Hospitality Law Blog

The Basics of Alcoholic Beverage Control Laws

I.              Introduction

Since the end of Prohibition, states have traditionally dealt with the issue of Alcoholic Beverage Control (“ABC”) laws in one of two ways, either through full state regulation of the sale of alcohol or through a three-tier system of production, distribution and sale. With the abuses of the industry fresh in their minds, policymakers after Prohibition set about finding ways to keep alcohol from becoming a societal problem through careful regulation.  In Kentucky, the three-tier system is paramount, and that principle has been consistently affirmed by key court cases and legislation. These materials will provide an overview of the three-tier system in Kentucky with discussions of relevant cases and legislative changes. More >

Kentucky’s Microbreweries, Small Farm Wineries and Craft distilleries Are Growing by Leaps and Bounds, but is the Law Catching Up?

The winds of change may be blowing in favor of small alcohol producers in Kentucky lately, but perhaps those winds could blow just a bit harder. In the midst of the phenomenal growth of the Kentucky Bourbon Trail and "alcohol tourism," the legislative bent of the Commonwealth of Kentucky lately seems poised to also encourage the proliferation of microbreweries, small farm wineries and craft distilleries. New laws and legislative considerations that permit certain retail privileges for small producers are a relatively new wrinkle in the state’s alcoholic beverage control (“ABC”) laws, and may reflect a growing shift in state alcohol policies that reflect and adapt to the growing economic benefit of both craft producers and alcohol-related tourism. At the same time, Kentucky is careful to uphold a strong three-tier system where larger producers are concerned, drawing a line separating economic benefit and tourism versus vertical integration and excessive top-heavy control by large distillers and breweries. Under these recent laws, small wineries and malt beverage producers may engage in modest retail activities that would ordinarily be restricted to them in the interest of furthering a thriving craft economy, but questions remain as to whether these laws go far enough in encouraging the growth of Kentucky’s craft producers, and even those of our iconic Bourbon distilleries, whose own retail privileges remain relatively limited. More >