• Skip to primary navigation
  • Skip to content
  • Skip to primary sidebar
  • Skip to footer
  • Advertise
  • About Craft Brewing Business

Craft Brewing Business

Professional Insight, Unfiltered

  • News
  • Business & Marketing
  • Ingredients & Supplies
  • Packaging & Distribution
  • Equipment
  • Webinars & White Papers
  • Newsletter

Pending signature: Brewers prohibited from owning distributor interest in Illinois

May 16, 2013Chris Crowell

Breweries with distributorship interest are starting to feel a pinch in that relationship in the Midwest. Ohio just put a new law on the books, and Illinois just unanimously passed a bill through the state senate, HB 2606, that would prohibit manufacturers of beer from holding any stake in a distributor.

Illinois distributor bill passes Senate
All that’s left is the Illinois governor’s signature, which seems to be a formality at this point, and brewers will be prohibited from owning distribution in the state.

“HB 2606 reaffirms Illinois’ policy and the state’s regulatory structure that manufacturers of beer, including out-of-state brewers, are prohibited from holding a distributor’s license, from owning any ownership interest in a distributorship, and from exercising vertical integration between a manufacturer of beer and a distributor or importing distributor through any ownership interest or through control of the distributor or importing distributor,” said State Senator Tony Munoz (D-Chicago).

As we reported last month when the bill passed the Illinois House of Representatives, HB 2606 is more of a clarification on a Senate bill passed in 2011 that was intended to accomplish the same thing but wasn’t upheld in practice by the Illinois Liquor Commission. The Commission stated previously that the 2011 Senate bill was not sufficiently clear. This perceived vagueness allowed an Anheuser Busch InBev subsidiary to continue to hold a 30 percent ownership interest in City Beverage.

Passage of the bill is now in the hands of the governor. If you recall, in Ohio, there was a last second push by AB Inbev to ask the state’s governor to reconsider portions of the Buckeye State’s pro-craft brewing bill. Here in Illinois, there will be no backlash because HB 2606 comes as no surprise. Knowing that there was strong opposition to AB Inbev owning any interest in distributorships, AB Inbev agreed that they would divest themselves of their interest in City Beverage Illinois LLC, which holds four Illinois distributorships licenses. But they requested some time to find a purchaser and complete the buyout. If the governor signs the bill into law, any brewer holding any interest in a beer distributorship will have until Jan. 1, 2015, to divest its interest.

“The legislation clarifies that the three-tier regulatory system does not allow vertical integration [ownership in another tier] and reinforces the intent of SB 754 which became law on June 1, 2011,” said Rep. David Leitch (R-Peoria), chief co-sponsor of HB 2606. “Additionally, it affirms the General Assembly’s policy which is ‘to protect the health, safety and welfare of the people of this State through the sound and careful control and regulation of the manufacture, distribution, and sale of alcoholic liquor through a three-tier regulation system.’”

Illinois law doubles craft brewer barrelage production limit
Illinois law doubles craft brewer barrelage production limit
Illinois craft beer
Illinois to increase size of craft brewer that falls under self-distribution exemption
Michigan Proposed Craft Beer Bills
Illinois bill to prohibit manufacturers from owning distribution passes House
TTB COLA label warning
Here’s the most common alcohol beverage label error according to the TTB

Reader Interactions

Leave a Reply Cancel reply

You must be logged in to post a comment.

Primary Sidebar

Latest News

  • Check out the results of Edinburgh Beer Factory’s new beer bottle laser coder
  • The Salt Lake City airport to include spots for both Squatters Craft Beers and Wasatch Brewery in redesign
  • Brewers Association updates: Grant program for more diverse craft beer events, new board members
  • BSG Hops bring aboard new hop specialist

Sign up for our newsletter

unsubscribe from list

Most Popular Today

Recent Features

  • wasatch breweryThe Salt Lake City airport to include spots for both Squatters Craft Beers and Wasatch Brewery in redesign
    February 21, 2019
  • tax returnsWhat craft breweries need to know about tax reform and equipment acquisition
    February 20, 2019
  • jawbrew sustainable brewingSustainable craft brewery spotlight: Inside Jaw Brew’s profitable commitment to the circular economy
    February 19, 2019
  • Tips on properly maintaining brewery wastewater with slot drains
    February 18, 2019
  • How to ace your brewery rebrand
    February 18, 2019
  • Joose Cannon Can LabelFive Beers to Know This Week: Collab IPAs for Zwickelmania and a 30-year anniversary
    February 15, 2019

Footer

  • Email Newsletter Sign Up
  • About Craft Brewing Business
  • Contact Us
  • Advertise on Craft Brewing Business
  • Media Kit Download
  • Privacy and Terms

© 2019 · CBB Media LLC

Continue ...

sponsored by