Board

This petition requires us to determine the legality of a practice in which respondent Anheuser-Busch, Inc. (Anheuser-Busch) purchases its own products in bars or other drinking establishments, and offers customers the opportunity to exchange its product for whatever brand they are currently drinking. (The practice is commonly known as “trade spending” or “trade sampling.”) Petitioner, the Department of Alcoholic Beverage Control (Department), attempted to put an end to the practice, but, after administrative proceedings, the Alcoholic Beverage Control Appeals Board (Board) found no violation of statute or regulation. The Department sought review pursuant to Business and Professions Code section 23090. We issue the writ of review, and conclude that the challenged practice is, in fact, unlawful. Accordingly, we annul the order and remand for further proceedings.

The Relevant Law

The issue is one of construing, and harmonizing if possible, a limited number of statutes and regulations. As a general principle, the Department may not adopt a rule which would conflict with the enabling or otherwise governing statute. (Webb v. Swoap (1974) 40 Cal.App.3d 191, 196 [ 114 Cal.Rptr.…