WineAmerica

TTB Funding Still in FY 2013 Budget

2012-02-24T08:40:00.000-08:00

By Cary Greene

In December, we sent out an ezine to the membership regarding a memo written by the Office of Management & Budget (“OMB”)—the federal agency that makes recommendations concerning government regulation and which oversees the drafting of the President’s budget—that asked whether the Alcohol & Tobacco Tax & Trade Bureau (“TTB”) should be dismantled. OMB proposed a transfer of TTB’s tax collection duties to the Internal Revenue Service (“IRS”), and TTB’s regulatory and public safety functions to the Food & Drug Administration (“FDA.”)

WineAmerica took a serious, but low key approach, in coalition with other producer groups, mindful that such a dramatic regulatory change would have a substantial impact on wineries. We hoped that OMB and the President’s administration generally could be convinced not to include an overhaul of TTB in the President’s budget. Apparently, these efforts were successful. See http://www.whitehouse.gov/sites/default/files/omb/budget/fy2013/assets/tre.pdf (TTB’s budget begins on page 1092).

While we are pleased to find no significant regulatory change for wineries in the President’s budget, historically, OMB has a habit of retreading its ideas in subsequent budgets. TTB “user fees”—essentially charging wineries to be regulated—and significant excise tax increases have both been proposed repeatedly by OMB, though not this year. Most likely, we now need to add the dismantling of TTB to our annual watch list.

The membership put us in a great position to get our grassroots engaged should it have been necessary, reaching out continuously since December regarding this issue. While we may ask that more funding be dedicated to the label approval process as 2013 expenditures move through Congress, we are happy to focus on improving industry regulation rather than battle to keep regulation from becoming a larger stumbling block to industry development.

TTB Industry Circular: Tie-In Sales--An Unlawful Trade Practice

2012-02-22T06:54:00.000-08:00

To: Distilled Spirits Plants, Breweries, Wineries, Taxpaid Wine Bottling Houses, Wholesale Liquor Dealers, Importers, Retailers, and Others Concerned.
What is the purpose of this circular?

Our purpose in publishing this circular is to remind alcohol industry members and others that tie-in sales of alcohol beverage “products,” as defined in 27 CFR 6.11, and hereafter referred to as “products,” are prohibited inducements under the “Tied-House” provisions of the Federal Alcohol Administration Act (FAA Act).

This Industry Circular supersedes Industry Circular 2003–3.

What is a Tie-in Sale?

A tie-in sale occurs when an industry member requires a retailer to purchase a product that the retailer did not want to purchase, in order to obtain the product the retailer wants. Tie-in sales are a form of unlawful quota sales covered by the FAA Act in 27 U.S.C. 205(b)(7). Tie-in sales are also one of the unlawful means to induce covered under the “Tied-House” regulations promulgated under the FAA Act, which are contained in 27 CFR part 6, “Tied-House.” In particular, 27 CFR 6.72 defines a tie-in sale:

The act by an industry member of requiring that a retailer purchase one product (as defined in § 6.11) in order to obtain another constitutes a means to induce within the meaning of the Act. This includes the requirement to take a minimum quantity of a product in standard packaging in order to obtain the same product in some type of premium package, i.e., a distinctive decanter, or wooden or tin box. This also includes combination sales if one or more products may be purchased only in combination with other products and not individually. However, an industry member is not precluded from selling two or more kinds or brands of products to a retailer at a special combination price, provided the retailer has the option of purchasing either product at the usual price, and the retailer is not required to purchase any product it does not want. * * *

A tie-in sale results in a violation of the FAA Act “Tied-House” provisions (27 U.S.C. 205(b)(7)) and TTB’s part 6 regulations (27 CFR 6.21(g)) when the prerequisite elements of means to induce, exclusion, interstate or foreign commerce, and similar State law (in the case of malt beverages) are established.
TTB deems tie-in sales to be a serious unlawful trade practice that inherently puts retailer independence at risk in the context of exclusion. 27 CFR 6.152(d).

What are some examples of tie-in sales?

Tie-in sales occur when:

A retailer must purchase a certain amount of regular distilled spirits, whether bottled or cased, in order to be allowed to purchase distilled spirits in a special holiday container or packaging.
A retailer must purchase ten cases of Winery X's Merlot from a wholesaler in order to purchase ten cases of Winery X's Chardonnay.
A retailer must purchase an industry member’s pre-mixed alcohol beverage specialty product (for example, strawberry daiquiri) in order to purchase a certain amount of their regular distilled spirits case goods. In other words, the regular distilled spirits products are not sold separately but only in combination with the specialty product. See § 6.93 of the TTB regulations (27 CFR 6.93) for rules concerning packaging of products with non-alcoholic items.
A retailer is required to purchase a two-bottle package containing one each of a winery's Merlot and Chardonnay in order to get the Merlot. The Merlot is not available for purchase separately.
A retailer must purchase a slow moving wine in order to purchase a distilled spirit that is in heavy demand. The distilled spirit is not available for purchase separately.

The above examples are considered tie-in sales because the retailer is compelled or required to purchase one product in order to obtain the product the retailer wants. A tie-in sale occurs regardless of whether the two products are the same brand or different brands of products. A tie-in sale also occurs if another category of alcohol beverage is involved.

Whom may I contact concerning the information in this circular?
If you have any questions about tie-in sales, you may contact the Trade Investigations Division at:

Trade Investigations Division
Alcohol and Tobacco Tax and Trade Bureau
1310 G Street, NW. Box 12
Washington, DC 20005
(202) 453-2272

WineAmerica Joins Call for Farm Bill Passage This Year

2012-02-14T09:02:00.000-08:00

WineAmerica, as part of the Specialty Crop Farm Bill Alliance, joined numerous other agriculture organizations in sending a letter to leaders of the Senate and House Agriculture Committees urging passage of the new Farm Bill this year. A continuation of current law with an extension of the 2008 bill into next year, as others have called for, would push the 2012 bill’s passage into a worse budget climate and make the future of several wine / grape program priorities more uncertain. Therefore, we fully support passage this year of the 2012 Farm Bill and will continue to push Congress to take action now rather than later. The letter follows:

February 10, 2012

The Honorable Debbie Stabenow, Chairwoman

The Honorable Pat Roberts, Ranking Member
Committee on Agriculture, Nutrition & Forestry Committee on Agriculture, Nutrition & Forestry
United States Senate
Washington, DC 20510

The Honorable Frank Lucas, Chairman

The Honorable Collin Peterson, Ranking Member
Committee on Agriculture Committee on Agriculture
United States House of Representatives
Washington, DC 20515

Dear Senators Stabenow and Roberts and Representatives Lucas and Peterson:

The 2012 farm bill is among the most important pieces of legislation the U.S. Congress will
consider this year. We the undersigned have heard calls for an extension of current law. We ask
you to reject these calls for delay and aggressively act to ensure that a new, comprehensive farm
bill is passed this year.

Farmers need a safety net that works more effectively, and they need access to tools that help
them be good stewards of our natural resources. The farm bill also provides essential resources
to prevent hunger, which is especially critical during these tough economic times. The bill also
addresses short and long-term job creation through streamlined and targeted rural economic
development policies and investments in agricultural research.

A temporary extension of current policy creates tremendous uncertainty while serving to further
none of these needs. We, therefore, stand ready to help you in an effort to pass a full,
comprehensive reauthorization of the farm bill this year, without needless delay or disruption.

Sincerely,

American Farm Bureau Federation
American Farmland Trust
American Society of Agronomy
American Soybean Association
American Sugar Alliance
Aquatic Plant Management Society
Association of Farm Managers & Rural Appraisers
Association of Fish and Wildlife Agencies
Board on Agriculture Assembly of the Association of Public and Land-Grant Universities
Center for Rural Affairs
Community Food Security Coalition
Council for Agricultural Science & Technology (CAST)
2
CropLife America
Crop Life & Reinsurance Bureau
Crop Science Society of America
Ducks Unlimited
Environmental Defense Fund
Evangelical Lutheran Church in America
Experiment Station Committee on Organization and Policy
Fair Food Network
Green for All
Housing Assistance Council
Institute of Food Technologists
Izaak Walton League of America
Kentucky Waterways Alliance
Land Trust Alliance
League of Rural Voters
Midwest Dairy Coalition
Missouri Coalition for the Environment
National Agricultural Biotechnology Council (NABC)
National Association of Conservation Districts
National Association of Counties
National Association of Development Organizations
National Association of Resource Conservation & Development Councils
National Association of Towns and Townships
National Association of Wheat Growers
National Audubon Society
National Barley Growers Association
National Bobwhite Conservation Initiative (NCBI)
National Catholic Rural Life Conference
National Coalition for Food & Agricultural Research
National Corn Growers Association
National Farmers Union
National Milk Producers Federation
National Organic Coalition
National Rural Health Association
National Sorghum Producers
National Sunflower Association
National Sustainable Agriculture Coalition
National Telecommunications Cooperative Association
National Trust for Historic Preservation
National Wildlife Federation
North Central Weed Science Society
Organic Farming Research Foundation
Organic Trade Association
Partners for Rural America
Pheasants Forever
Pollinator Partnership
3
Quail Forever
Rain and Hail
Rural Community Assistance Corporation
Rural Community Assistance Partnership
Rural Community Insurance Services
Slow Food USA
Soil and Water Conservation Society
Soil Science Society of America
Southern Weed Science Society
Specialty Crop Farm Bill Alliance
The Nature Conservancy
The Wildlife Society
The Xerces Society for Invertebrate Conservation
Theodore Roosevelt Conservation Partnership
Union of Concerned Scientists
United States Conference of Catholic Bishops
USA Dry Bean & Lentil Council
US Canola Association
US Composting Council
US Rice Producers Association
Weed Science Society of America
Western Peanut Growers Association
Western Society of Weed Science
World Wildlife Fund

cc: The Honorable John Boehner
The Honorable Nancy Pelosi
The Honorable Harry Reid
The Honorable Mitch McConnell
Members of House and Senate Agriculture Committees

Registration is Open for the 2012 Wine and Grape Policy Conference

2012-02-10T06:52:00.000-08:00

2012 Wine and Grape Policy Conference

WineAmerica and Winegrape Growers of America

Washington, DC

Please mark your calendars for the 2012 annual meeting

March 11-14, 2012

Washington Court Hotel

Washington, DC

Registration is now open for the annual Wine and Grape Policy Conference in Washington, D.C. The conference is an important opportunity for members of both organizations to discuss and evaluate Federal policy issues of interest to our industry, and to communicate our stances directly to Congressional Staff and the Administration. These meetings play an important role in the critical process of relationship building which is central to our mission of favorably influencing policy outcomes. It is also a great opportunity for wine industry leaders from across the country to network with each other in formal and informal settings. We hope that you will join us in March for this very important meeting.

It must be stressed that Congress will not be in session the week of our meeting. Due to the changing nature of the Congressional Calendar and hotel availability we could not change the dates or venue of our 2012 conference. We believe that we can still have a successful conference. Senior Congressional staff will still be available for meetings.

To register for the meeting please follow this link: http://www.wineamerica.org/membership/springmeeting.cfm

Call the hotel toll free at 800-321-3010 and reference the Wine and Grape Policy Conference

The rates are $299

Rooms fill up quickly in Washington, so please make your reservations as soon as possible. The room block cut off date is February 14.

Please contact Michael Kaiser at mkaiser@wineamerica.org or at 202-223-5172 with any questions regarding the 2012 Wine and Grape Policy Conference.

Preliminary Agenda

Sunday, March 11

12:00 PM - 5:00 PM
WineAmerica Executive Committee Meeting

4:00 PM- 6:00 PM
Welcome WGA Registrants Hospitality Suite

Monday, March 12

7:30 AM
Registration

8:00 AM
Breakfast

8:30 AM - 11:30 AM
Concurrent WGA and WineAmerica Board Sessions

12:00 PM - 1:30 PM
Welcome Luncheon with Speaker

1:30 PM - 5:00 PM
WineAmerica SAC Meeting

1:45 PM- 5:00 PM
WGA Meeting

5:30 PM - 7:00 PM
Wine Reception at hotel

7:00 PM
No Host Dinner

Tuesday, March 13

8:00 AM
Breakfast

8:30 AM - 12:00 PM
Policy Discussion

12:00 PM -1:00 PM
Luncheon and Hill Visit Preview

1:30 PM - 4:30 PM
Hill Visits

6:00 PM - 8:00 PM
Taste the Wines of America Reception

Wednesday, March 14

9:00 AM- 12:30 PM
Hill Visits cont.

12:30 PM
Legislative Wrap-Up Session

WineAmerica Staff Travel

2012-02-06T07:01:00.000-08:00

One of the most important and essential functions of the WineAmerica staff is getting our message out to members and non-members across the country. Wineries and State Winery Associations need to know what we are doing to protect their interests in Washington, DC. To get our message out, the WineAmerica staff has been and will be traveling to various parts of the country to speak at various meetings and conferences as well as visiting our member wineries. Additionally, we are always looking to recruit new members. Here is a breakdown of our travel this winter and early spring:

January

Cary Greene spoke at the Oregon Wine Board meeting in Portland, Oregon.

Jennifer Montgomery was a featured speaker at VinCo 2012, the joint meeting of the Colorado Wine Industry Development Board and the Colorado Association of Viticulture and Enology held in Grand Junction, Colorado.

Michael Kaiser was at the 2012 Unified Wine and Grape Symposium in Sacramento, California representing WineAmerica.

February

Jennifer Montgomery will be a featured speaker at the 2012 Midwest Wine and Grape Conference held in St. Charles, Missouri.

March

Michael Kaiser will be attending the inaugural Eastern Winery Exposition in Lancaster, Pennsylvania.

Michael Kaiser and Jennifer Montgomery will be attending Wineries Unlimited 2012 in Richmond Virginia.

April

Michael Kaiser will be a featured speaker at License to Steal: The National Wine Marketing Conference held in Geneva-on-the-Lake, Ohio

Michael Kaiser will be attending the fourth annual DrinkLocalWine Conference in Denver, Colorado. The conference will be focused on Colorado wine this year.

New Jersey Becomes 39th State to Allow Direct-to-Consumer Wine Shipping

2012-01-18T08:17:00.000-08:00

On January 17, New Jersey Governor Chris Christie (R) signed legislation that will allow in state and out-of-state wineries (producing less than 250,000 gallons) to ship wine directly to New Jersey consumers. There will be a shipping permit fee ranging from $100 to $1000. Wineries that meet the capacity requirements will be permitted to ship up to 12 cases of wine annual to each individual consumer over the age of 21. WineAmerica will be working closely with our trade association counterparts and the state ABC to ensure that shipping regulations issued later this year will be reasonable.

The new law also allows in-state and out-of-state wineries to sell wine at retail in up to 15 sales rooms in New Jersey. Previously, this was only permitted for in state wineries. There will be a $250 fee for each retail sales room. Out-of-state wineries will also be permitted to sell to wholesalers and retailers in New Jersey.

WineAmerica, working in tandem with the Garden State Wine Growers Association, was instrumental in the passage of this bill. We submitted a written letter of support (http://wineamerica.blogspot.com/2011/12/wineamerica-letter-of-support-for-a4436.html) to the New Jersey State Senate in December; and Chief Operating Officer and General Council, Cary Greene, testified in favor of the bill (http://wineamerica.blogspot.com/2012/01/wineamerica-testifies-in-favor-of.html) at the Assembly Budget Hearing on January 5.

The new law goes into effect on May 1.

TTB Proposes Revisions to the TTB Label Approval Form

2012-01-10T13:46:00.000-08:00

The TTB has proposed two specific changes to the Certificate of Label Approval Form. They are as follows:

In the application portion, the TTB is proposing eliminating the requirement to show wording appearing on caps and seals and other materials firmly affixed to the container.

In the second and third pages of the form, the TTB is updating the instructions for completing the form and the conditions of approval.

The TTB is also proposing additional circumstances that would allow the holder of an approved COLA to modify approved labels without submission of a new COLA.

For more details and to post a comment on the proposed changes please follow the following link:

Revisions to the Label Approval Form

WineAmerica is Looking for a New Logo

2012-01-09T09:44:00.001-08:00

WineAmerica is looking for a new logo. Submit your ideas and if we pick your design you could win $350.

New Logo Contest

WineAmerica Testifies in Favor of Direct-to-Consumer Shipping in New Jersey

2012-01-06T10:00:00.000-08:00

WineAmerica’s Cary Greene spoke out forcefully in favor of New Jersey wineries and direct-to-consumer shipping at a hearing on a New Jersey bill (A4436). The bill was heard by that state’s Assembly Budget Committee on January 5 and was voted out of committee. It should be up for a vote on the floor of the New Jersey Assembly next week. A companion bill has already passed the state Senate.

We urge our members and anyone interested in direct shipping to make their voices heard in support of this important bill by going to http://www.uncorknj.com/ and writing a letter of support.

To access the recording of the hearing please go to the following link, the portion of the hearing devoted to our testimony begins at 2:02:10.

New Jersey State Assembly Hearing on A4436

The written testimony follows as well:

WineAmerica, the National Association of American Wineries, on behalf of our member wineries in New Jersey and across the nation, encourages you to support A4436, a bill that would permit New Jersey and out-of-state wineries to self-distribute their products, operate satellite tasting outlets, and ship wine directly to New Jersey consumers. WineAmerica is the only national winery trade association.

We support this bill because it secures local winery privileges threatened by the recent Third Circuit decision in Freeman v. Corzine, 629 F.3d 146 (3d Cir. 2010) while expanding opportunity for all American wineries. A4436 offers continuing support to the New Jersey wine industry’s progress, growth and prosperity, and removes an unhelpful cloud of uncertainty that has prevented New Jersey wineries from opening their doors.

For more than a year, the looming Freeman decision has been a weight on the dynamic growth of the state’s wineries. A4436 will finally allow New Jersey winemakers to focus on what they do best—keep small farms viable and, through agri-tourism, build a new model for farm development.

A lack of action by the legislature is likely to lead the District of New Jersey to impose a remedy that will be harmful to the state and its businesses. A compulsory remedy could: (1) undermine the viability of New Jersey wineries; (2) undermine New Jersey’s alcohol beverage distribution laws; and (3) deny the state the ability to establish a more thoughtful solution that would balance the ability to regulate against a fully free market system, as A4436 does.

This legislation gives wineries authorities that are commonly permitted throughout the United States. Nearly every state allows wineries to operate tasting outlets. More than two-thirds of states allow some form of winery self-distribution and direct-to-consumer shipping.

New Jersey’s dynamic wine industry is a critical component of the state’s agricultural potential and heritage, and contributes to the preservation of rural landscapes that could otherwise be turned over to developers. In crafting its winery laws, New Jersey has rightly tried to keep these agricultural spaces vital and flourishing. A4436 supports this legitimate local purpose and promotes a traditional agricultural form—winemaking—that reliably makes family farming more economically feasible.

Small, dynamic businesses, like those of our members, that are particularly well-suited to small parcel agriculture; creating jobs in the state’s fastest growing agriculture segment; and paying more in taxes than they use in public resources, should be provided every opportunity to sell their goods in open markets. Wineries are keeping small farms viable and, through agri-tourism, are building a new model for farm development. New Jersey wineries are family destinations that educate consumers about local agriculture and feature local musicians and entertainers. Their impact is dynamic—helping make local restaurants, hotels, and attractions more profitable. In other words, local wineries are keeping the “Garden” in the “Garden State.”

Many New Jersey wineries are unable, or find it difficult, to reach consumers in the state, since smaller brands are not likely to find distribution through traditional three-tier channels. Satellite tasting outlets and self-distribution enable wineries to capture lost sales that often result from consumers’ inability to find their favorite New Jersey wines on local store shelves. Similarly, direct-to-consumer shipping has proven a vital channel for customers to find the wines they want, while still allowing for safe and effective regulation.

