AB-12 – Trade Practice Violations
What businesses need to know about common violations and enforcement of alcohol trade practice laws
Maryland has identified and taken action on multiple violations of alcohol trade practice laws, including illegal discounts, free products, and improper promotions, and this guidance explains common violations, enforcement outcomes, and the shared responsibility across the industry to comply with these rules.
What you need to know
- Trade practice violations are actively investigated and enforced
- Illegal deals, free products, and improper promotions are prohibited
- Both sellers and retailers can be held responsible
- Violations may result in significant fines or license action
Who This Applies To
This guidance applies to:
- Manufacturers
- Wholesalers
- Non-resident dealers
- Solicitor permit holders
- Retail licensees
What Violations Have Been Identified
Investigations have found violations such as:
- Providing free alcohol products to retailers
- Offering incentives in exchange for product purchases
- Repeated illegal deals with management knowledge
- Improper promotional activities
- Incorrect pricing or invoicing practices
Enforcement Actions Taken
Enforcement actions have included:
- Monetary fines ranging from $750 to $27,500
- Settlements with:
- Suppliers
- Wholesalers
- Solicitor permit holders
These penalties were issued in place of license suspension or revocation.
Responsibility Across the Industry
Responsibility applies to:
- Businesses (suppliers and wholesalers)
- Employees and agents
- Retail licensees
Retailers who:
- Accept free products
- Participate in illegal arrangements
are also in violation and subject to penalties.
Key Compliance Rule
Licensees may not:
- Offer or accept free alcohol products
- Provide or receive improper incentives
- Participate in arrangements that violate trade practice laws
What This Means for Businesses
Businesses should:
- Review sales and promotional practices
- Train staff on trade practice compliance
- Avoid offering or accepting anything of value tied to sales
- Ensure all transactions follow legal requirements
Important Notes
- Violations may occur even with implied or indirect agreements
- Management may be held responsible for employee actions
- Enforcement applies across all tiers of the industry
Need Help?
For questions about trade practices, contact the ATCC: 410-260-7314 ext. 2 or [email protected]