Florida | Read Time: 2 minutes

Beer Bills Pending for 2014 Florida Legislative Session

The 2014 session of the Florida Legislature is two months from starting, but already two pairs of craft beer bills put growlers and beer tastings on tap. Bills Authorizing Growlers & Tastings SB 406 and HB 283, identical bills in the Florida Senate and Florida House of Representative, would change the craft beer laws in two ways:

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Breweries | Read Time: 4 minutes

Ownership Agreements: 3 Common Mistakes

Beverage manufacturers–breweries, wineries, and distilleries–are often the creation of a core group of owners. One of the owners might be the mad-scientist brewer, who loves to create new style-busting beers. Another might be the marketing genius, who believes that a beer can be sold with the right branding and marketing. Still another might be the financier, who knows a good business opportunity when he or she sees it. Bringing these personalities together to create “The Brewery” or “The Winery” or “The Distillery” is a wonderful thing. To help owners come together and stay together, they need an Ownership Agreement. Not only is this good business practice, but it’s also required by the TTB as part licensing process. Ownership Agreements go by different names–Operating Agreement, Shareholders Agreement, Partnership Agreement, Buy-Sell Agreement–but they all have a common goal: Provide a clear roadmap for the brewery owners to jointly manage and grow the business and to minimize the impact of conflict and adversity among owners.  Avoid These Change-of-Ownership Mistakes:

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Florida | Read Time: < 1 minute

Do Florida Brewery Taprooms Hurt Retailers?

That’s the claim made by some distributors, as reported in Craft Business Daily. The Sarasota Herald-Tribune’s Alan Shaw (@AlanCShaw) has been at the center of the conversation with his web article and the comments to it. Alan writes: I understand why retailers and distributors are complaining about tasting rooms selling their packaged beer right to consumers, because the brewery has cut out the distributor and retailer in that transaction. A number of retailers commented to Alan that they have no problem with brewery taprooms. However, that distributors and retailers might push back against taprooms is an expected consequence of the three-tier system. The three-tier system intentionally keeps the roles of brewers, distributors, and retailers separate, meaning that tension among them is inevitable. The three-tier system has evolved separately in each state. In Florida, the system embraces brewery taprooms to “promote the brewery and the tourist industry of the state,” according to Section 561.221 of the Florida Statutes.

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Florida | Read Time: 5 minutes

Growler-Full of Confusion in Florida

**Originally posted on Florida Beer News Growlers—small, reusable, containers used to take tap-dispensed beer home from your favorite microbrewery—are a mainstay of craft beer culture and consumption. While craft beer is booming in Florida, the state has yet to adopt clear laws or regulations about the filling of growlers. In the Sunshine State, confusion about growlers abounds. This article addresses just one aspect of that confusion—who can fill growlers in Florida? Brewery Taprooms Can Fill Growlers Which license must a vendor have in Florida to sell beer, intended by the purchaser to be consumed off-premises, by filling and sealing the purchaser’s growler? It may be a straightforward question, but there is no definite answer in Florida law—neither in the Florida Statutes nor the Florida Administrative Code (the compilation of Florida’s administrative rules). Growler filling is generally permitted by brewery taprooms, which must have a CMB license to make beer and a 2COP license to sell beer or wine for consumption on or off premises. However, whether any other license holders can fill growlers is inexplicable, as demonstrated by two recent situations. Tipple’s Brews Cannot Fill Growlers Tipple’s Brews is a beer and wine bar and store in Gainesville, Florida. It has held a 2COP license since October 2009. According to the rules regulating the Florida Division of Alcoholic Beverages and Tobacco (the ABT), which issues 2COP and other licenses, the 2COP allows the holder to sell beer and wine for consumption on the premises or in sealed containers for take-away. Tipple’s began filling growlers early in 2010. In May 2010, the ABT ordered Tipple’s to stop filling growlers. The ABT claimed that filling growlers without a manufacturer’s (CMB) license was a violation of Florida Statutes Section 562.34(1) and a felony.

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Florida | Read Time: < 1 minute

New Sales Tax Exemption for Florida Manufacturers

Beginning April 30, 2014, the Florida manufacturers will be exempt from Florida’s sales and use tax on the purchase of industrial machinery and equipment used in Florida. To be eligible for the exemption, a manufacturer’s primary activity where the equipment will be located must fall within North American Industry Classification System (NAICS) codes 31, 32, and 33. NAICS codes 31, 32, and 33 includes a broad list of manufacturing classifications, including breweries and wineries, food manufacturing (for humans or animals); textiles; book printing; screen printing; wood products; pharmaceuticals and other medical; soaps and detergents; explosives; photographic materials; plastics; tires; concrete and other building materials; computers; communications equipment; electrical fixtures; motor vehicles and other transportation; toys and games; and office supplies manufacturing. To search for a specific eligible industry, refer to http://www.census.gov/cgi-bin/sssd/naics/naicsrch. At the time of purchase, the purchaser must provide a signed certificate stating that the purchaser is entitled to the tax exemption. The Florida Department of Revenue provides a suggested form of exemption certificate.

