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Alcohol Control Systems

Wholesale Distribution Systems for Wine

Laws addressing wholesale distribution of wine including State-run, private licensed sellers, or combination systems.

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About This Policy: Alcohol Control Systems: Wholesale Distribution Systems for Wine

Period Covered: 1/1/1998 through 1/1/2022

This policy topic covers laws addressing wholesale distribution of wine including State-run, private licensed sellers, or combination systems.

Note: The secondary literature and the laws and regulations related to this policy topic use a variety of terms that are sometimes used in different ways by different jurisdictions. To see definitions for these terms as they are used in APIS, see the Definitions heading below.

The policy topics that fall under the general heading of Alcohol Control Systems describe the systems for wholesale and retail distribution of alcoholic beverages in each State and the District of Columbia. For each beverage type (beer, wine, distilled spirits) a State may use a State-run distribution system, a system of private licensed sellers, or some combination of these at the wholesale level, the retail level, or both. All States with a license wholesale system also have a license retail system. However, States with State-run wholesale systems may have either State-run or license retail systems. No State maintains a State-run system of retail sale for on-premises consumption.

Many States distinguish among wines (and other beverage types) on the basis of alcohol content, usually expressed as a range (e.g., <5 percent Alcohol by Volume (ABV)). As noted in Definitions, these categories of wine are referred to as "beverage subtypes." Statutes and regulations may specify different retail distribution systems for different beverage subtypes.

The comparison tables include only the 18 States with a State-run wholesale or retail system for at least one alcoholic beverage subtype as of the January 1, 1998, baseline date. The remaining States have had license wholesale and retail systems for all alcoholic beverages (see Definitions for further clarification regarding license and State-run control systems) since that date.

This policy addresses Wholesale Distribution Systems for Wine.

Term Definition
Alcohol Control System The laws and regulations of a State that specify who may distribute alcoholic beverages. An alcohol control system subsumes a wholesale level and a retail level.
Beverage Subtype A beverage type with a specific alcohol content or range of alcohol content - e.g., beer with less than 7 percent alcohol.
Beverage Type Major classifications of alcoholic beverages (based on ingredients or methods of production). The APIS analysis of Alcohol Control Systems considers three beverage types: beer, wine, and spirits.
Contract Store An off-premises retail alcohol outlet operated on behalf of the State under a State-run system by a private contractor who may be paid a fee or commission. May also be referred to as an "Agency Store."
Note:  Contrasts with Licensee (see below) in that the contract store operates as an agent of the State.
Licensee A private business licensed by the jurisdiction to sell alcoholic beverages at retail or wholesale.
License System A system in which a State licenses private vendors to operate wholesale or retail systems of distribution of an alcoholic beverage type or subtype. Also called a private system.
Mixed/Not Overlapping A system in which some beverage subtypes are sold through the State-run system and other beverage subtypes are sold through the license system, but none are sold through both. Used to describe Overall Systems (see Variables).
Mixed/Overlapping A system in which some or all beverage subtypes are sold through both the State-run and license systems. Used to describe Overall Systems (see Variables).
Off-Premises Sales Retail sale of sealed containers of alcoholic beverages for consumption elsewhere than the premises where the beverages are purchased.
On-Premises Sales Retail sale of alcoholic beverages for consumption on the premises where the beverages are purchased (e.g., bars, restaurants).
Retail The sale of alcoholic beverages directly to consumers.
State-Run System An alcohol control system for wholesale and/or off-premises retail distribution of an alcoholic beverage type or subtype in which a State sets the prices of and gains profit/revenue directly from wholesale and/or retail off-premises sales (rather than solely from taxation).[1] A State may own and operate the wholesale business or retail stores itself or it may contract with a private vendor while maintaining control over pricing and profits through the contractual relationship. In the latter case, the private contractor may be paid a fee or commission. State-run alcohol control systems are also referred to as monopoly systems, and States with these systems are sometimes referred to as control States.
State Store An off-premises retail alcohol outlet operated directly by a State under a State-run system.
Wholesale The resale of alcoholic beverages obtained from a producer or distributor to a retailer.
  1. This characterization is based on an analysis presented in the National Alcohol Beverage Control Association Survey Book, 2002, and on interviews with NABCA officials.

