Florida’s New 60% Craft Distillery Rule Is Here. What It Means and How to Comply.

Effective July 1, 2026, Florida craft distilleries must satisfy a new agricultural sourcing and production requirement that is likely to reshape how many distilleries source, blend, formulate, and document their products.

The new law appears in Florida Statutes Section 565.03(2)(c), which provides:

“Effective July 1, 2026, a minimum of 60 percent of a craft distillery’s total finished branded products must be distilled in this state and contain one or more Florida agricultural products.”

At first glance, the requirement sounds straightforward. In practice, however, it raises a number of important questions that Florida regulators have not yet fully answered.

How is the 60% requirement measured?

What exactly counts as a “finished branded product”?

What qualifies as a “Florida agricultural product”?

Does redistilling imported neutral spirits count as being “distilled in this state”?

What level of documentation should a craft distillery maintain?

Those questions matter because the craft distillery designation carries valuable privileges, including direct-to-consumer sales through tasting rooms and gift shops. Losing compliance with the craft distillery requirements could place those privileges at risk.

The infographic below summarizes the issue at a high level. The remainder of this article provides a deeper analysis and practical compliance roadmap.

The Broader Context: Why Florida Adopted the Rule

The 60% requirement was enacted as part of Florida’s 2021 Craft Distilleries Law (SB 46). That legislation dramatically expanded the opportunities available to Florida craft distilleries by:

Increasing the production threshold for craft distilleries from 75,000 gallons to 250,000 gallons.
Expanding direct retail sales opportunities.
Allowing tasting room service by the drink.
Allowing participation in festivals, fairs, markets, and similar events.
Expanding ownership opportunities.

At the same time, the Legislature delayed implementation of the new Florida sourcing requirement until July 1, 2026. The delay strongly suggests that lawmakers understood the industry would need time to adapt.

Viewed as a whole, the statute appears designed to strike a balance:

Preserve the business flexibility that many modern distilleries need.
Encourage deeper connections between Florida distilleries and Florida agriculture.

That same balance can be seen elsewhere in Florida beverage law, particularly in the Florida Farm Winery Program.

The Four Most Important Words in the Statute

Nearly every compliance question comes back to four phrases:

60 percent
total finished branded products
distilled in this state
Florida agricultural products

Unfortunately, none of those phrases is fully explained by the statute.

What does “60 percent” mean?

The statute does not identify the measurement method. It does not say whether the percentage is based on:

SKUs
Brands
Bottles sold
Cases sold
Gallons produced
Proof gallons
Revenue

All of those approaches could produce dramatically different outcomes.

A distillery with ten products could satisfy the requirement under a SKU-based approach if six products qualify. The same distillery might fail under a gallons-based approach if most sales come from non-qualifying products.

At present, ABT has not publicly adopted a specific methodology.

What are “total finished branded products”?

The term “branded product” is defined elsewhere in Section 565.03.

A branded product must:

Be owned by the craft distillery.
Contain spirits manufactured through distilling, rectifying, or blending by the craft distillery on its licensed premises.
Have an approved federal label.

The statute does not explain what “finished” adds to that definition.

The most reasonable interpretation is that the denominator includes finished, market-ready products offered under the distillery’s brand portfolio.

However, ABT has not issued guidance confirming that interpretation.

What does “distilled in this state” mean?

This may become the most significant issue for many Florida distilleries.

Florida law already recognizes that craft distilleries may engage in:

Distilling
Rectifying
Blending

The problem is that the new rule requires qualifying products to be “distilled in this state,” not merely blended or bottled in Florida.

For example:

A product made from imported bourbon that is simply proofed down and bottled in Florida may satisfy other provisions of Florida law but may not satisfy the new 60% requirement.
A product created through blending imported spirits with other ingredients raises a more difficult question.
A product made by redistilling neutral grain spirits in Florida presents an even stronger compliance argument.

Until ABT provides formal guidance, this remains one of the largest compliance gray areas.

What is a “Florida agricultural product”?

The statute does not define the phrase.

Elsewhere in Florida law, agricultural products are broadly described as horticultural, aquacultural, viticultural, apicultural, and other farm or garden products.

Potential examples include:

Florida sugarcane
Florida sugar
Florida honey
Florida citrus
Florida grains
Florida botanicals
Florida fruits
Florida herbs

Just as important, the statute does not specify how much Florida agricultural content is required.

It says only that qualifying products must “contain one or more Florida agricultural products.”

That wording creates a significant unresolved question:

Is a small amount enough, or will regulators expect a meaningful contribution to the product?

The statute currently provides no answer.

What We Know About ABT Enforcement

One of the most useful clues comes from ABT’s current inspection form.

Question 17 now asks:

“If a craft distillery, are at least 60 percent of the craft distillery’s total finished branded products distilled in this state and do they contain one or more Florida agricultural products.”