In a recent comprehensive report examining direct shipping laws in the states where shipping is allowed, the Maryland Comptroller’s Office, the state agency that regulates alcohol in Maryland, concluded that: (1) state regulation of direct-to-consumer shipping is effective; (2) the safety protocols written into state direct shipping laws prevent deliveries to minors; and (3) recordkeeping and reporting requirements give states the tools for effective tax collection on wine shipments. See Peter Franchot, Compt’r. of Md., Direct Wine Shipment Report (2010), available at http://www.comp.state.md.us/DWS_Complete.pdf.

We support A4436 because it reinforces existing winery privileges and expands opportunity for both in-state and out-of-state businesses in the form of direct-to-consumer shipping. Wineries add both to the character and the strength of New Jersey’s agricultural industry, tourism and family farm development. While direct shipping capacity caps remain problematic, see Family Winemakers of Cal. v. Jenkins, 592 F.3d 1 (1st Cir. 2010), but see Black Star Farms LLC v. Oliver, 600 F.3d 1225 (9th Cir. 2010), New Jersey wineries should be afforded the opportunity to operate efficiently and profitably and New Jersey’s citizens should be allowed the benefit of free access to the wines of their choice. We believe that A4436 promotes these aims, and respectfully request that you to support this important bill.

WineAmerica's Comments on TTB Notice 122: Allowing Country of Origin Vintage Dating on Wine Labels

2011-12-21T07:49:00.000-08:00

January 3, 2012

Director, Regulations and Rulings

Division, Alcohol and Tobacco Tax and

Trade Bureau, P.O. Box 14412,

Washington, DC 20044–4412

Re: WineAmerica Comments on TTB Notice No. 122

Dear Director Isenberg:

Thank you for the opportunity to comment on Notice No. 122, Proposed Revision to Vintage Date Requirements. This rulemaking would allow wines labeled with a country appellation of origin, including American appellation wines, to disclose their vintage. WineAmerica has long supported this change to TTB regulations and urges the implementation of this proposed rulemaking as soon as possible.

This rulemaking is critical to our membership for at least two reasons:

First, the prohibition against use of vintage dates on country appellation wines unnecessarily harms domestic wineries. American appellation wines are produced in every state, but because they are prohibited from bearing basic, truthful and important vintage information, are at a considerable market disadvantage to other wines.

Second, vintage information helps clarify the “identity and quality” of wines for consumers. 27 U.S.C. § 205(e)(2). While American appellation wines, like all vintage wines, can vary widely year-to-year, current regulations make it difficult for consumers to distinguish which vintages of American appellation wine they prefer.

If adopted, Notice No. 122 would benefit thousands of American businesses, allowing wineries in every state to truthfully disclose information about their products that consumers find useful.

Overview

TTB has long prohibited wines with a country appellation of origin from including a vintage date. See 27 C.F.R. § 4.27. Since at least 2006, however, TTB has recognized that market forces have made the historical reasons for this limitation obsolete. See Change to Vintage Date Requirements, 71 Fed. Reg. 25748, 25751 (May 2, 2006) (responding to comments suggesting that vintage dating was primarily about location and harvest conditions, TTB noted that “vintage date information may be used by consumers in various ways.”) Notice No. 122 takes full account of changing consumer perceptions by allowing country appellation wines to bear a vintage date. WineAmerica applauds TTB for this notice of proposed rulemaking, and strongly urges its adoption.

Over the past 30 years the number of domestic wineries has grown astronomically, from fewer than 600 basic permitted wineries in 1975, to more than 7,500 located in every corner of the United States today. This dynamic growth is a remarkable success story that continues to unfold. Wineries are at the heart of a new model of rural economic development that relies on agri-tourism and values the authenticity of local products that reflect local culture. These businesses have pumped fresh investment and profit into nearly every corner of the country. And in every state, for a wide range of reasons, wineries make American appellation wines.

With our still fragile economic recovery, TTB’s decision to publish Notice No. 122, reducing an unnecessary regulatory burden that could restrict the continued growth of nascent and successful family businesses that promote good jobs in areas of the country that desperately need them, is sensible regulatory reform.

Truthfully Disclosing Vintage

American and other country appellation wines should be permitted to utilize vintage dates. As TTB notes in Notice No. 122, consumers often “use the vintage date to ensure that they are not purchasing a wine that is too old or too young for their preferences.” Proposed Revision to Vintage Date Requirements, 76 Fed. Reg. 68373, 68374 (Nov. 4, 2011). This allowance for disclosure of “information as to the identity and quality of the products” is fundamental to the Federal Alcohol Administration Act’s (“FAA Act”) labeling standards. 27 U.S.C. § 205(e). Wine labels should always be permitted to bear such truthful information that is helpful to consumers.

In 2006, commenters took issue with the overly narrow logic of 27 C.F.R. § 4.27 by noting that “[w]ith the exception of the luxury-priced wine market where a particular vintage is often celebrated for its uniqueness, nearly all other wine consumers, both domestically and abroad, have specific style and quality expectations that are consistent from purchase to purchase.” 71 Fed. Reg. at 25750. This consumer expectation continues to remain true, and justifies TTB’s decision to broaden vintage dating regulations through Notice No. 122. More broadly, vintage dates promote product transparency and lot identification, shelf management tools that protect producers and allow consumers to more clearly identify wines they like.

Prohibiting vintage dating for country appellation wines can also carry a false connation. It can give the misimpression of product uniformity from year-to-year—that a wine is in a “house” style produced from several vintages—when that is not in fact the case. It can likewise lead consumers to believe a product is a “jug” wine when the truth might be otherwise. Similarly, the restriction can be misleading in the way it creates consumer confusion. If a particular varietal wine is ordinarily a vintage product, consumers may not understand why the same varietal wine, produced by the same winery, because of vintage conditions and a need for out-of-state fruit, is suddenly non-vintage. Simply put, the prohibition on vintage dating can unfairly mark a wine as inferior or unfamiliar and cause consumer deception prohibited by the FAA Act. See id.

Wineries should not be penalized for choosing to use the American appellation. So long as the vintage information provided is truthful and not misleading, country appellation wines should be permitted to bear a vintage date.

Practical Impact of Policy Change

The Public COLA Registry lists more than 10,000 wines that have secured Certificates of Label Approval in the last decade that use an American appellation on their label. In addition, wineries throughout the U.S. regularly seek Certificates of Label Exemption in order to vintage date American appellation wines sold exclusively in intrastate commerce. Wineries should not be forced to choose between interstate sales and vintage dating, but that is exactly what TTB regulations currently require.

Notice No. 122 would finally treat American appellation wines as the equal of multi-state, state and county appellation wines. By establishing a more market driven definition for vintage labeling, TTB will make consumer outreach and education far easier. Wineries will no longer have to give long-winded explanations for why their American appellation wines are non-vintage, or why their vintage American appellation wines can only be sold in intrastate commerce. The wines will simply be permitted to stand or fall on their own merits.

Conclusion

The change contemplated by Notice No. 122 has long been a priority for WineAmerica and we welcome TTB’s publication of the notice of proposed rulemaking. This rulemaking will benefit wineries throughout the U.S., and the many thousands of wines that utilize the American appellation.

WineAmerica Letter of Support for A4436: Permits Self-distribution in NJ

2011-12-21T07:25:00.000-08:00

December 20, 2011

RE: A4436 (Burzichelli, Wisniewski, Riley) – Permits direct shipping by wineries and creates Out-of-State Winery license

Dear Member of the Assembly:

WineAmerica, the National Association of American Wineries, on behalf of our member wineries in New Jersey and across the nation, encourages you to vote yes on A4436, a bill that would permit New Jersey and out-of-state wineries to self-distribute their products, operate satellite tasting outlets, and ship wine directly to New Jersey consumers. WineAmerica is the only national winery trade association.

We support this bill because it secures local winery privileges threatened by the recent Third Circuit decision in Freeman v. Corzine, 629 F.3d 146 (3d Cir. 2010) while expanding opportunity for wineries throughout the United States. A4436 offers continuing support to the New Jersey wine industry’s progress, growth and prosperity, and removes an unhelpful cloud of uncertainty that has prevented New Jersey wineries from opening their doors.

Small, dynamic businesses, like those of our members, that are particularly well-suited to small parcel agriculture; creating jobs in the state’s fastest growing agriculture segment; and paying more in taxes than they use in public resources, should be provided every opportunity to sell their goods in open markets. Wineries are keeping small farms viable and, through agri-tourism, are building a new model for farm development. New Jersey wineries are family destinations that educate consumers about local agriculture and feature local musicians and entertainers. Their impact is dynamic—helping make local restaurants, hotels, and attractions more viable. In other words, local wineries are keeping the “Garden” in the “Garden State.”

We support A4436 because it reinforces existing winery privileges and expands opportunity for both in-state and out-of-state businesses in the form of direct-to-consumer shipping. Wineries add both to the character and the strength of New Jersey’s agricultural industry, tourism and family farm development. While direct shipping capacity caps remain problematic, see Family Winemakers of Cal. v. Jenkins, 592 F.3d 1 (1st Cir. 2010), but see Black Star Farms LLC v. Oliver, 600 F.3d 1225 (9th Cir. 2010), New Jersey wineries should be afforded the opportunity to operate efficiently and profitably and New Jersey’s citizens should be allowed the benefit of free access to the wines of their choice. We believe that A4436 promotes these aims, and respectfully request that you vote yes on this important bill.

Building On Our 2011 Successes

2011-12-19T10:22:00.000-08:00

By Cary M. Greene

As we come to the end of another year, American wineries have a lot to be thankful for. Our products are finding more consumers, and sales at higher price points are rebounding. The playing field for direct-to-consumer shipping continues to expand, and wineries are winning battles to simplify state sales and distribution laws. We’ve held harmful legislation at bay, including the CARE bill, H.R. 1161, and we’ve made progress at the state and national association level that will strengthen the impact of our industry grassroots. It’s a lot to absorb, and a lot to be proud of.

Still, we expect our share of challenges in 2012. Ensuring sufficient Congressional funding for the Alcohol & Tobacco Tax & Trade Bureau (“TTB”) will be high on the priority list.

The importance of this institutional knowledge can’t be overstated. Within the context of its regulatory mandate—effectively regulating interstate commerce in alcohol and collecting federal excise taxes—TTB and its predecessor, the Bureau of Alcohol, Tobacco & Firearms (“BATF”), have overseen a massive transformation of the wine industry, from a relatively concentrated group of wineries to a highly diffuse industry with thousands of mom and pop players. The agency has used a relatively flexible hand, learning along the way where smaller players encounter regulatory difficulties. This approach has reaped dividends in the form of federal excise taxes.

In 2011, the agency operated on a budget of $100 million, but collected nearly $11 billion in alcohol beverage excise taxes, with nearly $1 billion coming from wineries alone. That kind of ratio, nearly 110:1 in revenues over expenses, is a measure of success that few other federal agencies are likely to match. A regulator starting from scratch would be unlikely to match this success. A fully Congressionally-funded TTB could probably do even better.

While the agency isn’t perfect—the glacial pace of the label approval program in particular has become a major source of frustration for WineAmerica members—the problems the agency faces have more to do inadequate funding than ineffectiveness. Say what you will about the existing federal standards, but there are many good regulators within TTB who understand the practical impact of the existing system, and who are trying to make federal rules work better.

TTB has its priorities in the right place, whether its simplification of its label rules or its desire to educate the industry about the impact of its rules and the extent of its programs. We will certainly do our part to help Congress and the Administration understand this success and the need for additional funding in 2012.

WineAmerica's Testimony in Favor of Direct Shipping in New Jersey

2011-12-14T12:29:00.000-08:00

Update: S3172 Passed the New Jersey State Senate on December 15 by a vote of 23-13.

On December 15, 2010 WineAmerica will present written testimony to the New Jersey State Senate in favor of S3172, which would allow direct-to-consumer shipment of wine. Below is the text of our testimony.

RE: S3172 (Sweeney) – Permits direct shipping by wineries and creates Out-of-State Winery license

WineAmerica, the National Association of American Wineries, on behalf of our member wineries in New Jersey and across the nation, encourages you to vote yes on S3172, a bill that would permit New Jersey and out-of-state wineries to self-distribute their products, operate satellite tasting outlets, and ship wine directly to New Jersey consumers. WineAmerica is the only national winery trade association.

We support this bill because it secures local winery privileges threatened by the Third Circuit decision in Freeman v. Corzine, 629 F.3d 146 (3d Cir. 2010) while expanding opportunity for wineries throughout the United States. S3172 offers continuing support to the New Jersey wine industry’s progress, growth and prosperity, and removes an unhelpful cloud of uncertainty that has prevented New Jersey wineries from opening their doors. For more than a year, the looming Freeman decision has been a weight on the dynamic growth of the state’s wineries. S3172 will finally allow New Jersey winemakers to focus on what they do best—keep small farms viable and, through agri-tourism, build a new model for farm development.

We support S3172 because it reinforces existing winery privileges and expands opportunity for both in-state and out-of-state businesses in the form of direct-to-consumer shipping. While direct shipping capacity caps remain problematic, New Jersey wineries should be afforded the opportunity to operate efficiently and profitably and New Jersey’s citizens should be allowed the benefit of free access to the wines of their choice. We believe that S3172 promotes these aims, and respectfully request that you vote yes on this important bill.

Revisting Advertising Compliance

2011-12-01T07:05:00.001-08:00

We originally posted this in September, but think it is worth another look.

Make Sure Your Advertising is TTB Compliant

By Michael Kaiser

The TTB doesn't merely collect your taxes and approved your labels, they also regulate advertising for alcoholic beverages. Now your advertisements do not need to be approved by the TTB, but they must be complaint with the regulations and it is up to the winery or "responsible advertiser" to make sure the advertisements are complaint.

Let's examine what is considered by TTB to be an advertisement. According to TTB:

The regulations define the term"advertisement" as any written or verbal statement, illustration, or depiction which is in, or calculated to induce sales in, interstate or foreign commerce, or is disseminated by mail. Examples include ads in newspapers or magazines, trade booklets, menus, wine cards, leaflets, circulars, mailers, book inserts, catalogs, promotional materials, or sales pamphlets. The definition includes any written, printed, graphic, or other material accompanying the container; markings on cases, billboards, signs, or other outdoor display; and broadcasts made via radio, television, or in any other media. Though not specifically listed, this definition includes website and other Internet-based advertising.

That last sentence is very important. The regulations for labeling and advertising of wine have not been updated for quite some time, and they were originally written before the Internet became what it is today. So the TTB places Internet advertising under the "any other media" umbrella. The TTB considers Facebook and other social media sites to be advertising.

Required Information
There is some required information for advertising material. They are listed in the regulations (27 CFR Part 4.62) as the following:

Responsible advertiser. The advertisement shall state the name and address of the permittee responsible for its publication or broadcast. Street number and name may be omitted in the address.
Class, type, and distinctive designation. The advertisement shall contain a conspicuous statement of the class, type, or distinctive designation to which the product belongs, corresponding with the statement of class, type, or distinctive designation which is required to appear on the label of the product.
Exception. (1) If an advertisement refers to a general wine line or all of the wine products of one company, whether by the company name or by the brand name common to all the wine in the line, the only mandatory information necessary is the name and address of the responsible advertiser. This exception does not apply where only one type of wine is marketed under the specific brand name advertised. (2) On consumer specialty items, the only information necessary is the company name or brand name of the product.

Prohibited Information
As with wine label, there are prohibited practices for wine advertising. The regulations (27 CFR Part 4.64) list them as the following.

Any statement that is false or untrue in any material particular, or that, irrespective of falsity, directly, or by ambiguity, omission, or inference, or by the addition of irrelevant, scientific or technical matter tends to create a misleading impression.
Any statement that is disparaging of a competitor's products.
Any statement, design, device, or representation which is obscene or indecent.
Any statement, design, device, or representation of or relating to analyses, standards, or tests, irrespective of falsity, which the appropriate TTB officer finds to be likely to mislead the consumer.
Any statement, design, device, or representation of or relating to any guarantee, irrespective of falsity, which the appropriate TTB officer finds to be likely to mislead the consumer. Money-back guarantees are not prohibited.
Any statement that the wine is produced, blended, bottled, packed, or sold under, or in accordance with, any municipal, State, or Federal Government authorization, law, or regulations; and if a municipal, State, or Federal permit number is stated, the permit number shall not be accompanied by any additional statement relating thereto.
Any statement of bonded winecellar and bonded winery numbers unless stated in direct conjunction with the name and address of the person operating such winery or storeroom. Statement of bonded winecellar and bonded winery numbers may be made in the following form: “Bonded Winecellar No. __,” “Bonded Winery No. __,” “B. W. C. No. __,” “B. W. No. __.” No additional reference thereto shall be made, nor shall any use be made of such statement that may convey the impression that the wine has been made or matured under Government supervision or in accordance with Government specifications or standards.
Any statement, design, device, or representation which relates to alcohol content or which tends to create the impression that a wine contains distilled spirits, is comparable to a distilled spirit, or has intoxicating qualities.
Any word in the brand name or class and type designation which is the name of a distilled spirits product or which simulates, imitates, or creates the impression that the wine so labeled is, or is similar to, any product customarily made with a distilled spirits base.

Additionally, wine advertising may not include information that is deemed be inconsistent with labeling. Any label depicted on a bottle in an advertisement shall be a reproduction of an approved label.
Further restricted items on wine advertisements are:

Statement of age. No statement of age or representation relative to age (including words or devices in any brand name or mark) shall be made, except (1) for vintage wine, in accordance with the provisions of §4.27; (2) references in accordance with §4.38(f); or (3) use of the word “old” as part of a brand name.
Statement of bottling dates. The statement of any bottling date shall not be deemed to be a representation relative to age, if such statement appears without undue emphasis in the following form: “Bottled in __” (inserting the year in which the wine was bottled).
Statement of miscellaneous dates. No date, except with respect to statement of vintage year and bottling date, shall be stated unless, in addition thereto, and in direct conjunction therewith, in the same size and kind of printing there shall be stated an explanation of the significance of such date: Provided, That if any date refers to the date of establishment of any business, such date shall be stated without undue emphasis and in direct conjunction with the name of the person to whom it refers.
Flags, seals, coats of arms, crests, and other insignia. No advertisement shall contain any statement, design, device, or pictorial representation of or relating to, or capable of being construed as relating to, the armed forces of the United States, or of the American flag, or of any emblem, seal, insignia, or decoration associated with such flag or armed forces; nor shall any advertisement contain any statement, device, design, or pictorial representation of or concerning any flag, seal, coat of arms, crest, or other insignia likely to mislead the consumer to believe that the product has been endorsed, made, or used by, or produced for, or under the supervision of, or in accordance with the specifications of the government, organization, family, or individual with whom such flag, seal, coat of arms, crests, or insignia is associated.
Statements indicative of origin. No statement, design, device, or representation which tends to create the impression that the wine originated in a particular place or region, shall appear in any advertisement unless the label of the advertised product bears an appellation of origin, and such appellation of origin appears in the advertisement in direct conjunction with the class and type designation.
Use of the word “importer” or similar words. The word importer or similar words shall not appear in advertisements of domestic wine except as part of the bona fide name of the permittee by or for whom, or of a retailer for whom, such wine is bottled, packed or distributed: Provided, That in all cases where such words are used as part of such name, there shall be stated the words “Product of the United States” or similar words to negate any impression that the product is imported, and such negating statements shall appear in the same size and kind of printing as such name.
Confusion of brands. Two or more different brands or lots of wine shall not be advertised in one advertisement (or in two or more advertisements in one issue of a periodical or newspaper, or in one piece of other written, printed, or graphic matter) if the advertisement tends to create the impression that representations made as to one brand or lot apply to the other or others, and if as to such latter the representations contravene any provision of §§4.60 through 4.64 or are in any respect untrue.
Deceptive advertising techniques. Subliminal or similar techniques are prohibited. “Subliminal or similar techniques,” as used in this part, refers to any device or technique that is used to convey, or attempts to convey, a message to a person by means of images or sounds of a very brief nature that cannot be perceived at a normal level of awareness.

