Iowa Wine Retailer Sting Demonstrates Need for Permits for Out-of-State Retailer Wine Shipments -- Wine Wholesalers Wade Into Controversy With Double Standard Linked to Self Interest

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A recent sting in Iowa that found an out-of-state retailer shipping wine to an Iowa resident in violation of that state's laws points to the need for creating a "direct shippers" permit for both out-of-state retailers and wineries, as well as the national wine wholesalers double standard inspired by self interest, according to the Specialty Wine Retailers Association.

Online retailers are playing fast and loose with alcohol laws -- shipping beer, wine and liquor with no fear of being caught doing something illegal -- including selling to kids.

A media sting in Iowa carried out by the Daily Iowan last week caught an out of state retailer shipping wine direct to an Iowa college student in violation of that state's law prohibiting direct-to-consumer sales by out-of-state retailers. The Specialty Wine Retailers Association (SWRA) believes this sting illustrates the need for a new permit systems to be put into place around the country for retailer-to-consumer wine shipments. The event also illuminated the double standard wine distributors embrace when it comes to what sort of sales are dangerous.

All states that allow any degree of direct shipment of wine to consumers must have a permit system for in-state and out-of-state retailers laying out the protocol for safe, effective, consumer delivery. Retailers, not having been faced with any degree of enforcement by state regulators, shipped to states where the laws were unclear. By allowing retailers to ship wine direct to consumers across state lines using the same permit system that wineries currently use, states can create a mechanism for better regulating the flow of wine, more effectively protecting minors and collecting taxes.

Permits, On-Line Age Verification and Enforcement Create Safe Environment for Retailer-to-Consumer Wine Shipments

The media sting also demonstrated how on-line verifications systems, such as the IDology system endorsed by SWRA, combined with stings can foster a safe a well regulated environment in which consumers can obtain the wines they desire that have not been provided by the in-state wholesaler networks. It is noteworthy that both Iowa and Illinois are in a position to punish the violating retailer, which underscores the many methods of enforcement of state alcohol regulations that are available to state alcohol agencies.

Last week's sting in Iowa also revealed the double standard employed by the Wine & Spirit Wholesalers Association and wine wholesalers in general when Craig Wolf, the WSWA's President, issued a press release following the sting in which he breathlessly claims, "Online retailers are playing fast and loose with alcohol laws -- shipping beer, wine and liquor with no fear of being caught doing something illegal -- including selling to kids."

Wine Wholesalers Issue a Temper Tantrum Disguised as Press Release

"Mr. Wolf's tantrum, disguised as a press release, begs the question, what interest do wholesalers have in laws regulating retailers," asked SWRA executive director Tom Wark.

"The wholesalers don't send out press releases daily when wine is sold illegally to minors at brick and mortar retailers across the nation. Given their near hysterical reaction to this rare instance in which an interstate shipment of wine breaks the law, you'd expect Mr. Wolf's organization to be issuing heart pumping press releases daily explaining how 'fast and loose' brick and mortar retailers are playing with the law when they sell to minors on a regular basis. But they don't issue these press releases. Why?

"The answer is because the distributors already made a profit on the sale that ended up in minors' hands when they originally sold the wine to the brick and mortar retailer in the state where they operate. However, the wine middlemen in states to which a wine is being delivered from an out-of-state retailer don't make any money because the product didn't first go through their hands. It's only when wholesalers don't see a profit from a sale that press releases are swiftly issued and righteous indignation drips from their lips.

"When wholesalers start issuing press releases about brick and mortar wine shops making their first, second or even 500th illegal sale to minors, then we'll take seriously anything the Wine & Spirit Wholesalers Association has to say. Until then we'll write off their self-indulgent tantrums and remind politicians and consumers that the state clearly has successful ways to catch and punish wrong-doers and that retailers, just like wineries, should be permitted to ship direct to consumers under a well-regulated permit system."


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