFC/C-R zone;

(4) [Repealed].

(5) The opinion of the ANC, if any, has been given great weight; and

(6) The applicant does not hold a manufacturer’s or wholesaler’s license.

(c-1) Notwithstanding subsection (a) of this section, the holder of an off-premises retailer's license, class B, that qualifies as a full-service grocery store pursuant to subsection (c) of this section shall be authorized to apply for an on-premises retailer's license, class CR or DR.

(d)(1) A manufacturer, or its affiliate, licensed under this title, may hold an interest in a limited partnership providing financial assistance to a general partner wholesaler as described in paragraph (2) of this subsection, but shall only exercise such control of the limited partnership business as is permitted by this chapter. The limited partner shall not have or exercise managerial control or decision-making authority with respect to daily operations of the limited partnership. Upon a default by the general partner wholesaler, the limited partner shall not acquire or assume additional control, ownership, or financial interest in the limited partnership. The manufacturer, or its affiliate licensed in the District shall not have a financial or ownership interest in the general partner wholesaler.

(2) The only financial assistance allowed pursuant to paragraph (1) of this subsection shall be the initial financial assistance to the limited partnership to acquire a licensed beer wholesaler. In that arrangement for financial assistance, the wholesaler license issued under this title shall be issued in the name of the general partner wholesaler on behalf of the limited partnership, and shall not be issued in the name of the limited partnership nor in the name of the manufacturer, or its affiliate.

(3) The limited partnership providing the financial assistance described in this section shall not exist for more than 10 years from the date of its creation, and shall not be recreated, renewed, or extended beyond that date.

(4) This section shall not amend or otherwise alter this title, except for the limited purpose of allowing a manufacturer, or its affiliate, which is licensed in the District, to provide financial assistance to a limited partnership for the exclusive purpose of acquiring a licensed beer wholesaler. A manufacturer or its affiliate shall not require the wholesaler to use the financial assistance as described above.

(e) Nothing in this section shall prohibit a wholesaler or other licensee under this title from obtaining, perfecting, or enforcing a security interest under Article 9 of Subtitle I of Title 28 in any personal property or fixtures of a retailer or other licensee, including inventory and accounts and other rights to payment.

(f) The requirements of this section shall not apply to an applicant for an off-premises retailer's license, class B, for the sale of alcoholic beverages in an establishment if the:

(1) Establishment will be located inside of a hotel and will have no direct public access to the street or the outside of the hotel's building;

(2) Other license held by the applicant is an on-premises retailer's license, class CH, DH, CR, DR, CT, or DT, that is also located within the same hotel as the establishment's proposed location, or an off-premises retailer's license, class B, that is located within another hotel and has no direct public access to the street or the outside of the hotel's building.

(3) Establishment's sale of alcoholic beverages constitutes no more than 25% of the total volume of gross receipts on an annual basis; and

(4) Opinion of the ANC, if any, has been given great weight.