Health-related statements:

Health-related statement means any statement related to health and includes statements of a curative or therapeutic nature that, expressly or by implication, suggest a relationship between the consumption of alcohol, wine, or any substance found within the wine, and health benefits or effects on health. The term includes both specific health claims and general references to alleged health benefits or effects on health associated with the consumption of alcohol, wine, or any substance found within the wine, as well as health-related directional statements. The term also includes statements and claims that imply that a physical or psychological sensation results from consuming the wine, as well as statements and claims of nutritional value ( e.g., statements of vitamin content). Statements concerning caloric, carbohydrate, protein, and fat content do not constitute nutritional claims about the product.
Specific health claim is a type of health-related statement that, expressly or by implication, characterizes the relationship of the wine, alcohol, or any substance found within the wine, to a disease or health-related condition. Implied specific health claims include statements, symbols, vignettes, or other forms of communication that suggest, within the context in which they are presented, that a relationship exists between wine, alcohol, or any substance found within the wine, and a disease or health-related condition.
Health-related directional statement is a type of health-related statement that directs or refers consumers to a third party or other source for information regarding the effects on health of wine or alcohol consumption.

Rules for advertising

Health-related statements. In general, advertisements may not contain any health-related statement that is untrue in any particular or tends to create a misleading impression as to the effects on health of alcohol consumption. TTB will evaluate such statements on a case-by-case basis and may require as part of the health-related statement a disclaimer or some other qualifying statement to dispel any misleading impression conveyed by the health-related statement. Such disclaimer or other qualifying statement must appear as prominent as the health-related statement.
Specific health claims. A specific health claim will not be considered misleading if it is truthful and adequately substantiated by scientific or medical evidence; sufficiently detailed and qualified with respect to the categories of individuals to whom the claim applies; adequately discloses the health risks associated with both moderate and heavier levels of alcohol consumption; and outlines the categories of individuals for whom any levels of alcohol consumption may cause health risks. This information must appear as part of the specific health claim and in a manner as prominent as the specific health claim.
Health-related directional statements. A statement that directs consumers to a third party or other source for information regarding the effects on health of wine or alcohol consumption is presumed misleading unless it: Directs consumers in a neutral or other non-misleading manner to a third party or other source for balanced information regarding the effects on health of wine or alcohol consumption; and includes as part of the health-related directional statement, and in a manner as prominent as the health-related directional statement, the following disclaimer: “This statement should not encourage you to drink or increase your alcohol consumption for health reasons;” or includes as part of the health-related directional statement, and in a manner as prominent as the health-related directional statement, some other qualifying statement that the appropriate TTB officer finds is sufficient to dispel any misleading impression conveyed by the health-related directional statement.

It is clear that the TTB has an extensive list of prohibited practices for advertising of wine (and other alcoholic beverages) but it is consistent with the prohibited practices on wine labels. If you have any questions about anything listed in this blog post please let us know and we will clarify them further for you. It is essential for wineries to be compliant with TTB advertising regulations.

Joint Farm Bill Proposal Hits a Wall as Super Committee Fails

2011-11-22T07:34:00.000-08:00

By Jennifer Montgomery

Late last week, we were advised by Agriculture Committee staff that the Chairs and Ranking Members of the House and Senate Agriculture Committees had reached a tentative agreement on a 2012 Farm Bill proposal to be submitted to the Super Committee for consideration in the deficit reduction deliberations. Senate Agriculture Committee Chairwoman Debbie Stabenow (D-MI) and Ranking Member Pat Roberts (R-KS), had been working alongside House Agriculture Committee Chairman Frank Lucas (R-OK) and Ranking Member Collin Peterson (D-MN) to proactively come up with a Farm Bill proposal to cut $23 billion dollars out of the agriculture budget over the next 10 years. WineAmerica, along with other members of the Specialty Crop Farm Bill Alliance, had been working to try to ensure that critical specialty crop programs were protected as much as possible during this process.

While we did not see any legislative language at that time, some information on specialty crop programs was released. Under that tentative proposal, priority specialty crop programs would have faired well, under the circumstances:

· Blocks grants would have been funded at $70 million per year (up from $55 million).

o They included a multi-state component that will be used to enhance multi-state projects.

o They added acres to the calculation of how funding would allocated to each state.

· The Pest and Disease Title would have been funded at $60 million for the first two years and $65 million thereafter (current is $50 million).

o It would have rolled the Clean Plant Network into section 10201 of the Pest & Disease Title.

· It would have provided $400 million over 10 years for the Specialty Crop Research Initiative (SCRI) and would have protected the baseline for those 10 years, so the program would not have been truncated.

· The Value-Added Producer Grant program would have received $15 million in mandatory money, which is the current funding level in the 2008 Farm Bill.

But in light of the collapse of the Super Committee’s efforts, this proposal is not on the table and the general expectation is that the 2012 Farm Bill will now be written and considered in regular order, the way previous Farm Bills have been developed.

Given the hard work and bi-partisan cooperation that went into the creation of the proposal, WineAmerica considers it to be a good first step and it is hoped that it will serve as the foundation of the upcoming Farm Bill process – whatever that process turns out to be.

DTC Wine Symposium Expands to San Francisco, January 18-19, 2012

2011-11-21T06:44:00.000-08:00

Once again, WineAmerica is a sponsor of the successful Direct to Consumer Wine Symposium, the annual summit on wine direct marketing and sales. We encourage your marketing teams to attend.

Organized by vintners, for vintners, the fifth annual summit will take place at the Stanford Court Hotel in San Francisco on January 18 (evening) and January 19 (day).

Speakers from within and outside the wine industry will address topics such as:

· Branding in the Digital Age (Keynote)

· State of the States: What to Expect in 2012

· Taking Your Wine Club to the Next Level

· Using Video to Boost Sales

· How to Improve E-commerce Campaigns

· Training Tasting Room Staff, A to Z

The summit is an important fundraiser for the co-presenters, Free the Grapes! and Coalition for Free Trade. We have worked with these groups and other associations to increase the number of legal states for winery shipment from 17 to 38 in the last decade. Their focus on PR and litigation, respectively, has played an instrumental role, complementing industry representation in state capitols and Washington D.C.

There are several new components for the 2012 event:

DTC Winery Check Up: This results of this research project, which aggregates DTC sales performance for 120+ wineries along 18 separate metrics, will be presented January 19.

Video Contest: The Steering Committee will recognize outstanding achievement in video production by naming and promoting three winning winery promotional videos.

January 18 Evening Social Mixer: A short presentation will be followed by a wine reception and mixer for registrants and sponsors at the Stanford Court.

Early registration pricing for the evening social mixer ($75) and full day of programs ($375) ends December 12. The Stanford Court Hotel’s reduced rate of $209/night expires December 18. View the program and register at www.dtcwinesymposium.com.

WineAmerica Supports Federal Bill Allowing USPS to Deliver Wine to Consumers

2011-11-18T08:14:00.000-08:00

November 18, 2011

The Senate recently introduced S. 1789, the “21st Century Postal Service Act of 2011.” The bill includes a provision—section 404—that would modify federal law to allow the shipping of wine by the U.S. Postal Service (“USPS”). As a longtime advocate of winery direct-to-consumer shipping, WineAmerica supports this important provision, with qualification.

WineAmerica believes in fair markets and competition in the sale and distribution of wine. For years, there has been a growing mismatch between the state-based legal distribution system adopted in the wake of Prohibition and the wine market, particularly as it relates to small wine brands. See, e.g., Federal Trade Commission, Working Paper No. 304, State Regulation of Alcohol Distribution: The Effects of Post & Hold Laws on Consumption and Social Harms (Sept. 2010). Direct-to-consumer shipping has proven highly effective both from the standpoint of allowing consumers to find and purchase the wines they want, and of providing regulators the ability to collect taxes and prevent underage consumption. See, e.g., Comptroller of Maryland, Direct Wine Shipment Report (Dec. 2010).

Common carriers such as FedEx and the UPS have secured licenses, permits or approvals to deliver wine directly from wineries to consumers in at least 38 states. State laws typically mandate:

(1) that packages containing wine include a shipping label indicating their contents; and

(2) that common carriers obtain the signature of an adult on delivery.

State laws may also require common carriers:

(1) to file wine delivery reports; and

(2) to refuse receipt of shipments from businesses that do not follow state legal requirements.

These tools ensure state regulatory control over wine deliveries. E.g., id. at 66-69.

Section 404 of S. 1789 would allow “a licensed winery” to ship via USPS “in accordance with the law of the State, territory, or district of the United States where the addressee or a duly authorized agent takes delivery.” Wineries would gain the ability to ship through USPS to consumers, provided they followed state shipping laws with respect to licensing, tax payment, and regulatory control.

We fully support the laudable goals of section 404 of S. 1789 because the provision would give wineries and consumers greater access and choice with respect to the delivery of wine, subject to state shipping law. We believe, however, that the legislation contains several technical ambiguities that must be clarified before passage. They are:

· USPS must be subject to the same state requirements that bind other common carriers, including license applications and the power of states to rescind delivery authority; and

· The definition of “wine” used in section 404 should include all wines produced in accordance with the Internal Revenue Code (26 U.S.C. § 5041(a); 27 C.F.R. § 24.10) rather than the more limited definition provided in the Federal Alcohol Administration Act (27 U.S.C. § 211).

In its current form, section 404 represents a significant step forward for winery and consumer choice, but before WineAmerica can fully support the bill, without qualification, the language must be fixed to account both for state legal obligations and for the products produced by U.S. wineries.

WineAmerica will continue to support efforts that simplify and improve winery direct-to-consumer shipping laws, and hope that Congress will see fit to pass this important legislation with the suggested changes.

WineAmerica Co-Hosting Wine and Shellfish Reception on Capitol Hill Tonight

2011-11-17T08:07:00.000-08:00

Tonight WineAmerica, the Wine Institute and the East Coast Shellfish Growers Association are co-sponsoring a white wine and shellfish reception for the Congressional Wine Caucus and the Congressional Shellfish Caucus. Traditionally this has been an event that only served California wine. For the first time WineAmerica is providing wine from the East Coast for this event. Special thanks to the Virginia Wine Marketing Board, the Long Island Wine Council, Fox Run Vineyards (NY), Priam Vineyards (CT), Boordy Vineyards (MD), Black Ankle Vineyards (MD), Sugarloaf Mountain Vineyard (MD) and Knob Hall Winery (MD) for donating wine for this event.

The following East Coast wines will be served with select wines from California, provided by the Wine Instutite

Connecticut:
Priam Vineyards Chardonnay
Priam Vineyards Gewurtztraminer

Maryland
Black Ankle Vineyards 2010 Viognier
Boordy Vineyards 2010 Reserve Chardonnay
Knob Hall Tryst White Blend
Knob Hall 2010 Vidal Blanc
Sugarloaf Mountain Vineyards 2010 Chardonnay

Finger Lakes, NY
Anthony Road Wine Company 2010 Pinot Gris
Anthony Road Wine Company 2009 Riesling
Fox Run Vineyards Arctic Fox White Wine
Fox Run Vineyards 2010 Chardonnay
Miles Wine Cellars 2010 Chardonnay
Miles Wine Cellars Ghost White Wine

Long Island, NY
Bedell Cellars 2008 "Taste White" White Wine
Palmer Vineyards 2009 Pinot Blanc
Scarola Vineyards 2009 "Capella" Chardonnay
Sparkling Point 2007 Brut Sparkling Wine
Waters Crest Winery 2010 Sauvignon Blanc
Wolffer Estate 2010 Classic White

Virginia
Barboursville Vineyards 2009 Viognier
Breaux Vineyards 2010 Viognier
Gray Ghost 2009 Chardonnay
Jefferson Vineyards 2010 Chardonnay

2011 Fall Board Meeting in Boise

2011-11-10T12:40:00.000-08:00

By Michael Kaiser

The annual WineAmerica Fall Board of Directors and Membership meeting has come and gone once again. This year we visited the Snake River Valley in Southwest Idaho. The Snake River Valley is Idaho's first American viticultural area and is home to the largest concentration of wineries and vineyards in the state. The meeting itself was held at Hotel 43, a boutique hotel in Downtown Boise. This year we had attendees from Maryland, Nebraska, Idaho, Michigan, Colorado, California, Washington, Missouri, Oregon, Virginia, South Dakota, New York, Tennessee, Texas and Ohio.

The WineAmerica Board of Directors discussed a wide range of new association initiatives this week, and there will be more news on those initiatives as they progress. The WineAmerica Board and the State Associations Council also held various policy discussions ranging from the reauthorization of the Farm Bill to continuing to fight the so-called CARE Act (HR 1161).

On Monday night, the Idaho Wine Commission hosted an informal welcome reception, sponsored by the Southwest Idaho Tourism Association for the meeting attendees. Six local wineries were featured at the reception: Williamson Orchards and Vineyards, Cinder Wines, Bitner Vineyards, Huston Vineyards, Woodriver Cellars and Fraser Vineyards. The group then enjoyed a dinner at Fork Restaurant in Boise featuring local ingredients and wine.

Tuesday after the Board meeting ended we visited Bitner Vineyards (owned and operated by WineAmerica Board member Ron Bitner and his wife Mary) and then went to Ste. Chappelle Winery (the largest in the state) for a catered dinner and wine pairing. An enjoyable ending to a productive day.

The dates and location have been determined for the 2012 Fall Board of Directors and Membership Meeting. The meeting will be in Sonoma County, CA from November 12 to 14, 2012. The exact location has yet to be determined.

TTB Issues Notice of Proposed Rulemaking to Allow Vintage Dating on Country of Origin Wines

2011-11-04T12:07:00.000-07:00

The TTB has issued a Notice of Proposed Rulemaking to allow the use of vintage dating on a wine labeled with a country appellation of origin, such as "American". The official TTB summary is as follows.

The Alcohol and Tobacco Tax and Trade Bureau proposes to amend its wine labeling regulations to allow a vintage date to appear on a wine that is labeled with a country of origin. The proposal would provide greater grape sourcing and wine labeling flexibility to winemakers, both domestic and foreign, while still ensuring that consumers are provided with adequate information as to the identity and quality of the wines they purchase.

WineAmerica advocated for this rulemaking last year, below is an excerpt of an article we published in January 2010 regarding this issue:

The Alcohol & Tobacco Tax & Trade Bureau (TTB) has long prohibited wines with a country appellation of origin from including a vintage date. It is one of the many technical blips that we live with in alcohol beverage regulation that doesn’t seem to matter much until it affects your business. Like many other technical rules with somewhat mysterious origins, inertia has largely kept this vintage date prohibition alive. It’s time to seek a reevaluation.

There’s a strong case to be made that “American” and other country appellation wines should be permitted to utilize vintage dates. The reasons largely relate to how vintage dates are used in the market. Often, vintage dates are thought of as shorthand for whether wines need aging, are ready to drink, or are over the hill. They also promote product transparency and lot identification, shelf management tools that protect producers and allow consumers to more clearly identify wines they like. In addition, allowing vintage dating for American appellation wines would encourage the further development of wine industries in nontraditional winemaking states that have occasional need for out-of-state fruit.

There are few, if any, policy justifications for TTB’s restriction against country appellation vintage dating. As was stated eloquently in comments to TTB several years ago, “[w]ith the exception of the luxury-priced wine market where a particular vintage is often celebrated for its uniqueness, nearly all other wine consumers, both domestically and abroad, have specific style and quality expectations that are consistent from purchase to purchase.” Change to Vintage Date Requirements, 71 Fed. Reg. 25748, 25750 (May 2, 2006).

Likewise, the vintage date restriction often has unintended consequences. Some countries restrict use of varietal labeling except in instances where a wine bears a country appellation. This means that many foreign wineries selling in the U.S. are forced to choose between vintage labeling and varietal labeling. Under the current regulations then, foreign wineries are being punished for the practices of their domestic regulators.

Prohibiting vintage dating for country appellation wines can also carry a false connation. It can give the misimpression of product uniformity from year-to-year—that a wine is in a “house” style produced from several vintages—when that is not in fact the case. Similarly, the restriction can be misleading in the way it creates consumer confusion. If a particular varietal wine is ordinarily a vintage product, consumers may not understand why the same varietal wine, produced by the same winery, is suddenly non-vintage. Simply put, the prohibition on vintage dating can unfairly mark a wine as inferior or unfamiliar.

WineAmerica is encouraged to see that the TTB has proposed this rulemaking and will be submitting comments in support of the change. We encourage our individual members to do the same.

The TTB is seeking public comments on the proposal from today until January 3. To view the full notice and submit comments follow the link below.

Notice of Proposed Rulemaking on Vintage Dating

TTB Issues Final Approval of New Grape Variety Names for American Wines

2011-11-04T11:11:00.000-07:00

The TTB has issued their final ruling on proposed grape variety names for use on domestic wine labels. The TTB's statement on the ruling is below, as is the link to the final rulemaking.

This document adopts, as a final rule, a proposal to amend the Alcohol and Tobacco Tax and Trade Bureau regulations by adding a number of new names to the list of grape variety names approved for use in designating American wines, and to include in the list several separate entries for synonyms of existing entries so that readers can more readily find them. These amendments will allow bottlers of wine to use more grape variety names on wine labels and in wine advertisements.

Effective Date: This final rule is effective November 28, 2011.

Read the Final Rule

Understanding the California ABC’s New Advisory for Wineries and Third Party Providers

2011-11-02T07:30:00.000-07:00

Our friends and WineAmerica Supplier Member ShipCompliant have written a great analysis of the new advisory put out by the California ABC on "Third Party Providers".

Understanding the California ABC’s New Advisory for Wineries and Third Party Providers

November 1st, 2011

By Jeff Carroll - VP of Compliance, ShipCompliant

The proliferation of “Third Party Providers” (TPP) within the wine industry has been significant over the past two years. Known otherwise as “Third Party Marketers”, “Third Party Advertising Agents” and “Marketing Agents”, they represent a new sales channel for suppliers whether in the form of “flash sales” or multiple product offer websites.

However, anybody that has operated as a TPP in California has done so under a great deal of uncertainty ever since the issuance by the California Department of Alcoholic Beverage Control (ABC) of an advisory in June 2009 that questioned the degree to which TPPs and wineries utilizing their services were acting in accordance with the laws and regulations of California. Most of that has changed with a new advisory letter issued today by the California ABC that provides clear guidance on how wineries and TPPs can work together.

This article lays out the key concepts every licensed seller (wineries and wine retailers) should understand and adhere to in order to work with non-licensed TPPs in a compliant fashion. We see this new advisory by the California ABC as a critical new document that will have a big impact for wine suppliers, consumers, and advertisers alike.

KEY CRITERIA FOR LICENSED SELLERS WORKING WITH THIRD PARTY PROVIDERS

Criteria #1: Placement & Pricing
What the Advisory says: “all sales transactions involving Third Party Providers must ultimately be conducted by and under the control of a licensee. This includes decisions concerning the selection of alcoholic beverages to advertise or offer for sale, the pricing of those beverages, and the ultimate acceptance and fulfillment of the sales transaction.”
Best Practice: When engaging a TPP, the licensed seller should monitor how their products are being represented, and should also communicate to the TPP an allowable price (or price range) for advertisement to the consumer. Sellers should also communicate to the TPP the states in which they are licensed to ship so the TPP can filter products by the consumer’s state and also show the list of available states for each seller.

