California ABC is Actively Enforcing Credit Laws

John Hinman has an explanatory blog post and accompanying video that explain the active enforcement by the California ABC regarding credit laws. Both suppliers and retailers can face significant, escalating fines for violating the credit laws, so wineries, breweries, distilleries, importers, and retailers doing business in California should pay close attention to these developments.

The “Booze Rules” blog post does a great job of describing why the credit laws exist (suppliers are not allowed to provide a “thing of value” to retailers, and extending credit was commonly used as an incentive for retailers prior to prohibition) and what suppliers and retailers should do to make sure they’re in compliance. In short, study up on the credit laws, which exist both at the federal level and in each state where you’re doing business, and make sure your accounting and sales teams are trained and have the systems and processes in place to monitor invoices and accounts receivable.

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