35-8A-14. Exclusive sales territories--Designated wholesaler.
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/sd/title-35/chapter-35-8/35-8a-14A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Each supplier of malt beverages licensed by the state authorizing any licensee to sell its malt beverages shall sell its malt beverages through wholesale licensees of the state to retail licensees authorized under state statute, shall designate exclusive sales territories for every brand or brands sold in the state, and shall name one licensed wholesaler for sales territory who, within that territory, shall be the exclusive wholesaler for the designated brand or brands of said supplier.
Such supplier shall enter into a territorial agreement, in writing, designating the exclusive territory and authorizing the sale by a designated licensed wholesaler of that brand or brands within the designated territory. Such supplier may not designate more than one wholesaler for each brand for all or any part of a designated sales territory, and the written territorial agreement may not provide for the distribution of a brand or brands to more than one licensed wholesaler for all or any part of the designated territory.
No modification of either the designated sales territory or any territorial agreement is effective unless the supplier has acted in good faith and for good cause and until written notice thereof has been given by the supplier to the wholesaler. The wholesaler licensee designated as the exclusive wholesaler for a brand or brands within a designated territory shall service retail licensees within that territory without discrimination, and shall service for the purpose of quality control all of the malt beverages sold by that wholesaler to retailers within such territory.
No wholesaler may, without the prior approval of the supplier, sell that supplier's malt beverage products to any retailer whose place of business is outside of the wholesaler's designated sales territory for such products, or to any person the wholesaler knows or should know will sell or supply such products to any such retailer. Any violation of the provisions of this section shall subject the licensee to penalties and damages as set forth in Title 37.