Explanatory Notes and Limitations Applicable to All Alcohol Control Systems

  1. When it is not clear from the text of relevant statutes and regulations how a particular beverage subtype is sold or distributed within a particular State, the control system for that State is described in APIS tables as "indeterminate." Actual practice in such cases can be determined by review of administrative and court decisions and interpretations, but these are not currently within the scope of APIS.
  2. Administrators, business owners, and store managers can decide not to stock an alcoholic beverage that they are allowed by law to sell. Thus, just because the law states that a particular beverage may be sold in particular types of outlets does not necessarily mean that it, in fact, is sold in those outlets.
  3. The APIS analysis of Retail Distribution Systems includes only sales made on an off-premises basis. On-premises retail sales of alcoholic beverages (e.g., in bars and restaurants) in all States are conducted under a license system. No States operate on-premises retail establishments.
  4. This analysis does not address provisions dealing with internet sales or home delivery services.
  5. The APIS analysis of Alcohol Control Systems considers three beverage types: Beer, Wine, and Spirits. It does not specifically address:
    • Cider
    • Japanese or Chinese rice wine (Sake)
    • Brandy
    • Vermouth
    • Sparkling Wine
      Note that, in some States, particular beverages from this list may be defined as belonging to the Beer, Wine, or Spirits categories; alternatively, they may be treated as separate beverage categories. States may differ in the classification of these beverages (e.g., cider may be treated as beer in some States, as wine in other States, and as a separate category in other States). These beverages are only included in APIS for a given State if that State classifies them as Beer, Wine, or Spirits.
  6. The APIS analysis of Alcohol Control Systems assigns flavored alcoholic beverages (FABs) to the Beer, Wine, or Spirits beverage categories depending on the ingredients from which the FABs are produced. Fortified wines and dessert wines are included in the Wine category. Heavy beer is included in the Beer category.
  7. Some Alcohol Control Systems statutes and regulations have different effective dates for various provisions. For example, the date for implementing structural changes to a State’s distribution system may be a year earlier than the date sales begin or taxes are collected under the new system. If significant terms of a State's policy become effective on one date, even though full implementation or enforcement is not effective until a later date, the earlier date is displayed in the comparison tables. In such cases, a Row Note is included to indicate the date the arrangement is to be fully implemented and enforceable.
  8. State law pertaining to this policy topic includes both statutory and regulatory provisions. Because detailed and comparable information on historical regulations for all jurisdictions except West Virginia is only available from January 1, 2003, forward, it is possible that APIS coverage of historical data for this policy topic is incomplete. However, any gaps in APIS coverage are limited to regulations that were in effect on or after January 1, 1998, but repealed before January 1, 2003. If a regulation was in effect on January 1, 2003, it is included in the APIS data, including its date of promulgation. For West Virginia, information on regulations is available back to January 1, 1998.

Explanatory Notes and Limitations Applicable to All APIS Policy Topics

  1. State law may permit local jurisdictions to impose requirements in addition to those mandated by State law. Alternatively, State law may prohibit local legislation on this topic, thereby preempting local powers. For more information on the preemption doctrine, see the About Alcohol Policy page. APIS does not document policies established by local governments.
  2. In addition to statutes and regulations, judicial decisions (case law) also may affect alcohol-related policies. APIS does not review case law except to determine whether judicial decisions have invalidated statutes or regulations that would otherwise affect the data presented in the comparison tables.
  3. APIS reviews published administrative regulations. However, administrative decisions or directives that are not included in a State's published regulatory codes may have an impact on implementation. This possibility has not been addressed by the APIS research.
  4. Statutes and regulations cited in tables on this policy topic may have been amended or repealed after the specific date or time period specified by the site user's search criteria.
  5. The operation or enforcement of statutes or regulations affecting the policies addressed on APIS may have been suspended or modified by executive or administrative orders issued in response to the COVID-19 pandemic.  With the exception of the COVID-19 Digest and Dataset, APIS research does not address these orders or the effects they may have on the policies covered by APIS.
  6. Policy changes in APIS are presented as of the date these changes take effect as law. Users should be aware that in some situations there may be a delay between the effective date of a law and the time a corresponding policy change occurs in practice. Because APIS research is based entirely on primary legal source materials (codified statutes and regulations and, on rare occasions, published court opinions), APIS is unable to accurately determine when policy changes may appear in practice.
  7. If a conflict exists between a statute and a regulation addressing the same legal issue, APIS coding relies on the statute.
  8. A comprehensive understanding of the data presented in the comparison tables for this policy topic requires examination of the applicable Row Notes and Jurisdiction Notes, which can be accessed from the body of the table via links in the Jurisdiction column.

(Policies in effect on: 1/1/2022)

The 21st Amendment to the Constitution of the United States provides each State with the primary authority to regulate the sale and distribution of alcoholic beverages within its borders. Courts have provided varying interpretations of the extent of this authority, particularly its interaction with the Interstate Commerce Clause of the Constitution. For more information about the 21st Amendment and the Interstate Commerce Clause, see the About Alcohol Policy section of the APIS Web Site.

Our research identified no relevant Federal statutes or regulations pertaining to Alcohol Control Systems.

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