SMALL BREWERS/WHOLESALERS DISTRIBUTION DISPUTE RESOLVED

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By Bob Katzen

The Senate 40-0, approved and sent to the House a bill that supporters say will resolve a decade-long distribution dispute between beer brewers and wholesalers in the Bay State. The measure is a compromise that was reached by The Massachusetts Brewers Guild, representing craft breweries, and the Beer Distributors of Massachusetts

According to Senate President Karen Spilka’s office, current law makes it difficult for a brewer to end a relationship with their distributor and this jeopardizes potential growth. The bill would allow a brewery that produces less than 250,000 barrels per year (or just over 3.4 million cases) to end their relationship with a distributor with a 30-day notice and other certain protections. If a distribution contract is terminated, the brewery would be responsible for fairly compensating the wholesaler the fair market value of the distribution rights in addition to other costs for inventory and marketing investments. The legislation calls for both parties to engage in an expedited arbitration process to resolve such issues.

“Craft brewing is an industry that has grown in Massachusetts as a result of innovation, entrepreneurship, hard work and dedication to supporting small businesses, and is now thriving,” said Spilka. “Solving this decade-long dispute was a priority of mine long before becoming Senate president and I look forward to seeing this important agreement codified in law.”

“Massachusetts is home to more than 200 breweries that represent the unique culture and contours of our local communities,” said Sen. Joe Boncore (D-Winthrop), the sponsor of the original version of the proposal. “This legislation will create a level playing field for craft brewers. Now, perhaps more than ever, it is critical that we support small and local businesses as we work towards economic recovery from the COVID-19 pandemic.”

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