Wine Wars 6.2.4

payoff1The direct shipment of wine is not the battlefield it was back in 2005-2010. However, a few recent actions remind us that alcohol regulations and laws remain one of the primary vehicles through which rent-seeking, protectionist laws and political payback is accomplished.

As reported by ShipCompliant on their outstanding blog, The state of Louisiana recently declared that while direct shipping is permitted by out-of-state wineries, if awinery has a contract with any wholesaler it may not direct ship ANY wine into the state. The rule used to be that wineries were not allowed to ship any wines currently carried by a wholesaler. Of course there is no other industry in America that is prohibited BY THE STATE from directly selling one of its product to a consumer when a wholesaler in that state also represents the brand in some way. There is no legitimate public policy goal for this position other than to stifle interstate commerce on behalf it its wholesalers. Would love to see this one play out in court.

Just when it looked like the new Arizona bill that would allow AZ consumers to buy up to 12 cases annually from an out-of-state winery would be passed, a nice lawmaker decided to push through an amendment that would reduce the amount a winery could ship to a consumer in year one of the law to six cases annually, which rises to nine cases in year two of the law and finally levels back out to 12 cases per year in year three. Like the protectionist move in Louisiana described above, this little amendment amounts to a gift to Arizona wholesalers. It turns out there is actually no justifiable public policy explanation for this kind of amendment either.

A bill that would have allowed both in-state and out-of-state wine stores and retailers to ship wine direct to MI consumers was amended at a committee hearing to only allow in-state retailers to ship wine. The sponsor said he had a report from “an outside organization” detailing that Michigan retailers were losing $60 million per year because of illegal shipments by out-of-state retailers. Though we don’t have confirmation yet, we can nearly guarantee the “report” is the work of the solidly unbiased Michigan Beer and Wine Wholesalers. Why would they lie? In any case, even if the reported $60 million dollars in shipments from out-of-state retailers is accurate, the sponsor of the bill that referenced these purchases in explaining why he amended out-of-state retailers out of the bill never explained why Michigan consumers would have paid the cost of shipping on that $60 million in wine if they could have purchased those wines locally. That is the implication of the claim that Michigan lost sales to out-of-state retailers. As with the above two items, this is another example of simple protectionism and a “fuck the consumer” attitude that most lawmakers come to possess once provided with campaign contributions from industries that are willing to pay for protection from competition.


Posted In: Shipping Wine


5 Responses

  1. Liz Holtzclaw - March 24, 2016

    Too bad you are so shy about telling us what you really think! Te, he. Someday the courts will revisit Granholm and the arguments that applied to wineries will be applied to retailers as well. Level playing field for in state and out of state suppliers.

  2. Kat Collins - March 24, 2016

    Add Pennsylvania to your list of arcane shipping laws. Ridiculous.

  3. Bob - March 26, 2016

    I haven’t read Granholm in awhile, but is there any reason why it wouldn’t apply to retailers in addition to wineries? Which would make the Michigan law unconstitutional.

  4. larry mawby - March 28, 2016

    re the michigan bill and granholm – granholm does apply to retailers as well as wineries, so, yes, the proposed law in michigan is not constitutional, which means only that it will be scrapped, not that it will be expanded to include retailers from anywhere. years ago when michigan responded to the granholm decision, retailers were included in the shipping bill. after a year or so, they were removed, because the wholesalers did not like out of state retailers, particularly those in illinois and new york, selling wines to michigan residents that did not go through the wholesalers hands. this change in the law was, as usual, explained as a necessary protection against underage access to wine. nothing changes.

  5. Wine Wars 6.2.4 | Eat Yourself Skinny - March 29, 2016

    […] post Wine Wars 6.2.4 appeared first on […]

Leave a Reply