H.F. 2355 Section 1. Section 123.3, subsection 40, paragraph c, Code 1 2026, is amended to read as follows: 2 c. Notwithstanding paragraph “e” , the applicant is a citizen 3 of the United States and a resident of this state, or licensed 4 to do business in this state in the case of a corporation. 5 Notwithstanding paragraph “e” , in the case of a partnership, 6 only one general partner need be a resident of this state. The 7 residency requirements of this paragraph do not apply to an 8 applicant for a class “A” wine permit issued to a nonnative 9 wine manufacturer pursuant to section 123.176A. 10 Sec. 2. Section 123.23, subsection 1, Code 2026, is amended 11 to read as follows: 12 1. Any manufacturer, distiller, or importer of alcoholic 13 liquors shipping, selling, or having alcoholic liquors brought 14 into this state for resale by the state department shall, as 15 a condition precedent to the privilege of so trafficking in 16 alcoholic liquors in this state, annually make application for 17 and hold a distiller’s certificate of compliance which shall 18 be issued by the director for that purpose. No A brand of 19 alcoholic liquor brought into this state shall not be sold 20 by the department in this state unless the manufacturer, 21 distiller, or importer , and all other persons participating 22 in the distribution of that brand in this state have has 23 obtained a certificate. The certificate of compliance shall 24 expire at the end of one year from the date of issuance and 25 shall be renewed for a like period upon application to the 26 director unless otherwise suspended or revoked for cause. 27 Each completed application for a certificate of compliance 28 or renewal shall be submitted electronically, or in a manner 29 prescribed by the director, and shall be accompanied by a fee 30 of two hundred dollars payable to the department. However, 31 this subsection need not apply to a manufacturer, distiller, or 32 importer who ships or sells in this state no more than eleven 33 gallons or its case equivalent during any fiscal year as a 34 result of “special orders” which might be placed, as defined 35 -1- LSB 5476HV (3) 91 jm/ns 1/ 8

H.F. 2355 and allowed by departmental rules adopted under this chapter . 1 Sec. 3. Section 123.23, subsection 5, Code 2026, is amended 2 by striking the subsection. 3 Sec. 4. Section 123.135, subsections 1, 2, and 3, Code 2026, 4 are amended to read as follows: 5 1. A manufacturer, brewer, bottler, importer, or vendor 6 of beer, or any agent thereof, desiring to ship or sell beer, 7 or have beer brought into this state for resale by a class 8 “A” beer permittee, shall first make application for and be 9 issued a brewer’s certificate of compliance by the director 10 for that purpose. The certificate of compliance expires at 11 the end of one year from the date of issuance and shall be 12 renewed for a like period upon application to the director 13 unless otherwise revoked for cause. Each completed application 14 for a certificate of compliance or renewal of a certificate 15 shall be submitted electronically, or in a manner prescribed 16 by the director, and shall be accompanied by a fee of two 17 hundred dollars payable to the department. Each holder of a 18 certificate of compliance shall furnish the information in 19 a manner the director requires. The holder of a brewer’s 20 certificate of compliance may also hold a class “A” beer 21 permit. 22 2. At the time of applying for a certificate of compliance, 23 each applicant shall file with the department electronically, 24 or in a manner prescribed by the director, a list of all class 25 “A” beer permittees with whom it intends to do business and 26 shall designate a designation of the geographic area in which 27 its products are to be distributed by such permittee. The 28 listing of class “A” beer permittees and geographic area as 29 filed with the department shall be amended by the holder of 30 a certificate of compliance as necessary to keep the listing 31 current with the department. 32 3. All class “A” beer permit holders shall sell only those 33 brands of beer brought into the state which are manufactured, 34 brewed, bottled, shipped, or imported by a person holding a 35 -2- LSB 5476HV (3) 91 jm/ns 2/ 8

H.F. 2355 current certificate of compliance. Any employee or agent 1 working for or representing the holder of a certificate of 2 compliance within this state shall submit electronically, or in 3 a manner prescribed by the director, the employee’s or agent’s 4 name and address with the department. 5 Sec. 5. Section 123.173, subsection 2, Code 2026, is amended 6 to read as follows: 7 2. A class “A” wine permit allows the holder to manufacture 8 and sell, or sell at wholesale, in this state, wine. The 9 holder of a class “A” wine permit may manufacture in this state 10 wine having an alcoholic content greater than seventeen percent 11 by weight or twenty-one and twenty-five hundredths percent of 12 alcohol by volume for shipment outside this state. All Except 13 as provided in section 123.176A, all class “A” premises shall 14 be located within the state. 15 Sec. 6. Section 123.175, subsection 2, paragraph c, Code 16 2026, is amended to read as follows: 17 c. That the applicant is a citizen resident of the state 18 of Iowa or, if a corporation, that the applicant is authorized 19 to do business in the state. This paragraph does not apply if 20 the applicant is the state of Iowa or a state agency as defined 21 in section 669.2 . The residency requirement of this paragraph 22 does not apply to a nonnative wine manufacturer under section 23 123.176A. 24 Sec. 7. NEW SECTION . 123.176A Nonnative wine manufacturers. 25 1. As used in this section, “nonnative wine manufacturer” 26 means a person who processes the fruit, vegetables, dandelions, 27 clover, honey, or any combination of these ingredients, by 28 fermentation into wines on a premises located outside of this 29 state. 30 2. A nonnative wine manufacturer licensed or permitted 31 pursuant to laws regulating alcoholic beverages in another 32 state may apply for and be issued a class “A” wine permit, as 33 provided in section 123.175, without being a resident of this 34 state. 35 -3- LSB 5476HV (3) 91 jm/ns 3/ 8