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Labels | Read Time: 2 minutes

Federal Shutdown Won’t Stop the Flow of New, In-State Beers

Among the many negative consequences of the October 1, 2013 shutdown of the Federal Government (though not the most tragic) is the furlough of most of the workers at the Federal Alcohol and Tobacco Tax and Trade Bureau (TTB), including the one person who approves labeling for new beers. This means that the TTB cannot approve new beers, including new seasonal beers, until the shutdown is over. And when the TTB does get back to work, the turn-around time for new beer approvals, which was running at about 12 days, is bound to be much longer because of the backlog. But there is good news for local microbreweries.TTB approval is not required for new beers that will only be sold in-state. In a March 2013 ruling, the TTB announced that the TTB’s beer approval–called a “Certificate of Label Approval” (COLA)--is not required for beer that will be sold exclusively in the state in which it was bottled. New beer still has to comply with the marking, branding and labeling requirements under Federal law, including health warning statement requirements. Brewers may still need approval from their home state’s beer regulators (in Florida, the application is online), and they still need to comply with applicable state labeling laws. While we wait for the Federal Government to get back to work, we can still enjoy tasty new beers from our local microbreweries. **********UPDATE:********** One Florida Brewery Operations Manager emailed us and shared his experience with the TTB regarding Brand Registration. The TTB had told this Brewery Operations Manager that, “intrastate sales do not require COLA the Florida Brand Registration does require a TTB COLA ID in order to register the brand.  As you mentioned that it all depends on the state it seems as though FL breweries still need to get COLA even if it is in state sales only because the Florida DBPR requires a COLA ID in order to register a brand.” Cheers!

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Florida | Read Time: 3 minutes

Brewers’ Law 101: Florida Brewery Licenses & Florida Beer Laws

Brewers and breweries in Florida are regulated on both the state and federal levels. In this post, we will discuss the regulation at the state level. Are you interested in opening a winery instead? Florida Brewery Licenses To brew, you need a Florida CMB or CMPB License Brewers in Florida who want to make beer and sell it must have a CMB license or CMBP license. CMB stands for “Cereal Malt Beverage”. The CMB license or CMBP is issued by the Florida Division of Alcohol Beverage and Tobacco (ABT), a division of the Florida Department of Business and Professional Regulation. The CMB license is authorized by Florida Statutes Section 563.02(2). The brewpub exception is authorized by Florida Statutes Section 561.221(3), which contains numerous restrictions. Fill out the DBPR ABT 6001 form To get a CMB license or CMBP license, a Florida brewer must file the Application for New Alcoholic Beverage License (DBPR Form ABT-6001) with the ABT (in addition to federal filing requirements). The ABT application requires detailed information about the brewery premises and everyone having a financial interest in the brewery. The annual fee for a CMB license is currently $3,000, and for a CMBP license the annual fee is $500. In additional to the annual licensing fee, a brewery with a CMB or CMBP license must maintain a tax bond of at least $20,000. Florida Beer Laws How to serve beer at your brewery For brewers wanting to sell beer directly to the public, having only a CMB license isn’t enough. Florida has a relatively strict three-tier system for alcoholic beverages, the goal of which is to keep manufacturers, distributors, and retailers separate. Florida’s Tied House Evil Statute generally prohibits a brewer from having any financial interest in a retail operation. However, two exceptions to the three-tier system allow Florida brewers to be licensed to sell their beer (and the beer of others’) directly to the public. Open a taproom First, a Florida brewer can apply for a license to operate a taproom as part of the brewery. This exception makes possible taprooms according to Florida Statutes Section 561.221(2). In addition to the CMB license, a Florida brewer operating a taproom must obtain a vendor license which permits the sale of beer for consumption on the premises or in sealed containers for take-away (common licenses for this purpose are the 2COP beer-and-wine only license and the 4COP quota license). A brewer must file a separate ABT application for a 2COP or 4COP license. The filing fee currently ranges from $168 to $1,820 depending on the license and the county size. Get licensed as a brewpub Second, a retailer licensed to sell beer on its premises can be licensed as a brewpub, in which case it can make its own beer.  Despite the similarity in the name of the license to a CMB, the CMBP license is obtained by filing a retailer’s application for a brewpub special qualification for the consumption on premise (2COP or 4COP in most cases) license. It comes with specific restrictions. The brewpub cannot make more than 10,000 kegs (5,000 barrels) of beer each year, and the beer can only be served on the brewpub’s premises. None of the beer can be sold to a distributor. Questions? If you are a brewer and have any questions with this process or any other legal question with your start-up or existing brewery, email us at beer@brewerlong.com and we will be happy to assist you.

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Contracts | Read Time: 3 minutes

Save Money on Contracting with These Two Words

Reading, writing, and revising complicated business contracts: the central parts of my practice. I am often asked to prepare a written contract my client wants to send to a contract partner or to revise a contract they received from their contract partner. For these situations – there are two words that will help save my clients save money: Term Sheet. Term Sheet (it may also be called a Letter of Intent, Memorandum of Understanding, or other names) contains the essence of the agreement between the involved parties. The term sheet is written in basic language that emphasizes important points of the agreement to all parties involved. The idea is that the decisions-makers will work out the key points of their agreement and write them down on a Term Sheet. This is the agreement without all the legal provisos, conditions, and boilerplates. A term sheet is a page (or two) in length, and is the most efficient way for contract partners to highlight the points that are significant to include within the agreement.  Along with the terms, the contract partners should include specific directions for the attorney who is tasked with preparing the formal written contract (often, myself). Best of all, a Term Sheet will help you save money and time:  You can prepare a Term Sheet on your own without calling the attorney.

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