Handbook for Fulfillment Houses

Division of Alcoholic Beverage Control
Kansas Department of Revenue 109 SW 9th Street
Mills Building, 5th Floor Topeka, Kansas 66612

Phone: 785-296-7015 / Fax: 785-296-7185
Website: www.ksrevenue.gov/abcindex.html
Email: Kdor_abc.email@ks.gov

Please report errors, omissions or suggestions for improvement to this handbook to the Division of Alcoholic Beverage Control by telephone at 785-296-7015, by fax at 785-296-7185 or by email to Kdor_abc.email@ks.gov.

Changes made to this handbook since the previous revision(s) have been highlighted with a light blue background.

Table of Contents

Definitions

Alcoholic liquor

Means alcohol, alcoholic candy, spirits, wine, beer and every liquid or solid, patented or not, containing alcohol, spirits, wine or beer and capable of being consumed as a beverage by a human being, but shall not include any cereal malt beverage (“CMB”). [Subsection (c) of K.S.A. 41-102]

Fulfillment House

Means any location or facility for any in-state or out-of-state entity that handles logistics, including warehousing, packaging, order fulfillment or shipping services on behalf of the holder of a special order shipping license issued pursuant to K.S.A. 41-350. [Subsection (o) of K.S.A. 41-102, as amended by New Section 1 of 2021 House Bill 2137]

Person

Means any natural person, corporation, partnership, trust or association. [Subsection (x) of K.S.A. 41-102]

Wine

Means any alcoholic beverage obtained by the normal alcoholic fermentation of the juice of sound, ripe grapes, fruits, berries or other agricultural products, including such beverages containing added alcohol or spirits or containing sugar added for the purpose of correcting natural deficiencies. The term ‘‘wine’’ shall include hard cider and any other product that is commonly known as a subset of wine. [Subsection (ll) of K.S.A. 41-102]

Application for Licensure - Required Forms and Fees

All applications must be submitted to ABC online at https://www.ksabconline.gov.

The license fee for a fulfillment house license is $50, and such license shall be valid from the date specified on the license until two years after such date. [Subsection (a) of New Section 1 of 2021 House Bill 2137] At the end of the two-year license term, the license is renewable for another two-year term unless sooner suspended or revoked, as long as the licensee and premises continue to meet the requirements of all relevant laws and regulations. [K.S.A. 41-327]

The license fee is refundable if the applicant is denied a license. [Subsection (d) of K.S.A. 41-317]

The applicant may pay either the full amount of the license fee or may pay ½ of the license fee at the time of application. The remaining ½ of the license fee, plus 10% of the remaining balance, is due one year from the date on which the license was issued. Failure to pay the remaining license fee and 10% fee timely will result in the license being canceled. [Subsections (b) and (c) of K.S.A. 41-317]

There is an additional application fee of $30 for new applicants and $10 for renewals. [Subsection (a) of K.S.A. 41-317] There will also be an additional $20 modernization fee assessed to each application type (initial or renewal). [K.S.A. 41-213] The application and modernization fees are not refundable.

If the applicant or license holder is an out-of-state entity, they shall submit a copy of the Irrevocable Consent to Jurisdiction Form (ABC-160) that has been stamped as “filed” by the Kansas Secretary of State. [Subsection (c) of New Section 1 of 2021 House Bill 2137]

Once all of the required documents and forms have been received and the required fees have been paid, the director shall either issue the license or issue an order denying the license. [Subsection (a) of K.S.A. 41-319]

An order by the director denying a license shall state the reason(s) therefore. The order denying a license is appealable to the secretary of revenue by filing a form available from the office of the secretary. The form must be either mailed to the secretary by certified mail or personally served upon the office of the secretary within 15 days from the date of service of the director’s order upon the licensee. The review of the director’s order will be conducted in accordance with the provisions of the Kansas Administrative Procedure Act (K.S.A. 77-501 et seq.). [K.S.A. 41-321]

The decision of the secretary or secretary's designee on an applicant's appeal of a denial of licensure may be appealed to District Court pursuant to the Kansas Judicial Review Act, K.S.A. 77-601 et seq. [K.S.A. 41-323]

A fulfillment house license is a personal privilege and is not assignable. [K.S.A. 41-326]

Qualifications for Licensure

A separate license is required for each location that will be involved in the shipping process to Kansas residents. [Subsection (a) of New Section 1 of 2021 House Bill 2137]

Subsection (a) of K.S.A. 41-311 lists the qualifications for an initial license. The same requirements must be met for renewal of an existing license except as specifically indicated:

U.S. Citizenship.

