November 14, 2024
Earlier this month, the Alcohol and Tobacco Tax and Trade Bureau (“TTB”) issued Industry Circular 2024-1, which updates TTB’s alcohol advertising regulations to address the use of linked content on social media platforms. The circular modifies and supersedes TTB Industry Circular 2022-2.
At the federal level, alcohol advertising is governed by the Federal Alcohol Administration Act (“FAA Act”). The TTB periodically updates its FAA compliance guidelines as technology and social media evolve. The FAA Act requires that all alcohol advertisements, including those posted to social media, provide consumers with adequate product information, identify the person responsible for the advertisement, and contain certain mandatory disclosures. On a website, these disclosures must appear in a readily apparent location. However, some forms of media, like social networks and media sharing sites, limit the space available for mandatory information.
Industry Circular 2024-1 now allows alcohol advertisers on social media to meet the mandatory disclosure requirements by linking directly to a separate page that contains the mandatory information. The link must be clearly labeled (e.g., “Product Information”), lead directly to the required details, and be easily accessible to consumers. If space for link-sharing is limited, a reference page, such as Linktree, can be used to prominently display the link to the required information. This approach makes compliance easier for advertisers and minimizes the burden to fit lengthy product details within a small ad space.
Additionally, Industry Circular 2024-1 permits hired influencers to utilize tagging functions to link directly to the industry member’s account on the particular platform and thereby satisfy the mandatory information requirements. As long as the industry member’s tagged account includes the required disclosures, the influencer advertising the product is no longer required to include the same information within their own post.
For more information on alcohol advertising, contact an attorney at Strike Kerr & Johns.
October 03, 2024
California’s Governor Newsom has signed into law Assembly Bill 2174 (“AB 2174”), introducing a Beer Caterer’s permit for licensed breweries to sample and sell their beers at a range of public and private events, without requiring the breweries to maintain a separate, physical space at each event.
Beginning January 2025, beer manufacturers holding a Type 01 or Type 23 license can apply for a Type 91 Beer Caterer’s permit. The permit, issued by the California Alcohol Beverage Control (“ABC”), will allow breweries to sell up to 124 gallons of beer per event for consumption at trade conventions, sporting events, farmer’s markets, street fairs, or other similar community gatherings, with a maximum of 36 events per calendar year. (This differs from the currently available Type 84 Certified Farmer’s Market Beer Sales Permit, which only allows sales of sealed containers for off-site consumption to consumers at certified farmer’s markets.)
For each event, Beer Caterer permittees must obtain approval from ABC and local law enforcement through a catering authorization. Fees for catering authorizations are based on estimated attendance for the event, and ABC will not issue more than two beer catering authorizations for the same day at the same catering event. The annual license fee for a Beer Caterer’s permit is $275, and licensees must maintain records of all beer sales conducted under a Beer Caterer’s permit for a minimum of three years.
Prior to the passage of AB 2174, only certain on-sale retail licensees were authorized to obtain a Caterer’s Permit. With the addition of the Beer Caterer’s permit, licensed beer manufacturers, including smaller craft breweries, will have more opportunities to engage directly with their existing community, as well as reach new customers and drive market expansion.
For more information on applying for a Beer Caterer permit, contact an attorney at Strike Kerr & Johns.
August 05, 2024
Popular social media application TikTok quietly updated its advertising policy to allow alcohol ads on the platform, subject to certain restrictions. The beer, wine, and spirits industry advertising codes stipulate that beverage alcohol digital marketing communications should be placed only in media where at least 73.8% of the audience is reasonably expected to be of the legal purchase age, or where the platform can target an audience of legal purchase age individuals through their registered user database. The 73.8% threshold is based on 2020 US Census data that determined 73.8% of the U.S. population is 21 years of age and older. Apps like TikTok can target registered users to serve specific ad content. With TikTok’s user base rapidly growing, it is the latest social media platform to meet the 73.8% threshold. (The industry advertising codes can be found here: Beer Institute Advertising & Marketing Code, Wine Institute’s Code of Advertising Standards, and Distilled Spirits Council of the United States’ Code of Responsible Practices for Beverage Alcohol Advertising and Marketing.)