H.F. 2355 3. A nonnative wine manufacturer holding a class “A” wine 1 permit may sell, or sell at wholesale, in this state, wine 2 that the nonnative wine manufacturer has itself manufactured 3 by fermentation on its out-of-state licensed or permitted 4 premises, provided the wine is properly registered with the 5 alcohol and tobacco tax and trade bureau of the United States 6 department of the treasury. Pursuant to section 123.177, such 7 sales shall only be made to persons holding a class “A” wine 8 permit or to persons holding a retail alcohol license. 9 4. A nonnative wine manufacturer shall not sell in this 10 state wine fermented by another manufacturer. 11 5. A nonnative wine manufacturer may ship wine in closed 12 containers to individual purchasers within this state by 13 obtaining a wine direct shipper permit pursuant to section 14 123.187. 15 6. A nonnative wine manufacturer that holds a class “A” wine 16 permit shall be deemed to have consented to the jurisdiction 17 of the department or any other agency or court in this state 18 concerning enforcement of this chapter and any related laws, 19 rules, or regulations. A permit holder shall allow the 20 department to perform an audit of manufacturing and sales 21 records upon request. 22 7. A violation of this section shall subject the permit 23 holder to the general penalties provided in this chapter and 24 shall constitute grounds for imposition of a civil penalty or 25 suspension or revocation of the permit pursuant to section 26 123.39. 27 Sec. 8. Section 123.177, subsection 2, Code 2026, is amended 28 to read as follows: 29 2. A class “A” wine permit holder may purchase and resell 30 only those brands of wine brought into the state which are 31 manufactured, fermented, bottled, shipped, or imported by a 32 person holding a certificate of compliance issued pursuant to 33 section 123.180 . 34 Sec. 9. Section 123.179, Code 2026, is amended to read as 35 -4- LSB 5476HV (3) 91 jm/ns 4/ 8

H.F. 2355 follows: 1 123.179 Wine permit and license fees. 2 1. The annual permit fee for a class “A” wine permit that 3 is not issued to a native wine manufacturer is seven hundred 4 fifty dollars , except the annual permit fee for a class “A” 5 wine permit issued to a native wine manufacturer as provided in 6 section 123.176 or a nonnative wine manufacturer as provided in 7 section 123.176A is one hundred dollars . 8 2. The annual permit fee for a class “A” wine permit issued 9 to a native wine manufacturer is one hundred dollars. 10 3. 2. The fee for a charity beer, spirits, and wine special 11 event license is one hundred dollars. 12 4. 3. The fee for a wine auction permit is one hundred 13 dollars. 14 Sec. 10. Section 123.180, subsections 1, 2, and 3, Code 15 2026, are amended to read as follows: 16 1. A manufacturer, vintner, bottler, importer, or vendor 17 of wine, or an agent thereof, desiring to ship, sell, or have 18 wine brought into this state for sale at wholesale resale by 19 a class “A” wine permittee shall first make application for 20 and shall be issued a vintner’s certificate of compliance by 21 the director for that purpose. The vintner’s certificate 22 of compliance shall expire at the end of one year from the 23 date of issuance and shall be renewed for a like period upon 24 application to the director unless otherwise revoked for 25 cause. Each completed application for a vintner’s certificate 26 of compliance or renewal of a certificate shall be submitted 27 electronically, or in a manner prescribed by the director, and 28 shall be accompanied by a fee of two hundred dollars payable 29 to the department. Each holder of a vintner’s certificate 30 of compliance shall furnish the information required by the 31 director in the form the director requires. A vintner or wine 32 bottler whose plant is located in Iowa and who otherwise holds 33 a class “A” wine permit to sell wine at wholesale is exempt 34 from the fee, but not the other terms and conditions. The 35 -5- LSB 5476HV (3) 91 jm/ns 5/ 8