The person must be a U.S. citizen. [Subsection (a)(1) of K.S.A. 41-311]

For either an initial or renewal license, this requirement does not apply to the person's spouse. [Subsection (a)(12) of K.S.A. 41-311]

Felony conviction.

The person cannot have been convicted of a felony in Kansas or any other state or the United States. [Subsection (a)(2) of K.S.A. 41-311]

For an initial license, this requirement also applies to the person's spouse regardless of when the conviction occurred. [Subsection (a)(12) of K.S.A. 41-311]

For a renewal license, this requirement also applies to the person's spouse, but only if the conviction occurred during the time that the person's spouse was licensed under the Liquor Control Act. [Subsection (a)(13) of K.S.A. 41-311]

Previous liquor license revocation

The person cannot have had a license revoked for cause under the Kansas Liquor Control Act or the Kansas Beer and Cereal Malt Beverage Keg Registration Act or the cereal malt beverage laws of Kansas or any other state. However, a revocation will be disregarded if it occurred more than 10 years ago and was the result of a conviction of a misdemeanor. [Subsection (a)(3) of K.S.A. 41-311]

For an initial license, this requirement applies to the person's spouse. For a renewal license, this requirement does not apply to the person's spouse. [Subsection (a)(12) of K.S.A. 41-311]

Conviction for keeping a house of prostitution.

The person cannot have been convicted of being a keeper of a house of prostitution and cannot have forfeited bond to appear in court to answer charges of being a keeper of a house of prostitution. [Subsection (a)(4) of K.S.A. 41-311]

For an initial license, this requirement also applies to the person's spouse regardless of when the conviction occurred. [Subsection (a)(12) of K.S.A. 41-311]

For a renewal license, this requirement also applies to the person's spouse, but only if the conviction occurred during the time that the person's spouse was licensed under the Liquor Control Act. [Subsection (a)(13) of K.S.A. 41-311]

Conviction for owning a gambling house, pandering or crime opposed to decency or morality.

The person cannot have been convicted of being a proprietor of a gambling house, pandering or any other crime opposed to decency and morality and cannot have forfeited bond to appear in court to answer charges for any of these crimes. This includes both felonies and misdemeanors. [Subsection (a)(5) of K.S.A. 41-311]

"Pandering" is not currently used in the Kansas criminal law. Black's Law Dictionary defines a "panderer" as one who solicits for prostitution. The definition of "pander" includes being a "pimp" or procurer of persons to be prostitutes. Most of these acts are currently prohibited by K.S.A. 21-6419 (selling sexual relations) and 21-6420 (promoting the sale of sexual relations).

Crimes involving morality are defined in subsection (o) of K.A.R. 14-14-1 as including:

  • prostitution
  • procuring any person
  • solicitation of a child under 18 years of age for any immoral act involving sex
  • possession or sale of narcotics, marijuana, amphetamines or barbiturates
  • rape
  • incest
  • gambling
  • adultery
  • bigamy

For an initial license, this requirement also applies to the person's spouse regardless of when the conviction occurred. [Subsection (a)(12) of K.S.A. 41-311]

For a renewal license, this requirement also applies to the person's spouse, but only if the conviction occurred during the time that the person's spouse was licensed under the Liquor Control Act. [Subsection (a)(13) of K.S.A. 41-311]

Age requirement

The person must be at least 21 years of age. [Subsection (a)(6) of K.S.A. 41-311]

For either an initial or renewal license, this requirement does not apply to the person's spouse. [Subsection (a)(12) of K.S.A. 41-311]

Employee of ABC

The person cannot be an employee of the Division of Alcoholic Beverage Control. [Subsection (a)(7) of K.S.A. 41-311] For an initial license, this requirement applies to the person's spouse. For a renewal license, this requirement does not apply to the person's spouse. [Subsection (a)(12) of K.S.A. 41-311]

Law enforcement officer.

The person cannot be a commissioned law enforcement official. [Subsection (a)(7) of K.S.A. 41-311] "Official" is not defined in the statute but is interpreted as being any law enforcement officer or head of a law enforcement agency. Since this subsection does not mention jurisdiction, it is assumed that this restriction applies regardless of whether the law enforcement official is located in the same county, city, etc. as the RLS. [Ruling approved by the director on Jan. 19, 2005.]