TikTok’s updated policy is based on applicable local laws and regulations and includes country-specific requirements. In the US, all potential advertisers must work with a TikTok sales representative to determine eligibility. Alcohol ads must: only target users aged 25 years or older, clearly state the product’s ABV, be registered in the target region and comply with all applicable laws and regulations. Alcohol ads and brand landing pages must also contain a responsible drinking message. Notably, the policy does not allow retail or e-commerce advertisements that promote the sale of alcohol or alcohol delivery services.
What’s allowed in ad content (US):
What’s not allowed in ad content (US):
In addition, brands that advertise alcoholic products or any of the permitted content above should consider disabling comments on these ads, because as of the time of publication, TikTok does not verify that commenters are 21 years of age or older.
Note TikTok has separate rules for branded content under the TikTok Branded Content Policy. “Branded content” is defined as “content that promotes a third-party brand or its products or services in exchange for payment or any other incentive,” e.g., influencer ads. Currently, alcohol cannot be promoted under the branded content policy, so alcohol brands should tread carefully when working with influencers.
For more information on alcohol advertising in social media, contact an attorney at Strike Kerr & Johns.
January 25, 2024
And that’s a wrap on 2023! As we close out the first month of the new year, here is a look at the California Alcoholic Beverage Control’s (“ABC”) significant legislative changes affecting the industry in 2024:
For more information on new ABC legislation, contact an attorney at Strike Kerr & Johns.
December 04, 2023
The partners at Strike Kerr & Johns are pleased to announce the elevation of Roger Clayton from Senior Associate to Partner!
Roger joined the firm as an associate in 2019. Prior to developing an expertise in alcohol regulatory law, Roger was a trial attorney in San Diego and a litigator with an international law firm. Roger regularly assists clients with trade practice issues, marketing promotions, tied-house compliance, third-party alcohol delivery, distribution agreements and administrative actions.
If you have any questions regarding the above, or relating to Chicago sports, Roger likely has the answers. Learn more about Roger here.
November 03, 2023
In 2022, Alaska Governor Mike Dunleavy signed Senate Bill 9 (“SB 9”), an omnibus beverage alcohol bill that includes new requirements for direct to consumer (“DtC”) shipping. Starting January 1, 2024, in- and out-of-state manufacturers must apply for a Manufacturer Direct Shipment license to ship product directly to Alaska residents. Manufacturer Direct Shipment licensees may only ship holder’s product through approved common carriers, and may not ship to any address in a zip code that has adopted a local option rule prohibiting the sale of alcohol. The Alcohol and Marijuana Control Office (“AMCO”) will compile a list of zip codes that are located within local option areas and notify Manufacturer Direct Shipment licensees of changes to the list. The bill’s language suggests that a permit holder may only ship wines of its own production, but the wording is ambiguous on this issue.
Previously, Alaska was one of only a few states where DtC shipping was permitted without a license. In-state and out-of-state manufacturers were able to ship direct to consumers under a blanket letter from AMCO stating that Alaska does not regulate alcoholic beverages imported in to the state for personal use. With the passing of SB 9, licensees will need to apply for the Manufacturer Direct Shipment license to continue shipping DtC.
The Manufacturer Direct Shipment license authorizes Alaska brewery retail, winery retail, and distillery retail licensees, as well as holders of manufacturer licenses issued in other states, to sell and ship their product directly to Alaska consumers, subject to quantity limits:
Manufacturer Direct Shipment licenses will not be issued to licensees that annually produce more than 300,000 barrels of brewed beverages or more than 50,000 proof gallons of distilled spirts. There are no production limits for winery licensees.
The new legislation also includes age verification requirements for Manufacturer Direct Shipment licensees. Prior to shipping, licensees must verify that the person submitting the order is at least 21 years of age using an age verification service or other method and require a signature by a person who is at least 21 years old upon delivery. Licensees must also label the shipping container as containing alcohol and include written or electronic information to the purchaser regarding fetal alcohol syndrome. Licensees should retain records relating to DtC sales for at least two years.