H.F. 2355 holder of a vintner’s certificate of compliance may also hold a 1 class “A” wine permit. 2 2. At the time of applying for a vintner’s certificate 3 of compliance, each applicant shall file with the department 4 electronically, or in a manner prescribed by the director, a 5 list of all class “A” wine permittees with whom it intends 6 to do business. The listing of class “A” wine permittees as 7 filed with the department shall be amended by the holder of 8 the certificate of compliance as necessary to keep the listing 9 current with the department. 10 3. a. Except as provided in paragraph “b” , all class 11 “A” wine permit holders shall sell only those brands of 12 wine brought into the state which are manufactured, bottled, 13 fermented, shipped, or imported by a person holding a 14 current vintner’s certificate of compliance. An employee or 15 agent working for or representing the holder of a vintner’s 16 certificate of compliance within this state shall register the 17 employee’s or agent’s name and address with the department 18 electronically, or register in a manner prescribed by the 19 director . These names and addresses shall be filed with the 20 department’s copy of the certificate of compliance issued 21 except that this provision does not require the listing of 22 those persons who are employed on the premises of a bottling 23 plant, or winery where wine is manufactured, fermented, 24 or bottled in Iowa or the listing of those persons who are 25 thereafter engaged in the transporting of the wine. 26 b. A class “A” wine permit holder may sell brands of wine 27 brought into the state which are not manufactured, bottled, 28 fermented, shipped, or imported by a person holding a current 29 vintner’s certificate of compliance if the brands of wine were 30 purchased from a private sale pursuant to section 123.171, 31 subsection 4 , or if authorized by the laws of another state. 32 EXPLANATION 33 The inclusion of this explanation does not constitute agreement with 34 the explanation’s substance by the members of the general assembly. 35 -6- LSB 5476HV (3) 91 jm/ns 6/ 8

H.F. 2355 This bill relates to alcoholic beverage control by making 1 changes to distiller’s, vintner’s, and brewer’s certificates of 2 compliance (certificates) and by allowing for the issuance of 3 class “A” wine permits to nonnative wine manufacturers. 4 The bill strikes a provision requiring persons participating 5 in the distribution of an alcoholic liquor brand, other 6 than manufacturers, distillers, and importers, to obtain a 7 distiller’s certificate prior to the resale of that brand in 8 this state. The bill also strikes a provision specifying 9 the certificate is not required to be accompanied by a list 10 of persons employed on the premises where alcoholic liquors 11 are manufactured, processed, bottled, or packaged or who are 12 employed in transporting such liquors. 13 Currently, an application for a distiller’s, brewer’s, or 14 vintner’s certificate requires the application to be submitted 15 to the department of revenue (department) electronically, or in 16 a manner prescribed by the director of revenue (director). For 17 a brewer’s certificate, the bill specifies that the required 18 list of all class “A” beer permittees with whom the applicant 19 intends to do business and the designated distribution area 20 must also be submitted to the department electronically or in a 21 manner prescribed by the director. The bill also specifies the 22 holder of a brewer’s certificate of compliance may also hold a 23 class “A” beer permit. 24 The bill strikes a provision exempting a vintner or wine 25 bottler with a plant in Iowa and holding a class “A” wine 26 permit from paying the $200 fee accompanying an application for 27 a vintner’s certificate. The bill requires (1) each applicant 28 for a vintner’s certificate to file with the department 29 electronically, or in a manner prescribed by the director, a 30 list of all class “A” wine permittees the applicant intends to 31 do business with in the state, and (2) each employee or agent 32 working for or representing the certificate holder to similarly 33 submit electronically with the department the person’s name 34 and address. The bill also strikes a provision specifying a 35 -7- LSB 5476HV (3) 91 jm/ns 7/ 8

H.F. 2355 certificate is not required to be accompanied by a list of 1 persons employed on the premises of a bottling plant or winery 2 or persons who are employed in transporting the wine. 3 New Code section 123.176A allows a nonnative wine 4 manufacturer (manufacturer) to apply for a class “A” wine 5 permit and to sell or sell at wholesale wine the manufacturer 6 has manufactured on its permitted or licensed premises that 7 are located in another state, provided the wine is properly 8 registered with the federal alcohol and tobacco tax and trade 9 bureau. Class “A” wine permits are governed by Code sections 10 123.173, 123.175, and 123.177, which generally allow a resident 11 holder of the permit to manufacture and sell or sell at 12 wholesale wine for consumption off premises in this state. 13 A sale by the manufacturer within this state is restricted to 14 sales made to a person holding a class “A” wine permit or to a 15 person holding a retail alcohol license, pursuant to current 16 law. The bill prohibits a manufacturer from selling in this 17 state wine fermented by any other manufacturer. The bill also 18 specifies the manufacturer may ship wine in closed containers 19 to purchasers in this state by obtaining a wine direct shipper 20 permit. 21 By holding a class “A” wine permit, the manufacturer is 22 deemed to have consented to the jurisdiction of the department 23 and the courts for enforcement, and must allow audits of 24 manufacturing and sales records upon request. Violations of 25 the bill subject the manufacturer to general penalties provided 26 in Code chapter 123 and constitute grounds for imposition of 27 a civil penalty or suspension or revocation of the permit as 28 provided in Code section 123.39. 29 The bill establishes the annual fee for a class “A” wine 30 permit issued to a manufacturer at $100, which is equal 31 to the annual class “A” wine permit fee issued to a native 32 manufacturer. 33 -8- LSB 5476HV (3) 91 jm/ns 8/ 8