Criteria #2: Transparency
What the Advisory says: “The licensee responsible for the sale must be clearly identified and must ultimately control the transaction, including any decisions concerning acceptance or rejection of such orders.”
Best Practice: TPPs should clearly show to the consumer, prior to checkout, the name of the licensee for the transaction. For example, “This product is sold and shipped by Winery A, Sonoma, CA”. The licensee name should also be presented to the consumer on any generated consumer invoices.

Criteria #3: Acceptance
What the Advisory says: “The licensee responsible for the sale must be clearly identified and must ultimately control the transaction, including any decisions concerning acceptance or rejection of such orders.”
Best Practice: A good mechanism for ensuring acceptance is a batch email that is sent out on a periodic (daily or semi-daily, for example) basis. The email would contain the order request information and details, and the seller would have the opportunity to reject or accept the orders by responding to the email, or clicking on an accept/reject button. If a comprehensive compliance check has already been run against the seller’s shipping license, then the seller would likely not have many reasons to reject the requests.

Criteria #4: Fulfillment
What the Advisory says: “Licensees must also be responsible for, and must control, the fulfillment of orders and the shipment of alcoholic beverages from the licensees’ licensed premises or other authorized shipping point (such as a licensed public warehouse).”
Best Practice: Following the acceptance process, the seller then provides instructions for releasing the order to fulfillment. Licensees should ensure that the wine is shipped either from their licensed premise, or a licensed warehouse. The wine is then shipped, and a shipping notification is sent back to both the seller and the TPP. Following shipping notification, payment is captured.

Criteria # 5: Payment and Disbursement
What the Advisory says: “The control of funds from a transaction involving the sale of alcoholic beverages constitutes a significant degree of control over a licensed business. As such, while a Third Party Provider may act as an agent for the licensee in the collection of funds (such as receiving credit card information and securing payment authorization), the full amount collected must be handled in a manner that gives the licensee control over the ultimate distribution of funds. This means that the Third Party Provider cannot independently collect the funds, retain its fee, and pass the balance on to the licensee. The Third Party Provider should pass all funds collected from the consumer to the licensee conducting the sale, and that licensee should thereafter pay the Third Party Provider for services rendered.”
Best Practice: At the time of transaction, payment is authorized, but not captured. Following shipment notification, payment is captured, and funds settle either directly to the seller, or into a trust account that is controlled by the seller. The funds can then be disbursed to the parties (for advertising fees, fulfillment fees, technology fees, etc.) from the control of the licensed seller.

The new criteria for licensees working with TPPs is a paradigm shift that will work its way through the industry over the next few months. However, we believe that as licensed sellers and TPPs understand the change and put in to place mechanisms to insure they are operating compliantly, the new rules will help both TPPs and licensed sellers operate with certainty, at least in California.

It is important to understand that this new criteria only applies to licensees in California. However, California’s regulatory system often acts as a benchmark for regulators in other states and we will be watching closely to see how other states react to this collaborative effort between the ABC and the working group of industry experts it established to provide recommendations on the issue of TPPs in California. It should be noted that this new CA ABC advisory was issued today in the midst of a meeting of the National Conference of State Liquor Administrators (NCSLA) meeting in San Francisco. So, regulators in most states are now well aware of the new California advisory and the process they used to come to the solution.

In the end, what’s important for licensees working with TPPs to understand is that it is the licensed seller (the winery or retailer) that is ultimately responsible for the actions of the Third Party Provider, which makes it in the best interests of the licensee to be sure the TPP understands these new rules and that they are in compliance with them.

TTB Retail Registration

2011-10-17T11:27:00.000-07:00

It has been a few years since the Special Occupational Tax was repealed by the US Congress, due to the successful grassroots efforts of WineAmerica and others. While not required to pay the $500 or $1000 tax, all alcohol retailers are still required to register with TTB. For more information on what is required please go here:

TTB Retailer Registration FAQ

Mandatory E-Verify Passes House Committee

2011-09-23T11:37:00.000-07:00

By Jennifer Montgomery

This week, the House Judiciary Committee passed the Legal Workforce Act (HR 2164), introduced by House Judiciary Chairman Lamar Smith (R-TX). The bill would mandate the use of E-Verify for all US employers. Administered by the Department of Homeland Security, E-Verify is an Internet-based system used by businesses to determine the eligibility of their employees to work in US. The Agriculture Coalition for Immigration Reform (ACIR), including WineAmerica, has repeatedly expressed its concerns to Congress over the inaccuracies of the E-Verify program, as well as concerns about passing this legislation without a provision to address the agricultural labor shortage.

During the hearing, Rep. Dan Lungren (R-CA), co-chair of the Congressional Wine Caucus, offered an agriculture labor amendment, but it was struck down by the committee. The legislation contained a three-year waiver for the agriculture industry, but it was stripped from the bill in this week’s committee action as well. This means that HR 2164 will go to the floor of the House of Representatives with no provisions addressing the unique labor needs of agriculture. This is a development that will make the bill more difficult to pass in the House and more unlikely to pass the Senate.

Additionally, Chairman Smith plans to hold a hearing on a separate agriculture labor bill, the American Specialty Agriculture Act. Its prospects for passage are not known at this point.

We will keep you advised as the process moves forward.

TTB Issues New Guidance for "Personalized Labels"

2011-09-22T13:52:00.000-07:00

By Michael Kaiser

The TTB has issued updated guidelines for the approval of "personalized labels". In the past the TTB had allowed "templates" to be submitted for personalized labels. Meaning, the required information for the wine would be on the label, but the artwork could change. This allowed a winery to submit one label for many events, rather than having to submit a separate label for weddings, birthday, etc. A few years ago, the TTB started requiring new COLA submittals for any possible change in artwork. That meant that a winery would need to submit COLAs for any specific event they might do. This lead to increased work for wineries as well as the TTB.

Due to the dramatically increased turnaround times for COLA approvals, the TTB has now gone back allowing for a "template" for personalized labels. The standard is as follows:

In addition, the application must contain in item 19 of the paper application, or in the special wording section found in Part II/Step 2 in COLAs Online, a description of the specific personalized information that may change. For example, the application may state: “The graphics, salutations, dates, and artwork presented on this label may be changed to personalize this label.” For bottles etched with personalized information, the application must also indicate in item 19 of the paper application or in the special wording section found in Part II/Step 2 in COLAs Online that personalized information will be etched on the bottle. The label submitted with the COLA may contain a “blank” area where customized artwork or information will appear when the actual labels are printed.

Additionally all personalized labels will be approved with this qualification:

The approval of this COLA covers this label and any additions, deletions or changes in graphics, salutations, congratulatory dates and names, and artwork to personalize the label as indicated on the application. This approval to change the personalizing information does not permit the addition of any information that discusses either the alcohol beverage or characteristics of the alcohol beverage or that is inconsistent with or in violation of the provisions of 27 CFR parts 4, 5, 7or 16, as applicable, or any other applicable provision of law or regulations.

This is a step in the right direction for speeding up COLA turnaround times and WineAmerica suggested to TTB on numerous occasions to go back to template approvals for personalized labels. We applaud TTB for taking this step.

If you have any questions please feel free to contact us and if you wish to read the entire release from TTB it can be found here:

Public Guidance for Personalized Labels

Make Sure Your Advertising is TTB Compliant

2011-09-21T08:36:00.000-07:00

Responsible advertiser. The advertisement shall state the name and address of the permittee responsible for its publication or broadcast. Street number and name may be omitted in the address.
Class, type, and distinctive designation. The advertisement shall contain a conspicuous statement of the class, type, or distinctive designation to which the product belongs, corresponding with the statement of class, type, or distinctive designation which is required to appear on the label of the product.
Exception. (1) If an advertisement refers to a general wine line or all of the wine products of one company, whether by the company name or by the brand name common to all the wine in the line, the only mandatory information necessary is the name and address of the responsible advertiser. This exception does not apply where only one type of wine is marketed under the specific brand name advertised. (2) On consumer specialty items, the only information necessary is the company name or brand name of the product.

Prohibited Information
As with wine label, there are prohibited practices for wine advertising. The regulations (27 CFR Part 4.64) list them as the following.

Any statement that is false or untrue in any material particular, or that, irrespective of falsity, directly, or by ambiguity, omission, or inference, or by the addition of irrelevant, scientific or technical matter tends to create a misleading impression.
Any statement that is disparaging of a competitor's products.
Any statement, design, device, or representation which is obscene or indecent.
Any statement, design, device, or representation of or relating to analyses, standards, or tests, irrespective of falsity, which the appropriate TTB officer finds to be likely to mislead the consumer.
Any statement, design, device, or representation of or relating to any guarantee, irrespective of falsity, which the appropriate TTB officer finds to be likely to mislead the consumer. Money-back guarantees are not prohibited.
Any statement that the wine is produced, blended, bottled, packed, or sold under, or in accordance with, any municipal, State, or Federal Government authorization, law, or regulations; and if a municipal, State, or Federal permit number is stated, the permit number shall not be accompanied by any additional statement relating thereto.
Any statement of bonded winecellar and bonded winery numbers unless stated in direct conjunction with the name and address of the person operating such winery or storeroom. Statement of bonded winecellar and bonded winery numbers may be made in the following form: “Bonded Winecellar No. __,” “Bonded Winery No. __,” “B. W. C. No. __,” “B. W. No. __.” No additional reference thereto shall be made, nor shall any use be made of such statement that may convey the impression that the wine has been made or matured under Government supervision or in accordance with Government specifications or standards.
Any statement, design, device, or representation which relates to alcohol content or which tends to create the impression that a wine contains distilled spirits, is comparable to a distilled spirit, or has intoxicating qualities.
Any word in the brand name or class and type designation which is the name of a distilled spirits product or which simulates, imitates, or creates the impression that the wine so labeled is, or is similar to, any product customarily made with a distilled spirits base.

Statement of age. No statement of age or representation relative to age (including words or devices in any brand name or mark) shall be made, except (1) for vintage wine, in accordance with the provisions of §4.27; (2) references in accordance with §4.38(f); or (3) use of the word “old” as part of a brand name.
Statement of bottling dates. The statement of any bottling date shall not be deemed to be a representation relative to age, if such statement appears without undue emphasis in the following form: “Bottled in __” (inserting the year in which the wine was bottled).
Statement of miscellaneous dates. No date, except with respect to statement of vintage year and bottling date, shall be stated unless, in addition thereto, and in direct conjunction therewith, in the same size and kind of printing there shall be stated an explanation of the significance of such date: Provided, That if any date refers to the date of establishment of any business, such date shall be stated without undue emphasis and in direct conjunction with the name of the person to whom it refers.
Flags, seals, coats of arms, crests, and other insignia. No advertisement shall contain any statement, design, device, or pictorial representation of or relating to, or capable of being construed as relating to, the armed forces of the United States, or of the American flag, or of any emblem, seal, insignia, or decoration associated with such flag or armed forces; nor shall any advertisement contain any statement, device, design, or pictorial representation of or concerning any flag, seal, coat of arms, crest, or other insignia likely to mislead the consumer to believe that the product has been endorsed, made, or used by, or produced for, or under the supervision of, or in accordance with the specifications of the government, organization, family, or individual with whom such flag, seal, coat of arms, crests, or insignia is associated.
Statements indicative of origin. No statement, design, device, or representation which tends to create the impression that the wine originated in a particular place or region, shall appear in any advertisement unless the label of the advertised product bears an appellation of origin, and such appellation of origin appears in the advertisement in direct conjunction with the class and type designation.
Use of the word “importer” or similar words. The word importer or similar words shall not appear in advertisements of domestic wine except as part of the bona fide name of the permittee by or for whom, or of a retailer for whom, such wine is bottled, packed or distributed: Provided, That in all cases where such words are used as part of such name, there shall be stated the words “Product of the United States” or similar words to negate any impression that the product is imported, and such negating statements shall appear in the same size and kind of printing as such name.
Confusion of brands. Two or more different brands or lots of wine shall not be advertised in one advertisement (or in two or more advertisements in one issue of a periodical or newspaper, or in one piece of other written, printed, or graphic matter) if the advertisement tends to create the impression that representations made as to one brand or lot apply to the other or others, and if as to such latter the representations contravene any provision of §§4.60 through 4.64 or are in any respect untrue.
Deceptive advertising techniques. Subliminal or similar techniques are prohibited. “Subliminal or similar techniques,” as used in this part, refers to any device or technique that is used to convey, or attempts to convey, a message to a person by means of images or sounds of a very brief nature that cannot be perceived at a normal level of awareness.

Health-related statements:

Health-related statement means any statement related to health and includes statements of a curative or therapeutic nature that, expressly or by implication, suggest a relationship between the consumption of alcohol, wine, or any substance found within the wine, and health benefits or effects on health. The term includes both specific health claims and general references to alleged health benefits or effects on health associated with the consumption of alcohol, wine, or any substance found within the wine, as well as health-related directional statements. The term also includes statements and claims that imply that a physical or psychological sensation results from consuming the wine, as well as statements and claims of nutritional value ( e.g., statements of vitamin content). Statements concerning caloric, carbohydrate, protein, and fat content do not constitute nutritional claims about the product.
Specific health claim is a type of health-related statement that, expressly or by implication, characterizes the relationship of the wine, alcohol, or any substance found within the wine, to a disease or health-related condition. Implied specific health claims include statements, symbols, vignettes, or other forms of communication that suggest, within the context in which they are presented, that a relationship exists between wine, alcohol, or any substance found within the wine, and a disease or health-related condition.
Health-related directional statement is a type of health-related statement that directs or refers consumers to a third party or other source for information regarding the effects on health of wine or alcohol consumption.

Rules for advertising

Health-related statements. In general, advertisements may not contain any health-related statement that is untrue in any particular or tends to create a misleading impression as to the effects on health of alcohol consumption. TTB will evaluate such statements on a case-by-case basis and may require as part of the health-related statement a disclaimer or some other qualifying statement to dispel any misleading impression conveyed by the health-related statement. Such disclaimer or other qualifying statement must appear as prominent as the health-related statement.
Specific health claims. A specific health claim will not be considered misleading if it is truthful and adequately substantiated by scientific or medical evidence; sufficiently detailed and qualified with respect to the categories of individuals to whom the claim applies; adequately discloses the health risks associated with both moderate and heavier levels of alcohol consumption; and outlines the categories of individuals for whom any levels of alcohol consumption may cause health risks. This information must appear as part of the specific health claim and in a manner as prominent as the specific health claim.
Health-related directional statements. A statement that directs consumers to a third party or other source for information regarding the effects on health of wine or alcohol consumption is presumed misleading unless it: Directs consumers in a neutral or other non-misleading manner to a third party or other source for balanced information regarding the effects on health of wine or alcohol consumption; and includes as part of the health-related directional statement, and in a manner as prominent as the health-related directional statement, the following disclaimer: “This statement should not encourage you to drink or increase your alcohol consumption for health reasons;” or includes as part of the health-related directional statement, and in a manner as prominent as the health-related directional statement, some other qualifying statement that the appropriate TTB officer finds is sufficient to dispel any misleading impression conveyed by the health-related directional statement.

TTB Issues Intructions on How to File A Disaster Claim

2011-08-30T06:23:00.000-07:00

ATTENTION: RETAILERS, WHOLESALERS, IMPORTERS, EXPORT WAREHOUSE PROPRIETORS, AND MANUFACTURERS OF BEVERAGE ALCOHOL AND TOBACCO PRODUCTS:

Businesses may file claims with the Alcohol and Tobacco Tax and Trade Bureau (TTB) for the payment (refund or allowance of credit) of Federal excise taxes paid on beverage alcohol or tobacco products lost, rendered unmarketable, or condemned by a duly authorized official under various circumstances, including where the President has declared a major disaster. Where to obtain further information, conditions on claims, and where to file claims, are described below.

Links to further information:

For a list of disaster areas recently declared by the President, visit the Federal Emergency Management Agency Web site at http://www.fema.gov/.
Use TTB Form 5620.8 to file a claim.
Visit the TTB Web site at http://www.ttb.gov/tax_audit/atftaxes.shtml to view the current Federal alcohol and tobacco excise tax rates.

Claims are subject to a number of conditions, including:

You must file your claim with TTB within 6 months from the date of a disaster. If the President declares or determines a major disaster, claims must be filed no later than 6 months from the date the President declared the major disaster.
Products lost due to theft are not eligible for payment.
For distilled spirits, wine, and beer, TTB will not allow claims for less than $250 for losses resulting from a disaster unless the President has declared a major disaster area. There is no minimum dollar amount placed on claims relating to presidentially declared disasters.
For tobacco products, cigarette papers and tubes, the $250 minimum claim amount does not apply. Retailer or wholesaler claims can only be filed if the loss is due to a presidentially declared disaster area.
TTB will not pay claims if your insurance covers the amount of the Federal excise tax paid. For example, if your insurance policy covers the full amount that you paid for destroyed alcohol or tobacco products, including the amount paid for any excise tax, then you are not eligible to file a claim for those products.
Your claim must state whether taxes were included in the purchase price of the products. If your claim includes imported products, you must state whether duties were included in the purchase price. Claims for customs duties must be submitted separately to U.S. Customs. Claims for tax on products of Puerto Rico must be filed with the government of Puerto Rico.
You must prove that you owned the products at the time of the disaster with the intent to sell them.
If your goods were in transit, you may be eligible for payment if you hold title to those goods. If any portion of your claim includes goods in transit, please include a statement indicating who held title at the time of the disaster.
TTB will pay claims without interest on an amount equal to taxes paid or determined on distilled spirits, wine, beer or tobacco products lost, made un-merchantable, or condemned by a duly authorized official as a result of fire, flood, or other disaster. Before you destroy any un-merchantable or condemned products, contact TTB and ask if the Bureau wants to witness the destruction.
26 U.S.C. 5064, for alcohol, and 26 U.S.C. 5705 and 5708, for tobacco, are the sections of the Internal Revenue Code which will allow you to file your claim for payment under various circumstances relating to disasters.

Filing your claim:
File your claim(s) using TTB Form 5620.8 CLAIM — ALCOHOL, TOBACCO AND FIREARMS TAXES, and mail the form to the following address:

Alcohol and Tobacco Tax and Trade Bureau
National Revenue Center
550 Main Street
Suite 8002
Cincinnati, Ohio 45202-5215

For more information contact:
If you have questions regarding filing a claim or on Federal excise taxes, please call the National Revenue Center at: 1–877–882–3277 or 513–684–3334; or e-mail TTB at ttbquestions@ttb.treas.gov.

In addition:
When filing a claim, you must provide the following information on TTB Form 5620.8 in Item 11 for losses incurred:

Distilled Spirits — Brand, type, bottle size, bottles per case, alcohol content (% or proof), number of cases, proof gallons per case, total in proof gallons, tax rate per unit, and total tax.
Wine — Brand, type, bottle size, bottles per case, percent of alcohol by volume, liters per case, number of cases, total liters, tax rate per unit, and total tax.
Beer — Brand, size of unit, number of units, tax rate per unit, and total tax.
Tobacco Products and Cigarette Papers and Tubes — Brand, type of tobacco product, unit of measure, total quantity, tax rate, and total tax. Provide proof that the products were taxed at the rate you are claiming or were removed tax paid during the period that the rate was effective.

PLEASE NOTE: Supporting documentation is necessary to process your claim without delay. You must submit on the claim form any evidence or statement made by State or local officials regarding the condition of the property. You must include a copy of your insurance policy with your claim. If your records are lost, you must obtain other supporting documentation that might be available such as copies of invoices from your supplier, copies of inventory records from your accountant, or copies of banking or insurance records.

