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Tuesday, March 14, 2006

Ind. Law - Wine shipping on its way to Governor Daniels

A release just received from the Indiana farm winery industry:

The Senate has adopted House Bill 1016 conference committee report by a vote of 48-2. The bill now goes to Governor Mitch Daniels for his signature. Now that both chambers have adopted the conference committee report, the nine Indiana wineries who filed a lawsuit in November 2005 in Marion County Superior Court will drop their suit.

“We want to again thank the legislators who helped us reach this compromise, notably Senator Garton, Representative Whetstone and Representative Kuzman,” said Larry Satek, president of the Indiana Winegrowers Guild and owner of Satek Winery in Fremont, Ind. “Because of their help – and the help of many other legislators and Indiana farm winery customers – many of our farm wineries are no longer in danger of going out of business.

“As we’ve said before, there are still challenges up ahead for our farm wineries, and we look forward to working with legislators in the coming year to address these challenges. For example, the face-to-face provision in HB1016 is not consumer-friendly,” said Satek. This provision requires wineries to sell wine to a first-time consumer through a face-to-face transaction instead of by direct shipment.

As HB 1016 was originally written, it would have devastated Indiana farm wineries’ business and significantly reduced consumers’ choices. Legislation considered earlier this session would not only have banned wineries from direct shipping to customers and retail outlets, but also would have jeopardized their ability to sell on the premises via tasting rooms.

A core issue at stake nationally is whether the three-tier distribution system should be mandated. Wholesalers – part of the three-tier liquor distribution system – will always serve an important role in the distribution of alcohol. Indiana wineries’ business, however, was not built on the three-tier system. The ability to sell directly to consumers and retailers is the foundation of Indiana wineries’ business model. This was the very thing in jeopardy under the original language in HB 1016 and in other legislation considered this legislative session.

Posted by Marcia Oddi on March 14, 2006 05:21 PM
Posted to Indiana Law