Manufacturer Direct Shipment licensees will also be subject to state excise tax starting in 2024. Licensees are required to file monthly statements and remit taxes to the Alaska Department of Revenue. Reports must include the total number of gallons sold, the name and Alaska address of each buyer, and the gallonage of each kind of beverage sold to the respective buyers.
The Manufacturer Direct Shipment license application will be available through AMCO and cost $200 biennially. We expect that AMCO will publish additional guidance soon. If you’re interested in applying for a license or have questions about the new legislation, contact an attorney at Strike Kerr & Johns.
August 19, 2023
This week, California ABC announced new priority and intercounty license authorizations for eligible counties. This year’s announcement includes five (5) new Type 87 licenses for specified census tracts in San Francisco, as well as new on-sale liquor licenses in Napa, Mariposa, Alpine, Shasta, and El Dorado counties. A full list of the new license authorizations can be found here.
Introduced in 2016, Type 87 licenses are known as Neighborhood Restricted Special On-Sale General Licenses, issued to applicants in specific neighborhoods in the city and county of San Francisco. Type 87 licenses are typically designated for bona fide eating places and authorize the sale of beer, wine, and distilled spirits for consumption on the licensed premises, and generally subject to the same privileges and restrictions as a Type 47 license. These licenses require unique public notification and community interaction and approval during the formal application process and are generally non-transferrable. If there are more applicants than the five (5) licenses available in the specified
neighborhoods, a drawing will take place.
Another notable announcement includes a number of new on-sale authorizations in counties where priority licenses are generally unavailable. ABC announced new on-sales licenses in Napa County (10), Mariposa County (2), Alpine County (1), Shasta County (4), and El Dorado County (4). Priority license application form for all counties should be available August 23rd.
Between September 11th and 22nd, 2023, ABC district offices will accept applications for priority and intercounty licenses in eligible counties. This year, priority license fees are $17,335 and intercounty license fees are $6,570, to be paid at the time of filing. If there are more applicants than licenses available, priority drawing will be held the week of October 23rd. More information on specific dates and time for each drawing should be available October 16th.
There are residency requirements to be eligible for these licenses and the priority application process has become more cumbersome in recent years, resulting in some priority drawing winners later being deemed ineligible. As such, we recommend having experienced alcohol counsel review your applications prior to submission. If you’re interested in applying for a new or intercounty priority license, or have additional questions about the drawing process, contact an attorney at Strike Kerr & Johns.
June 01, 2023
Over the last week, leading industry trade groups have announced updates to their respective codes of advertising and marketing standards. These revisions are based on the latest 2020 census data released by the United States Census Bureau and aimed at ensuring alcohol advertising reaches an appropriate adult audience and complies with the industry’s commitment to responsible promotion.
Under the new guidelines, alcohol advertising should not appear in any media where more than 26.3% of the audience is under 21 years old, the legal purchasing age. The previous threshold, based on the 2010 census data, was 28.4%. The decision to revise the standard was prompted by the 2020 census data, which revealed that 73.8% of the U.S. population is 21 years of age and older, an increase from the previous figure of 71.6%. This adjustment ensures that alcoholic beverage advertisements are effectively targeted towards the intended adult audience. By aligning advertising strategies with the revised codes, industry members can demonstrate their commitment to responsible marketing and product promotion.
The adoption of the census-based standard was originally recommended by the Federal Trade Commission (FTC) in its 2008 report on “Self-Regulation in the Alcohol Industry.” Periodic updates to these voluntary standards ensure the industry practices reflect changes to modern society and technology.
Trade organizations including The Wine Institute, The Distilled Spirits Council of the United States (DISCUS), American Craft Spirits Association (ACSA), American Distilled Spirits Alliance (ADSA), Beer Institute, and Brewer’s Association are among the groups that have released updated guidelines.
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