TTB I 1200.68 (08-2011) Previous editions obsolete.
Page Last Updated/Reviewed: 08/26/2011

Registration is Now Open for the Fall 2011 WineAmerica Board of Directors and Membership Meeting in

2011-08-29T07:12:00.000-07:00

The 2011 WineAmerica Fall Board of Directors and Membership Meeting is rapidly approaching. This year we are very excited to be going to Boise, Idaho.

This year’s Fall Meeting is very important. There have been many changes at WineAmerica this year and the future of the organization is now more essential than ever with issues such as H.R. 1161 threatening the industry. We hope that you can join us.

November 7-9, 2011

Hotel 43

Boise, ID

Hotel Accommodations: Please Book These on Your Own

Rates: $109, taxes not included

Cutoff date for the room block is October 3, 2011. Hotel rooms fill up fast. Please make your hotel reservations before this date!

To book a room set aside for WineAmerica meeting participants, please call Hotel 43 at 208-342-4622 and reference the WineAmerica Fall Meeting.

To register for the meeting please go here: http://www.wineamerica.org/membership/fallmeeting.cfm

Time for Payment of Certain Excise Taxes, and Quarterly Excise Tax Payments for Small Alcohol Excise Taxpayers

2011-08-26T11:02:00.000-07:00

The Alcohol and Tobacco Tax and Trade Bureau (TTB) is adopting, as a final rule, regulations contained in a temporary rule pertaining to the semimonthly payments of excise tax on distilled spirits, wine, beer, tobacco products, and cigarette papers and tubes, and pertaining to the quarterly payment of alcohol excise tax by small taxpayers. This final rule action does not include those regulations contained in the temporary rule pertaining to part 19 of the TTB regulations, which were adopted as a final rule in a separate regulatory initiative.

To read the final rule please go here:

http://www.gpo.gov/fdsys/pkg/FR-2011-08-24/pdf/2011-21615.pdf

WineAmerica signs Joint Letter on Alcohol Temperature Expressing

2011-08-24T12:31:00.000-07:00

Wine Institute and WineAmerica are requesting assistance from TTB’s Scientific Services Division for the purpose of determining whether TTB regulations and requirements can be modified so that the temperature at which percentage of alcohol by volume is expressed is consistent with the international standard of 20 degrees Celsius.

Numerous regulations and a US statute define “proof” and “proof gallon” in terms of ethyl alcohol content of a liquid at 60 degrees Fahrenheit.i For wine at least, virtually all other countries have adopted the international standard temperature of 20 degrees Celsius-- the US is the only country that still adheres to the temperature of 60 degrees Fahrenheit, or 15.56 degrees Celsius.

Protecting Your Business in an Evolving Wine Shipping Market

2011-08-10T12:19:00.000-07:00

By Cary M. Greene

Back in 2009, we wrote about several investigations by state alcohol beverage regulators questioning the use of third parties in facilitating direct to consumer shipping—marketing portals, online retailers, pick and pack warehouses, and similar businesses. While the situation has improved substantially in a number of ways since then—there are now a variety of companies with interesting business models that try to ensure wineries can remain compliant with state licensing laws—you still need to be careful.

Regulators generally want some measure of market transparency—clear and simple transactions they can follow from beginning to end. Because it’s axiomatic in alcohol beverage law that if a transaction is not permitted, it’s prohibited, regulators in an alcohol beverage context have the power to turn a desire for market transparency into enforceable rules. As a result, non-conforming transactions that don’t fit within a proscribed regulatory scheme are not simply suspect, they’re potentially illegal.

It’s understandable that wineries would turn to third party solutions to make wine direct shipping simpler and more profitable. After all, in most business contexts, if a business model isn’t working, you try another. But alcohol beverage law isn’t generally oriented toward allowing businesses to develop market solutions for their problems. Wineries and other businesses may only ship wine direct to consumers within the confines of the complex system as it exists, even where that system is expensive and difficult to manage.

Wineries, in other words, must carefully examine the business practices of potential outside service provider partners. If a business is pitching you to provide logistical or other support in your direct shipping operations, there are at least three rules you should follow:

First, most states that allow direct shipping require each direct shipper to be licensed separately. The idea of businesses pooling together to get a joint license isn’t really contemplated by most state direct shipping laws, nor do most state laws account for wineries shipping their products through the license of an outside service provider. Generally speaking, these practices are seen by most state regulators as trying to get around inconvenient local law.

Second, a transaction involving an outside service provider may affect laws in your state in ways you have not anticipated. Make certain whomever you sell the wine to, that the sale is legitimate and within the contemplation of your winery license.

Third, transactions involving an outside service provider may affect the laws of the delivery state. Even if a practice is legal back home, it doesn’t mean the practice is legal everywhere. We live in a weird world, and definitions for the simplest concepts, like, what constitutes a “sale,” are endlessly sticky. Take the time to ensure the business you’re working with has done their homework reputable, and that you are complying with the terms of your out-of-state shippers’ permits.

There are a variety of reputable shipping businesses that take compliance with respect to direct shipping transactions seriously, but this isn’t universally true. WineAmerica will continue working with our friends at the state and federal level to try to simplify and reduce the cost of direct shipping. Until the law changes, however, we urge you to make sure you are shipping in ways that protect your hard earned business reputation. It is simply not worth the consequences to get out too far ahead of the law.

A Talk with WineAmerica's Cary Greene

2011-08-09T13:43:00.000-07:00

WineAmerica's Cary Greene gave an interview with Wine and Spirits Daily. It was published today.

WineAmerica is a grassroots organization that represents large and small wineries in approximately 48 states. It started in 1978 as an eastern regional wineries association, and ultimately transitioned to a national organization in the mid-1990s. They represent both their paying membership and more than 60 state winery associations around the country at both the state and federal level. "If you take into account both our membership and the affiliation that we have with state winery associations, we end up representing most of the nation's wineries on Capitol Hill," Cary Greene, WineAmerica's chief operating officer and general counsel, recently told WSD. "We also work a lot with our industry partners, including the Wine Institute, in state legislatures and work closely with the state associations to try and make sure that wineries have the best policy possible to get their products to market." And it's no easy task as the wine industry is still relatively young, and has grown "from fewer than 600 wineries 30 years ago to more than 7,000 now." So what are some of the biggest issues they are facing right now? It all boils down to wineries having the ability to remain profitable.

Wine and Spirits Daily is a subscription service. To read the rest either log in or subscribe here: Wine and Spirits Daily

TTB Makes Change to Approval of Personalized Labels

2011-08-09T12:39:00.000-07:00

by Michael Kaiser

The following story was posted by the Associated Press today:

Schumer: Feds move to speed wine bottle labeling

Associated Press

ROCHESTER, N.Y. — Sen. Charles Schumer says the federal government is taking an important step to simplify the process of approving labels for New York wines.

Schumer has been pressing the Alcohol and Tobacco Tax and Trade Bureau this summer to clear up a labeling logjam. Dozens of New York's 300-plus wineries say getting approval for new labels is sometimes taking months instead of days.

Schumer says Tuesday the agency has agreed to immediately begin approving template labels for custom winemakers. Wineries have complained they need approval each time they made small changes to artwork or names on labels designed for special events like weddings or birthdays.

Over the last decade, the agency says its staff has been reduced by budget cutbacks while label-approval applications from wineries nationwide have almost doubled.

Senator Schumer's office contacted WineAmerica for information about the label approval process and we suggested this to them as a step that TTB could take to speed up COLA approvals. Three years ago the TTB began requiring new COLA submittals for each different form of artwork used on personalized labels. In the past they allowed "template labels' be used for personalized labels. That is, a generic label is submitted with the understanding that the winery will not violate labeling regulations on the bottled wine. WineAmerica supports TTB's decision to once again allow "template labels" be used for personalized labels. Fewer submissions will reduce the time needed to review COLA submissions that do require approval. We applaud Senator Schumer's for his efforts on this issue.

New Biennial Registration Requirement with the Food & Drug Administration

2011-07-27T09:12:00.000-07:00

By Cary Greene

A member winery recently asked about changes in Food & Drug Administration (“FDA”) registration requirements. It’s an important question, and it seemed like a good opportunity to remind all wineries about the new requirements.

Since the Bioterrorism Act of 2002 was passed, the FDA has required wineries to complete a one-time registration as a “food facility.” To FDA’s credit, the guidance for registration is fairly user-friendly, though it inevitably presents its challenges, http://www.fda.gov/Food/GuidanceComplianceRegulatoryInformation/RegistrationofFoodFacilities/OnlineRegistration/default.htm.

With the official passage of the Food Safety Modernization Act (the “FSMA”) back in January, the one-time registration has been modified to a biennial registration. The statute explains that “food facilities” will need to register: “[d]uring the period beginning on October 1 and ending on December 31 of each even-numbered year.” See 21 U.S.C. § 350d(a)(3) (emphasis added).

In all likelihood, starting in October 2012 (and every alternating year following), wineries will have a three-month window to re-register as “food facilities” and satisfy FDA’s new requirement. This may be subject to change as FDA has yet to issue final rules on biennial registration.

As we reported on numerous occasions last year (e.g., http://wineamerica.org/newsroom/newsletters/September_2010_Newsletter.pdf), the original versions of the FSMA contained a variety of onerous requirements (including an annual $500 fee that wineries would have needed to pay to FDA) that WineAmerica played a major role in avoiding. While wineries have ultimately been included in the FSMA’s biennial registration requirement, this is a relatively modest burden compared to the possibility of what could have been. There was a real chance we could have faced conflicting FDA and Alcohol & Tobacco Tax & Trade Bureau (“TTB”) safety standards. This would have been a source of significant business disruption.

Because of WineAmerica’s efforts, in coordination with our industry partners, wineries aren’t stuck in a regulatory morass, TTB remains our primary regulator, and FSMA’s requirements for wineries are straightforward. This was a big victory for the American wine industry, and something that should make you feel good about the investment you’re making as a WineAmerica member.

We’ll keep you updated if FDA publishes new information on the biennial registration requirement.

The 2011 Wine Bloggers Conference

2011-07-25T09:38:00.000-07:00

By Michael Kaiser

This past weekend, the fourth annual Wine Bloggers Conference was held at the Omni Hotel in Charlottesville, Virginia. It was a great opportunity for wine bloggers and others in the industry to really be introduced to the wonderful world of Virginia wine. Virginia wineries really delivered and they illustrated why the state has become so respected in the wine world.

WineAmerica had the honor of being asked to speak at the conference. Cary Green and I discussed the Legalities of Wine. Not the most exciting of subjects, but an important one. Cary discussed the CARE Act and the current state of wine distribution laws in the states. I handled the TTB regulatory discussion. It was a varied topic and we had some lively discussion with those in attendance.

The two keynote speakers at the conference were Jancis Robinson, the wine correspondent for the Financial Times, and Eric Asimov from The New York Times. They provided a good bridge from traditional wine writing and the relatively new medium of wine blogging.

Friday nights event at Monticello featured more than 30 Virginia wineries showcasing one red wine and one white wine. It was a great chance for me to meet some people face to face that I have been talking to for five years now. Despite the oppressive heat, the event was a huge success.

Saturday featured winery visits and a dinner that featured food pairing with some excellent Virginia wines.

The world of wine blogging is a relatively new world. As someone who reads wine blogs on a daily basis, I find them to be a unique way of learning about the wine industry from a different perspective. The medium will only continue to grow.

WineAmerica Signs Joint Industry Comment on FDA Menu Labeling

2011-07-06T08:20:00.000-07:00

July 5, 2011

Division of Dockets Management (HFA-305)

Food and Drug Administration

5630 Fishers Lane, Rm. 1061

Rockville, MD 20852

Re: Food Labeling; Nutrition Labeling of Standard Menu Items in Restaurants and Similar Retail Food Establishments (Docket No. FDA-2011-F-0172, and RIN 0910-AG57) (76 Fed. Reg. 19192 (April 6, 2011))

Dear Sir or Madam:

On behalf of the undersigned trade associations representing virtually all alcohol beverage producers, including brewers, distillers, vintners, and importers, we greatly appreciate the opportunity to share our views regarding the Food and Drug Administration’s (FDA) proposal to implement the menu labeling provisions of the Patient Protection and Affordable Care Act of 2010 (Affordable Care Act).

We support FDA’s proposal to exclude alcohol beverages from the Agency’s menu labeling rules. The rationale underpinning FDA’s decision will best serve the intent of Congress to provide consumers with nationally uniform and readily available information about the caloric content of food served at chain restaurants and similar retail food establishments covered by the menu labeling requirements.

FDA’s position is well taken because:

(1)       the Alcohol and Tobacco Tax and Trade Bureau of the Department of Treasury (TTB) is the primary regulatory authority on the labeling of alcohol beverages pursuant to the provisions of the Federal Alcohol Administration Act (FAA Act) (27 U.S.C. 201 et seq.)[1];

(2)       TTB has a “Serving Facts” rulemaking underway that is intended to establish a clear and consistent manner for determining and expressing nutrient values for alcohol beverages; and

(3) establishment of an FDA menu labeling requirement for alcohol beverages while a TTB rulemaking on alcohol beverage container labeling is underway could result in inconsistent information between alcohol beverage container labels and menu caloric information, creating uncertainty and confusion.

The course of action set forth in FDA’s proposal, particularly FDA’s recognition of TTB’s expertise in alcohol beverage labeling, preserves the historical bifurcation of jurisdiction between two fellow federal agencies, and helps support the goals of the Act to provide consistent and accurate information for consumers.

I. TTB/FDA Alcohol Beverages Regulatory Framework

As FDA recognized in its proposed rule, the primary federal regulatory Agency overseeing alcohol beverage labeling is TTB. In exercising its broad and longstanding regulatory authority, TTB is very familiar with the entire range of alcohol beverage products, as well as the day-to-day practices of producers and importers across the beer, wine and spirits categories. The Bureau regulates virtually every aspect of alcohol beverage products and the industry members who produce and/or import these products. Within the broader food industry, alcohol beverage importers and domestic manufacturers are the only entities required to undergo an investigation prior to commencement of operations. TTB requires completion of employment and financial questionnaires by key personnel and investors, as well as detailed information on the location and operation of each business.

TTB’s regulatory authority over labeling and formulation of alcohol beverages includes statutory pre-approval processes and testing designed for consumer protection and tax classification purposes. Each year, over 100,000 alcohol beverage label and container designs are pre-approved by TTB to ensure that “packaging, marking, branding, and labeling and size and fill of container” will not deceive consumers and that statements and other information on each product are not likely to mislead consumers.[2] Label approval must be received by a U.S. importer before a product is imported into the United States or introduced into interstate commerce by a domestic producer.[3]

TTB and the FDA operate under a longstanding Memorandum of Understanding (MOU) that has been updated various times since the 1940s. The most recent version reiterates TTB’s statutory authority and the scope of existing TTB regulations and states that the Bureau of Alcohol, Tobacco and Firearms (TTB’s predecessor agency), “will be responsible for the promulgation and enforcement of regulations with respect to the labeling of distilled spirits, wine, and malt beverages pursuant to the Federal Alcohol Administration Act.”[4] The bifurcation of jurisdiction between TTB and FDA has well served the consuming public and the respective goals of each Agency.

Congress has expressly encouraged TTB and FDA to work together in implementation of two recently enacted statutes governing areas where FDA and TTB jurisdiction overlap, the Food Allergen Labeling and Consumer Protection Act of 2004^{^[5]} and the Food Safety Modernization Act of 2010.^{^[6]} Cooperation in rulemaking between TTB and FDA is beneficial because it helps minimize uncertainty and confusion in the marketplace for consumers, industry and the federal agencies. Coordination between TTB and FDA in rulemaking is also not unusual. Two recent examples of TTB coordination of rulemaking with FDA include:

a) Major Food Allergen Labeling for Wines, Distilled Spirits and Malt Beverages, mandatory labeling standards for major food allergens used in the production of alcohol beverages subject to the labeling requirements of the Federal Alcohol Administration Act and the Federal Food, Drug and Cosmetic Act contained in the Food Allergen Labeling and Consumer Protection Act of 2004.[7]

b) Disclosure of Cochineal Extract and Carmine in the Labeling of Wines, Distilled Spirits, and Malt Beverages, revisions to TTB regulations to require the disclosure of the presence of cochineal extract and carmine on the labels of any alcohol beverage product (addressed separately in a final rule issued by the Food and Drug Administration).[8]

As recognized by FDA, given detailed prior Acts of Congress and the history of alcohol beverage policy in the United States, TTB has a clear, multifaceted and ongoing administrative and regulatory mission with respect to labeling and public disclosure of information about alcohol beverages. The discharge of this mission has served well the retail customers of our industry and our consumers who choose to drink alcohol beverage products.

We respectfully submit that the goals of the Affordable Care Act will best be effectuated by the continuation of the long history of cooperation and coordination between TTB and FDA.

II. Interim Steps for Menu Labeling of Alcohol Beverages

TTB has invested several years of careful effort, analysis and Agency resources in the “Serving Facts” rulemaking, and it has done so within the broader context of other labeling challenges, some of which are unique to alcohol beverages and to TTB’s statutory authority. Likewise, industry members participated in the administrative activity including, but not limited to the following:

a) Caloric and Carbohydrate Representations in the Labeling and Advertising of Wine, Distilled Spirits and Malt Beverages, Agency guidance on making truthful and specific statements about calorie and carbohydrate content in the labeling and advertising of wine, distilled spirits, and malt beverages, addressing false or

misleading claims or representations about calorie or carbohydrate content in the labeling and advertising, and prohibiting statements that imply that the consumption of low carbohydrate alcohol beverages is a part of a specific weight reduction plan.[9]

b) Labeling and Advertising of Wines, Distilled Spirits and Malt Beverages, a notice of proposed rulemaking regarding “Serving Facts,” which would amend current alcohol content disclosure requirements and, for the first time, require nutrient information (calories, fat, carbohydrates, and protein) on all alcohol beverage labels.[10]

c) Labeling and Advertising of Wines, Distilled Spirits and Malt Beverages, an advance notice of proposed rulemaking to solicit public comment on general approaches to disclosure of nutrient information and alcohol content.[11]

Just as FDA experienced considerable challenges grappling with the Nutrition Labeling and Education Act (NLEA) labeling mandates, TTB has studied various methodologies and approaches to calculating caloric and nutrient content in a manner that is workable for thousands of alcohol beverage brands sold in the United States. No final rule has been published at this time; therefore, no certainty exists about the manner in which nutrition values for alcohol beverage labeling and advertising will be determined and communicated to millions of consumers. For long-term consistency and to avoid potential conflict, the TTB “Serving Facts” rulemaking should be completed before the FDA takes further action.

FDA correctly pointed out in the NPRM that a menu labeling requirement for alcohol beverages at this point creates uncertainty for both regulators and industry. The absence of Congressional hearings prior to enactment of the menu labeling law prevented both agencies and industry representatives from advocating a straightforward means to address potential conflicts between specific alcohol beverage labeling requirements and labeling requirements that are generally enforced by the FDA for other food and beverage products, such as NLEA.

Simply put, the current alcohol beverage regulatory framework does not establish a clear and consistent manner for determining or expressing nutrition values for alcohol beverages. That situation should change in the foreseeable future as TTB completes the pending “Serving Facts” rulemaking.

Conclusion

Again, the undersigned organizations appreciate FDA’s recognition of the dilemma posed for alcohol beverage products and for proposing a common-sense approach that will ultimately serve the public interest, as well as efficiency and economy in government by avoiding inconsistent calorie and nutrition information on TTB-approved product labels and FDA-sanctioned menu labeling. In excluding alcohol beverages from the menu labeling rule at this

early stage in the process, FDA implicitly recognizes the schedule for administrative action in the Affordable Care Act cannot be perfectly coordinated with ongoing administrative actions, such as TTB’s pending “Serving Facts” rulemaking.