Interestingly, the form does not include:

A calculation worksheet
A formula
A gallons test
A SKU test
A production test

Instead, the inspector simply checks yes or no.

This does not mean documentation is unimportant. The same inspection procedures emphasize records, inventories, invoices, and maintenance of production documentation.

In other words, compliance may currently be verified through records rather than through a standardized calculation process.

The Farm Winery Comparison

The best analogy may be Florida’s Certified Farm Winery Program.

To qualify as a Florida Farm Winery, a winery must:

Produce or sell less than 250,000 gallons annually.
Ensure that 60% of wine produced is made from state agricultural products.
Maintain at least five acres producing commodities used to make wine.
Remain open for tours, tastings, and sales.

The similarities are striking.

Both programs:

Use a 60% agricultural threshold.
Promote Florida agriculture.
Link agricultural sourcing to valuable tourism and retail privileges.

Importantly, the farm winery framework recognizes a practical reality: successful wineries often need a mix of products and sourcing strategies.

That same practical reality exists in the distillery industry.

Many Florida craft distilleries rely heavily on:

Transfer-in-bond spirits
Imported neutral grain spirits
Blending
Flavoring
Product development
Contract manufacturing relationships

A reasonable interpretation of the craft distillery law should leave room for those business models while preserving the Legislature’s goal of supporting Florida agriculture.

Compliance Roadmap for Florida Craft Distilleries

Until ABT provides more guidance, every Florida craft distillery should consider implementing a structured compliance plan.

Step 1: Inventory Every Product

Create a complete list of all products sold under the distillery’s brand portfolio.

For each product, identify:

Brand name
SKU
Spirit source
Production process
Florida agricultural ingredients
Annual production volume

This becomes the foundation of every compliance analysis.

Step 2: Classify Products

Create three categories:

Category A – Clearly Qualifying

Products that are:

Distilled in Florida; and
Contain Florida agricultural products.

Category B – Potentially Qualifying

Products involving:

Florida redistillation
Florida rectification
Florida blending with agricultural inputs

These may qualify but involve interpretive risk.

Category C – Unlikely to Qualify

Products that are:

Distilled outside Florida;
Merely bottled or packaged in Florida; and
Lack meaningful Florida agricultural content.

Step 3: Track Compliance Using Multiple Methods

Because the statute does not identify the denominator, calculate compliance several ways:

SKU count
Cases
Gallons
Proof gallons

If all four calculations exceed 60%, the compliance position becomes significantly stronger.

Step 4: Shift Sourcing Where Necessary

Many distilleries will find that the easiest compliance solution is sourcing more Florida-distilled spirit.

This may involve:

Florida-produced neutral grain spirits
Florida-produced rum
Florida-produced vodka base
Florida-produced whiskey distillate

Replacing imported base spirits can dramatically simplify compliance.

Step 5: Build Florida Agriculture Into the Products

Whenever possible, use genuine Florida agricultural inputs.

Examples may include:

Sugarcane
Honey
Citrus
Fruit
Herbs
Botanicals
Grains

The stronger the connection between the product and Florida agriculture, the stronger the compliance position.

Step 6: Create an Annual Compliance File

Every craft distillery should maintain:

Ingredient invoices
Supplier certifications
Production records
Batch logs
TTB documentation
Product formulas
COLAs
Brand registrations
Inventory reports

The goal is simple: if an ABT agent asks how the distillery satisfies the 60% rule, the answer should already be documented.

Step 7: Evaluate Alternative License Structures

For some operators, the craft distillery model may no longer be the best fit.

Businesses focused primarily on:

Transfer-in-bond spirits
Blending
Rectification
Product development

may wish to evaluate whether another Florida licensing structure better matches their long-term business objectives.

The answer will vary widely depending on the value of direct retail sales and tasting room operations.

Final Thoughts

The new 60% rule is probably the most important change affecting Florida craft distilleries since the passage of the 2021 Craft Distilleries Law.

The challenge is not that the requirement exists. The challenge is that critical details remain unresolved.

At the moment, no public ABT guidance clearly explains:

How the 60% threshold is measured.
What denominator applies.
How much Florida agricultural content is required.
How redistilled products are treated.
What documentation ABT expects.

Until regulators provide additional clarity, the safest approach is to assume that every craft distillery should be prepared to demonstrate, through records and documentation, that at least 60% of its finished branded products are both Florida-distilled and connected to Florida agriculture.

That approach not only reduces enforcement risk, but it also aligns with the apparent purpose of the statute: encouraging deeper connections between Florida distilleries and Florida farmers while preserving the benefits of Florida’s craft distillery framework.

Additional Brewers’ Law Resources

Do you have any questions about Florida’s New 60% Craft Distillery Rule? Contact us to schedule a consultation with a beverage attorney.

Because we’re attorneys: Disclaimer. Originally posted 07/19/2026.

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