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Wine News

New laws set to limit US direct shipments

This week the Uniform Law Commission passed a model Alcohol Direct-Shipping Compliance Act, that when adopted by states will severely limit direct shipping of wine interstate.

The US market has been a three tier model of suppliers, distributors and retailers. Over the last few years domestic wineries have, in some states, been allowed to ship direct to consumers, by-passing the three tier system.

The Uniform Law Commission writes model legislation for states to adopt, this is to ensure some consistency between each state's laws. This non elected body has created a model law covering compliance rules for direct shipping. The proposed law, if adopted by states, covers how to licence and prosecute direct shippers.

Many mid-sized wineries don’t manage distribution themselves, they take orders and arrange shipping from distribution centres. The winery may use 3 or 4 distribution centres dotted around the country close to their key markets, providing fast, cost effective and low carbon shipping. Currently the licence to ship to each state is held by the winery. The proposed law will require each distribution centre to be licensed in every state for every winery that they sell. This is a huge increase in regulation and will make it very expensive and difficult to use distribution centres.