In sum, it is incumbent on TTB and FDA to continue working collaboratively in the future. Our associations and the industry members we represent stand ready to cooperate in those important efforts.

Sincerely,

Mr. Joseph S. McClain Mr. Charlie Papazian Ms. Lynne J. Omlie

Beer Institute Brewers Association Distilled Spirits Council

Mr. William T. Earle Ms. Victoria I. McDowell Mr. Cary M. Greene

National Association of Presidents’ Forum WineAmerica

Beverage Importers

Mr. Wendell C.M. Lee

Wine Institute

[1] We acknowledge that FDA exclusively regulates the labeling of alcohol beverages that are not under TTB's jurisdiction, including beers

that do not meet the definition of a “malt beverage” under the Federal Alcohol Administration Act (FAA Act) (27 U.S.C. 201 et seq.)

and wine beverages containing less than 7 percent alcohol by volume. See, e.g., FDA, “Guidance for Industry: Labeling of Certain Beers

Subject to the Labeling Jurisdiction of the Food and Drug Administration; Draft Guidance.”  August 2009.

[2] 27 U.S.C. 205(e).

[3] 27 CFR Parts 4, 5 & 7.

[4] Memorandum of Understanding Between the Food and Drug Administration and the Bureau of Alcohol, Tobacco and Firearms, § III(A), November 20,1987.

[5] P.L. 108-282, August 2, 2004.

[6] P.L. 111-353, January 4, 2011.

[7] 71 F.R. 42329, July 26, 2006.

[8] 75 F.R. 67669, November 3, 2010.

[9] TTB Ruling 2004–1, April 7, 2004.

[10] 72 F.R. 41860, July 31, 2007.

[11] 70 F.R. 22275, April 29, 2005.

WineAmerica Disappointed in the Times Failure to Check Their Facts

2011-07-05T11:58:00.000-07:00

By Cary M. Greene

This past weekend, the New York Times published an article Congress's Man of the Vines, Including His Own on one our industries biggest advocates, Congressman Mike Thompson (D-CA). The portrait of Congressman Thompson painted by the Times was wholly unfair. As a representative of wineries in nearly every state, WineAmerica knows as well as anyone that Congressman Thompson’s efforts on behalf of American wine and grape growers are simply an acknowledgement of the potential of a dynamic and growing rural industry.

The reality is that wineries are at the core of a rural economic renaissance that has continued unabated for more than three decades. The numbers speak for themselves. In 1975, there were fewer than 600 wineries. Today, there are more than 7,500 and number continues to rise even in face of a challenging economy.

American winemaking is a farm-based business that is dynamic, profitable and productive. It has allowed thousands of family farms throughout the United States to hire new employees, create billions of dollars in direct and indirect economic benefit to their local communities, and introduce millions of Americans to the beautiful landscapes and agricultural potential of their own backyards. These thousands of mom and pop businesses are a vital source of rural jobs and economic activity and are at the heart of agritourism and the “buy local” movement.

It only makes sense to try to enable policies that continue to allow a young and dynamic industry to reach its potential. Congressman Thompson’s support should be applauded, not questioned.

TTB Clarifies the American Grape Variety Rules for use on Wine Labels

2011-06-21T08:23:00.000-07:00

The TTB has issued a lengthy update to clarify the rules for American grape varieties on wine labels. The following is taken from the TTB website and can be found here:

http://www.ttb.gov/wine/grape-varieties.shtml

If you have any questions please contact Michael Kaiser at: mkaiser@wineamerica.org.

TTB Introduces New COLA Form for Label Approval

2011-06-21T07:12:00.000-07:00

The Alcohol Tobacco Tax and Trade Bureau have released an updated version of the Certificate of Label Approval Form (TTB F 5100.31). The new form now requests a listing of any grape varietals that are displayed on the label. Additionally, all pre-COLA evaluations should now be noted in the data field marked “Formulas”. The TTB news release says the following about the form update:

We are updating COLAs Online to incorporate these changes. When we update the electronic system, applicants will not see an immediate change to the data collection portion of the electronic application and should not change the manner in which they apply, but their approvals will contain the new data fields. An additional update to COLAs Online is expected to take place in December 2011, and at that time the system will be updated to request grape varietal information as item 10 of the electronic application. From now until the expected December 2011 update, item 10 will remain blank on all electronically filed COLA approvals with nothing more required from COLA applicants.

The new paper version of the COLA form is not impacted by the data collection issue identified above for the electronic applications. Therefore, paper applicants are expected to complete all relevant items on the COLA application form, including item 10 for grape varietal information displayed on their wine labels. We will be able to capture this information in our database during the data entry process.

The new form is available online through the TTB’s website (and on the WineAmerica website). The TTB will accept paper applications on the older forms until December 30, 2011. For more information please contact Michael Kaiser at mkaiser@wineamerica.org

Mandatory E-Verify Legislation Introduced in Both Chambers

2011-06-20T10:48:00.000-07:00

By Jennifer Montgomery

Last week was a very busy one for the Agriculture Coalition for Immigration Reform (ACIR) as mandatory E-Verify legislation was introduced in both the House and Senate.

The House bill, HR 2164 (the Legal Workforce Act), was introduced last Wednesday in a House Judiciary Committee hearing by Chairman Lamar Smith (R-TX) amid significant concerns of the Agriculture community. Charles Grassley (R-IA), Ranking Member of the Senate Judiciary Committee, introduced a similar version in the Senate a day later.

These bills would require all employers to use E-Verify, an internet based federal system that compares US Department and Homeland Security and Social Security Administration records to information contained on an employee’s I-9 Employment Eligibility Verification form, without including a fix for the broken H-2A temporary and seasonal alien agriculture worker program. The current H-2A program is unworkable and unable to meet the labor intensive needs of US agriculture. Therefore, passage of either of the bills without a meaningful solution to the agriculture labor problem is more than kicking the can down the road, it will be disastrous.

The enforcement-only approach, with stepped up raids and I-9 audits, cannot solve the problem. It is the hope of WineAmerica, as part of ACIR, that Congress will reconsider this tactic to curb illegal immigration and provide agriculture with a means to employ a stable, legal workforce.

TTB Update

2011-06-09T08:16:00.000-07:00

By Michael Kaiser

The Alcohol and Tobacco Tax and Trade Bureau is still facing major delays in the review of Certificate of Label Approvals. As it stands now, it is taking 30 days for an online submission and 60 days for a paper submission. If you are going to be submitting a wine label for approval please allow for adequate time for review.

One question that comes up a lot with wine labels is trademarking. The TTB does not regulate trademarks. Their only concern is the accuracy of the wine label and if it is compliant with the laws and regulations. To clarify this further, the TTB has issued a statement of clarification about trademarking:

Does my TTB certificate of label approval mean I have trademark protection?

TTB’s authority to issue certificates of label approval (COLAs) for alcohol beverage products does not include trademark protection, as is stated in the instructions for TTB Form 5100.31, Application for and Certification/Exemption of Label/Bottle Approval. While TTB may be aware of an established trademark when acting on an application for a COLA, that awareness is important only for carrying out the labeling authority under the deception and misleading standards imposed by the Federal Alcohol Administration Act and not for purposes of Federal law applicable to trademarks. Therefore, TTB approval of a COLA neither automatically confers trademark protection, nor indicates that a particular mark may be used in violation of applicable intellectual property law.

The U.S. Patent and Trademark Office (USPTO) provides for trademark registrations and guides United States domestic and international intellectual property policies. The USPTO Web site address is www.uspto.gov/. You may find the USPTO’s list of frequently asked questions on the subject of trademarks particularly helpful: www.uspto.gov/faq/trademarks.jsp. The USPTO also has a Web site on trademark protection specifically designed for small business owners at www.uspto.gov/smallbusiness/.

If you have any questions about this please contact me at mkaiser@wineamerica.org.

WineAmerica Supports New Jersey Bill Allowing Direct Shipping

2011-06-02T13:31:00.000-07:00

May 26, 2011

Chairman John A. Girgenti

Senate Law and Public Safety Committee

Committee Room 10, 3rd Floor

State House Annex

125 W State St

Trenton, NJ 08608-1101

Dear Chairman Girgenti and Members of the Committee:

WineAmerica, the National Association of American Wineries, on behalf of our member wineries in New Jersey and across the nation, encourages you to support S2782, a bill that would permit New Jersey and out-of-state wineries to self-distribute their products, operate satellite tasting outlets, and ship wine directly to New Jersey consumers. WineAmerica is the only national winery trade association.

We support this bill because it secures local winery privileges threatened by the recent Third Circuit decision in Freeman v. Corzine, 629 F.3d 146 (3d Cir. 2010). S2782 offers continuing support to the New Jersey wine industry’s progress, growth and prosperity.

New Jersey’s dynamic wine industry is a critical component of the state’s agricultural potential and heritage, and contributes to the preservation of rural landscapes that could otherwise be turned over to developers. In crafting its winery laws, New Jersey has rightly tried to keep these agricultural spaces vital and flourishing. S2782 supports this legitimate local purpose and promotes a traditional agricultural form—winemaking—

that reliably makes family farming more economically feasible. Small, dynamic businesses, like those of our members, that are creating jobs should be provided every opportunity to sell their goods in open markets. Wineries are keeping small farms viable and, through agri-tourism, are building a new model for farm development. The wine industry helps keep the “Garden” in the “Garden State.”

In a recent comprehensive report examining direct shipping laws in the states where shipping is allowed, the Maryland Comptroller’s Office, the state agency that regulates alcohol in Maryland, concluded that: (1) state regulation of direct-to-consumer shipping is effective; (2) the safety protocols written into state direct shipping laws prevent deliveries to minors; and (3) recordkeeping and reporting requirements give states the tools for effective tax collection on wine shipments. See Peter Franchot, Comptroller of Maryland, Direct Wine Shipment Report (2010), available at http://www.comp.state.md.us/DWS_Complete.pdf.

WineAmerica fully supports S2782, albeit with measured trepidation for its direct shipping capacity caps. See Family Winemakers of Cal. v. Jenkins, 592 F.3d 1 (1st Cir. 2010); but see Black Star Farms LLC v. Oliver, 600 F.3d 1225 (9th Cir. 2010). Wineries add both to the character and the strength of New Jersey’s agricultural industry, tourism and family farm development. New Jersey wineries should be afforded the opportunity to operate efficiently and profitably and New Jersey’s citizens should be allowed the benefit of free access to the wines of their choice. We believe that S2782 promotes these aims, and respectfully request that you support this important bill.

Sincerely,

Cary M. Greene

General Council

Wholesalers Ignore Small Wineries, Again

2011-05-24T12:26:00.000-07:00

By Cary M. Greene

Last week, the Wine & Spirits Wholesalers Association (“WSWA”) and the National Beer Wholesalers Association (“NBWA”) published a pair of opinion pieces in The Hill, "The Right Approach to Alchohol Policy, and Huffington Post, "Nobody's Coming to Stop Your Wine Shipment... or Mine Either!". In defending the indefensible H.R. 1161, the associations accused the “opposition,” which includes WineAmerica, of being composed of:

…a syndicate of foreign-owned distillers and brewers, wine conglomerates, and unaccountable online alcohol sellers.

Apparently, this nefarious “syndicate”:

…use[s]…the courts in attempt to pad their pockets at the expense of responsible regulation that the CARE Act would address.

If it wasn’t obvious that H.R. 1161 was without substance before, "An Update on the CARE Act", the deliberate cheap shots against our industry partners should end all speculation. But apart from the attacks, the deliberate exclusion from the policy debate of the many thousands of small family producers throughout the United States—who, incidentally, would be directly harmed by the CARE Act—speaks loudest above the din of wholesaler bombast.

It’s not bad enough that wholesalers dismiss small brands and producers in the marketplace—as is widely understood, the dynamic growth of the wine industry over the past three decades has been driven mostly by direct sales to consumers and self-distribution—now, wholesalers are trying to deliberately exclude us in the policy forum as well.

Unfortunately for NBWA and WSWA, WineAmerica and its partners will continue fighting this harmful bill, and telling the truth about what it does and who it benefits: "What Scholars Have to Say About the CARE Bill".

The 2011 Wine and Grape Policy Conference

2011-05-16T08:29:00.000-07:00

By Michael Kaiser

Last week WineAmerica and the Winegrape Growers of America (WGA) held the annual Wine and Grape Policy Conference at the Phoenix Park Hotel here in Washington, DC. The annual conference allows the Board of Directors for both organizations a chance to meet, as well as for joint policy meetings. This year we had industry members from 16 states in attendance.

The Conference started on Sunday, May 8 with a meeting of the Executive Committee of the WineAmerica Board of Directors. WGA also had a short Board Meeting. The evening concluded with an informal wine reception. This year the Conference had a specific focus on wines from Idaho. WineAmerica will be holding its Fall Board Meeting in Boise this November.

On Monday, May 9 a joint policy session was held. The major topics of discussion this year were the CARE Act, the upcoming re-authorization of the Farm Bill, immigration reform, and excise taxes. The joint policy meeting featured a presentation from Peter Cressy, the president of the Distilled Spirits Council of the United States. The policy meeting also featured a panel discussion on agriculture issues featuring Robert Guenther of United Fresh, Jennifer Montgomery of WineAmerica, Jean-Mari Peltier of the National Grape and Wine Initiative, and Craig Regelbrugge of the American Nursery and Landscape Association. After a joint lunch the group headed to meetings at the United States Department of Agriculture.

Tuesday, May 10 started with concurrent WineAmerica and WGA Board Meetings. The WineAmerica Board Meeting focused on how to increase membership within the organization and all of the hard work the staff has been doing over the past year. The afternoon featured meetings with Members of Congress and their staffs. The congressional meetings are essential for our industry to present concerns and ideas to their elected representatives. At the core of the discussion this year with Congress is the industry's opposition to HR 1161, or the CARE Act. Tuesday wrapped up with the annual Taste the Wines of America wine reception. This year we featured wine from 24 different states.

After a breakfast speech from Rep. Jack Kingston (R-GA) the State Associations Council met. The SAC is a great resource for sharing ideas and to update what is going on in each state. The SAC meeting marked the end of the 2011 Wine and Grape Policy Conference. Overall, it was a very successful conference we are looking forward to the WineAmerica Board Meeting in Boise, Idaho this November.

TTB Clarifies its February 2 Release Suspending Expedite Requests and Informal Review of COLAs

2011-05-02T07:27:00.000-07:00

On Friday, April 29, the Alcohol and Tobacco Tax and Trade Bureau (TTB) issued a clarification on their February 2, 2011 notice suspending "expedite requests" and informal review of alcohol beverage labels. As members of the industry are well aware, the processing time for Certificate of Label Approval (COLA) submissions has been drastically increased in recent months. This delays in processing times are correlated to increased COLA submissions due to industry growth and dwindling of TTB resources. According to their April 29 statement:

Expedited requests require more resources to process because TTB must spend time to determine whether each specific request meets the grounds for expedited treatment, rather than simply the time spent to evaluate and process the label application. While our regulations generally establish a 90-day timeframe within which TTB may process an application, you may be assured we will work hard to perform our review more quickly than that. However, we remind applicants that they should allow adequate time in planning for a label approval to account for the processing timeframe that the regulations provide, particularly since revisions to labels or formulas may be necessary and may cause delays that are not within TTB’s control.

After TTB announced its policy on the discontinuance of expedited and informal reviews on February 2nd, we received several inquiries that, while expressing an understanding of the rationale underlying the policy, asked for a phase-in of the policy. Consequently, we wish to clarify that a phase-in policy is not necessary since requests that demonstrate good cause for expedited processing, such as requests presenting circumstances that are or were not reasonably within the applicant’s control or ones which could not have been anticipated and planned for in advance through appropriate internal controls and procedures, may be processed in an accelerated manner. For purposes of fairness to the entire industry, and in order to address the backlog that TTB currently faces, we will consider this standard very narrowly. You may direct any written request (with full details on why good cause is present) for an expedited review to TTB’s Advertising, Labeling and Formulation Division (ALFD) for evaluation. Informal label review, however, will not be conducted under any circumstances.

The TTB will now allow a very small number of "expedite requests" as long as the applicant illustrates a scenario with their submission that was not within their control or could not have been anticipated of planned. This will be reviewed on a case by case basis and will only be allowed under the most narrow of circumstances. If you have any questions regarding this, please contact Michael Kaiser at WineAmerica.

Cary Greene Writes Column for ShipCompliant CARE Act Blog

2011-04-22T06:32:00.000-07:00

Cary Greene has written a blog post for the great new CARE Act blog that our friends from ShipCompliant have put together. The ShipCompliant CARE Act blog is a great resource to get all the different perspectives on H.R. 1161.

What Scholars Have to Say About the CARE Bill

License to Steal

2011-04-18T08:06:00.000-07:00

By Michael Kaiser

Last week I had the pleasure of attending License to Steal, the National Wine Marketing Conference. The conference was held at the Lodge and Conference Center in Geneva State Park in Geneva-on-the-Lake, Ohio. Located right on the shores of Lake Erie, Geneva is home to many wineries in OH. The Grand River Valley appellation is perfect for growing Riesling and other varietals such as Cabernet Franc and Vidal Blanc.

License to Steal is the brainchild of Donniella Winchell, the Executive Director of the Ohio Wine Producers Association (and long time champion of WineAmerica). It is the first wine conference completely devoted to marketing. The marketing directors from several state associations organize the topics and content of the conference. This year Indiana, Missouri, Ohio, Virginia, Michigan, Illinois, Pennsylvania and New York all had a hand in developing the agenda for the conference. Wineries from Maryland to Texas were in attendance.

I was a featured speaker on the second day of the the conference. My topic of discussion was the CARE Act and other federal issues that will impact the wine industry. I also discussed the importance of joining WineAmerica. It was great to see so many members in attendance.

The License to Steal Conference is an important tool for any winery, no matter the size, to learn how to better market themselves to consumers and retailers. Social media dominated the discussion, as expected. Facebook and Twitter have really surged in use by wineries and License to Steal can teach wineries how to really use those programs to reach out to their consumers. I urge any winery looking to change or improve their marketing practices to attend License to Steal next year.

On my way back to the Cleveland airport I stopped at Ferrante Winery. Ferrante is a long time WineAmerica Member. Nick Ferrante, who is a third generation winemaker at the winery, and has become known for his Rieslings. If you are ever in that area of Ohio I urge to to stop at Ferrante Winery and all of the other great wineries in the region.

This week it is on to the Pennsylvania Wineries Association meeting. I'll have a report on that later in the week.

Government Shutdown Will Include TTB

2011-04-08T08:10:00.000-07:00

With the very real possibility of a government shutdown due to a lapse in appropriations, the TTB has issued guidelines for their shutdown procedure. The attached link has all of the information. If you have any questions please contact us.

TTB Government Shutdown Plans

WineAmerica Signs Letter Requesting Continuing Funding of USDA Research

2011-04-05T09:35:00.000-07:00

April 1, 2011

The Honorable Harold Rogers The Honorable Norm Dicks
Chairman and Ranking Member
Committee on Appropriations Committee on Appropriations
U.S. House of Representatives U.S. House of Representatives
Washington, D.C. 20515 Washington, D.C. 20515

Dear Chairman Rogers and Ranking Member Dicks:

The undersigned organizations represent a broad coalition that is extremely concerned about the elimination of vital research funding for American agriculture under the most recent Continuing Resolution.

