Industry groups rap proposed alcohol law

A joint letter this week from major alcohol supplier trade associations to members of the U.S. House of Representatives calls the proposed "CARE Act" discriminatory and anti-competitive.

The bill, H.R. 5034, would radically alter the business landscape if passed. It has been pushed by the National Beer Wholesalers Association (NBWA) and the Wine & Spirits Wholesalers of America (WSWA).

It is formally called the Comprehensive Alcohol Regulatory Effectiveness (CARE) Act of 2010. In essence, supporters say the proposed legislation is necessary to protect a state’s ability to collect taxes, and to prevent minors from access to alcohol. Opponents say it would get around a Supreme Court decision limiting states’ regulatory powers.

This is a complex issue, in that the bill actually would modify several statutes. David Honig wrote an excellent analysis of it for Palate Press, the online wine magazine. You can read it here.

The letter from the industry groups reads:

"Dear Member of Congress:

"We, the undersigned beer, wine and spirits associations representing virtually all alcohol beverages produced in the 50 states respectfully request you to preserve the effectiveness of the existing state-based alcohol regulatory system -- and support the constitutional principles that protect the marketplace against discriminatory and anti-competitive state laws -- by rejecting H.R. 5034.

"The current system of alcohol beverage regulation in the U.S. provides a proven and effective balance between states and the federal government that allows for local flexibility while providing necessary consistency and fairness on a national basis. This allows producers, distributors and retailers to conduct business in an efficient and effective manner that best serves the interests of the American public.

"The National Beer Wholesalers Association (NBWA) and the Wine & Spirits Wholesalers of America (WSWA) seek to dramatically alter the current system of alcohol regulation. With H.R. 5034, NBWA and WSWA want to put brewers, wineries, distillers and retailers at a competitive disadvantage; allow states to unfairly and arbitrarily enact protectionist laws against out-of-state beer, wine and spirits producers; and effectively eliminate federal oversight of alcohol. Specifically, H.R. 5034 would allow states to pass laws that violate the dormant Commerce Clause, federal antitrust laws and any other Act of Congress.

"We fully support existing state alcohol regulatory systems and believe they provide an effective and efficient balance of control that serves the interests of consumers, producers and the marketplace as a whole. We strongly oppose H.R. 5034 and respectfully ask that you refrain from supporting this unnecessary legislation."

It was signed by the Distilled Spirits Council of the U.S. (DISCUS), Wine Institute, Beer Institute, Brewers Association and WineAmerica.

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