DEPARTMENT OF  REVENUE
Division of Liquor Enforcement
LIQUOR CODE
1 CCR 203-2
Regulation 47-432. Colorado Wineries – Alternating Proprietor Licensed Premises.
A.  Definitions
1.  “Alternating Proprietor Licensed Premises” shall mean that portion of the host winery’s licensed premises that is shared by the host winery and alternating proprietors for the manufacture of vinous liquor, which is readily identified by use of placards showing the license number of the winery using that area.  Such shared premises may include crush pads, processing tanks, bottling lines, barrel storage, and casking areas.
2.  “Alternating Proprietor” or “tenant winery” shall mean a winery licensed pursuant to 12-47-402, C.R.S. or 12-47-403, C.R.S. who, by way of written agreement, takes possession of a host winery’s licensed premises for use as an alternating proprietor licensed premises as defined in 12-47-103(2.5), C.R.S. and this regulation. 
3.  “Alternating Proprietor Agreement” shall mean a written agreement between a host winery and an alternating proprietor that, at minimum, conveys possession of specific alternating proprietor licensed premises within a host winery’s licensed premises to specific alternating proprietors, establishes the general time frame for possession of alternating proprietor licensed premises, and the manner in which each alternating proprietor will maintain control over its manufacturing operations as an independent producer.  Such agreement must be approved by the Liquor Enforcement Division, and any changes, modifications, or termination of such agreement must also be reported to the division within the time frame specified within paragraph C of this regulation.
4.  “Host Winery” shall mean a winery licensed pursuant to 12-47-402, C.R.S. or 12-47-403, C.R.S. who, by way of written agreement, makes available a portion of its licensed premises to other wineries licensed pursuant to those sections, for use as an alternating proprietor licensed premises as defined in 12-47-103(2.5), C.R.S. and this regulation.
5.  “Dedicated Premises” shall mean that portion of a winery’s licensed premises that is not made available to other wineries for use as an alternating proprietor licensed premises, and where the winery may exercise all of the privileges described in 12-47-402, C.R.S. or 14-47-403, C.R.S., including the storage of vinous liquor, the establishment of a retail sales area, and consumer tasting or consumption.
B.  Requirements of Alternating Proprietor Licensed Premises in Colorado Wineries
1.  Only wineries licensed pursuant to 12-47-402, C.R.S. or 12-47-403, C.R.S. for the manufacture of vinous liquor are eligible to engage in alternation of licensed premises, as described in this regulation, either as a host winery or tenant winery (alternating proprietor).
2.  A host winery that elects to alternate its licensed premises may allow more than one tenant winery to take possession of alternating proprietor licensed premises, pursuant to the requirements of this regulation, as long as there is no more than one tenant winery per alternating proprietor licensed premises at any given time.
3.  All wineries licensed pursuant to 12-47-402, C.R.S. and 12-47-403, C.R.S. must maintain possession of their dedicated premises at all times pursuant to 12-47-301(3)(a), C.R.S.  A host winery that elects to alternate its licensed premises must maintain dedicated premises that are separate from tenant winery premises.  Tenant wineries must ensure that their manufactured product comes to rest upon their own dedicated premises, where it is inventoried for state tax purposes prior to sale or shipment pursuant to 12-47-402 and 12-47-403. Nothing herein shall prohibit any host winery or tenant winery from temporarily transporting its vinous liquor over dedicated premises or alternating proprietor licensed premises. 
4.  At all times specified in the alternating proprietor agreement, a tenant winery must maintain possession, title, and control over raw materials and manufacturing operations, occurring on its designated alternating proprietor licensed premises.  Nothing in this regulation authorizes joint venture operations, and the operations of each winery must be separate and distinct.  However, nothing herein shall prohibit a host winery or a tenant winery from utilizing the services of another winery’s staff or employees, as long as such an arrangement is provided for in the alternating proprietor agreement.
5.  Alternating proprietor licensed premises within a host winery must be separated in a manner that adequately distinguishes each alternating proprietor licensed premises area by use of placards, partitions, or other physical means.
6.  The authorization to alternate any licensed premises may be suspended or denied by the state licensing authority due to violations of the host or tenant winery.
C.  Application for Alternating Proprietor Licensed Premises
1.  When a host winery elects to alternate its licensed premises by designating a portion of its licensed premises as alternating proprietor licensed premises, it shall file notification with the Liquor Enforcement Division, no later than ten (10) days after alternation has commenced.
2.  Notification shall be filed on forms prepared by the Liquor Enforcement Division, and shall include all applicable fees, an alternating proprietor agreement, color-coded diagrams delineating those sections of the licensed premises that are to be operated as alternating proprietor licensed premises and those sections that are to remain designated premises, and the manner in which vinous liquor ownership will be identified and segregated.
D.  Record Keeping and Excise Tax Reporting Requirements
1.  The host winery and the tenant winery shall maintain a record of the movement or transfer of raw materials or vinous liquor:  when introduced to the alternating proprietor licensed premises, when moved from crush pad to tank, when moved from tank to barrel, when moved from barrel to bottling, and when removed from the alternating proprietor licensed premises.
2. Any transfer of vinous liquor to or from the alternating proprietor licensed premises shall be recorded in the business records of each winery.
3.  All wineries engaged in the activities described herein must maintain control over their separate business records at all times.  Whether such records are maintained on the alternating proprietor licensed premises or the dedicated premises, tenant wineries must provide access to all records when requested by any enforcement officer, without authorization of the host winery or other tenant wineries.
4.  Before the 20th day of each month, each tenant winery shall file a report of the preceding month’s alternating proprietor licensed premises operations. Such report shall be filed with the Monthly Report of Excise Tax, as required by 12-47-503, C.R.S. and related regulations. A tenant winery may submit said report in a format approved by the Department of Revenue, Taxpayer Services Division.