On July 17, 2024, Pennsylvania Governor Josh Shapiro signed Senate Bill No. 688 into law, now known as Act 86 of 2024. This legislation introduces a major change to the state’s liquor laws by permitting the sale of ready-to-drink cocktails. Effective September 16, 2024, this new law allows restaurants, hotels, and distributors to sell pre-mixed beverages. Below, I explain the key points of Act 86 and what it means for both businesses and consumers.
What Are Ready-to-Drink Cocktails (RTDC)?
RTDCs are pre-mixed beverages that contain distilled spirits and other non-alcoholic liquids. Examples of RTDCs include High Noon, Mike’s Hard Lemonade, Campari Soda, Absolut Cocktails, and Jack Daniel’s Country Cocktails. These beverages are packaged in containers no larger than 16 ounces and must have an alcohol content between 0.5% and 12.5% alcohol by volume (ABV). Notably, RTDCs do not include wine, malt, or brewed beverages—they are classified as “liquor” under Pennsylvania law.
Who Can Sell RTDCs?
Restaurants, hotels, distributors, and importing distributors can apply for an RTDC permit, allowing them to sell these beverages for on-premises consumption or to-go. Licensees must have Responsible Alcohol Management Program (RAMP) certification to obtain an RTDC permit. The permit authorizes sales Monday through Saturday until 11:00 p.m., and with a Sunday sales permit, RTDC sales are permitted on Sundays until the same time, with a 9:00 p.m. cut-off for distributors and importing distributors.
From where can a licensee purchase a RTDC for resale?
- From the PLCB: RTDC permit holders may purchase RTDCs from the Pennsylvania Liquor Control Board for resale. Restaurants, hotels, and distributors CANNOT prepare their own RTDCs in-house for resale.
- From Licensed Pennsylvania Manufacturers (LPMs): RTDC permit holders may also purchase RTDCs for resale from licensed Pennsylvania manufacturers, including active limited distillery licensees and any distillery licensees that previously held an active limited distillery license before July 1, 2024. LPMs can sell RTDCs to permit holders without an additional permit. These manufacturers can sell RTDCs in any quantity to both consumers and RTDC permit holders. However, LPMs are required to file quarterly reports detailing sales data, including quantities, purchase prices, and the names of products sold.
Key Requirements for RTDC Permit Holders:
- Permit Fees: A $2,500 application fee is required, with an annual renewal fee of 2% of the cost of RTDCs purchased by the licensee for resale.
- Sales Locations and Regulations: All RTDC sales must occur at a designated register staffed by an employee at least 18 years old and trained under the Responsible Alcohol Management Program (RAMP). Self-checkout sales are prohibited.
- Purchase Limits: Restaurants and hotels may sell up to 192 ounces of RTDCs per transaction. Distributors and importing distributors face no limitations, provided the beverages are sold in original containers.
- Transaction Scans: Licensees must use a transaction scan device to verify the age of anyone appearing under 35.
Act 86 imposes several restrictions on how RTDCs can be sold:
- No Below-Cost Sales: RTDCs cannot be sold at a price lower than what was paid by the permit holder.
- No Private Label Products: RTDC permit holders are prohibited from selling private label products—those made under contract exclusively for a retailer. Also, a restaurant CANNOT prepare its own RTDCs in-house for resale.
- Storage Rules: RTDCs must be stored in locked areas, inaccessible to the public and to employees under 18 years of age.
- RTDC permit holders—excluding distributors and importing distributors—must allow RTDCs to be consumed on-premises. This requirement mirrors the rules for beer and wine sales, meaning businesses cannot solely operate as off-premises retailers of RTDCs.
Conclusion
Act 86 of 2024 significantly expands opportunities for businesses to offer ready-to-drink cocktails in Pennsylvania. With RTDC permits, restaurants, hotels, and distributors can now sell these convenient beverages, whether to-go or for on-premises consumption.
