Western Cape Liquor Bill passed

Wednesday, 4 April, 2007
Danie Cronje
The Western Cape Parliament passed the Western Cape Liquor Bill during its sitting on 27th March 2007. The Bill is expected to be promulgated shortly after the 1st June 2007 and will regulate the micro-manufacture, retail sale and consumption of liquor in the Western Cape.
The Bill brings a number of changes that are relevant to the wine industry.

In terms of the Bill a licence will now be required to micro-manufacture liquor.  The current Liquor Act only requires a licence for the sale of liquor.

As the Standing Committee who prepared the Bill refused to include a provision in terms of which small scale winemakers could apply for an exemption even garagiste wine makers will now require liquor licences to manufacture wine.

The exemption under the current Liquor Act which allows a wine producer to sell wine manufactured from grapes grown on land owned or leased by him to licence holders such as hotels, restaurants and liquor stores without a licence has not been included in the Bill. Producers currently selling under this exemption will now have to apply for liquor licences.

In response to submissions made on behalf of SAWIT i.r.o. the position of new entrants to the wine industry, the Standing Committee amended the Bill to allow wine producers to manufacture wines in leased cellar space, a practice which was considered problematic under the current Liquor Act.

A welcome change to the Act is the inclusion of a special events licence for the sale of wine for consumption off the premises. Under the current Act a temporary licence can only be obtained for the sale of wine for consumption on the premises.  Such a temporary licence would typically relate the food and wine tent at one of the many festivals taking place throughout South Africa during the year. It will now be possible to apply for a special events licence for a wine tasting- and sales stall at a festival.

Another welcome inclusion is a new category of licence being a licence for the sale of liquor for consumption both on and off the licenced premises. This will allow wine estates to conduct the business of a wine sales and tasting area in the same space as a restaurant or function venue. This is not possible under the current Liquor Act.

Although the Bill provides for the sale of liquor on Sundays in grocer’s stores, liquor stores and wine estates the days and hours of sale will be determined by the municipality of a particular area subject to certain maximum hours included in the Bill.

Although representations were made to the Standing Committee to also allow for the sale of wine coolers in supermarkets this proposal was rejected and only the sale of wine will be allowed in retail stores. The limitation of a maximum alcohol level of 14% has been lifted and natural wine with alcohol up to 16,5% as well as fortified wines can be sold in supermarkets.

The provision included in the draft bill published for public comment which empowered the Minister to regulate the containers in which liquor be sold was removed from the Bill after it was pointed out in submissions that this a national competency under the Liquor Products Act. Any prohibition or regulation of the sale of 'papsakke' and plastic bottles will have to be contained in regulations under this Act.

The Bill provides for higher fines and stiffer sentences for contraventions of the Bill.

Although no regulations under the Act have been published for public comment, it is expected that the application fees payable, i.r.o. applications for licences, as well as annual licence fees for the renewal of licences, will be increased significantly as the Liquor Board will be required to fund its own activities in future.

In view of the expected increase in fees, the expected 'teething problems' with implementing a new act and the risk that a municipality may decide against Sunday sales, Danie Cronje, a Liquor Law Specialist from Cluver & Markotter Inc. advises wine producers to get their house in order before promulgation of the Act by making application for any changes in licence conditions or new licences.
Danie Cronje
Director: Liquor Law Services
Cluver Markotter Incorporated
Mobile +27 (0)82 772 3517
Telephone: +27 (0)21 808-5642