Wednesday, December 11, 2013

Have a Holly, Jolly, (Felony) Holiday if You Ship Wine

At this time of year spreading holiday cheer is almost required – unless it’s cheer of the bottled variety. But what about sending a nice bottle of homemade watermelon wine to Aunt Sarah? Sorry, that’s illegal. No matter how you try to ship it.

Thanks to a Prohibition-era law, an individual cannot send a bottle of wine to family, friends, or business contacts. Why? Because of a 1909 law that lists a postal ban on delivering "spirituous, vinous, malted, fermented or other intoxicating liquors."

Currently, the U.S. Postal Service (USPS) cannot accept any alcohol in the mail. That leaves only private shipping companies like UPS and Fed Ex. Unfortunately, you must have an alcohol license to ship wine - in other words, be an alcohol business. No license – no shipping!

FedEx has a company policy that “only accepts shipments of wine from licensed shippers that have executed a FedEx Alcohol Shipping Agreement with FedEx.”

The same type of policy applies to Brown. UPS “only accepts packages containing wine from shippers who are licensed under applicable law and who have signed and entered into a contract with UPS for the transportation of wine.”

Shipping Advocate

Sen. Charles Schumer
But U.S. Senator Charles Schumer of New York is proposing an end to the restrictions on shipping wine, beer and spirits. Schumer says the law is outdated and no longer needed.

By ending this law, several businesses would profit including the US Postal Service, which could then ship alcohol for individuals and businesses. This would level the playing field for all shippers in the country. In Schumer’s state of New York alone that means jobs for almost 12,100 postal workers.

The current law also limits the growth opportunities of small wineries, breweries, cideries, and distilleries throughout the country. Doing away with it would help boost sales in these micro businesses, especially during the holidays, which can equate into more jobs for winery workers, tasting room and wine club personal, and shipping departments.

And before the anti-postal shipping crusaders step upon that soapbox - Regulations would remain in place to prevent minors from gaining access to alcohol that was shipped.

But, instead of alcohol businesses having to ship through a private carrier at whatever prices they deem collectable, a flat-rate shipping option would be offered across the country, and that would mean lower shipping prices across the board. The flat rate pricing system would be more of a “what the market will bear” and not “what we can force them to pay” situation.

Will It Go Round in a Circle?

Although it is an idea whose time has been long in coming, it will be interesting to see if the bill makes it to the floor for a vote. While many Senators have states that would benefit (think California, Washington, Oregon, New York, and Texas) from a law change, there are big businesses that would not, with Fed Ex and UPS being just the tip of the shipping hierarchy.

The change in law could help save the USPS, which in 2012 lost $16 billion and defaulted twice on payments to the government that were to be used to pre-fund retiree health care benefits. A flat rate for alcohol shipping could provide an estimated increase of $225 million in annual revenue for the USPS.

Congress is expected to take a look at Schumer’s postal reform bill soon, and sources say changes could come sometime in 2014. Let’s hope this time next year, we can send a bottle to a friend, then pop a cork and celebrate the new era of alcohol shipping in the U.S.

~ Joy