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So, you want to start a microbrewery? Opening a new business is a new and exciting challenge that has the ability to be very profitable. Along with the usual challenges associated with starting and running a small business, when opening a microbrewer, you will need to think about food and beverage production and sale. In this article, we run through some of the main legal and regulatory issues to help bring your microbrewery dream to life.

What Will I Call my Brewery?

Equally as important as your brew, is a memorable name. “Old Wives Ales” and “Shenanigans Brewing” rank high on my favourites list. Once you have decided on your name, you should ensure that nobody else has taken it through a few simple searches. Google and the Independent Brewers Association are good starting points, as well as ASIC’s Business Name search. Next, you would register your business name and potentially talk to a lawyer about trade marking your brand.

Producer/Wholesaler License for Brewers

To sell your product, you will need a Producers/Wholesalers Licence. In NSW, you can obtain this from the Office of Liquor, Gaming and Racing. The license will allow you to:

  • sell your product to other licensees;
  • sell you product to the public; or
  • conduct tastings of your product.

You may want to run brewery tours, or allow the public to come and taste your beer as a way of introducing your product to new customers and selling more beer.

The Producer/Wholesaler license will enable you to sell your product to other licensees (their employees or related corporations) at any time. However, you can only make retail takeaway sales to the public between:

  • 5am to 10pm on Monday through to Saturday, and
  • 10am to 10pm on a Sunday.

While you can apply for extended trading hours, there is a 6-hour closure period that applies to all licenses.

The annual fee for a Producer/Wholesaler license is $500. If you produce less than 100,000 litres per year, you may qualify to pay the reduced annual fee of $200.

Additional Permits

Along with extended trading authorisation, you may consider attaching additional permits to your license including the drink on-premises authorisation, allowing you to sell your beer to the public for consumption on your premises. You will also need this if you are considering opening a bar, café/restaurant, guest accommodation or function centre.

You can also apply for an industry liquor-show and producers markets authorisation. This allows you to provide samples for tasting and selling unopened beers to the public at industry shows and farmers markets with at least ten stalls.

To obtain your Producer/Wholesaler license, you will also need to lodge the following notices that you can find at the end of the application form along with lodgement instructions:

  • public consultation – site notice;
  • police notice; and
  • local consent authority notice.

You will also need to have a Responsible Service of Alcohol (RSA). For more information on this in NSW see the Office of Liquor, Gaming & Racing.

Beer Excise

Home-brewed beer produced for your personal consumption is excise-free. However, once you make the move to nano or micro-brewery, you will need to pay excise on any beer you produce to sell. Excise is a tax that is placed on:

  • alcohol;
  • tobacco;
  • fuel; and
  • petroleum products.

The actual alcohol content, as well as the volume in which you sell your beer, determines the excise rates. For example, the excise rate differs depending on whether you sell your beer in a bottle or keg (>48 L). The rate of excise on beer is indexed twice a year in line with the consumer price index in February and August. For the current excise rates see the Australian Tax Office website.

Labelling of Alcoholic Beverages

The Australian and New Zealand Food Standards Code (Code) forms the basis for food and beverage regulation in Australia.

The Code contains general food standards that apply to all food and a standard specific to beer (Standard 2.7.2). The Code covers not only the production of Beer but also labelling requirements. A copy of the code is available Food Standards Australia New Zealand and regulates the inclusion of information such as:

  • volume;
  • alcoholic content;
  • standard drinks;
  • country of origin;
  • best before date; and
  • barcode.

Key Takeaways

There is a lot more to commercial brewing than just malt, water, yeast and hops. You need to consider:

  • what you will name your business;
  • your licencing requirements;
  • tax requirements; and
  • labelling regulation.

If you need help setting up a microbrewery, contact LegalVision’s business lawyers on 1300 544 755 or fill out the form on this page.

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