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Winds of Change Blowing for Craft Brewers

For those who follow developments in the law and craft brewing with equal passion, every year has its share of substantial issues. This year has been no exception, with a pending Supreme Court case; a substantial upswing in federal trade practice enforcement activity; a massive rewrite of US Tax and Trade Bureau (TTB) labeling and advertising regulations; and prospects for extending the biggest cuts in the excise tax on beer since the repeal of Prohibition.

As these developments play out over the next year, we may see changes translate into the marketplace. Find out what you can expect.

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Originally published in The New Brewer, May/June 2019.




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TTB Spring 2019 Updates to Semi-Annual Regulatory Agenda

The spring edition of the federal government’s semi-annual Unified Agenda of Federal Regulatory and Deregulatory Actions (Regulatory Agenda) has been published. Like other federal agencies, the Alcohol and Tobacco Tax and Trade Bureau (TTB) uses the Regulatory Agenda to report on its current rulemaking projects.

The Regulatory Agenda provides glimpses into TTB’s policy focus and aspirations. But, readers should recognize that TTB rulemaking moves very slowly, and the Agency often does not meet the aspirational dates published in the Regulatory Agenda.  (more…)




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CDC and SAMHSA to Hold Summer Meetings for Public Health and Marijuana

The Centers for Disease Control (CDC) and Substance Abuse and Mental Health Services Administration (SAMHSA) announced meetings to be held this summer related to public health and marijuana. The CDC’s Board of Scientific Counselors will convene for a two-day meeting, July 16–17, 2019, to discuss a wide variety of topics, including the role of the CDC’s National Center for Injury Prevention and Control in “addressing public health concerns related to marijuana.” This portion of the meeting will be held on July 17, will be open to the public and will allot 15 minutes for public comments at the end of the session from 3:40–3:55 pm on July 17, 2019. (more…)




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House Financial Services Committee to Consider Cannabis Banking Issues

116th Congress’ first cannabis-related hearing

Next week, Congress will hold a long-awaited hearing on the future of banking in the cannabis industry.

On Wednesday the 13th, the House Financial Services Committee Consumer Protection and Financial Institutions Subcommittee will convene a hearing entitled, “Challenges and Solutions: Access to Banking Services for Cannabis-Related Businesses.”

Among the discussion points will be the Secure and Fair Enforcement (SAFE) Banking Act, which was introduced and championed in the last Congress by Rep. Ed Perlmutter (D-CO), a member of the committee. The Perlmutter bill provides safe harbor to banks working with businesses in the cannabis industry operating legally within their jurisdiction. Groups including the Credit Union National Association and the Independent Community Bankers of America support such legislative efforts. Last year, a bipartisan group of 19 state attorneys general sent a letter to Congress urging passage of the SAFE Banking Act. The bill had 95 cosponsors (including 13 Republicans) in the last Congress. Its companion legislation in the Senate, introduced by Jeff Merkley (D-OR), had 20 bipartisan cosponsors.

Banks, particularly the largest financial institutions, remain hesitant to provide services to the cannabis industry for fear of violating federal money laundering laws. That leaves many businesses in the industry to deal in cash. For a $10 billion (and growing) industry, “cash only” is not a sustainable policy. Business interests, regulators and (increasingly) Congress agree that something must be done in order to bring the cannabis industry into the banking system. Next week’s hearing is the first significant step of the 116th Congress to address this issue. In the coming weeks, banking legislation will be re-introduced, negotiated, marked-up in the Financial Services Committee, and possibly brought to the floor of the House.

Hearing details:

House Committee on Financial Services – Maxine Waters (D-CA), Chair

Subcommittee on Consumer Protection and Financial Institutions – Gregory Meeks (D-NY), Chair

Challenges and Solutions: Access to Banking Services for Cannabis-Related Businesses

Wednesday, February 13, 2019 at 2:00 pm ET

2128 Rayburn House Office Building

Streaming on https://financialservices.house.gov




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Legal and Policy Issues Surrounding Taprooms

Rapid growth in the number of small and independent breweries that rely on taproom sales has received a lot of attention—not all of it positive—across the beer industry. Until this unprecedented growth, taproom sales went largely unnoticed. Competing retailers, beer wholesalers, and even well-established craft brewers were pleased with steadily growing craft beer sales and consumer demand. As demand has leveled out and competition has increased, taprooms are receiving increased scrutiny.

