Any elevation of the spirit is welcome during the COVID time.
As lawyers representing breweries, wineries, distilleries, retailers and countless other businesses working in the hospitality industry in North Carolina, we have been the first to witness the industry’s struggles during the pandemic. of COVID-19. We’ve also seen our distillers, in particular, grapple with the hurdles associated with North Carolina’s historic alcohol monopoly.
North Carolina state lawmakers made it clear last month that they too had witnessed these struggles. On September 10, Governor Cooper signed House Bill 890, an omnibus bill containing alcohol reform measures that should benefit all business owners governed by the Alcohol Control Commission. Many of the bill’s provisions focus on nearly 100 state-owned distilleries.
Changes for distilleries
In particular, the legislation, which was adopted by 35 votes to 7 by the State Senate and by 95 votes to 8 of the members of the House, standardizes the rules of the game for the distilleries by making the laws applicable to them. more consistent with the laws governing wineries and breweries.
For example, distilleries previously could not be opened during hours when local ABC stores were not open. Now, distilleries are able to offer tours, tastings and can sell closed containers of their products to consumers for off-site consumption seven days a week (9:00 a.m. to 9:00 p.m. Monday through Saturday and from noon to 9 p.m.). on Sunday). Distilleries are no longer required to keep records of tours offered to people who visit the distillery before purchasing a bottle of distilled spirits, as required by NC Gen. Stat. 18B-1105 (a) (4).
Distilleries or their representatives who obtain a spirits special event permit can now not only offer free tastings to consumers at trade shows, conventions, local fundraisers and farmers markets, but can also sell mixed drinks. or spirits distilled at the distillery during such events. Notably, however, the sale of mixed drinks in conjunction with consumer tasting is not permitted in shopping malls, street festivals, holiday festivals, or balloon races. Finally, after obtaining the appropriate permit, distilleries will also be able to donate one 50 milliliter mini-bottle per customer per day at trade shows, festivals and other similar approved events.
Plus, changes for consumers are coming to State ABC stores as well. Consumers will now be able to place orders online and then pick up products at ABC stores across the state. Business owners will no longer have to commute to pick up alcohol from ABC stores and warehouses – they will be able to order alcohol and have it delivered to their outlets, just like beer and wine are delivered.
The legislation also allows private label distilled spirits, meaning that individuals and restaurants can contract for products to be made and labeled for them with a label stating that the product has been “bottled for,” “distilled.” for ”or“ in honor of ”, an individual, an event, a company or a cause.
The legislation creates a new permit known as the “Non-Resident Spirits Vendor Permit” which can be issued to distilleries outside of North Carolina that sell their products in the state; a brokerage of these products; or an importer / bottler of spirits. The licensee is authorized to sell, deliver and ship spirits approved for sale in North Carolina to the licensee’s employees in North Carolina and to the licensee’s brokerage if the brokerage holds a non-resident spirits seller’s permit for the purpose of organizing special spirits events. Shipments and deliveries are limited to the quantity of spirits necessary for any consumer tasting event scheduled within one month of shipment or delivery.
In areas where the sale of blended beverages has not been approved, a distillery located on property used for bona fide agricultural purposes may sell blended beverages containing only distillery produced spirits for on-site consumption.
Finally, a North Carolina Spirits Advisory Council will be established, consisting of members with training or experience in the alcoholic beverage or tourism industries. Board members will not receive any salary for their service, but will have powers and duties to promote public awareness and the quality of the North Carolina spirits industry.
Retail provisions for the benefit of consumers
Retailers of all types, and consumers, will also benefit from the legislation, which extends the legal size of a growler (for beer or wine) from 2 liters to 4 liters. Business owners will also have the right to make their alfresco dining expansions (and alcohol service areas) permanent and sell alcoholic beverages for off-premises consumption in designated “social quarters”. Cities and counties will have the opportunity to carve out social neighborhood areas, where locals and tourists can walk around with alcoholic beverages purchased in the social neighborhood. And these “walktails” aren’t the only new development; charter buses that cover at least 75 miles will now be allowed to serve alcohol. Finally, the extension of door-to-door sales to outdoor spaces, which was temporarily authorized, is now codified. Retailers located in cities and counties that pass an ordinance allowing the extension of premises must follow the steps set out in 18B-904 (h) to obtain approval for the extension of their premises.
Sports fans also have something to look forward to in the legislation. Stadiums, facilities and sports arenas at universities and public colleges in North Carolina can now sell two malt beverages or glasses of wine to a single customer at a time. This should reduce the time fans spend in the drink queue at sporting events.
Finally, the legislation extends ABC’s jurisdiction to regulate not only alcoholic beverages but also alcoholic consumables. Alcoholic consumables are defined as any manufactured and packaged ice cream, ice pop, gum or gelatin food product containing at least one-half percent (0.5%) alcohol by volume. These products were previously beyond the reach of the ABC system. However, the new legislation will require that all manufacturers of these products be registered in the state, that all products and labels of these products be approved by the Commission, and that these products are only sold through the appropriate retail channels. .
Special event permit provisions
Representatives of vendors of non-resident malt beverages, wineries and liquor brands can now qualify to hold a Special Event Permit for Malted Beverages, Wineries or Spirits, as applicable, their allowing free tastings of their products in shopping centers, retail shows, festivals, balloon races, farmers’ markets and fundraising events approved by the Commission.
Companies regulated by the ABC Commission have endured many challenges throughout the COVID-19 pandemic, which likely highlighted the historic challenges facing North Carolina distillers. Hopefully, this legislation’s focus on modernizing alcohol sales and promoting outdoor dining and social neighborhoods in North Carolina will lift all boats. The authorization process is nuanced and requires attention to detail.
© 2021 Ward and Smith, Pennsylvania. All rights reserved.Revue nationale de droit, volume XI, number 304