16-3-213. Brewers or beer importers not to retail beer -- small brewery exceptions -- brewer collaboration. (1) Except as provided for small breweries in subsection (2) and except as provided in 16-4-401(9), it is unlawful for any brewer or breweries or beer importer to have or own any permit to sell or retail beer at any place or premises. It is the intention of this section to prohibit brewers and beer importers from engaging in the retail sale of beer. This section does not prohibit breweries from selling and delivering beer manufactured by them, in original packages, at either wholesale or retail.

(2) (a) For the purposes of this section, a "small brewery" is a brewery that has an annual nationwide production of not less than 200 gallons or more than 60,000 barrels, including:

(i) the production of all affiliated manufacturers; and

(ii) beer purchased from any other beer producer to be sold by the brewery.

(b) A small brewery may, at one location for each brewery license and at no more than three locations including affiliated manufacturers, provide samples of beer that were brewed and fermented on the premises in a sample room located on the licensed premises, subject to subsection (4). The samples may be provided with or without charge between the hours of 10 a.m. and 8 p.m. No more than 48 ounces of malt beverage may be sold or given to each individual customer during a business day for consumption on the premises or in prepared servings through curbside pickup, provided that the 48-ounce limit may not in any way limit a small brewery's sales as provided in 16-3-214(1)(a)(iii). No more than 2,000 barrels may be provided annually for on-premises sample room consumption, including all affiliated manufacturers.

(3) For the purposes of this section, "affiliated manufacturer" means a manufacturer of beer:

(a) that one or more members of the manufacturing entity have more than a majority share interest in or that controls directly or indirectly another beer manufacturing entity;

(b) for which the business operations conducted between or among entities are interrelated or interdependent to the extent that the net income of one entity cannot reasonably be determined without reference to operations of the other entity; or

(c) of which the brand names, products, recipes, merchandise, trade name, trademarks, labels, or logos are identical or nearly identical.

(4) A small brewery may serve in its sample room beer not brewed and fermented on the premises if:

(a) the beer is brewed in collaboration with another brewery, including multiple breweries;

(b) all brewers were actively involved in the brewing of the beer. For the purposes of this subsection (4)(b), the term "actively involved" means that all brewers were present for the brewing process.

(c) no more than six distinct collaboration beers, brewed and fermented at another brewery, may be served in a calendar year;

(d) the amount of beer that a brewer serves under this section, for any one type of distinct collaboration beer, does not exceed an equal proportion of the beer produced based on the number of participating breweries or seven barrels, whichever is less; and

(e) all brewers report to the department:

(i) that the brewers will collaborate as provided in this subsection (4) prior to the collaboration; and

(ii) sales from the collaboration for tax reporting.

(5) For a licensed brewery holding complete ownership of a retail license pursuant to 16-4-401(9), beer that is manufactured and sold at the colocated premises is not subject to the limitations imposed by this section. Beer manufactured and sold at the colocated premises does count toward production levels for tax purposes.