In an article published by The New Brewer, Art DeCelle addresses this disruptive change in a mature market and the unique combination of laws and policies that can oftentimes create confusion. Since each state licensing law authorizing brewery taprooms and brewpubs operations is different, he recommends that brewery owners are best served by gaining a full understanding of their state’s licensing requirements. He notes that some states follow the federal model, treating brewers as manufacturers and authorizing retail sales on the brewery premises. Several states have complex exceptions that permit brewers to operate wholly-owned retail establishments at locations other than the licensed brewery.

Access the full article.

Originally published in The New Brewer, January/February 2019.




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Congressional Cannabis Caucus – 116th Congress

On Wednesday, January 9, 2019, Rep. Earl Blumenauer (D-OR) announced the leadership team of the Congressional Cannabis Caucus for the 116th Congress. In addition to Mr. Blumenauer, the Caucus will be co-chaired by Rep. Barbara Lee (D-CA), Rep. Dave Joyce (R-OH) and Rep. Don Young (R-AK).

Mr. Blumenauer helped found the Caucus in 2017 with the goal of providing a bipartisan forum for discussing and collaborating on sensible federal cannabis legislation. The Caucus has a particular focus on harmonizing federal and state laws with regard to medicinal or adult-use of cannabis. The group also works to address issues related to researching cannabis, providing veterans access to medicinal marijuana and business needs, including reforming the tax code. Two of the founding co-chairs have since left Congress: Rep. Dana Rohrabacher (R-CA), who lost his re-election bid in November, and Rep. Jared Polis (D-CO), who was elected governor of Colorado. (more…)




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Bioengineered Food Disclosures

Earlier this year, the U.S. Department of Agriculture (USDA) proposed a new regulation that would require food manufacturers to disclose information about bioengineered (BE) food and BE food ingredients. The proposed rule is the result of a 2016 law that required the USDA to establish a National Bioengineered Food Disclosure Standard for all food. For purposes of the BE disclosure law, “food” includes alcohol beverages intended for human consumption as well as non-alcohol beverages.

Read the full article.

Originally published in The New Brewer, November/December 2018.




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Further CBP Guidance on Craft Beverage Modernization Act

Earlier this week, US Customs and Border Protection (CBP) issued further guidance on the procedures for importers to take the lower tax rates and credits available under the Craft Beverage Modernization Act (CBMA).

Key points of the new guidance:

  1. CBP will process drawback claims on an oldest-entry-first basis.
  2. Failure to substantiate drawback claims by January 31, 2019, risks a loss of the CBMA rates/credits for the entries in question.
  3. Going forward, every entry seeking to claim CBMA rates/credits must be accompanied by a CBMA Spreadsheet based on a template provided by CBP.
  4. Each importer must also submit a Controlled Group Spreadsheet, based on a template provided by CBP, for each controlled group it belongs to (foreign producers have the option of providing this information directly to CBP). Importers are responsible for immediately reporting to CBP any changes to the information in the Controlled Group Spreadsheet.
  5. Each foreign producer must provide their importer or CBP with an Assignment Certification based on a template provided by CBP.

With this guidance, importers can now start benefiting from the CBMA lower rates and credits on entries going forward, and make drawback claims for imports entered since January 1, 2018.




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Alcohol, Cannabis and State Driving Laws

As more states legalize the recreational use of marijuana, beer servers will undoubtedly face situations in which a patron is too impaired to drive due to the consumption of both cannabis and alcohol. State laws do not provide a crosswalk of breath alcohol concentration (BrAC) limits and nanograms per milliliter (ng/ml) of delta-9-tetrahydrocannabinol (THC) in a driver’s body fluids. But a few states have established limits on the nanograms per milliliter (ng/ml) of THC that may be present in a driver’s blood or urine. States will continue to create and modify statutory and regulatory schemes focused on marijuana impairment. In doing so, state legislatures will likely revisit the policy discussions on limits for alcohol consumption.

Read the full article. 

Originally published in The New Brewer, July/August 2018.




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