STAND. COM. REP. NO. 1038

                                   Honolulu, Hawaii
                                                     , 1999

                                   RE:  H.B. No. 1622
                                        H.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Transportation and Intergovernmental
Affairs, to which was referred H.B. No. 1622, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO INTOXICATING LIQUOR,"

begs leave to report as follows:

     The purpose of this measure is to permit a brewer of beer to
hold interest in a wholesale dealer's or a manufacturer's license
limited to manufacturing or wholesaling the beer brewed.

     Testimony in support of this measure was received from the
Anheuser Busch Companies and the Anheuser Busch Sales of Hawaii,
Inc.

     Your Committee finds that current law prohibits a
manufacturer liquor licensee from holding any interest in any
other liquor licensee.  The intent of this law, which is
consistent with federal law, is to prohibit trade practices which
tend to produce monopolistic control of retail liquor outlets,
such as arrangements for exclusive outlets, creation of tied
houses, commercial bribery, and sales on consignment or with
privilege of return.

     Your Committee believes that a brewer of beer should not be
prohibited from doing business as a wholesale dealer in the State
of Hawaii, or vice-versa, as these interests do not create the
same potential for monopolistic practices when those licensees
have interests in retail licenses.


 
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                                   STAND. COM. REP. NO. 1038
                                   Page 2


     As affirmed by the record of votes of the members of your
Committee on Transportation and Intergovernmental Affairs that is
attached to this report, your Committee is in accord with the
intent and purpose of H.B. No. 1622, H.D. 1, and recommends that
it pass Second Reading and be referred to the Committee on
Judiciary.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Transportation
                                   and Intergovernmental Affairs,



                                   ______________________________
                                   CAL KAWAMOTO, Chair

 
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