This blog was last updated on February 14, 2025
By Tom Wark, Executive Director, National Association of Wine Retailers
We are often reminded by the media and those in the wine industry—as well as by wine enthusiasts—that the three-tier system of alcohol distribution in most states hinders consumer access to the expansive number of wines available in this country. Some would argue that the rise of winery-to-consumer direct shipping over the past 20 years has mitigated this problem. However, as described by the National Association of Wine Retailers in the recent white paper, Interstate Retailer DtC Wine Shipping: A Primer for Lawmakers, Regulators and Stakeholders, the primary obstacle to product access facing wine consumers is the numerous states that ban wine shipments from out-of-state retailers.
Today, 37 states ban consumers from receiving wine shipments from out-of-state retailers. These bans apply to brick-and-mortar retailers, internet retailers, retailer wine-of-the-month clubs and auction houses, all of which are licensed in their respective states as retailers. As a result of these state bans on shipments from out-of-state retailers, consumers in those states do not have access to:
- The vast majority of French, Italian, Spanish, German, Austrian, Australian, New Zealand, Chilean, Argentine and all other imported wines brought into the United States—all of which are only sold by retailers;
- Most rare and collectible wines for sale in the United States;
- Nearly all older domestic wines;
- All of the many wine-of-the-month clubs that deliver discoveries beyond those shipped directly by domestic wineries.
It is not hyperbole to note that over a million imported, out-of-vintage and collectible wines are inaccessible to consumers due to these bans on interstate shipments by retailers. This is because wholesalers in any given state distribute only a small minority of the wines that are actually available somewhere in the country and sold by specialty retailers, auction houses and retailer wine-of-the-month clubs, not by wineries.
The near-ubiquitous bans on shipments from out-of-state wine retailers have undoubtedly stunted the growth of the wine industry by barring consumers from accessing some of the most interesting, unique and talked-about wines sold in the United States. These bans not only harm consumers who can’t access wines, they also injure producers, wholesalers and retailers.
Retailers DtC Wine shipping bans are universally damaging
Producers and importers who sell all or parts of their production via the three-tier system would see those wines move off the shelves faster if retailers could offer them via direct shipment. Wholesalers also would benefit from retailer-to-consumer interstate shipping. If the mainly small-production domestic and imported wines that make up the majority of trailer shipments moved out of retailers’ inventory at a higher velocity, the wholesalers who supply them to retailers would have the opportunity to replace them with more wines. Finally, states benefit from retailer-to-consumer wine shipments due to the increased tax revenue these additional sales would bring to the states that currently ban this form of distribution.
In general, retailer shipping laws have been thwarted by retailers who have no interest in direct shipping but don’t want the competition from out-of-state retailers, by wholesalers who view interstate retailer shipments as a threat to the three-tier system, by producers who have no interest in seeing retailers in the direct shipping channel, and by lawmakers who have received generous campaign contributions from opponents of retailer shipping.
Creating a well-regulated retailer shipping market
Yet in those states where retailer DtC wine shipping laws have been passed, there has been no evidence of reduced sales by in-state producers, retailers or wholesalers. Still, opponents of retailer shipments have been successful in making the arguments that wine shipments from out-of-state retailers would provide minors with greater access to alcohol, overwhelm a state’s alcohol regulators, cost sales to in-state sellers and make it difficult to collect taxes on these shipments.
The NAWR white paper, however, demonstrates there is a tried-and-true method of regulating retailer wine shipments that addresses all of these claims. That system of regulation for retailer wine shipments should look familiar to the industry:
- Require retailers to obtain a permit from the state into which they want to ship.
- Mandate the remittance of sales taxes on all shipments.
- Require reporting to the state on how much wine was shipped into the state.
- Decree that a form of age verification to be shown at the time of delivery.
- Limit how much may be shipped to an individual during a calendar year
- Require retailer shippers to consent to a state’s legal and regulatory jurisdiction.
State lawmakers could readily begin implementing these commonsense and tested regulatory arrangements so that consumers can access all the wines they want. Also of note, many state bans violate the U.S. Constitution by allowing their in-state retailers to ship wine to their consumers while banning out-of-state retailers from doing the same.
Currently, NAWR is helping to support seven lawsuits challenging this sort of unconstitutional discrimination. We expect these lawsuits to eventually result in legal victories that dictate retailers, like wineries, may not be discriminated against when it comes to the sale and shipment of wine to consumers.
We look forward to the creation of an even playing field for the sale and distribution of wine, allowing consumers to access the wines they want and helping wine industry regulation move into the modern era.
Learn more
Read the NAWR white paper, Interstate Retailer Wine Shipping: A Primer for Lawmakers, Regulators and Stakeholders.