Under House Joint Resolution 48, funding was eliminated for the remainder of the year for all special research grants under the National Institute of Food and Agriculture (NIFA), and all “Congressionally directed” research projects in the ARS budget. The total amount of this account for FY 2011 was $89 million from the NIFA budget and $42 million from the ARS budget, which is a small sum in comparison to the overall federal budget, but a critical amount considering the essential research being conducted in almost every state. Moreover, these research efforts support jobs and future technological advancements that will help our country maintain its ability to address future global food security issues.

Specifically, NIFA and ARS funding supports vital research essential to combat pests and diseases, address food safety and security issues, environmental compliance, and to enhance the nutritional value of certain crops. Additionally, the beneficial impact of the vital funding that effective agricultural research can deliver has been identified as a 30 to 1 return on investment for the American taxpayer. What makes this situation even worse is that NIFA and ARS are allowed no alternatives to achieve savings. Rather, they are directed to target and eliminate “Congressionally-directed” research projects without regard for the importance of, or the need for, the research being conducted.

Though we are respectful of the difficult task that confronts Congress and the important efforts that have been taken to begin to reducing our federal deficit, we believe that the costs of eliminating this funding, and thereby these research functions, far outweigh any immediate benefit in regard to spending reduction. In the future, the funds that the federal government will need to provide to fill this void, particularly in the area of pest and disease eradication will far exceed the small yet vital investment that these competitive
grants currently receive.
We respectfully ask that a funding level equal to that in FY2010 be provided for these essential activities.

Thank you for considering this important issue.

Sincerely,

American Nursery and Landscape Association
Blue Diamond Growers
California Association of Nurseries and Garden Centers
California Grape and Tree Fruit League
California Table Grape Commission
Cal/West Seeds
Cape Cod Cranberry Growers
Columbia-Snake River Irrigators Association
Del Monte Foods
Empire State Potato Growers
Florida Fruit and Vegetable Association
Georgia Fruit and Vegetable Growers Association
Idaho Grower Shippers Association
Idaho Potato Commission
Maine Potato Board
Michigan Carrot Development Program
Michigan Potato Industry Commission
National Alfalfa & Forage Alliance
National Association of Wheat Growers
National Aquaculture Association
National Council of Farmer Cooperatives
National Grape and Wine Initiative
National Grape Cooperative Association/Welch’s
National Milk Producers Federation
National Potato Council
National Watermelon Association
Northern Plains Potato Growers Association
Northwest Agri Products
Northwest Horticultural Council
Ocean Spray Cranberries, Inc.
Oregon Potato Commission
Produce Marketing Association
Seneca Foods Corporation
Society of American Florists
Texas Produce Association
United Fresh Produce Association
U.S. Apple Association
U.S. Dry Bean Council
Washington State Hay Growers Association
Washington State Potato Commission
Washington Association of Wine Grape Growers
Western Pistachio Association
Wild Blueberry Commission of Maine
Wisconsin Cranberry Growers Association
Wisconsin Potato and Vegetable Growers Association
WineAmerica

Wineries Unlimited Wrap-Up

2011-04-04T06:56:00.000-07:00

By Michael Kaiser

Last week the 35th Annual Wineries Unlimited Trade Show and Conference, presented by Vineyard and Winery Management Magazine was held at the Greater Richmond Convention Center in Richmond, Virginia. The 2011 Conference was the first to be held in Virginia and it did not disappoint. The Virginia wine industry really embraced the Conference and showed why it is one of the most important wine states in the country.

Wineries Unlimited is always a good conference for WineAmerica. We see a lot of old friends and we get to make some new ones. This year was no different. As always, we shared a booth on the trade show floor with the WineAmerica Insurance Administrators who were excited to talk about their new insurance program. Their new underwriters (Markel) are located in the Richmond area. The trade show was an excellent way for us to illustrate why wineries should belong to WineAmerica.

From viticulture and enology to marketing, Wineries Unlimited is a very good way for existing and new wineries to learn how to make their business more successful. Jim Trezise, the president of the New York Wine and Grape Foundation (and WineAmerica Executive Committee and Board Member) gave the keynote address at the conference. Additionally, at the Best of the East Grand Gala, Governor Bob McDonnell of Virginia was the featured speaker. The Governor and First Lady of Virginia have been huge supporters of the Virginia Wine Industry since he took office in January 2010. This March, during Virginia Wine Week, the first lady planted Chambourcin vines at the Virginia Governor's Mansion and they hope to turn that into a wine. Todd Haymore, the Virginia Secretary of Agriculture, also spoke at the Gala. His presentation focused on how the Virginia wine industry has grown in recent years.

The slogan for Wineries Unlimited 2011 was: "Virginia is for Wine Lovers" and the program and attendance confirms that. We look forward to the 36th conference in 2012.

I hope to see some of you at the "License to Steal" wine marketing conference next week in Geneva, Ohio. I will be a featured speaker.

Update on the CARE Act

2011-04-01T10:58:00.000-07:00

By Cary M. Greene

The effort to defeat the newly numbered H.R. 1161, known to many of you as the CARE Act or H.R. 5034 (the bill number given to it last Congressional session) continues as though it never stopped. Last Congress, the wholesaler effort to pass the harmful H.R. 5034 culminated in a hearing before the House Judiciary Committee. As we commented at the time, wholesaler trade group witnesses not only failed to justify the necessity of the bill, they “repeatedly and readily acknowledged that courts would be re-litigating and rehearing long settled principles of alcohol law for years to come if H.R. 5034 becomes law.” WineAmerica, From the Chiefs Desk (October 2010 Newsletter) available at http://wineamerica.org/newsroom/newsletters/October_2010_Newsletter.pdf (containing our complete analysis of the hearing).

In other words, wholesaler witnesses—at a hearing they had sought, relating to a bill they had demanded—admitted that the CARE Act would open up a veritable can of jurisprudential worms. But despite the failure to offer any good reasons for Congress to spend its time considering H.R. 5034 last session, wholesaler trade groups have seen fit this session to seek the reintroduction of the nearly identical and equally bad H.R. 1161.

As we did last session, WineAmerica continues working together with our coalition colleagues at the Wine Institute, Brewers Association, Beer Institute, Distilled Spirits Council (“DISCUS”), and the National Association of Beverage Importers to defeat this harmful bill. So far, this producer coalition has sent a number of joint letters to the Hill and visited individually and in coalition with a wide range of Congressional offices.

Throughout this effort, WineAmerica’s message has been simple: the CARE Act is bad for American wineries.

The passage of H.R. 1161 would signal to states that they should be afraid. It would tell state legislators and regulators that despite the promise of technology to improve and modernize their regulatory structure, and despite the effectiveness of free flowing interstate commerce in building and growing markets for local products, states should make their laws regulating alcohol tighter. Even though data and evidence show that there are ways to safely regulate wine apart from the existing system, see http://wineamerica.blogspot.com/2011/02/wineamerica-joins-industry-partners-to.html, H.R. 1161 would tell states to ignore these possibilities because they are just too dangerous.

The spillover effect of the CARE Act for American wineries would be a more restrictive wine regulatory system with less accountability to consumers and less adaptation to market needs.

For more than a year now, wholesaler groups have argued that the CARE Act is necessary because they believe courts are undermining the Twenty-first Amendment and forcing the “deregulation” of alcohol beverages. They want to provide the states virtually unlimited power when it comes to regulating alcohol. To paraphrase one NBWA supporter’s arguments, at the time it was ratified “everyone knew” the Twenty-first Amendment “trumped” the Commerce Clause (the section of the Constitution that gives Congress the power to ensure the free flow of interstate commerce) and other federal laws.

Unfortunately, this revisionism ignores the forty years of history, case law and federal statute that preceded the Twenty-first Amendment. As Supreme Court cases from the 1880s and 1890s confirm, states were never permitted to pass protectionist laws that favored local alcohol beverages or alcohol beverage dealers. During this period, Congress also indicated that states may only regulate out-of-state alcohol “to the same extent and in the same manner as though such [alcohol beverages] had been produced in such State or Territory.” In other words, court efforts to curb state protectionist tendencies have a long and telling pedigree and—reasonably enough—continue to shape court interpretation of the Twenty-first Amendment.

States wield a variety of judicially supported powers that are not in jeopardy, including: (1) establishing “control” jurisdictions; (2) licensing and investigating license applicants; (3) imposing and monitoring pricing controls; (4) conducting random compliance inspections; (5) establishing restrictions on hours of operation and outlet density; (6) establishing restrictions on exchange and use of marketing and advertising materials; (7) prohibiting consumption by various classes of consumers including those who are underage; (8) mandating ID checks; and (9) imposing excise and other taxes.

As with our other producer trade group colleagues, WineAmerica supports state rights to regulate alcohol, and has no interest in seeing alcohol abused. At the same time, states should not be encouraged by Congress, as H.R. 1161 proposes to do, to abuse their regulatory power by passing laws that undermine the interstate commercial character of our national markets. Federal courts have wisely used their powers of judicial review to strike down state alcohol laws that are anti-competitive, protectionist or a violation of vital Constitutional interests. At the same time, courts have repeatedly affirmed laws that actually enforce “core” Twenty-first Amendment concerns, such as temperance.

WineAmerica will continue to advocate on behalf of American wineries to defeat the CARE Act. We hope our members continue to support our efforts whether through paying dues, or actively becoming involved in contacting your legislators. Let us know how we can help you.

Congressional Outreach Still Critical

2011-04-01T10:41:00.000-07:00

By Jennifer Montgomery

As WineAmerica continues its efforts in opposition of the recently re-introduced the CARE Act (HR 1161), we still need help from our grassroots. If you have not yet gotten an opportunity to contact your Member of Congress, we urge you to reach out to him or her at your earliest convenience. With the wholesalers recently canvassing the Hill, Congress, particularly the new members, need to hear the other side of the story and to know that this legislation could have a significant negative impact on the local wine industries in their home states. Your outreach is vital to our overall efforts.

I will be happy to address and questions or concerns you may have.

jmontgomery@wineamerica.org

WineAmerica Staff Travel Update

2011-03-22T08:38:00.000-07:00

The WineAmerica staff is about to embark on another round of traveling to get our message out to the masses.

Cary Greene will be at Taste Washington in Seattle, WA from March 25 to 27.

Michael Kaiser and Jennifer Montgomery will be at the Wineries Unlimited Trade Show and Conference in Richmond, VA from March 29 to 31.

Michael Kaiser will be attending and speaking at License to Steal, the National Wine Marketing Conference at Geneva-on-the-Lake, OH from April 12 to14.

Michael Kaiser will be attending and speaking at the Pennsylvania Wineries Association Meeting in State College, PA from April 19-20.

Also, we are gearing up for the 2011 Wine and Grape Policy Conference jointly presented with the Winegrape Growers of America at the Phoenix Park Hotel here in Washington, DC from May 8 to 11.

The Reintroduction of the CARE Act

2011-03-18T11:39:00.000-07:00

By Jennifer Montgomery

As you have probably heard, the CARE Act has flnally resurfaced. Representative Jason Chaffetz (R-UT), reintroduced the bill yesterday afternoon and it is now called the Community Alcohol Regulatory Effectiveness Act, (HR 1161). Chaffetz was joined in introducing the bill by several other original co-sponsors including Representatives Bruce Braley (D-IA), Howard Coble (R-NC), John Conyers (D-MI), Ted Deutch (D-FL), Jim Jordan (R-OH), Dennis Ross (R-FL), and Debbie Wasserman-Schultz (D-FL). The bill is the same one as the revised legislation that was proposed last fall.

Congress has recessed and the members are now back in their districts for a week-long work period. It is imperative that you take this opportunity to make sure your Member of Congress hears from you while he or she is home and understands how potentially harmful this bill is to your business and to the wine industry as a whole. It also would be a good time to contact your state Attorney General.

We urge you to reach out to your lawmakers so that they know there two sides to the story of the CARE Act (HR 1161).

Please don't hesitate to contact us if you have questions.

BEER, WINE AND SPIRITS PRODUCERS URGE CONGRESS TO REJECT THE “COMMUNITY ALCOHOL REGULATORY EFFECTIVENESS” ACT OF 2011

2011-03-18T06:50:00.000-07:00

WASHINGTON (March 17, 2011) – The Brewers Association, WineAmerica, Distilled Spirits Council of the United States, Wine Institute, Beer Institute and the National Association of Beverage Importers, associations representing virtually all alcohol beverages sold in the 50 states, today called on Members of Congress to reject the CARE Act (H.R. 1161), legislation backed by the wholesale tier of the alcohol beverage industry.

The producer groups stated: "We strongly oppose H.R. 1161, which, like its predecessor in the last Congress, is unnecessary. Its provisions would harm consumers and the marketplace, limit consumer choice, and allow states to enact protectionist and anti-competitive laws. If this bill became law, it would make it much harder for brewers, vintners, distillers and importers to get their products to market.

"Since Prohibition's repeal, a balanced system of state and federal regulation has evolved to maintain a well-regulated and orderly market for the sale and distribution of alcohol beverages. Nothing has changed to warrant upsetting this careful balance, and we do not believe that Congress should spend valuable time wading into an intra-industry squabble, nor should it favor one segment of an industry at the expense of other industry members and American consumers.

“On March 7, 2011, the United States Supreme Court declined to review a challenge to a Texas state law, effectively ending litigation that the wholesalers say justifies their legislation. The wholesalers’ praise of this Supreme Court action is inconsistent with wholesaler support for H.R. 1161, which strips courts of their power to make precisely these kinds of balancing judgments.

“We urge Congress not to unravel a successful regulatory structure to the detriment of consumers, the industry, and the federal interest in a fair, competitive, and orderly marketplace for alcohol beverages.”

The producer groups in February 2011 sent a letter to Members of Congress in which they expressed their opposition to this legislation.

# # #

Contacts:

Bob Pease, Brewers Association
bob@brewersassociation.org, 303-447-0816

Nancy Light, Wine Institute

nlight@wineinstitiute.org, 415-356-7520

Frank Coleman, Distilled Spirits Council of the United States

fcoleman@discus.org, 202-682-8840

Lindsay Mize for the Beer Institute
lmize@clsdc.com; 202-777-3540

Cary M. Greene, Esq., WineAmerica
cgreene@wineamerica.org, 202-478-7642

William T. Earle, NABI

nabipresident@gmail.com, 202-393-6224

Registration is Open for the 2011 Wine and Grape Policy Conference

2011-03-15T06:13:00.000-07:00

Registration is open for the 2011 Wine and Grape Policy Conference. The annual Wine and Grape Policy Conference in Washington, D.C. is an important opportunity for members of WineAmerica and WGA to discuss and evaluate Federal policy issues of interest to our industry, and to communicate our stances directly to Members of Congress and the Administration. These meetings play an important role in the critical process of relationship building which is central to our mission of favorably influencing policy outcomes. It is also a great opportunity for wine industry leaders from across the country to network with each other in formal and informal settings. We hope that you will join us in May for this very important meeting. Registration for the meeting can be found here:

http://www.wineamerica.org/membership/springmeeting.cfm

Four unique wine marketing opportunities at the 2011 Wine Tourism, Wine Bloggers and Food Blogger Conferences

2011-03-09T09:05:00.000-08:00

The 2011 Wine Tourism Conference http://winetourismconference.org/ is brought to you by Zephyr Adventures and MartinCalder Productions . An anticipated 300 national and international delegates representing wine and travel businesses, meeting planners, educators and other stakeholders in the wine tourism industry will convene in the Napa Valley on November 16 and 17, 2011 to address industry trends and the issues that impact wine tourism for both new and old world wine regions. You may want to attend this conference to keep abreast on what the latest trends and best practices are in the wine tourism industry or you may want to attend and showcase your wine region as a wine tourism destination as a conference sponsor. Sponsorship information can be found on the blog under SPONSORS or click here: http://winetourismconference.org/sponsors

The Wine Bloggers Conference http://winebloggersconference.org/america/ travels from the west coast to the east for a three day event taking place July 22 – 24 in Charlottesville, VA. 300 plus wine bloggers, new media innovators and wine industry representatives will convene to taste wine and discuss the intersection of wine with the world of new media including blogging, social media, and more. This conference offers several excellent opportunities for you to get your wines in front of some of today’s most influential wine & food bloggers. Visit http://winebloggersconference.org/america/ and click on SPONSORS for more sponsorship information.

The 2011 International Food Blogger Conferences take place August 26-28 in New Orleans LA and November 11-13 in Santa Monica CA : http://www.foodista.com/ifbc2011/ Both of these conferences offer a wonderful opportunity for a wine to stand out amongst a largely Food Blogger base of attendees. We are expecting 250 to 300 to attend the New Orleans conference and 230 to 260 to attend the Santa Monica conference. With a focus on food, writing, and technology, IFBC is the premier event for not only food bloggers, but anyone interested in engaging with industry leading authors, chefs, bloggers and more. For the past two years the IFBC has sold out months in advance and continues to be the largest event of its kind. Sponsorship Opportunities can be found on the conference blog or click here: http://www.foodista.com/ifbc2011nola/sponsors/

WineAmerica Opposes New Jersey Assembly Bill Restricting Winery Privileges in New Jersey

2011-03-07T09:51:00.000-08:00

March 7, 2011

Assemblyman M. Gordon Johnson, Chair
Law and Public Safety Committee
Assembly of the State of New Jersey
545 Cedar Lane
Teaneck, NJ 07666

Dear Chairman Johnson and Members of the Committee:

WineAmerica, the National Association of American Wineries, on behalf of our member wineries in New Jersey and across the nation, encourage you to oppose A. 3831 that would restrict winery privileges in New Jersey. WineAmerica is the only national winery trade association.

We oppose this bill because it reduces the range of privileges currently available to New Jersey wineries, undermines the agricultural character of New Jersey’s wine industry, and imposes extraterritorial restrictions on the operation of wineries in states other than New Jersey that are likely unconstitutional.

A. 3831 would be a step back for New Jersey winery law which currently promotes local agriculture, New Jersey’s agricultural potential and heritage, and the preservation of rural landscapes. In developing its winery laws, New Jersey was right to try to keep its rural areas vital and flourishing. It should not undercut this legitimate local purpose, but should instead defend its right to promote an agricultural form—winemaking—that reliably makes rural living on wide open spaces more economically feasible.

At the same time, imposing a requirement that out-of-state New Jersey small winery licensees grow and cultivate “at least three acres” of “grapes or fruit used in the production of wine,” and produce no more than 250,000 gallons per year, likely imposes an extraterritorial restriction that violates the Constitution. E.g., Healy v. Beer Institute, Inc., 491 U.S. 324 (1989). A state may not establish regulations that have the “effect of controlling commercial activity occurring wholly outside the boundary of the State.” By subjecting out-of-state wineries to qualification standards that may conflict with local law—i.e., imposing production and cultivation standards that differ from those imposed by other states—New Jersey is contemplating limiting the policy choices of those states whose wineries may wish to do business in New Jersey.

WineAmerica continues to support the sales and distribution privileges currently afforded to New Jersey wineries, and believes that these and similar privileges, including direct-to-consumer shipping, may be responsibly and thoughtfully extended to wineries without compromising New Jersey’s ability to regulate alcohol beverage markets.

Wineries add to the character of New Jersey agricultural and should be afforded the opportunity to operate efficiently and profitably. We do not believe that A. 3831 promotes this aim, and respectfully request you reject this hastily drafted bill.

Sincerely,

Cary M. Greene
Chief Operating Officer & General Counsel

WineAmerica Supports Opening Maryland Up for Direct to Consumer Wine Shipping

2011-03-04T07:53:00.000-08:00

by Michael Kaiser

Today at 1 pm the Maryland State Senate and Maryland State Assembly will hold hearings regarding the two pending legislative proposals that would allow direct-to-consumer wine shipment in Maryland. WineAmerica, in conjunction with the Maryland Wineries Association supports House Bill 234 and Senate Bill 248. Below is the text of our letter of support that is being put into the legislative record.