Persons not commissioned as law enforcement officers, including non-commissioned correctional facility employees, are not included as “law enforcement officers” for purposes of acquiring a license. [Ruling by the director on July 24, 2012]

This requirement does not apply to the person's spouse. [Subsection (a)(12) of K.S.A. 41-311 as referenced in subsection (a)(1) of K.S.A. 41-2623]

Supervisor of law enforcement officers.

The person cannot hold a position that appoints or supervises any law enforcement officer. However, members of the governing body of a city or county (assume this means city council members and county commissioners) are exempt from this restriction. [Subsection (a)(7) of K.S.A. 41-311] Since this subsection does not mention jurisdiction, it is assumed that this restriction applies regardless of whether the person is located in the same county, city, etc. as the potential licensed premises. [Ruling approved by the director on Jan. 19, 2005.]

This requirement does not apply to the person's spouse. [Subsection (a)(12) of K.S.A. 41-311 as referenced in subsection (a)(1) of K.S.A. 41-2623]

Acting as agent of another.

The person cannot intend to act as an agent for another in operating the licensed business. [Subsection (a)(8) of K.S.A. 41-311]

Conviction of violating the intoxicating liquor laws

The director may deny an initial license or deny renewal an existing license if the person or the person's spouse has been convicted of violating the intoxicating liquor laws of any state or the United States or has forfeited bond to appear in court on charges of any such violation, within 10 years immediately preceding the date of application for an initial license or for renewal of an existing license. [Subsection (a) of K.S.A. 41-330]

Conviction of violating the Cereal Malt Beverage Act

The director may deny an initial license or deny renewal an existing license if the person or the person's spouse has been convicted of violating the laws of any state relating to CMB, within 10 years immediately preceding the date of application for an initial license or for renewal of an existing license. [Subsection (b) of K.S.A. 41-330]

Previous finding of hidden beneficial interest

The person cannot, after a hearing before the director, be found to have held an undisclosed beneficial interest in any liquor license which was obtained by means of fraud or any false statement made on the application for such license. [Subsection (a)(15) of K.S.A. 41-311]

Record Keeping

A fulfillment house licensee shall maintain records of all shipments for a period of three years. Such records shall contain:

  • Name, address and license number of the special order shipping licensee for whom the shipments were handled;
  • Name of the express company or common carrier used;
  • Date of each shipment;
  • Carrier tracking number of each shipment;
  • Name and address of the consignee of product received; and
  • Weight of each package and product type of alcoholic liquor shipped.

[Subsection (e)(1)(A)(i) through (vi) of New Section 1 of 2021 House Bill 2137]

These records shall be submitted to the director monthly in the form of an electronic report, the form and format of which may be prescribed by the director. [Subsection (e)(1)(B) of New Section 1 of 2021 House Bill 2137] Reports must be submitted using the KDOR Customer Service Center, which can be found at Kansas Department of Revenue - Home page (https://www.kdor.ks.gov/Apps/kcsc/login.aspx).

Reports submitted by fulfillment house licensees are open records available pursuant to the Kansas Open Records Act. Information relating to the name and address of any consignee or any alcoholic liquors shall be redacted prior to being made publicly available. [Subsection (e)(2) of New Section 1 of 2021 House Bill 2137]

A fulfillment house that willfully fails to file any report described above is subject to a civil penalty of not more than $100. After notice and an opportunity for hearing in accordance with the Kansas Administrative Procedure Act, the director may refuse to issue or renew or may revoke any fulfillment house license upon a finding that the licensee has failed to comply with any applicable provision of law. [Subsection (f) of New Section 1 of 2021 House Bill 2137]

Authorized Activities

Service logistics on behalf of special order shipping licensees

A fulfillment house licensee may provide services for the warehousing, packaging, order fulfillment and shipping of wine produced by and belonging to any duly licensed special order shipping licensee.

A fulfillment house licensee shall make reasonable efforts to confirm that any winery for whom they offer services holds a valid Kansas special order shipping license. A fulfillment house licensee may rely on the representation of any such winery for such assurance. [Subsection (a) of New Section 1 of 2021 House Bill 2137]

As an additional resource, ABC’s Liquor License Database can be used to see all active special order shipping licenses.

