As the online revolution continues, the District of Columbia Alcoholic Beverage Regulation Administration (ABRA) recently reviewed several technology businesses that partner with liquor-licensed retailers to provide alcohol order and delivery services. ABRA informed companies Drizly and Klink today that the Board did not find their business models in violation of District law.
The Board advises technology companies facilitating the sale of alcohol through websites and apps to limit their operations to:
- Connecting consumers over the Internet to District retailers such as liquor and grocery stores; and/or
- Promoting a retailer’s alcoholic products.
Technology companies are restricted from:
- Soliciting, selling and shipping orders for alcoholic beverages;
- Storing alcoholic beverages for sale to consumers; and
- Collecting any money, fees or transacting any credit or debit cards for the sale of alcoholic beverages.
Any credit or debit card information provided to a website or app would need to be transferred to a liquor-licensed retailer in order to complete the transaction. The licensee would also need to retain the discretion to process or deny any order. Complete details are available in the Board’s advisory opinion and online quick guide.
“We encourage businesses that facilitate the sale of alcoholic beverages to contact the agency before starting any new operations in the District. This will allow us to ensure operations are compliant with the law before they begin,” ABRA Director Fred Moosally said.
A technology company that violates D.C. law could be subject to criminal and civil penalties as well as an order to cease operations in the District. A licensed retailer that violates the law could face fines and possible suspension or revocation of its license.
As small business owners continue to use online services to help customers the use of the internet for small business will increase in all areas. Customers should remember to use special care when giving credit card or debit card information online.