Survey
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Licensing and Regulating Internet Retailing: Perspective of the Unlicensed Marketer Kristen Techel [email protected] strikeandtechel.com One type of “TPP”: unlicensed marketer Where Did TPPs Come From? Bridging Direct Shippers and E-Commerce Granholm starts to quickly open new sales opportunities, but wineries need help. TPPs start modest and quickly become full-service. • • • • • Create a website for a winery Consult on strategy for winery website, including featured products and pricing promotions Host a website for a winery and manage payment processing on behalf winery Host a stand-alone website that combines offers from more than one winery, but links out to winery websites Host a stand-alone website that combines offers from more than one winery and manages all payments Why use a Full-Service TPP? Data indicates direct to consumer sales are increasing TPPs can connect sellers to customers they wouldn’t otherwise reach TPPs can make the transaction easy. + Ecommerce issues (merchant account rates, fraud protection, privacy) + Technology to Manage complexities (interface with compliance software, reporting tax collection) TPP as a modern form of advertising? Topics from Regulators on TPPs 1. You need a license to sell alcohol 2. An alcoholic beverage license is a personal right (no “availing”) 3. Licensees have to know the rules and comply with them 4. Lack of familiarity with ecommerce Regulatory Topic: Licensing You need a license to sell alcohol • State definition of sale • Types of licenses: Home state, direct shipper, delivery-related, internet marketing portal (VA) • TPP Approaches: • TPP restricts activity to avoid making sale, as defined in state • TPP makes sure there is a licensee who is authorized to make sale • Sellers select states • Sellers verify licenses • TPP checks licenses Regulatory Topic: Availing A license is a personal right • TPP Approaches: • CONTROL for licensee • TPP Compensation • Flow of Funds • No “blinds” Regulatory Topic: Compliance • There are many state-specific rules to manage TPP approaches: Learn rules, interface with compliance programs and professionals, give licensee control and help them stay compliant • Licensing • Volume caps • Production requirements • Package markings • Discounting/Promotions • Signature Collection • Reporting Licensees Must Know and Follow Rules of MY STATE Iowa • “Fermented on winery premises” • No volume limit • TPPs? Illinois • “Wine made by licensee” • 12 cases per year to a resident • TPPs? • • Oregon No Production specification No more than two 9L cases per month to a resident Retailers can also direct ship TPPs? • • • • Colorado “Produced or bottled by permittee” Register labels No volume limit TPPs? • • Regulatory Topic: Understanding Ecommerce What exactly is happening here? There are too many models to investigate them all I sense that TPPs are doing too much and licensees too little I have no jurisdiction over unlicensed parties- how do I stop bad actors? The landscape is changing too quickly to keep up This feels too virtual How do we regulate this? Do we need to regulate it at all? Best Practices for TPPs • Only work with compliant licensed sellers with the right license to make a sale • Learn the rules, help your sellers comply • Leave control with the seller, especially the ability to reject an order • Find a way to give the seller control over the funds • Ensure fees are reasonable given the services provided, be thoughtful with % fees • Don’t act as a go-between for suppliers and retailers • Have a contract that your sellers can provide to a liquor regulator without putting their license in danger • Don’t be a bad actor. Anyone can start a TPP with very little start-up capital. If you have no license in a state, it isn’t easy for the state alcohol regulators to stop you. Resist the temptation to act without understanding the legal positioning for your action. Taking uneducated risks will tighten the market for everyone else. Questions? Kristen Techel [email protected] strikeandtechel.com Disclaimer: This presentation is provided for educational and informational purposes only and is not intended and should not be construed as legal advice.