Shipment of products

When making shipments on behalf of a licensed special order shipper, a fulfillment house shall utilize a common carrier pursuant to K.S.A. 41-725. [Subsection (d)(2) of New Section 1 of 2021 House Bill 2137]

A fulfillment house licensee shall ensure all containers of alcoholic liquor shipped directly to an individual in Kansas are labeled with the name, address and license number of the fulfillment house licensee. All containers shall contain a conspicuously printed statement of “SIGNATURE OF PERSON AGE 21 OR OLDER REQUIRED FOR DELIVERY.” [Subsection (d)(1) of New Section 1 of 2021 House Bill 2137]

Prohibited Activities

While New Section 1 of 2021 House Bill 2137 does not outline specific prohibitions on the actions of a fulfillment house licensee, Subsection (a) does contain the following phrase: “The holder of a fulfillment house license may only provide services for the warehousing, packaging and shipping of alcoholic liquors produced by, and belonging to, a special order shipping licensee in accordance with K.S.A. 41-350.” (emphasis added) This means that a fulfillment house licensee is subject to the same restrictions as a special order shipper, as described in K.S.A. 41-350. These include:

  • Shipping more than 12 standard cases (144 bottles) of wine to any one person or address in a calendar year [Subsection (c) of K.S.A. 41-350];
  • Selling or shipping wine to an individual who is under the age of 21. [Subsection (a) of K.A.R. 14-11-23]; and
  • Shipping wine to a licensed premises. [Subsection (e) of K.S.A. 41-350]

Administrative Actions for Violations of Statutes and Regulations

If an ABC Enforcement Agent observes or discovers a violation of the state liquor statutes or administrative regulations, the agent may issue an administrative citation setting forth the details of the violation as listed in subsection (c) of K.S.A. 41-106. If possible, the Agent shall deliver the administrative citation to the licensee or person in charge of the licensed premises at the time of the violation. A copy of the administrative citation shall also be sent to the licensee by U.S. mail within 30 days after the date of the violation. [Subsection (a) of K.S.A. 41-106]

If a law enforcement officer from any other law enforcement agency observes or discovers a violation of the state liquor statutes, the law enforcement officer may prepare a notice of the violation (Form ABC-60) and serve the notice on the licensee or person in charge of the licensed premise. The law enforcement officer shall then submit a report of the violation to ABC for review to determine if administrative action should be taken against the licensee. If ABC decides to take action, then an administrative citation and notice of administrative action is sent to the licensee by U.S. mail within 30 days after the date of the violation. [Subsection (b) of K.S.A. 41-106]

The “person in charge” is defined as any individual or employee present on the licensed premises at the time of the alleged violation who is responsible for the operation of the licensed premises. If no individual or employee has been designated by the licensee as being in charge, then any employee present is considered the “person in charge” for the purpose of delivering an administrative citation by an ABC Enforcement Agent or for delivering a notice of violation by any other law enforcement officer. [Subsection (e) of K.S.A. 41-106]

The director may suspend, involuntary cancel or revoke any license issued by the Division of Alcoholic Beverage Control for any of the following reasons after the issuance of a citation to the licensee and a hearing conducted by the director pursuant to the Kansas Administrative Procedure Act in which the licensee has an opportunity to participate:

  • Providing false information on the license application or at any hearing relating to the issuance of the license.
  • Violation of any provision of the Liquor Control Act or any administrative regulation adopted pursuant to such act
  • No longer meets the qualifications to obtain a license pursuant to K.S.A. 41-311 or K.S.A. 41-311b.
  • Violation of any provision of a lawfully issued order of the director.

[Subsections (a) and (b) of K.S.A. 41-320, K.S.A. 41-320a]

The director may also impose a civil fine not exceeding $1,000 for each violation. Any fine imposed for a violation of the act shall be by written order of the director and state the nature of the violation, amount of fine, and the right of the licensee to appeal the order. A licensee will be granted a formal hearing under KAPA upon written request to the director. Fines are to be remitted to the State Treasurer for deposit into the state general fund. [K.S.A. 41-328]

The director may determine a penalty based on the ABC’s fine and penalty schedule, dated July 16, 2012. Penalties may vary from the schedule based on the presence of mitigating or aggravating circumstances. The liquor penalty grid is available for download from our website at https://www.ksrevenue.gov/pdf/LiqPenGrid.pdf.

Any order by the director suspending, involuntarily cancelling or revoking an existing license, or imposing a fine on a licensee is appealable to the Secretary of Revenue by filing a form available from the office of the Secretary. The form must be either mailed to the Secretary by certified mail or personally served upon the office of the Secretary within 15 days from the date of service of the director’s order upon the licensee. The review of the director’s order will be conducted in accordance with the provisions of the Kansas Administrative Procedure Act (K.S.A. 77-501 et seq.). [K.S.A. 41-321]

Revised 05/2021