WineAmerica, the National Association of American Wineries, on behalf of our member wineries in Maryland and across the nation, encourage you to pass HB 234 allowing for the direct shipment of wine to consumers. WineAmerica is the only national winery trade association.

We support this bill because many of our member wineries both in Maryland and throughout the United States find it challenging to reach Maryland consumers interested in purchasing their products. WineAmerica supports the adoption of winery direct-to-consumer shipping in Maryland, and encourages you to pass HB 234 on to the House for a full vote.

Currently, Maryland law does not provide for a workable system that allows local and out-of-state wineries to ship to Maryland consumers. Small, dynamic businesses—like those of our members—that are creating jobs and rural economic development should be provided every opportunity to sell their products in open markets. As the U.S. Supreme Court has said: “every farmer and every craftsman shall be encouraged to produce by the certainty that he will have free access to every market in the Nation…Likewise, every consumer may look to the free competition from every producing area in the Nation to protect him from exploitation.” P. Hood & Sons, Inc. v. Du Mond, 336 US 525, 539 (1949). Giving wineries the ability to ship directly to consumers would uphold this principle and would be economically beneficial to Maryland, its wineries, and its consumers. Notably, Maryland is one of the last holdouts in the country that prohibits direct-to-consumer shipping.

We commend the Maryland legislature for its insight in mandating the outstanding Direct Wine Shipping report compiled by the Maryland Comptroller’s office. Its utility goes well-beyond Maryland. Indeed, this thorough report is now the leading study on direct wine shipping and its regulation. As the report concludes, giving wineries direct-to-consumer shipping privileges would be a positive development both for the wine industry and the state.

The report conclusively shows that winery direct shipping, as provided for in HB 234, poses few risks to the collection of revenue, and will not result in increased risk of access by minors. In addition, because direct shipping typically accounts for no more than 1% of sales in most wine markets, and because of the character of products received by consumers via direct shipment, HB 234 will pose little risk to Maryland retailers.

Within Maryland or a short distance of Maryland there are nearly 1,000 wineries. The vast majority of these businesses, including Maryland’s 42 wineries and 15 wineries in development, are small, family operations. These businesses are keeping small farms viable, and through agri-tourism are building a new model for rural economic development. Many of them are also unable to reach Maryland consumers—either partially or at all—since smaller brands are not likely to find distribution through traditional three-tier channels. By allowing wineries in New York, New Jersey, Pennsylvania, Delaware, Virginia, North Carolina, West Virginia, and Ohio to ship to Maryland consumers, the state would be opening its borders to many of these boutique products for the first time. Maryland wineries would also benefit by being able to capture lost sales that often result from consumers aiming to buy local, but unable to find their favorite Maryland wines on local store shelves.

This bill is a positive step for your state and for consumers. WineAmerica urges you to vote yes on a HB 234.

For more information please visit the Maryland Wineries Association website.

Maryland Wineries Association

Registration Coming Soon for the 2011 Wine and Grape Policy Conference

2011-03-02T12:24:00.000-08:00

by Michael Kaiser

Registration will be open soon (March 14) for the 2011 Wine and Grape Policy Conference. The annual Wine and Grape Policy Conference in Washington, D.C. is an important opportunity for members of both organizations to discuss and evaluate Federal policy issues of interest to our industry, and to communicate our stances directly to Members of Congress and the Administration. These meetings play an important role in the critical process of relationship building which is central to our mission of favorably influencing policy outcomes. It is also a great opportunity for wine industry leaders from across the country to network with each other in formal and informal settings. The registration form is attached or you can register on the WineAmerica website. We hope that you will join us in May for this very important meeting. The best way to register will be through the WineAmerica website.

WineAmerica Joins Industry Partners to Oppose a Wholesaler Protection Bill

2011-02-17T09:10:00.000-08:00

By Cary M. Greene

On Monday February 14, WineAmerica joined with our producer and importer trade association partners in expressing our opposition to the wholesaler-sponsored bill known as the Comprehensive Alcohol Regulatory Enforcement Act (CARE Act) or, more appropriately, the Wholesaler Protection Act. The purpose of our joint producer letter, available at http://www.winebusiness.com/content/file/Joint_Producer_Letter_GO_2_14_2011.pdf, is to ensure that members of Congress, particularly new members of Congress, understand the ramifications and intent of this harmful bill before it is reintroduced this year. As we noted in our joint letter, “[t]he 2010 bill would have invited enactment of discriminatory state laws and protracted litigation.”

When the CARE Act was introduced last Congressional session it was dropped under the bill number H.R. 5034. The bill will have a new bill number when it is reintroduced this session, but that will not stop WineAmerica from forcefully opposing the CARE Act.

Our core arguments against the CARE Act are simple: not only does the bill seek to undermine a core Constitutional tenet—that interstate markets should be free and open—it does so through scare tactics that are fundamentally at odds with the evidence.

Wholesalers talk constantly about the threat of “state deregulation,” that any changes to the three-tier system—even thoughtful, well considered changes—will result in underage alcohol consumption and states being unable to collect alcohol excise and sales taxes. They use these arguments consistently to push for the CARE Act and to try and establish its “necessity.”

Reading the recent Direct Wine Shipping report put out by the Maryland Comptroller’s office, http://www.comp.state.md.us/DWS_Complete.pdf, several facts become clear: (1) state regulation of direct-to-consumer shipping is effective; (2) the safety protocols written into state direct shipping laws prevent deliveries to minors; and (3) bonding and reporting requirements give states the tools for effective tax collection on wine shipments.

The arguments wholesalers use to defend the CARE Act are simply untrue, and we will be on the front lines of this fight until the bill is ultimately defeated.

WineAmerica Legislative Update

2011-02-16T10:31:00.001-08:00

By Jennifer Montgomery

As we await the next step in the saga of the “CARE” Act, drama is not lacking on Capitol Hill as Congress and the Administration wrangle and argue over major money issues. President introduced his 2011 budget and as expected, the budget proposes some significant cuts which the Republicans feel do not go far enough. The House began debating the Continuing Resolution (CR) this week as well. The CR would provide money to operate federal agencies and programs through September. In its current proposed form it cuts 60 billion dollars from current spending levels. If it does not pass both the House and Senate, the possibility of a government shutdown becomes very real. It will be a very protracted CR debate in the House because approximately 600 amendments have been filed by members. We are still sorting out what the CR and Presidential budget cuts would mean to the programs that are important to our industry.

Going back to the “CARE” Act, WineAmerica, along with other groups that have been working together to oppose the bill, sent a letter to the Hill urging Members of Congress to refrain from co-sponsoring the bill when it resurfaces. We still have no solid intelligence that indicates when or in which chamber the bill will be re-introduced, but we know it will be resurrected and we are keeping a close watch on the Hill so that when it does show up we’ll be out in front of it.

One issue that is very important to the industry, but is still a little further down the road is the 2012 Farm Bill. But that being said, WineAmerica, as part of the Specialty Crop Farm Bill Alliance, has already begun educating the new members of Congress about the Farm Bill programs that we care about, meeting with USDA, as well as talking with other specialty crop groups about strategies for preserving these programs and their funding in what will be an incredibility tight Agriculture budget.

FY 2012 TTB Budget to be $5 million less than proposed for FY 2011

2011-02-14T10:01:00.000-08:00

By Michael Kaiser

Today to much fanfare the White House released the FY 2012 Budget Proposal. This is the recommendation to Congress for the funding of the Federal government for the 2012 Fiscal Year. There are a wide variety of spending cuts that have been proposed by the Obama Administration in the proposal.

The TTB is facing a cut of $5,000,000 from previous years. Unlike previous budgets, there are no proposed "user fees" for TTB regulation. In the past the Bush Administration and the Obama Administration have proposed that the industry pay to be regulated through a "user fee." The user fee was essentially a reintroduction of the Special Occupational Tax that wineries were subject to for many years.

The TTB has been struggling with budget issues for the past two years. Any reduction in funding would be detrimental to their ability to regulate the industry. We hope that TTB will be able to restore their funding to previous levels in order to best serve the wine industry and the public.

WineAmerica: U.S. Wine Industry Consumer Direct Sales Survey

2011-02-11T12:11:00.000-08:00

WineAmerica: U.S. Wine Industry Consumer Direct Sales Survey: "VinQuest™ 2011 - the U.S. wine industry's annual survey of consumer direct sales trends at the country's 3500+ bonded wineries. Qualif..."

TTB Announces Changes for COLA Submissions

2011-02-02T14:29:00.000-08:00

By Michael Kaiser

The Alcohol Tobacco Tax and Trade Bureau has just announced a few changes for submitting Certificate of Label Approvals (COLAs) and Formula Approvals.

As many of you probably noticed it is taking longer than normal for COLAs to be reviewed. The current average is around 20 to 25 business days, which works out to close to six weeks. The TTB came out with the following statement today:

COLA and formula reviews will continue to be conducted in as timely a manner as possible. To achieve that goal, we will continue to review COLA and formula applications in the order they are received. However, to reduce review delays on these applications, we will no longer be accepting “Expedite Requests” or "Informal Reviews,” effective immediately. As we are experiencing considerable increases in the number of applications received, you should allow adequate time for a 90-day application review process within your business plan and anticipate that we may require you to make revisions to your labels or formulas.

Now, this does not mean that it will take 90 days for your label submission to be approved, but what it does mean is to allow 90 days for any issues that may come up with the label. The TTB is currently understaffed, and with the current Federal hiring freeze, they cannot hire new staff and if someone leaves the agency they are not replaced.

What is of particular concern is the suspension of "Expedite Requests". In the past, with proper documentation, the TTB would expedite the review of a particular label(s). Label approvals could be turned around in less than a week. Now a winery has no recourse for an expedited label review if an unforeseen rejection occurs.

TTB is strongly encouraging people to use the COLAs Online system. Online applications are reviewed in half the amount of time that paper submissions are. Because of the amount of labels submitted and the staffing issues at TTB, it is currently taking around 10 business days for COLAs to be reviewed online.

If you are a WineAmerica member and are currently using COLAs Online or want to switch to that form of COLA submission, I am always more than happy to review the label before it is submitted.

If you have any questions about this TTB announcement please contact me at mkaiser@wineamerica.org or at 202-783-2756.

To read the notice from TTB, please go here: http://www.ttb.gov/labeling/label-formula-application-adjustment.shtml

The Fourth Annual Wine Bloggers Conference is Coming to Virginia

2011-02-02T12:53:00.000-08:00

Join wine bloggers, new media innovators, and wine industry leaders on July 22-24, 2011 in Charlottesville, Virginia for the fourth annual North American Wine Bloggers Conference - the premier conference for new media and the wine industry. This three-day symposium builds on our past successes and brings you a unique opportunity to learn about and discuss the intersection of wine with the world of new media including blogging, social media, and more.

Who Should Attend

Citizen Bloggers who write about wine or the wine industry on their own.

Industry Bloggers who maintain a blog to support their winery or other wine-related business.

New Media Innovators who work in the world of blogging and social media.

Wine Industry members who would like to learn about new media or interact with bloggers.

About the Conference

The Wine Bloggers Conference is a unique opportunity to connect with the “new media” of wine, getting your message and your product or service in front of key influencers who write about wine and the wine industry on a daily basis. Wine bloggers are more than just enthusiastic about their wine experiences. They are actively socializing their experiences by publishing their thoughts on the Internet and engaging their community of followers in conversations around their favorite topic - wine. More than 300 attendees are expected at the 2011 Wine Bloggers Conference.

2011 Wine Bloggers Conference

Decision Threatens Winery Privileges

2011-02-01T08:51:00.000-08:00

The following article appears in the February 2011 issue of Wines and Vines

by Cary M. Greene

The Third Circuit Court of Appeals in Philadelphia recently issued a decision, Freeman v. Corzine, which represents a substantial threat to the status quo for state winery tasting room, self-distribution, event, festival, restaurant, farmers market and other local winery privileges. As a representative of wineries in 48 states, and knowing how central these privileges are to thousands of successful businesses, I find Freeman more than a little disappointing. Whether the decision ultimately proves the law of the land will depend largely on the industry’s ability to articulate why the decision is wrong.

The decision addresses New Jersey wine laws and directly threatens the rights of wineries to have satellite tasting rooms and self-distribute their wines—or it could allow out-of-state wineries to have those privileges.

Unlike direct-to-consumer shipping, the privileges at play are not particularly discrete and don’t lend themselves to easy remedy. It’s true that tasting room, event and festival privileges are usually offered exclusively to local winery licensees, but in the vast majority of cases, this has little to do with protectionism. Mostly, it’s because the privileges aren’t functionally the same in the hands of in-state and out-of-state businesses.

When dealing with local privileges like tasting rooms, we are dealing with the raw components of agri-tourism and the buy-local movement. Satellite tasting outlets, winery events, farmers market sales and winery festivals aren’t merely offered to local wineries to sell wine. They promote local agriculture, a state’s agricultural potential and heritage, and the preservation of rural landscapes. States are right to try to keep their rural areas vital and flourishing.

The Freeman decision ignores these underlying purposes entirely. Instead it takes a cursory look at New Jersey’s law and finds that in-state wineries are “allowed to skip the first two tiers—wholesalers and retailers—while out-of-state wineries must involve both of these tiers in order for their wine to reach consumers.” While strictly true, Freeman’s analysis is flawed because it fails to wrestle with the practical realities of how tasting room, event and festival privileges function in the real world.

It’s axiomatic in Commerce Clause jurisprudence that state laws advancing a “legitimate local interest” that cannot “be served as well by available non-discriminatory means” are Constitutional. In other words, while states must attempt to level the commercial playing field for local and out-of-state wineries, the Constitution cuts them slack if the alternative would give out-of-state wineries a competitive advantage.

When operated by local wineries, tasting rooms are more or less farm stands with a more sophisticated image. Freeman’s characterization that tasting rooms allow wineries “to skip the first two tiers” is a gross simplification since agriculture is central to the operation of a tasting room.

On the other hand, “tasting rooms” operated by out-of-state wineries are wine bars with on- and off-premise sales privileges. Their natural competition is other local pubs and liquor stores. In other words, offering out-of-state wineries tasting room privileges—the available non-discriminatory alternative—does nothing to rectify the apparent discrimination identified by Freeman. It creates a market advantage for local retailers that happen to be out-of-state wineries.

The context of winery direct-to-consumer shipping is different than the context for tasting room and other local winery privileges. Unlike direct shipping, tasting room privileges are functionally different in the hands of in-state and out-of-state businesses. By followingFreeman, courts would be encouraging retailers to produce a few gallons of wine somewhere. Those few gallons would become a retailer’s ticket to lower costs of entry, broader sales privileges and mobility—without the related cultural benefits those privileges offer in the hands of local wineries.

While Freeman is important, the decision doesn’t justify rethinking long-held beliefs about the state of alcoholic beverage regulation. As a dynamic and growing industry, we need to advocate for thoughtful state policy approaches that better allow us to reach consumers. The existing distribution system doesn’t accommodate many of our products all that well. We need state legislatures to understand that adding flexibility to the three-tier and control systems is wise policy when deployed carefully.
Freeman doesn’t change everything, but it requires us to better defend the hard-fought privileges wineries have sought and won during the past four decades.
Cary M. Greene is the chief operating officer and general counsel of WineAmerica, the National Association of American Wineries. Learn more about WineAmerica atwineamerica.org.

Unified Wine and Grape Symposium

2011-01-31T08:23:00.000-08:00

By Michael Kaiser

I just returned from the 2011 Unified Wine and Grape Symposium in Sacramento, California. Once again, a very impressive and important event for the American wine and grape industry. It is always a good opportunity for WineAmerica to connect with current winery and SAC members and develop some new contacts.

The WineAmerica staff is going to be traveling quite a bit more in the next few months and we hope to see a lot of our current members and make more new connections as we continue to grow our membership this year.

Here is where the WineAmerica staff will be in the coming months:

Jennifer Montgomery, Director of Political Affairs and Grassroots will be attending the Midwest Wine and Grape Conference in St. Charles, MO from February 4 -7. She will also be attending the Cold Climate Conference in Minneapolis, MN from February 17-19. Jennifer will also be at Wineries Unlimited in Richmond, VA from March 29-31.

Cary Greene, Chief Operating Officer and General Council will be attending the Oregon Wine Industry Symposium in Eugene, OR from February 21-23.

Michael Kaiser, Director of Communications and Regulatory Affairs will also be attending Wineries Unlimited. Michael will also be attending License to Steal in Geneva, OH from April 12-14 and the Pennsylvania Wineries Association Meeting in State College, PA from April 18-20.

We hope to see many of you at these various events.

TTB Updates Rules for Approval of American Viticultural Areas

2011-01-23T07:35:00.000-08:00

By Michael Kaiser

On Thursday, January 20 the TTB released updated rules on the approval process of American Viticultural Areas. Essentially the process for approval is the same. The applicants will still need to file a petition with the TTB with significant evidence to support the establishment of a new AVA.

The TTB issues a notice of proposed rulemaking in November 2007 requesting comment on the establishment of new rules. Most notably, the TTB implemented a "grandfather" clause that would have allowed the use of geographic brand names even if the winery in question was not sourcing their grapes from the AVA in question. This has been dropped in the final rule.

TTB decided against imposing specific minimum acreage size or vineyards density for new AVAs. They did stress that the grape-growing in the proposed region be of sufficient scope.

The TTB is still stressing their ultimate authority to deny AVA applications and to require more specific information from petitioners. They did not go as far enough to constrain the approval of smaller viticultural areas embedded with larger viticultural areas.

WineAmerica will have a more in depth analysis of this final rule after the Unified Wine and Grape Symposium next week.

To read the final rule please visit this website: http://edocket.access.gpo.gov/2011/pdf/2011-1138.pdf

TTB Announces Notice of Proposed Rulemaking Proposing 57 New Approved Grape Variety Names

2011-01-20T16:19:00.000-08:00

Today the Alcohol and Tobacco Tax and Trade Bureau issued a notice of proposed rulemaking that would add 57 new grape names to the approved list of grape variety names.

TTB is seeking comments on the grape names proposed to insure accuracy. They would like to hear from wineries that may want to use the names on their wine labels. The majority of the grape names proposed are hybrid grapes.

The grape names have been proposed by growers and winemakers in each case. Some of the names are already allowed pending formal approval by the TTB. The list of approved grape names has not been updated since 2002.

Here is the link for the Notice of Proposed Rulemaking. TTB is seeking comments until March 21, 2011.

TTB Notice of Proposed Rulemaking on New Grape Names

U.S. Wine Industry Consumer Direct Sales Survey

2011-01-20T12:35:00.000-08:00

VinQuest™ 2011 - the U.S. wine industry's annual survey of consumer direct sales trends at the country's 3500+ bonded wineries.

Qualified representatives of any U.S. winery may participate in this survey by clicking here.

Your participation will benefit the entire wine industry.

In return for your time, all winery participants who complete this survey will receive a free copy of theVinQuest 2011 Research Summary -- a $149 value.

All information provided is completely confidential and will be used only to identify industry averages and important sales trends affecting U.S. wineries.

Thank you for your participation in this project.

For more information on the VinQuest research project, please click here.

2011-01-14T10:08:00.000-08:00

We are headed to Grand Junction, Colorado next week for VinCO 2011 : Wine Business, Enology, Viticulture, & Horticulture. Cary Greene and Michael Kaiser are featured speakers at the event and WineAmerica Insurance will have a booth at the trade show.

http://www.caveonline.org/content/VinCO-2011