Legislators in Ohio are raising concerns about an alcohol statute that they claim is antiquated and detrimental to small companies, such as craft brewers.
Legislators in Ohio have been trying to change the Alcohol Franchise Law from 1974 for a while now. Breweries in the Mahoning Valley shared their thoughts on the law, and 21 News investigated the language’s impact on microbreweries.
The Ohio Craft Brewers Association’s Executive Director, Mary MacDonald, noted that the law is currently having the opposite impact of what it was intended to do: safeguard small businesses.
Even though the Alcoholic Beverages Franchise Act of Ohio is turning 50 this year, a lot has occurred in the alcohol sector during that time, such as the proliferation of craft brewers in Ohio.
“If a small brewery finds itself trapped in a relationship with a wholesaler who’s not adequately representing their brand in the market, they’re kind of stuck unless the wholesaler decides to let them go,” said MacDonald.
Exiting a franchise arrangement might be challenging due to a 1974 regulation that prohibits manufacturers or distributors from doing so without the wholesaler’s prior authorization.
A new policy brief from the Buckeye Institute, “Brewing Freedom: Ensuring the Freedom to Contract for Ohio’s Craft Brewers,” was out earlier this month. The brief argues that Ohio’s alcohol franchise statute unfairly benefits wholesalers at the expense of small craft brewers and calls on lawmakers to repeal the law.
There has been no action on either Senate Bill 138 or House Bill 306 as of yet.